Despite regularly denouncing the rising socialist menace, President Trump has been pursuing a policy arguably just as, if not more, dangerous to liberty and prosperity as anything proposed by Zohran Mamdani or Bernie Sanders: using government funds to purchase partial ownership of private companies.
The Trump administration has obtained ownership interests of approximately 27 billion dollars in 30 companies since January of 2025. While President Trump and his defenders claim making these “investments” will benefit the American people, the truth is this policy will harm most Americans. The policy distorts the capital markets by incentivizing investors to support these companies because the investors believe government’s ownership interest creates a de facto government guarantee of a stock’s value. For example, after the government announced it would acquire ten percent ownership in chip manufacture Intel, the company’s stock price had a big increase.
When investors allocate their resources to companies because government is supporting those companies, capital is deprived to businesses that can thrive by pleasing consumers instead of politicians. This reduces economic growth, harming consumers and workers. It also incentivizes other businesses to seek government investment instead of developing ways to better serve consumers.
Government “investment” in private companies means government control. So, the “beneficiaries” of government support will be forced to make decisions based on political considerations rather than based on what will maximize profits. This will have negative effects on the companies and the entire economy.
Given how many Republicans have been critical of the rise of an openly socialist wing of the Democratic party, it would be reasonable to expect congressional Republicans to push back against President Trump’s use of taxpayer funds to take ownership interests in private companies. However, not only are most Republicans not speaking out against this policy, but Senate Republicans have included a provision in the fiscal year 2027 National Defense Authorization Act (NDAA) authorizing this policy.
The provision in question creates a “Defense Equity Investment Account” that the Pentagon can use to invest as much as 500 million dollars in private companies that produce batteries, as well as critical minerals, materials, and chemicals. The bill allows the Defense Department to take an ownership interest in companies in exchange for the Defense Department’s investment. This provision is claimed to be justified because it ensures the military-industrial complex has reliable supplies. Therefore, anyone who raises concerns about this expansion of the Pentagon’s influence over private businesses will be told that this is a limited grant of authority done for national security purposes.
History shows that new infringements on liberty often start as limited measures presented as supporting national security and then expand over time. Any Republicans who vote for an NDAA with this provision are endorsing the principle of government funding, and control, of private businesses. Once they have embraced the principle, it will be difficult for them to oppose future legislation expanding government “investment” in private businesses.
President Trump’s policy of using government funds to invest in private companies in exchange for partial government ownership of the companies is not pure socialism. Instead, it is corporatism. Corporatism is where power remains nominally in private hands but the government gains significant control. If the final version of the NDAA gives congressional authorization to President Trump’s corporatist policy, the country will have taken a major step down the road to serfdom and Republicans will have lost what little credibility they had left as supporters of the free market and limited government.
This article first appeared at RonPaulInstitute.org.
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9 Responses
Ron Paul is a light in the dark, a voice of reason when all others fail.
Yes, former Texas Senator, Ron Paul who ran for President in 2012 KNOWS the truth about the so-called “Federal” “Reserve” and how it, along with massive fraud and corruption is eating out our substance as main street Americans. He ran with the slogan “END THE FED!” Of course, I knew he’d never get elected – even if he were 30 years younger – because our so-called “Representatives” in Washington, D.C. (District of Criminals) don’t have the balls to fight the “Fed”.
Be it Republican or Democrat, the government always has different priorities other than delivering the best possible product at the lowest possible price. Whenever the government gets involved, competition goes out the window, causing the consumer (and/or taxpayer) to suffer.
Mr. Paul knows what he is writing about.
Trump overstepped his bounds on this.
Recall, the left took over GM and other things. Isn’t this similar?
That Nick Sirly dweeb is surely a feeb, governmental info agent. Why you think jones is promoting him ? They both applaud the glorious trumpy Bear and his glorious wars. Im so old I remember when I thought fatty was the real deal.
PAID ADOLESCENT PROPAGANDIST ALERT
Jones attacks Trump policies on many things, you lying dullard. They both oppose the war, you cheap liar.
Look folks the paid propagandist attempts unsuccessfully to smear and distract from the subject of extreme government corruption.
It’s a classic propaganda move – Shirley takes a heroic stand, so attack him for it.
Great AI slop image 👍🏻 Really high effort reporting 🤡
You wrote awfully cheap content free whining, it is really low quality babbling, like a adolescent.
A. Loghead is paid to come here to ridicule AJN, but the result instead is that A. Loghead embarrasses itself.
Does Loghead think it is impressing anyone? Loghead has nothing better to do than write gibberish posts?
You are so full of shit as you are boning each other right up the ass in your adjacent cubicles.