Government Taking Stakes in Private Companies - Veering Toward Fascism Through Corporatocracy

[DaisyDay]

Are Trump’s Deals with Nvidia and AMD Constitutional?

Cornell Law professor Michael C. Dorf examines the legality of the Trump administration’s deals with Nvidia and AMD, which require the companies to pay 15% of AI chip sales made to China to the U.S. g...

verdict.justia.com

Earlier this month, the Trump administration announced that it had reached deals with Nvidia and Advanced Micro Devices (AMD) under which the companies would pay the federal government fifteen percent of the money they make selling artificial intelligence chips to China. Both Howard Gleckman at The Tax Policy Center and Professor Ilya Somin at The Bulwark were quick to point out that the deals are, in effect, taxes, but that the Constitution bans export taxes, thus implying that the deals are unconstitutional.​

​

Are they right? Possibly—but the answer is less straightforward than one might think.​

​

...In practice, however, we should not expect the companies to challenge the de facto tax. Nvidia and AMD have likely learned the same lessons that media companies, law firms, and universities have learned about the Trump administration: it will ruthlessly and shamelessly use any and all points of leverage, including unrelated regulatory authority, to punish those entities that refuse to do its bidding. Even though the fifteen percent tax may be unlawful, the companies have probably been advised by their lawyers that contesting it would risk economically ruinous retaliation.​

​

Here, as elsewhere, the question is not so much whether the Trump administration is acting lawfully. The question is whether the administration can get away with violating the law. And as it is in other contexts, the answer is probably yes.​

​

 

[essentialsaltes]

Trump says Intel has agreed to deal for US to take 10% equity stake​

President Donald Trump said on Friday the U.S. would take a 10% stake in Intel (INTC.O), opens new tab under a deal with the struggling chipmaker and is planning more such moves, the latest extraordinary intervention by the White House in corporate America.

The development follows a meeting between Tan and Trump earlier this month that was sparked by Trump's demand for the Intel chief's resignation over his ties to Chinese firms.

Commerce Secretary Howard Lutnick said on X that the deal had been completed. "The United States of America now owns 10% of Intel," he wrote, saying Tan had struck a deal "that's fair to Intel and fair to the American People."

The Intel investment would be the latest of several unusual deals with U.S. companies, including agreeing to allow AI chip giant Nvidia (NVDA.O), opens new tab to sell its H20 chips to China in exchange for the U.S. government receiving 15% of those sales.

[They were prevented from selling them to China because of national security issues, but if you cut in the government for a piece of the action, the national security issues go away, it seems.]

The Pentagon is also slated to become the largest shareholder in a small mining company to boost output of rare earth magnets and the U.S. government negotiated for itself a "golden share" with certain veto rights as part of a deal to allow Nippon Steel to buy U.S. Steel.

--

From tariffs to skimming profits to owning parts of companies (and providing grants to those companies), the Government is extending control over formerly free enterprise. This has gone beyond sticking a thumb on the scale and just tossing the scale and making up rules as they go.

 

[Pommer]

Are we inching even closer to the government owning the means of production?
What’s “conservative” about this!?

 

[Maria Billingsley]

Are Trump’s Deals with Nvidia and AMD Constitutional?

Cornell Law professor Michael C. Dorf examines the legality of the Trump administration’s deals with Nvidia and AMD, which require the companies to pay 15% of AI chip sales made to China to the U.S. g...

verdict.justia.com

Earlier this month, the Trump administration announced that it had reached deals with Nvidia and Advanced Micro Devices (AMD) under which the companies would pay the federal government fifteen percent of the money they make selling artificial intelligence chips to China. Both Howard Gleckman at The Tax Policy Center and Professor Ilya Somin at The Bulwark were quick to point out that the deals are, in effect, taxes, but that the Constitution bans export taxes, thus implying that the deals are unconstitutional.​

​

Are they right? Possibly—but the answer is less straightforward than one might think.​

​

...In practice, however, we should not expect the companies to challenge the de facto tax. Nvidia and AMD have likely learned the same lessons that media companies, law firms, and universities have learned about the Trump administration: it will ruthlessly and shamelessly use any and all points of leverage, including unrelated regulatory authority, to punish those entities that refuse to do its bidding. Even though the fifteen percent tax may be unlawful, the companies have probably been advised by their lawyers that contesting it would risk economically ruinous retaliation.​

​

Here, as elsewhere, the question is not so much whether the Trump administration is acting lawfully. The question is whether the administration can get away with violating the law. And as it is in other contexts, the answer is probably yes.​

​

Yes, at this point he is pretty much untouchable, thanks to the supreme court. He can do what ever he wants including building a three mile radius kingdom in DC with a 90,000 sq.ft. compound protected by the military and Homeland Security, who have no accountability. And we are only 8 months into it. Lets see if Gavin Newsome can turn this around.

 

[essentialsaltes]

With Trump's interest in cars, the MAGAFolksvehicle Canyonero can't be far off.

Can you name the truck with four wheel drive,
smells like a steak and seats thirty-five..
Canyonero! Canyonero!

12 yards long, 2 lanes wide,
65 tons of American Pride!
Canyonero! Canyonero!

 

[BCP1928]

Are we inching even closer to the government owning the means of production?
What’s “conservative” about this!?

Government owning the means of production? That sounds familiar, but it can't be socialism. Socialism is about little boys playing sports with little girls, gun control, family leave, taking action on global warming, single-payer health care, that kind of thing. It's definitely not socialism, so what shall we call it? Wait. I know, let's call it free market capitalism. That way, patriotic Americans are sure to go along with it.

 

[essentialsaltes]

Trump wants more deals like Intel's, worrying business community​

"We're moving from a pure capitalistic economy to a much more state-engaged economy... That's a huge change for America and over where we've been. I've never seen an era like this," said Bill George, former Medtronic CEO and executive education fellow at Harvard Business School.

Trump doubled down on the idea of similar deals in other sectors on Monday, telling reporters at the White House, "I hope I'm going to have many more cases like it."

Trump said in a social media post on Monday that he would help companies that make similar "lucrative" deals with U.S. states, but did not provide details.

"If socialism is government owning the means of production, wouldn’t the government owning part of Intel be a step toward socialism?" [Senator Rand] Paul said.

 

[wing2000]

President Donald Trump said on Friday the U.S. would take a 10% stake in Intel (INTC.O), opens new tab under a deal with the struggling chipmaker and is planning more such moves, the latest extraordinary intervention by the White House in corporate America.

"If socialism is government owning the means of production, wouldn’t the government owning part of Intel be a step toward socialism?" [Senator Rand] Paul said.

<crickets>

 

[GoldenBoy89]

Government owning the means of production? That sounds familiar, but it can't be socialism. Socialism is about little boys playing sports with little girls, gun control, family leave, taking action on global warming, single-payer health care, that kind of thing. It's definitely not socialism, so what shall we call it? Wait. I know, let's call it free market capitalism. That way, patriotic Americans are sure to go along with it.

It’s like some sort of socialist nationalism.

 

[essentialsaltes]

It’s like some sort of socialist nationalism.

 

[BCP1928]

It’s like some sort of socialist nationalism.

And it is supposed to benefit the workers in the long run, right? Let's see, national worker socialism party...? Socialist national workers party...? We'll have to work on that. Perhaps we can look back into the past and see what parties with the same agenda as the Republicans have called themselves.

 

[FAITH-IN-HIM]

In 2009 when US government gave $50 billion to General Motors , US government had 60.8% equity stake in the company.

“We are acting as a reluctant shareholder because this is the only way to help GM succeed,” Obama said in nationally televised remarks delivered in the White House’s Grand Foyer He called the new effort “a credible plan that is full of promise.” “Our goal is to get GM back on its feet, take a hands off approach and get out quickly,” the president said.

I initially viewed the Obama administration's actions as contrary to free market principles, but under those circumstances, they were necessary.

President Obama's actions were neither fascist nor authoritarian. At the time, many conservatives—now often associated with MAGA—called President Obama a dictator, fascist, and socialist because his administration took equity in private businesses.

Currently, President Trump is engaged with Navid and Intel in a way regard as government intervention. His approach differs from previous conservative ideas and free market principles. However these actions are not classified as fascism.

 

[DaisyDay]

In 2009 when US government gave $50 billion to General Motors , US government had 60.8% equity stake in the company.

“We are acting as a reluctant shareholder because this is the only way to help GM succeed,” Obama said in nationally televised remarks delivered in the White House’s Grand Foyer He called the new effort “a credible plan that is full of promise.” “Our goal is to get GM back on its feet, take a hands off approach and get out quickly,” the president said.

I initially viewed the Obama administration's actions as contrary to free market principles, but under those circumstances, they were necessary.

President Obama's actions were neither fascist nor authoritarian. At the time, many conservatives—now often associated with MAGA—called President Obama a dictator, fascist, and socialist because his administration took equity in private businesses.

Currently, President Trump is engaged with Navid and Intel in a way regard as government intervention. His approach differs from previous conservative ideas and free market principles.

The difference between GM/Chrysler is that the stakes were collateral for the bailout loan which were relinquished when the loans were paid off, with interest, while Intel/Nvidia are very solvent, highly profitable and there are no actual benefits to the companies other than simply being allowed to conduct business internationally. There is a major difference between requiring collateral for a loan and requiring a permanent piece of the company for....what exactly? It smells like extortion which is quite different from a bailout.

However these actions are not classified as fascism.

Right, most people say its classified as socialism and extortion.

 

[RocksInMyHead]

With Trump's interest in cars, the MAGAFolksvehicle Canyonero can't be far off.

Can you name the truck with four wheel drive,
smells like a steak and seats thirty-five..
Canyonero! Canyonero!

12 yards long, 2 lanes wide,
65 tons of American Pride!
Canyonero! Canyonero!

It'll be number one in utility sports. The unexplained fires are a matter for the courts.