The U.S. government has taken a stake in Intel. Defence industry contractors could be next
The American government’s recent decision to take an ownership stake in U.S. chip-maker Intel has sparked controversy and raised questions about the administration’s approach to public-private partnerships. Commerce Secretary Howard Lutnick hinted at the possibility of exploring similar opportunities with Pentagon contractors during a recent interview, suggesting that more discussions are needed on how to finance munitions acquisitions.
Lutnick’s comments come on the heels of Treasury Secretary Scott Bessent’s remarks about potential future transactions involving government intervention in private industries. These developments indicate a shift towards a new form of economic statecraft under the Trump administration.
The Intel transaction, in particular, has drawn criticism from various quarters, with some likening it to corporate socialism. Despite the backlash, the government’s move to secure a stake in Intel is part of a broader strategy to reduce U.S. dependence on foreign-made chips and bolster national security interests.
While some Republicans have expressed concerns about government interference in the private sector, others see the Intel deal as a necessary step to maintain competitiveness in the global market. Bernie Sanders has voiced support for the government’s ownership stake in Intel, arguing that taxpayers deserve a return on their investment in companies that benefit from federal grants.
Critics of the government’s intervention point to potential economic costs and the risk of politicizing industry decisions. There are also concerns about the impact on Intel’s international business, as the U.S. government’s significant stockholding could lead to regulatory challenges in other countries.
Despite the controversy surrounding the Intel deal, the Trump administration appears determined to pursue similar opportunities in the future. The administration’s approach to industrial policy is seen as a departure from traditional Republican principles, with a focus on maximizing returns for taxpayers and enhancing national security.
As the debate continues, it remains to be seen how the government’s involvement in private industries will shape the economic landscape and impact companies like Intel in the long run. The intersection of public and private interests in sectors like technology and defense will likely remain a contentious issue for policymakers and industry stakeholders alike.
