NEW YORK (AP) \u2014 Donald Trump has a message for critics who think turning the U.S. government into a major stockholder of Intel is a \u201csocialist\u201d move: More is coming. <\/p>\n
\u201cI will make deals like that for our Country all day long,\u201d the president posted on Truth Social after critics piled on, adding later about future ownership stakes, \u201cI want to try and get as much as I can.\u201d<\/p>\n
One possible target: defense contractors, whom Commerce Secretary Howard Lutnick told CNBC Tuesday were ripe for the picking given the U.S. government is a big customer.<\/p>\n
Free-market conservatives were already wary of Trump\u2019s tendency to interfere in corporate decision-making by, for example, telling Apple where it should make iPhones, or even demanding a cut of Nvidia\u2019s sales of chips to China. But the Intel move is a startling defiance of Republican orthodoxy that says governments shouldn\u2019t try to pick corporate winners and losers and risk messing things up as owners by rewarding executives for politically smart but financially stupid decisions.<\/p>\n
The U.S. government is getting a 10% stake in Intel<\/a> through the conversion of billions in previously granted government funds and pledges, making it one of Intel\u2019s largest shareholders.<\/p>\n \u201cIf socialism is government owning the means of production, wouldn\u2019t the government owning part of Intel be a step toward socialism?\u201d Republican Sen. Rand Paul said in a post on X. \u201cTerrible idea.\u201d<\/p>\n Scott Lincicome, a Cato Institute trade expert, says Intel could end up making decisions now to please Trump even if they\u2019re impractical, say, by going ahead with plans to open a long-promised chipmaking factory in Ohio. And even short-term gains from government ownership, such as more companies buying Intel semiconductors, will hurt business in the end by saddling those companies with inferior chips. <\/p>\n \u201cIntel might simply gain customers from folks that are looking to stay on Trump\u2019s good side,\u201d he said. \u201cBut innovation requires ruthless competition, an endless drive for an advantage \u2014 and now they might accept a disadvantage because they need the political win.\u201d <\/p>\n Many Republicans remained silent on the issue, prompting others to suggest they are free market hypocrites.<\/p>\n \u201cFor so many of my self-described true conservatives, you\u2019re going to have to explain to me how this reconciles with true conservatism and true free-market capitalism,\u201d Republican North Carolina Sen. Thom Tillis told CBS in an interview. \u201cI don\u2019t see it.\u201d<\/p>\n Early last year, the Biden administration agreed to provide Intel with billions of dollars in funding under the CHIPS Act for it to build semiconductor manufacturing factories around the country, part of a plan to produce 20% of the world\u2019s most advanced chips in the U.S. by 2030, up from zero at the time.<\/p>\n Trump argues that he got the Intel stake for free by converting $11.1 billion of funding into the equity stake. He also notes that Intel shares shot higher after he struck the deal Friday, handing a big win to U.S. taxpayers.<\/p>\n \u201cI love seeing their stock price go up, making the USA RICHER, AND RICHER,\u201d Trump posted Monday morning before the stock trading began. \u201cMore jobs for America!!! Who would not want to make deals like that?\u201d<\/p>\n The price of Intel stock fell slightly both Monday and Tuesday, and investors have reason to be cautious. <\/p>\n In a filing to its investors after the deal was announced, Intel warned that it may lose overseas customers reluctant to buy from a U.S. government-owned business. The company has lost more than $22 billion since the start of 2023 after largely missing out on the frenzy surrounding artificial intelligence. <\/p>\n James Secreto, a former Biden administration official who helped hammer out the CHIPS Act grants, said a falling stock price is a big danger given Trump\u2019s tendency to measure his success and failure by gyrations in the public market and his willingness to jawbone companies to do things to help him politically. <\/p>\n \u201cThe Trump administration now owns Intel\u2019s success or failure,\u201d said Secreto, former Commerce Secretary deputy chief of staff. \u201cThe next question is how far will the U.S. government go to defend its equity postion?<\/p>\n He called the Intel stock purchase a \u201cbridge too far\u201d even for Democrats who believe government help is needed occasionally. <\/p>\n \u201cFor the sake of national security, we still need Intel to win on performance, not politics,\u201d he said.<\/p>\n That Trump would be labeled a \u201csocialist\u201d by members of his own party is ironic given that he has long wielded that term against his opponents. <\/p>\n Yet in some ways the Intel move fits a pattern. <\/p>\n Trump has erected the highest tariffs in decades, a trading strategy that his party has long rejected, and has tried to influence corporate decisions the GOP used to say were best left to business owners. In addition to telling Apple not to shift production to India<\/a>, he has gotten Coca-Cola to change ingredients<\/a> and warned Walmart not to raise prices<\/a>.<\/p>\n There have also been a series of moves that will directly benefit or hurt the government depending on how businesses perform.<\/p>\n In June, Trump struck a deal approving Nippon Steel\u2019s takeover of U.S. Steel<\/a> in exchange for a \u201c golden share<\/a> \u201d that essentially gives the U.S. government veto power to ensure national security interests are protected against cutbacks in steel production. In July, he spent $400 million of taxpayer money on MP Materials stock to make the U.S government the biggest owner in the Las Vegas rare earths miner<\/a>. Then earlier this month came his deal with Nvidia and AMD to give the U.S. government a 15% cut of revenue<\/a> from selling certain chips to China.<\/p>\n A White House official who spoke on condition of anonymity to describe internal deliberations said the deals with Intel, Nvidia, and U.S. Steel are seen as one-offs, necessary moves because the companies have outsized importance to the country\u2019s national security. The source likened the deals to the government\u2019s departure from free market principles when it limits American aerospace companies from selling fighter jets to countries like China.<\/p>\n Some conservatives aren\u2019t buying it.<\/p>\n \u201cThis isn\u2019t about funding innovation,\u201d said influential conservative radio host Erick Erickson on Friday. \u201cIt\u2019s a paradigm shift towards socialism.\u201d<\/p>\n In addition to Lutnick\u2019s comments about targeting defense contractors, Trump\u2019s top economic adviser has also said hinted about what is likely coming next. He said the president is interested in setting up a sovereign wealth fund in which federal government would invest in an array of companies. <\/p>\n \u201cThere\u2019ll be more transactions, if not in this industry then other industries,\u201d said Kevin Hassett, the director of the National Economic Council.<\/p>\n One prominent politician did voice support for the Intel deal, but it more likely hurts than helps Trump\u2019s cause with Republicans. <\/p>\n \u201cTaxpayers should not be providing billions of dollars in corporate welfare to large, profitable corporations like Intel without getting anything in return,\u201d said Vermont Senator Bernie Sanders, a self-described democratic socialist and Trump antagonist. \u201cThe taxpayers of America have a right to a reasonable return on that investment.\u201d<\/p>\n \u2014\u2014\u2014<\/p>\n AP reporter Michelle L. Price contributed from Washington.<\/p>\n","protected":false},"excerpt":{"rendered":"NEW YORK (AP) \u2014 Donald Trump has a message for critics who think turning the U.S. government into…\n","protected":false},"author":3,"featured_media":179754,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[229,166,239,10635,64,74,1226,69,57,17785,59,65,43930,101620,34523,2184,40176,147,80,26390,101619,48567,10452,618,158,57244,16538,11084,61,322,67,370,132,68,2742],"class_list":{"0":"post-179753","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-business","8":"tag-advanced-micro-devices","9":"tag-aerospace-and-defense-industry","10":"tag-apple","11":"tag-bernie-sanders","12":"tag-business","13":"tag-china","14":"tag-conservatism","15":"tag-donald-trump","16":"tag-general-news","17":"tag-howard-lutnick","18":"tag-inc","19":"tag-information-technology","20":"tag-intel-corp","21":"tag-james-secreto","22":"tag-kevin-hassett","23":"tag-las-vegas","24":"tag-mp-materials-corp","25":"tag-nvidia-corp","26":"tag-politics","27":"tag-rand-paul","28":"tag-scott-lincicome","29":"tag-semiconductor-manufacturing","30":"tag-socialism","31":"tag-taxes","32":"tag-technology","33":"tag-the-coca-cola-co","34":"tag-thom-tillis","35":"tag-trump-media-technology-group","36":"tag-u-s-news","37":"tag-u-s-republican-party","38":"tag-united-states","39":"tag-united-states-government","40":"tag-unitedstates","41":"tag-us","42":"tag-vermont"},"share_on_mastodon":{"url":"","error":"Validation failed: Text character limit of 500 exceeded"},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/179753","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=179753"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/179753\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/179754"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=179753"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=179753"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=179753"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}