In a move that’s left both Wall Street and Washington buzzing, President Donald Trump’s administration announced on Friday, August 22, 2025, that the federal government has acquired a 10% equity stake in Intel, the iconic California-based chipmaker. The deal, which converts more than $11 billion in government funds—including money previously awarded under the U.S. Chips and Science Act—into shares, marks a sharp departure from decades of American economic policy and has ignited fierce debate across the political spectrum.
President Trump unveiled the deal as a “win-win for America and the company,” touting it as a bold step to strengthen domestic semiconductor manufacturing. But not everyone is convinced. Senator Rand Paul of Kentucky took to social media days before the official announcement, warning, “If socialism is government owning the means of production, wouldn’t the government owning part of Intel be a step toward socialism? Terrible idea.” Representative Thomas Massie, also from Kentucky, echoed that sentiment, posting, “Our government should not have ownership in private companies. There are so many specific problems with an arrangement like this, but fundamentally, this is not who we are as a country.”
Despite the criticism, Trump has doubled down. On Monday, August 25, he defended the deal and signaled there could be more like it on the horizon. “I just made $10 billion, or $11 billion for the United States of America, and yeah, there will be other cases,” the president told reporters. “If I have that opportunity again, I would do that … You do have stupid people say, ‘Oh that’s a shame.’ It’s not a shame. It’s called business.” According to Reuters, he added on social media, “I will make deals like that for our Country all day long. I love seeing their stock price go up, making the USA RICHER, AND RICHER. More jobs for America!”
Intel, for its part, has welcomed the investment, describing it as a reflection of “the critically important role the company plays in expanding the domestic semiconductor industry.” The company clarified in a news release that the government’s stake will be passive—meaning no board seats and only limited voting rights in “limited” circumstances. There are also no details yet about when or if the government will sell its shares, or whether U.S. taxpayers will benefit from dividends. (Intel hasn’t paid out dividends since last year.)
This approach upends a longstanding American tradition: the government has only taken corporate stakes in rare emergencies, such as the 2008 financial crisis, when bailouts of automakers and banks were seen as necessary to avert economic collapse. Even then, the intention was to hold those assets only temporarily, with the goal of returning earnings to taxpayers. According to a 2023 Government Accountability Office study, the 2008-09 bailout ultimately cost taxpayers about $31 billion.
What makes the Intel deal even more striking is that it comes at a time when the company is struggling but not in crisis. Intel has fallen behind rivals Nvidia and AMD in the race to dominate artificial intelligence chips, and its share price has dropped more than 50% over the past five years. The company’s manufacturing division posted a $3.2 billion loss in the second quarter of 2025, and just last month, Intel announced it would lay off 15% of its workforce by year’s end, cancel billions in planned investments, and delay completion of a $28 billion chip plant near Columbus, Ohio. Still, Intel maintains a cash cushion of $9 billion and a market value of $105 billion.
Since the government’s stake was announced, Intel’s shares have climbed about 4%. Some analysts see potential upside in the partnership, but others are wary. The administration hasn’t spelled out under what circumstances it would sell the shares, or whether it would seek to profit from future dividends. In a securities filing on Monday, Intel warned that the arrangement could actually limit its ability to secure future grants, depending on performance, and might harm international sales or subject the company to new regulations and restrictions.
Commerce Secretary Howard Lutnick has pointed to national security as a key motivator for the government’s move, arguing that a robust domestic chip industry is essential for the country’s strategic interests. But President Trump has focused more on the potential financial windfall. “Nobody realizes how great it will be,” he told reporters on Monday. “I want to try to get as much as I can.”
Some experts say the deal represents another norm-shattering expansion of presidential authority into the business world. Clyde Wayne Marks, a fellow at the libertarian Competitive Enterprise Institute, told The Washington Post, “He’s doing all this in a spooky, controversial way. Right now there is no crisis.” The government, Marks noted, has assumed total control of private corporations before, but only during times of war or economic meltdown—like when President Woodrow Wilson nationalized the railroads and communications infrastructure during World War I.
This isn’t the first time the Trump administration has taken direct stakes in private companies outside of a crisis context. Already, the White House has secured a “golden share” in Japan’s Nippon Steel as part of a deal granting approval for that company’s bid for U.S. Steel, giving the government a say in future transactions. Last month, the Defense Department purchased $400 million in rare earth miner MP Materials, making it the firm’s largest shareholder. The administration also plans to take a cut of sales from chipmakers Nvidia and AMD for their transactions with China.
Kevin Hassett, director of Trump’s National Economic Council, has floated the idea that these transactions could form the basis of a sovereign wealth fund—a concept more familiar in countries like Norway or Singapore than the United States. “At some point there’ll be more transactions, if not in this industry, in other industries,” Hassett told CNBC. The idea is to give U.S. taxpayers direct stakes in companies, although the administration has yet to fully develop the mechanism.
The government’s role in supporting private enterprise is hardly new. Over the years, Washington has provided subsidies, loans, and grants to companies ranging from solar power startups like Solyndra (which went bankrupt) to electric vehicle giant Tesla (now worth $1.2 trillion). But as Dan Reicher, a former Energy Department official, told The New York Times, “History has proven that the more free-market approach, making the bottom line the bottom line for the companies running these operations, is a smarter way to go.”
As the dust settles on the Intel deal, one thing is clear: U.S. taxpayers are now the company’s largest shareholders, and the Trump administration appears eager to repeat the experiment. Whether this marks a new era of government intervention in the American economy—or simply a one-off gamble—remains to be seen. For now, all eyes are on Intel, and on what President Trump’s next move might be.
