Trump Administration Built $22.9 Billion Government Equity Portfolio Across Tech and Mining Sectors, Drawing Accusations of "State Capitalism"

Details

Between June 2025 and February 2026, the Trump administration directed federal agencies—primarily the Department of Defense (rebranded the "Department of War" in September 2025), the Department of Commerce, and the Department of Energy—to take direct equity stakes in at least fifteen companies across the semiconductor, rare earth minerals, defense, and steel sectors. The administration also brokered revenue-sharing arrangements requiring chipmakers to pay the government 15-25% of certain sales to China. By February 2026, the government's equity portfolio had grown to over $22.9 billion—a return exceeding 180%, dramatically outperforming the S&P 500's roughly 18% gain over the same period. The portfolio is publicly tracked by Insiderwave, similar to how congressional stock trackers follow lawmakers' trades.

Summary of Government Stakes and Arrangements

Company	Stake/Arrangement	Investment	Agency	Date
Intel	9.9% equity	$8.9 billion	Commerce (CHIPS Act)	August 2025
MP Materials	15% equity	$400 million + $150M loan	Defense Department	July 2025
Lithium Americas	5% equity (company + GM joint venture)	Part of $2.3B loan renegotiation	Energy Department	October 2025
Trilogy Metals	10% equity + warrants	$17.8 million	Defense Department	October 2025
Vulcan Elements	Equity stake	$50M (Commerce) + $620M (Defense)	Commerce/Defense	November 2025
ReElement Technologies	Warrants	Part of $1.4B partnership	Defense Department	November 2025
Atlantic Alumina (ATALCO)	Preferred equity	$150 million	Defense Department	January 2026
USA Rare Earth	10% equity	$1.6 billion	Commerce (CHIPS Act)	January 2026
Korea Zinc (JV)	40% stake in Tennessee JV	~$1.9 billion	Defense Department	2025
xLight	Equity stake	$150 million	Commerce (CHIPS Act)	December 2025
L3Harris (rocket motor division)	Convertible investment	$1 billion (converts to equity on IPO)	Defense Department	December 2025
U.S. Steel	"Golden share" (veto power)	No direct equity	Executive (CFIUS)	June 2025
Nvidia	15-25% revenue share (China chip sales)	~$5B annually projected	Commerce Department	August-December 2025
AMD	15% revenue share (China MI308 sales)	N/A	Commerce Department	August 2025

Government Stake in Intel

On August 22, 2025, President Trump announced that the federal government would acquire a 9.9% stake in Intel, making it the company's largest shareholder. The $8.9 billion investment came from repurposed CHIPS Act grants ($5.7 billion) and funds from the Defense Department's Secure Enclave program ($3.2 billion), combined with $2.2 billion Intel had already received, for a total of $11.1 billion.

The deal came together after Trump publicly called for Intel CEO Lip-Bu Tan to resign in early August over concerns about his past investments in Chinese companies. Following a White House meeting, Tan agreed to the equity stake. Trump told reporters: "He walked in wanting to keep his job, and he ended up giving us $10 billion for the United States."

Nvidia and AMD Revenue-Sharing Agreement

On August 10, 2025, the Trump administration confirmed that Nvidia and AMD had agreed to pay 15% of their revenues from certain AI chip sales to China in exchange for export licenses. The deal allowed Nvidia to sell its H20 chips and AMD to sell its MI308 chips in China after months of restrictions.

Trump told reporters: "I said, 'Listen, I want 20% if I'm going to approve this for you'... So we negotiated a little deal." Analysts estimated the arrangement could generate approximately $5 billion in federal revenue annually.

In December 2025, Trump expanded the deal to include Nvidia's higher-grade H200 chips, with a 25% revenue share.

Rare Earth Minerals and Mining

In July 2025, the Defense Department acquired a 15% stake in MP Materials, making the government the largest shareholder in America's only rare earth mine operator. The deal included $400 million in stock purchases, a $150 million loan, and a guaranteed floor price of $110 per kilogram for rare earths.

In October 2025, the Energy Department took a 5% stake in Lithium Americas and its joint venture with General Motors for the Thacker Pass lithium mine in Nevada as part of renegotiating a $2.3 billion federal loan.

Also in October 2025, the Defense Department invested $17.8 million in Trilogy Metals for a 10% stake plus warrants in the Canadian company developing copper-zinc projects in Alaska.

In November 2025, the administration announced a $1.4 billion partnership with Vulcan Elements and ReElement Technologies to expand rare earth magnet production, with Commerce taking a $50 million equity stake in Vulcan and Defense receiving warrants in both companies.

In January 2026, the Defense Department invested $150 million in preferred equity in Atlantic Alumina Co. (ATALCO), operator of the nation's only remaining alumina refinery in Gramercy, Louisiana. The investment will fund expansion of alumina production and construction of the country's first large-scale gallium production facility. Gallium is a critical mineral used in semiconductors, satellite systems, and military radar, with China currently controlling approximately 99% of global refined supply.

Also in January 2026, the Commerce Department announced a $1.6 billion investment in USA Rare Earth, taking a 10% equity stake in the Oklahoma-based company developing rare earth mining and magnet manufacturing facilities in Texas and Oklahoma.

Additional investments include a 40% stake in a joint venture with Korea Zinc valued at approximately $1.9 billion to fund a $7.4 billion smelter in Tennessee, and a $150 million equity stake in xLight, a Palo Alto startup developing semiconductor manufacturing technology. The Defense Department also committed $1 billion to L3Harris Technologies' rocket motor division, which will convert to equity upon an IPO planned for the second half of 2026.

U.S. Steel "Golden Share"

On June 18, 2025, Trump approved Nippon Steel's $14.1 billion acquisition of U.S. Steel after securing what he called a "golden share"—veto power over key business decisions including factory closures, relocations, salary reductions, and name changes.

Unlike traditional equity stakes, the golden share does not represent direct ownership but grants the president extraordinary governance control. Sarah Bauerle Danzman, a political economist at Indiana University and former CFIUS case officer, noted: "The U.S. government does not appear to actually hold an equity stake in U.S. Steel... what the U.S. government has is kind of extra-special governance rights."

In September 2025, the administration exercised its golden share authority for the first time, blocking U.S. Steel from idling operations at its Granite City, Illinois plant.

Portfolio Performance

By February 2026, the government's equity portfolio had grown from approximately $9.4 billion to over $22.9 billion—a return exceeding 180%, dramatically outperforming the S&P 500's roughly 18% gain over the same period. Intel alone accounts for over 91% of the portfolio's value. Individual stock performance since government investment includes Intel (+122%), MP Materials (+106%), Trilogy Metals (+138%), and Lithium Americas (+64%).

In February 2026, Trump formally announced "Project Vault," a $12 billion critical minerals stockpile initiative intended to further reduce reliance on Chinese rare earths.

Constitutional and Legal Questions

Legal experts raised significant concerns about the Nvidia/AMD arrangements. The U.S. Constitution prohibits export taxes, and statutory law (50 USC 4815(c)) expressly forbids fees for export control licenses.

Peter Harrell, a former Biden administration official, wrote: "In addition to the policy problems with just charging Nvidia and AMD a 15% share of revenues to sell advanced chips in China, the US Constitution flatly forbids export taxes."

Derek Scissors of the American Enterprise Institute noted: "There's no precedent for this, probably because export taxes are unconstitutional. They call it a fee, but 15% of sales revenue is about as standard a tax as it comes."

The MP Materials deal bypassed standard procurement laws using a rarely invoked part of the Defense Production Act, avoiding the Federal Acquisition Regulation, Cost Accounting Standards, and the Competition in Contracting Act.

Conflict of Interest Concerns

Beyond the ideological critiques, analysts have raised specific conflict of interest concerns. The government now has a financial incentive to favor companies in which it holds equity through permitting, contracting, and regulatory decisions.

For example, Trilogy Metals needs federal permits for a controversial 211-mile road through Gates of the Arctic National Park to develop its mine—permits the government now has a financial interest in approving. MP Materials warned investors in SEC filings that the government deal could lead to "government audits, investigations, congressional scrutiny" and "inquiries about conflicts of interest."

In February 2026, ranking Democrats on the House Natural Resources and other committees sent letters to four cabinet secretaries asking for disclosure of the legal framework governing these investments, how profits are managed, and whether any administration officials, major donors, or Trump Organization affiliates hold positions in the companies.

Libertarian and Conservative Criticism

Cato Institute

The libertarian Cato Institute emerged as a leading critic of the administration's approach. Scott Lincicome, Vice President of General Economics at Cato, wrote in the Washington Post that the Intel deal "marks a dangerous turn in American industrial policy. Decades of market-oriented principles have been abandoned in favor of unprecedented government ownership of private enterprise."

Lincicome warned: "With the U.S. government as its largest shareholder, Intel will face constant pressure to align corporate decisions with the goals of whatever political party is in power."

Clark Packard of Cato stated: "There is no statutory basis for these companies having to pay a share of their Chinese sales revenue in exchange for their export licenses. Beyond the troubling legal questions, the deal with Nvidia and AMD reeks of more crony capitalism."

Ryan Bourne of Cato observed that Commerce Secretary Howard Lutnick "can deny that this is a step" toward socialism, but "the effect is the president allocating capital through partial nationalization."

Norbert Michel, Vice President of Cato's Center for Monetary and Financial Alternatives, told Newsweek: "In as much as a socialist economy is one where the government has ownership and control over the means of production, this is a step toward that."

American Enterprise Institute

Michael Strain, Director of Economic Policy Studies at the American Enterprise Institute, told CBS News: "I think the right way to describe it is a move toward state capitalism."

The AEI's James Pethokoukis wrote: "The president's impulsive decision to demand conversion of nearly $9 billion of promised subsidies into a 10 percent government stake in Intel strikes me as less a careful national strategy than an expression of his own taste for deal-making. He likes equity. He likes leverage."

National Review and Wall Street Journal

The conservative National Review called the Nvidia revenue-sharing deal "extortion" and a "lurch toward state-directed capitalism."

The Wall Street Journal's editorial board labeled the Intel deal "a de facto nationalization." The Journal's chief economics commentator, Greg Ip, described Trump's policies as "state capitalism," defining it as "a hybrid between socialism and capitalism in which the state guides the decisions of nominally private enterprises."

Senator Rand Paul

Senator Rand Paul (R-KY) wrote on X: "If socialism is government owning the means of production, wouldn't the government owning part of Intel be a step toward socialism? Terrible idea."

Paul cautioned: "Today it's Intel, tomorrow it could be any industry. Socialism is literally government control of the means of production."

Other Conservative and Business Criticism

Adam Posen, President of the Peterson Institute for International Economics, responded to news of potential additional government stakes in companies by posting on X: "ARE you effing kidding me? We are going past 1984 into Animal Farm territory at this point."

Harvard economics professor Gregory Mankiw compared the administration's negotiation tactics to "a shakedown from the Mafia."

Walter Isaacson, Tulane University professor and biographer, told CNBC that Trump's dealings with Intel and Nvidia amount to "a scattershot method of crony capitalism," adding: "That state capitalism often evolves into crony capitalism, where you have favored companies and industries that pay tribute to the leader."

Mark Williams, Master Finance Lecturer at Boston University, told Newsweek: "The Intel deal pushed by the government is the latest example of a march towards state capitalism."

Tyler Cowen, professor of economics at George Mason University, wrote that Trump is turning major U.S. businesses into arms of the government: "A dose of government ownership and the associated politicization are not what American industry and innovation need."

Comparisons to China

Multiple analysts noted the irony of Trump adopting economic policies similar to those of China, which he has frequently criticized.

The Wall Street Journal argued that Trump is "imitating the Chinese Communist Party by extending political control ever deeper into the economy."

A Built In analysis observed: "This setup has drawn some comparisons to the Chinese government, whose state-owned enterprises dominate energy, defense and other vital sectors of its economy."

Simon Moores, CEO of Benchmark Mineral Intelligence, told E&E News: "It's very rare for western governments to do this in modern times. It's more of a China and Russia play [to] take stakes in mineral mining companies through state-owned enterprises."

The "Jack Ma Moment" Warning

By mid-2026, the China comparison had sharpened from a critique of state ownership into a warning about politicized state-business relations more broadly. In a June 28, 2026 New York Times guest essay—an opinion piece, not news reporting—Dan Wang, a research fellow at Stanford's Hoover Institution, and Julian Gewirtz, a Columbia University scholar who served in senior China-policy roles on the Biden administration's National Security Council, warned that the U.S. government was "skating close to its own Jack Ma moment, when a government wounds a tech leader seemingly out of spite"—a reference to Beijing's 2020 retaliation against the Alibaba co-founder after he criticized Chinese regulators, which cancelled Ant Group's IPO, erased roughly two-thirds of Alibaba's market value, and collapsed Chinese venture funding.

Wang and Gewirtz wrote chiefly about the administration's escalating confrontation with AI companies—including the Pentagon's March 2026 designation of Anthropic as a supply chain risk after the company protested use of its models in autonomous weapons and domestic mass surveillance, and a June 2026 export-control directive restricting access to one of Anthropic's models—rather than about the equity portfolio itself. But their framing bears directly on the state-capitalism debate: they argued that the real competition is no longer simply the United States versus China but "an even more acute form of competition, between the public power of governments and the private power of ambitious companies," with both governments "struggling to determine whether their frontier A.I. companies are national champions or national security threats." They also pointed to the administration's "demonstrated willingness to punish companies to assert dominance or satisfy a political constituency"—the same dynamic critics identified in the Intel episode, in which Trump demanded the CEO's resignation and emerged with a 9.9% government stake.

The authors cautioned that "self-destructive American actions, not Chinese competition, may be the most significant threat to the evolution of A.I. for years to come," though they judged that the United States, "with its system of legal protections and its deep capital markets," was unlikely to suffer damage on the scale China inflicted on itself. Their recommendations ran in both directions: AI executives should stop "doom trolling," and the U.S. government "needs to realize that the stakes of A.I. are far too high to allow a breakdown of trust" with its leading companies. The essay represents a notable escalation in mainstream elite commentary: where earlier critics compared the administration's equity stakes to Chinese state-owned enterprise practice, Wang and Gewirtz compared its treatment of disfavored companies to the Chinese Communist Party's punitive crackdown on its own tech champions.

Trump's Prior Anti-Socialism Statements

The administration's approach stands in stark contrast to Trump's rhetoric during his first term. At his 2019 State of the Union address, Trump declared: "Tonight, we renew our resolve that America will never be a socialist country."

In the same speech, Trump criticized Venezuela's "socialist policies" while condemning "new calls to adopt socialism in our country."

Administration Response

Commerce Secretary Howard Lutnick defended the Intel deal at a Cabinet meeting: "Intel agreed to give us 10% of their company, which, of course, was worth $11 billion. So, it's not socialism. This is capitalism."

White House Deputy Press Secretary Kush Desai told Newsweek the administration is "ensuring that taxpayers are able to reap the upside of the federal government's investments into safeguarding our national and economic security."

Kevin Hassett, Director of the White House National Economic Council, told CNBC that while Intel is a "very, very special" circumstance, "there'll be more transactions, if not in this industry, then other industries."

Trump rejected the criticism and pledged to "make deals like that for our country all day long."

Other Politician Reactions

Senator Bernie Sanders (I-VT), whom Trump famously stared down during his 2019 anti-socialism declaration, expressed support for the Intel stake. California Governor Gavin Newsom called Trump on the Pivot podcast "the leading nationalist and socialist of our time" and stated: "This guy has completely perverted capitalism, Donald Trump. It's crony capitalism. It's whatever, you pay him off, give him a phone call."