Why the Trump Administration is Now Taking Equity Stakes in American Companies

Odd Lots

Bloomberg

News, Investing, Business, News Commentary, Business News

4.4 • 1.6K Ratings

🗓️ 16 October 2025

⏱️ 49 minutes

🔗️ Recording | iTunes | RSS

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Summary

It's nothing new for the US government to use public money to support private American companies. The Biden administration, via CHIPS and the Inflation Reduction Act, was aggressive about using loans and grants to accelerate US industry. But the Trump administration has been engaged in something more novel: taking direct stakes in US companies like Intel and MP. But what is the legal basis for such action? And what are the advantages and disadvantages of direct equity stakes? On this episode, we speak with Peter Harrell, visiting scholar at the Georgetown Institute of International Economic Law. We discuss the structure of these new arrangements, and the advantages and disadvantages for the government to be a minority shareholder in publicly-traded companies.

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0:00.0	Hello and welcome.
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0:27.2	You certainly ask interesting questions.
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0:52.2	I'm Joe Wisenthal.
0:53.3	And I'm Tracy Allaway. Tracy, isn't it you who's said for a long time that whenever the government does some of these deals, like with chips or maybe the early backing of Tesla, et cetera, aren't you always like, why didn't the government get equity stakes in these companies? Why are we just getting back sort of loans that are more or less the
1:10.9	amount of money we put in? Yeah, I think I have said that. Yeah. I mean, it seems like this weird
1:15.9	sort of half ground where you are investing in a company without asking anything in return.
	...

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