Trump's corporate stakes are a gift to the next Democratic president
The Trump administration has announced or completed deals to take ownership stakes in 40 private companies, raising concerns about how future administrations might leverage this power.
Just this week, the Commerce Department added four more proposed stakes to the running count maintained at the Cato Institute's Restoring Free Enterprise initiative. This ad hoc approach to government ownership continues despite the Trump administration initially abandoning plans for a formal sovereign wealth fund.
Democratic plans
Democrats are already strategizing how to use these government stakes. Former Biden officials see opportunities to pressure gun and oil companies through ownership. Doug Farrar, who worked for then-FTC Chair Lina Khan, noted a future president could leverage stakes to regulate AI companies more aggressively.
especially a Democrat who wants to seriously regulate this industry
Republican inaction
Congressional Republicans, who frequently criticize Democrats as socialists, have taken no action to stop the Trump administration's accumulation of corporate stakes. In fact, they're working to provide the legal authority for future administrations to continue this practice.
The administration claims these equity stakes benefit taxpayers more than blank checks and are necessary for national security supply chains. However, even selling the entire Intel stake would only net about $28 billion—less than 1.5% of the $2 trillion deficit run up last fiscal year.
Market impact
Government ownership creates unfair advantages for selected companies while disadvantaging competitors. This barrier to entry threatens to stifle the entrepreneurial spirit critical to America's economic success, particularly for upstart firms that don't yet exist.
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