Will the REAL Socialists Please Stand Up?
The party that spent forty years warning about government picking winners now owns 9.9% of Intel. Every claim below is linked to a primary source — check them.
Guess what? The real socialists have entered the chat — and they're wearing red ties.
Before you close the tab, this isn't a gotcha. It's an observation about something genuinely strange: a governing coalition that preaches free-market gospel on Sunday and takes equity positions in private corporations on Monday. Not loans. Not contracts. Ownership.
And here's the part that should bother you regardless of your registration: it's mostly been happening without much of a fight from anyone.
First, Let's Define the Words
Free-market capitalism, as pitched: government sets the rules and steps back. Competition picks winners. No handouts, no state ownership, no industrial policy. If you can't compete, you fail.
State capitalism is when government directs capital toward chosen firms and industries — taking stakes, steering investment, deciding which companies matter. China does it openly. So, increasingly, do we.
That's the distinction that matters. Not "socialism" in the textbook sense of workers owning the means of production — nobody's proposing that. What's actually happening is narrower and stranger: the state taking equity in specific corporations while the people doing it insist they oppose exactly that.
Exhibit A: The Government Owns a Tenth of Intel
In August 2025, the U.S. government purchased 433.3 million shares of Intel at $20.47 a share — $8.9 billion, a 9.9% stake, making Washington one of the company's largest shareholders.
Where did the money come from? $5.7 billion in CHIPS Act grants that had already been awarded but not yet paid, converted into equity, plus $3.2 billion from the Secure Enclave program. The government also took a five-year warrant for another 5% if Intel drops below 51% ownership of its foundry business.
Sources: Intel's own announcement • CNBC — U.S. takes 10% stake in Intel • PBS NewsHour — what economists make of it • Senate Banking Committee letter to Commerce
Read that again: grant money the company had already been promised was converted into government ownership. Intel didn't win this in a market. A government decided Intel specifically should exist at scale, and bought in.
You can argue that's smart. Semiconductors are strategic, and the case for not depending on Taiwanese fabs is real. But whatever it is, it is not letting the market decide.
Exhibit B: The Pentagon Became a Mining Company's Biggest Shareholder
In July 2025, the Department of Defense purchased $400 million of convertible preferred stock in MP Materials, the only operating rare-earth mine in the United States, plus a warrant. Fully exercised, that leaves the Pentagon holding roughly 15% — the company's largest shareholder.
Sources: CNBC — Pentagon to become largest shareholder in MP Materials • MP Materials' announcement • SEC filing • Payne Institute — explainer on the DoD partnership
The strategic logic is genuinely strong — China supplied roughly 70% of U.S. rare-earth imports, and that's a real vulnerability. But "the Defense Department is the largest shareholder in a publicly traded mining company" is a sentence that would have caused a stroke at the 2012 Republican National Convention.
Exhibit C: The Golden Share
As a condition of Nippon Steel's acquisition of U.S. Steel, the federal government took a perpetual "golden share" — giving the president consent rights over closing or idling plants, moving production or jobs abroad, and reducing promised investment.
Source: Reporting on the golden share terms
A permanent government veto over a private company's operating decisions. There is a word for that arrangement, and it isn't "deregulation."
Exhibit D: A 15% Cut of the Sales
Then there's the arrangement where Nvidia and AMD agreed to hand the U.S. government 15% of their revenue from chip sales to China in exchange for export licences.
The Tax Policy Center's analysis is worth reading, because it makes an argument you rarely hear: functionally this is an export tax — and Article I, Section 9 of the Constitution says "No Tax or Duty shall be laid on Articles exported from any State."
Sources: PBS NewsHour — the 15% arrangement • Tax Policy Center — "It's an export tax"
Revenue-sharing with private firms in exchange for permission to trade. That's not a free market. That's a concession.
Now the Part Where We Aim at Everyone
If this piece stopped here it would be exactly the partisan hackery this site exists to complain about. So:
The CHIPS Act was bipartisan. It passed with Republican votes and was signed by President Biden in 2022. The money that became Intel equity started as a Democratic-signed industrial policy. Both parties built this machine.
Democrats do the same thing constantly — the Inflation Reduction Act is one of the largest industrial-policy programs in American history, directing hundreds of billions toward chosen technologies. The Obama administration bailed out automakers and bet on Solyndra. The Biden administration approved the Willow oil project while campaigning on no new federal drilling.
Here's the difference, and it's the whole point: Democrats generally say they believe government should steer investment. You can think that's wrong — plenty of people do — but it's a stated position defended in public.
The contradiction isn't taking equity in Intel. It's taking equity in Intel while campaigning against government picking winners. Do one or the other. Doing both is how you end up unable to explain your own principles.
The Questions Worth Asking
If a 9.9% federal stake in a chipmaker isn't the government picking winners, what would be? This is a genuine question, not a rhetorical one. There should be an answer.
Who's on the other side of the trade? When Washington takes equity, taxpayers hold the downside and existing shareholders get the capital. If the bet works, the public gets a return — that's the honest case for it. If it doesn't, the public ate the loss for a private firm's balance sheet. Which was it? We should be able to find out.
Why does the standard flip by income? A corporation that can't compete gets a federal equity injection framed as national security. A person who can't cover medical debt gets a lecture about personal responsibility. Both are the state deciding who gets rescued. Only one gets called socialism.
And if we're doing industrial policy anyway — which, demonstrably, we are — then the argument is no longer whether government directs capital. It's who decides, on what criteria, and with what disclosure. That's a much more useful fight than the one we're having.
The Final Word
Will the real socialists please stand up?
Turns out they were capitalists all along. They just believe in capitalism for you and portfolio management for themselves.
The honest positions are both available. "No stakes, no subsidies, let firms fail" is coherent — harsh, but coherent. "Semiconductors and rare earths are strategic, so the state invests and the public shares the upside" is also coherent, and it's roughly what most of our allies do openly.
What isn't coherent is running the second policy while campaigning on the first, then calling it socialism when someone proposes the same treatment for people instead of corporations.
Own it or drop it. The pretending is the part that's corrosive.
Spotted an error, or have a source that sharpens or undercuts any of this? Tell us — corrections get made and noted.