Federal stakes in public companies may enrich the government, but they are bad for America.
When it comes to the government’s relationship with business, Donald Trump is the most activist president since Franklin D. Roosevelt. He has wielded tariffs, the government’s purchasing power, and the threat of regulatory action to bend companies to his will. Over the past year, the president has even made the federal government a corporate shareholder across a range of industries. Just last week, the Commerce Department announced that it was taking stakes in a portfolio of quantum-computing companies in exchange for $2 billion in investment.
The federal government’s bold entrance into the world of corporate investing began last June, when Trump agreed to allow Japan’s Nippon Steel to buy U.S. Steel as long as the combined company granted the United States veto power over certain management decisions and ensured that key leadership roles went to American citizens. In the months since, the administration has taken sizable stakes in rare-earth firms and a new rocket company. Most dramatically, the administration insisted last year that the semiconductor giant Intel hand over nearly 10 percent of the company in exchange for $8.9 billion in grants that had already been earmarked in the CHIPS Act and other government awards but not yet paid. Trump now likes to brag that Intel’s stock has since surged by 300 percent.
