The Trump administration has quietly built a portfolio of direct equity stakes in major American companies, converting billions in taxpayer grants into ownership positions across semiconductors, critical minerals, and steel. Since January 2025, the government has committed $26.7 billion across thirty deals involving direct ownership, a scale of state capitalism the United States has never seen outside of wartime or financial crisis bailouts.îŽ citeweb_search:1#4
The most prominent deal is the 9.9% stake in Intel, acquired in August 2025 by converting $8.9 billion in CHIPS Act grant money into equity. Commerce Secretary Howard Lutnick has openly floated expanding the model to defense contractors, while National Economic Council Director Kevin Hassett described the Intel deal as a "down payment on a sovereign wealth fund."îŽ citeweb_search:1#3
The Growing Portfolio
The government's equity playbook extends well beyond Intel. The Department of Defense holds a 15% stake in MP Materials, the only fully integrated rare earth mining and processing facility in the U.S., to counter China's dominance in critical minerals. The Commerce Department took a 10% stake in Lithium Americas Corp. and a similar position in Trilogy Metals. A "golden share" in U.S. Steel was negotiated as a condition for approving its merger with Japan's Nippon Steel, giving the U.S. veto power over certain management decisions.îŽ citeweb_search:1#2
In May 2026, the administration added quantum-computing firms to the list, taking stakes in exchange for a fresh $2 billion investment. The Council on Foreign Relations, which maintains a tracker of these deals, notes that the Commerce Department leads with seventeen such transactions, followed by the Development Finance Corporation with six and the Department of Defense with seven.îŽ citeweb_search:1#0web_search:1#4
Why This Breaks Precedent
Federal equity in private companies is not entirely new, but it has historically been limited to extraordinary circumstances. The government took a stake in Chrysler during its 1980s bankruptcy, and again in AIG, General Motors, Citigroup, and Bank of America during the 2008 financial crisis. In every case, the goal was stabilization, not long-term ownership. The government divested once the emergency passed.îŽ citeweb_search:1#1web_search:1#3
Trump's approach is different. He is making government ownership a routine feature of industrial policy. The administration frames it as a more robust alternative to traditional subsidies, arguing that equity gives taxpayers a share of upside while ensuring companies stay aligned with national security goals. Trump himself has bragged that Intel's stock has surged roughly 300% since the deal, and posted on Truth Social that "I PAID ZERO FOR INTEL, IT IS WORTH APPROXIMATELY 11 BILLION DOLLARS."îŽ citeweb_search:1#0web_search:1#3
The claim that the stake cost nothing is misleading. The government purchased 433.3 million Intel shares at $20.47 each, using CHIPS Act funds that had already been earmarked for the company.îŽ citeweb_search:1#3
The Political and Market Risks
The shift has drawn sharp criticism from across the political spectrum. Former Trump official Nikki Haley called Intel "a test case of what not to do." Former acting White House chief of staff Mick Mulvaney, speaking on a Skadden Arps podcast, called the practice "extraordinarily dangerous" and predicted it would not stop because "this is where the Republican Party is, and it's where the Democrat Party has wanted to be for a long time."îŽ citeweb_search:1#1web_search:1#3
Policy analysts at CSIS warn that equity stakes risk politicizing corporate decision-making. A government shareholder may pressure companies into choices that serve national policy rather than shareholder value. There is also the risk of cronyism if stake selections appear driven by political connections rather than strategic merit. The Intel deal is structured as passive ownership with no board seat, but the precedent itself worries observers who note that the government is now both investor and regulator in the same industries.îŽ citeweb_search:1#5
What Voters and Markets Are Watching
For ordinary Americans, the concern is less abstract. Government ownership of private companies sits uncomfortably with a political culture that has long treated state capitalism as something other countries do. The administration's defenders argue that U.S. firms are competing against Chinese, South Korean, and Japanese rivals backed by aggressive industrial policy, and that equity stakes signal market confidence that can attract private investment. Since the CHIPS Act passed in 2022, over $450 billion in private capital has flowed into domestic semiconductor manufacturing.îŽ citeweb_search:1#5
But the long-term question is whether these stakes will ever be sold. Past bailouts were temporary. Trump's model looks permanent. If the government becomes a permanent shareholder in strategically important companies, the line between public policy and private enterprise blurs in ways the U.S. has historically avoided. The coming months will show whether Congress pushes back, or whether the sovereign wealth fund Hassett described becomes a formal reality.
Watch for Commerce Department announcements on defense contractor stakes and any congressional hearings on the government's expanding corporate portfolio.