Photo above – The White House announces it is buying a 10% stake in Intel. INTC stock shares soared 20% this month.
MAGA is losing their minds. They have declared Trump’s government stake in Intel as “socialist”. The BBC, which actually IS a socialist news organization owned by the UK government, calls the Intel purchase “a break with the American tradition” (see link below).
They’re both wrong. Everyone should bone up on history.
Acquiring Intel is "mercantilist", NOT socialist. Mercantilism is a term probably unfamiliar to people who keep lists of books to be burned, or obsess over Epstein. The difference between socialism and mercantilism? Socialism nationalizes important industries to ensure consumer demand can me fulfilled and prevent riots by people suffering shortage and inflation. Socialism gives control of the means of production to the proletariat. Well, not really . . . under socialism the means of production is controlled by unelected bureaucrats. Which is what’s been going on for years in America, with deep state regulatory controls to bypass congress and voters.
Mercantilism doesn’t even look like it belongs in the same family tree as socialism or communism. The goal of mercantilism is to grow exports, shrink imports, and accumulate sovereign wealth – typically national gold reserves. Well, Trump is partially getting the import/export theory right with his tariffs. But creating meme coins and unleashing crypto currencies is not in any way the same as building sovereign wealth. Bitcoin as a replacement for gold is scary-risky and is likely to drain money from banks as investors chase crypto for higher interest yield than they can get on CDs. Until crypto has one of its periodic “day of reckoning events” and loses 50% of its value in a week, as it has so often in the past.
There’s a link below defining the differences between socialism and mercantilism in detail, in case anyone thinks I’m making this up.
Okay, so MAGA is wrong about socialism. What about the BBC, claiming Trump is taking the USA into “uncharted territory”? I give the BBC a pass on being ignorant about American history, but they’re as wrong as MAGA is. Raise your hand if you remember the Obama administration “investing” $50 billion in GM stock. As part of TARP, and the housing crisis. Allegedly to rescue GM from foreign ownership. The GM shell game was actually a vote buying scheme, to bring the UAW factory workers into line. What happened to this $50 billion GM “investment”? American taxpayers lost $10 billion when Obama gave up on it after winning his second term as president.
If you think Obama’s TARP stock purchases ended with the GM misadventure, you couldn’t be more wrong. The gummint also bought Citibank, Chase, Bank of America, Merrill Lynch, Wells Fargo and a dozen other highly reviled financial institutions. This was to keep the banking regulators – FDIC, Federal Deposit Insurance Corporation – from being destroyed by trillions in risky mortgages which banks handed out. Banks loaned money hand over fist to people with crappy FICO scores, no down payments, and who fantasized they could get rich like reality TV home flippers. Corporate greed, say hello to US government bailouts.
Am I in favor of the US government purchasing Intel stock in 2025? I am not. Even if we DIDN’T have a $37 trillion national debt which could end American life as we know it, snapping up Intel shares would still be a terrible idea. It creates “winners and losers” in the marketplace and distorts corporate America’s behavior.
If you doubt THAT part, let me remind you of a more recent event: the years and years of tax rebates, subsidies and grants to Tesla. Which elevated Musk to mythical godlike status, until he was abandoned by both the left and the right. First a winner, then a loser.
I’m just sayin’ . . .
Trump's Intel deal gives US stake in business – and breaks with American tradition
Mercantilism Vs Communism: A Tale of Economic Rivalries – About Financials
Why is the US government buying Intel stock (INTC) when we’re already $37 trillion in debt, and paying trillions more in interest annually?
byu/baltimore-aureole ineconomy
Posted by baltimore-aureole
21 Comments
The current US government wants to nationalize (partially) big corporations in order directly control them and install key managers. I mean Trump wants directly manage everything including big business. Such situation has the special term in history.
This is capitalism /s
Who knows the true details of the transaction, but according to Taco Tuesday, the shares were given. Not purchased.
Turns out trump is a south American socialist and feels like only a few can own anything.
The US government know the current capitalist economic model isn’t able to compete with the chinese state backed capitalism model.
They realize that the US must also make profits off of large corporations, and this also gives them the means to influence corporate decision to be more in their favour.
Well we were about to just give them money without receiving any equity so this seems a little better
Biden already gave the money to them with zero accountability or return. We now have 10 pct non voting ownership for the American people.
Leftists don’t know how this works, so they are going to hate it obviously
My understanding was Intel was to receive a grant from US Government. and now, the government is getting shares instead of nothing.
The theory is that it will help the United States to be more competitive against China. Apparently the MP materials deal was very good for taxpayers and shareholders. I still think it is a bad road for the United States to go down but I understand the reasoning.
Because Trump is a dictator.
“Listen, we have the best chips! So fast, with the best numbers. And the AI—nobody processes AI like us. They’re smart chips, very smart, like me. Believe me. We’re beating everybody—sleepy AMD, communist Taiwan—it’s not even close. We’re winning bigly”
Because Donald Trump and the GOP are fascists and fascists believe in the merger between corporate and state power. We are entering the era of permanent bail outs.
This money was from the chips act that was passed by Biden
Rather keep the investments into the tech sectors than own a sliver of a 2nd rate chip manufacturer. We got TSMC to on-shore, however that reinvestment ecosystem meant to generate additional economic activity is somewhat ruined from Doge so now even less money is circulating, lossing us whatever benefits the act brought
I think it’s funny how people are complaining about this. If you have any sort of savings and if you were smart you’d put that money into Intel. If the government is buying shares you think the government is going to fail when the rates are about to be cut? Possibly two or three times even by the start of 2026? Intel will definitely be over $30 a share soon.
Tell that to the Republicans in South Florida. For them socialism = communism.
Trump administration poster boy for incels, Lutnick, advises that reframing taxes is not taxes.
Tariffs are extra taxes on consumers.
The government having stock in companies is extra corporate taxes.
Important to recognise that a simple mercantalist policy of maximising exports believing that will improve the real wealth of your nation is a fool’s errand. If you export real production it means you as a nation had to do all the real work to make it (and swallow the opportunity costs associated with deploying the production inputs to that task) but don’t get to enjoy the material benefits from it (e.g. current consumption utility or increased capital stock to improve future conditions and consumption).
Accumulating financial claims on foreign nations and actors means nothing unless you believe at some point in the future they will be producing more to export back to you on net – which doesn’t help you all throughout your mercantilist joy ride and is not guarenteed.
Giving the state ownership, instead of just giving the money away, is actually a good thing. Not his worst day on the job.
TARP was passed in 2009 under Bush.
Obama’s TARP and bail out for Auto manufacturers is not the same as Trump taking over a 10 percent share of Intel. Its not even in the same ball park. Its shocking how everyone is cool with this but scream at the top of their lungs about healthcare for all. But, then again, normal everyday people don’t deserve a break from all the costs because it will make them lazy (actual reasoning Republicans are giving for cuts to Medicaid).