The government took stakes in a number of private companies during 2025, and it’s likely to continue making equity investments while Donald Trump remains in office. Whether or not this is a wise long-term strategy is an ongoing debate, with strong opinions on both sides.
The practice represents a new industrial policy that’s meant to tie the executive branch of government closer to companies it considers essential to national security and economic prowess. The Trump administration hopes it’s a more robust approach than subsidy grants in rebuilding critical supply chains domestically, reducing reliance on China, and ensuring key industries remain under U.S. control.
But it also puts the government in the venture capital business—which may not be a good fit for politicians and bureaucrats. “The government now perceives itself as a source of capital and the markets perceive them as a source of capital—it’s not going to stop,” said former acting White House chief of staff Mick Mulvaney on a recent episode of The Informed Board, a podcast from Skadden Arps. And it may not be easy for a private company to say no. “Any business that either sells a lot of stuff to the federal government or gets a lot of subsidies from the federal government is going to be a target,” he added.
“I think it’s extraordinarily dangerous. And the reason I think it’s not going to go away is that regardless of the outcome, I think this is where the Republican Party is,” Mulvaney said. “And it’s where the Democrat Party has wanted to be for a long time.”
The U.S. government has taken equity shares in private companies before, but only in times of war or economic crisis, and never as a normal feature of industrial policy, as the Trump administration views it.
The government took a minority stake in Chrysler in the early 1980s when the company faced bankruptcy. During the 2008 financial crisis, the government took equity stakes in AIG, General Motors, Citigroup, Bank of America, and others. During the COVID-19 pandemic, the Treasury received equity warrants in airlines, including Delta, United, and American, in exchange for payroll support.
Commerce Secretary Howard Lutnick has suggested that the administration is considering expanding the practice of buying equity to include defense contractors.
The U.S. and Intel
The government’s biggest equity investment is the troubled chipmaker Intel. The Trump administration said in August that it would take a 9.9% stake, using $8.9 billion of CHIPs and Science Act grant money that had already been earmarked for the company. Intel finance chief David Zinsner said the government’s investment was meant to incentivize Intel to keep majority control over its contract chip-fabrication business.
