The Trump administration is providing a $2 billion vote of confidence to struggling US chipmaker Intel by acquiring an around 10% equity stake in the company. This strategy, however, has raised concerns about its potential impact on the market and the use of taxpayer dollars.
As part of this plan, the White House aims to pressure major US tech companies into buying Intel chips or using its foundry services. The approach is expected to be driven by a mix of national security concerns and financial incentives.
Treasury Secretary Scott Bessent has confirmed that talks are underway for the US government to take an equity stake in Intel through the conversion of CHIPS Act loans. However, he also clarified that there are no plans to force companies to purchase Intel products.
The move has sparked debate about the effectiveness of this strategy and its implications for the market. Some question whether this approach is a sign of the administration’s shift towards state capitalism, which could have significant consequences for US businesses and investors.
Critics argue that such an approach could lead to a national champion being created without sufficient competition or oversight. In contrast, supporters see it as a necessary measure to bolster domestic fabrication of semiconductors in response to growing national-security concerns posed by China’s Huawei Technologies and other Chinese companies.
The deal would be the latest example of the Trump administration’s efforts to intervene in US business dealings to protect national interests. This move has significant implications for US businesses, investors, and policymakers alike, as it marks a departure from traditional laissez-faire policies towards state intervention in key industries.
Source: https://www.axios.com/2025/08/19/trump-intel-softbank-bessent