.

President Donald Trump has made the federal government Intel’s biggest shareholder by authorizing a 10% stake in the ailing American chipmaker. The decision breaks with longstanding Republican economic orthodoxy and has sparked criticism from conservatives who usually support the president.

Trump, though, sees the move as a good deal that will make the U.S. “richer and richer” — and he suggested that Intel is just the start. “I hope I’m going to have many more cases like it,” he said. By taking equity in a private company, Trump is wading into the kind of industrial policy that many economists used to deride: government involvement in nurturing and steering the economy’s most important sectors.

Some now wonder whether the action goes so far as to be socialist. Socialism has long been defined, at least in part, as government ownership of the means of production for the benefit of all. By that measure, critics say, the Trump decision is not so different from what has taken place in China or Russia.

There’s an added layer of political irony. When Barack Obama moved to seize control of Chrysler and General Motors in the financial crisis of 2008–2009, conservatives decried it as a vital rescue of what would otherwise have been two iconic American brands. But if Obama had seized a 10% stake in Intel, Trump supporters say, the conservative media would have screamed that he was trying to turn the U.S. into a communist country.

Trump argues this case is different because he isn’t bailing out the company, he’s making an investment. He also noted that he converted close to $9 billion in grants (money that was already headed to the company from the federal government under President Joe Biden’s bipartisan Chips Act) into government equity. “So we got $10 billion to $11 billion in value right now, for the taxpayers of this country,” Trump said. “Why are ‘stupid’ people unhappy with that?”

Reaction from the Right

The reaction from the right has been fast and fierce. Larry Kudlow, Trump’s former top economic adviser, told Fox Business he was “very, very uncomfortable with that idea.” Steve Moore, another informal Trump adviser, was stronger. “I hate corporate welfare,” he declared. “That’s privatization in reverse. We want the government to divest of assets, not buy assets. So terrible, one of the bad ideas that’s come out of this White House.”

The editorial board at National Review published an editorial, headlined “Government Shouldn’t Get Into the Chip Business.” Senator Thom Tillis said the deal had him “seeing red.” It risked creating a “semi-state-owned enterprise a la CCCP,” he tweeted, using the acronym for the former Soviet Union. Senator Rand Paul made the same point on social media: “Wouldn’t the government owning part of Intel be a step toward socialism? Terrible idea.”

Progressive Senator Bernie Sanders, by contrast, celebrated the decision as an example of the government deploying its economic muscle for the people’s benefit. Commerce Secretary Howard Lutnick also leapt to Trump’s defense, telling Laura Ingraham, “That is not socialism. That’s the best businessman in the United States of America in the Oval Office doing fair things for us.”

Intel Itself Raises Concerns

Intel itself sounded alarm bells. The chipmaker said in a required filing with the Securities and Exchange Commission that the arrangement could limit its ability to win government grants in the future. The equity stake could also harm foreign sales, the company said, and subject it to increased regulation. The company is already in trouble: it had said it would lay off 15% of its workers earlier this year. Intel’s market value is around $110 billion, having lost half its value since the start of 2024, though shares ticked up 4% on the day of Trump’s announcement.

The Wall Street Journal reported that Trump initially demanded that Intel CEO Lip-Bu Tan resign for his past associations with China. The president changed his mind after meeting the Intel executive at the White House. “I liked him a lot, I thought he was very good,” he said.

Many remain skeptical. The U.S. government will be the company’s biggest shareholder and won’t even vote its shares. But critics noted that when the president of the United States is your largest investor, it’s hard to imagine his influence won’t reach down into the business.

Trump will likely try to take the credit if Intel rights itself and returns to its central place in American tech. But if the company continues to stumble, taxpayers may have to foot the bill. Trump has not ruled out further deals along these lines. “There’s going to be a lot of things coming up like that,” he said. “There are a lot of companies.”

What’s more, if you’re worried about this one, consider it a first step. Companies that take government grants have lobbied for the U.S. to take equity in exchange and have some backing in Congress.

Socialism, capitalism, Trumpism? At the very least, the Intel stake is a fundamental change in the federal government’s relationship with private business. And it shows just how far Trump has transformed the Republican Party’s approach to the economy.