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monknomo parent
the president unilaterally extorting 10% ownership out of a company isn't going to build the kind of system that competes with anyone. Big business can't really thrive under this kind of thing any more than corner stores can thrive under a protection racket.
tootie
I'm seriously not getting something about the entire argument in this blog post. How does a 10% equity stake make Intel more stable? At best it props up the stock price for a minute. If Intel continues to founder, then what? Federal government will buy more shares? Sell them? How does it affect the company's performance or decisions? Gov is not taking a board seat.
AnimalMuppet
Didn't the US pay $9.8 billion? Intel's market cap is $106 billion, so $9.8 billion for 10% is buying at a slight discount.

If that data is correct, how did the US "extort" ownership?

Look, I'm as terrified of Trump's overreach as the next guy. I could easily see him extorting partial ownership of companies. But I don't see this as being that.

Can you make a convincing argument otherwise?

davedx
It was a grant (free money). Then the terms were (mostly) unilaterally changed to be an equity investment. Right?
cpncrunch
No. It was a grant with profit sharing. The profit sharing was turned into equity.

https://www.intc.com/news-events/press-releases/detail/1748/...

BeetleB
It was because Intel likely wasn't going to get the rest of the grant money, because Lip-Bu Tan openly told the world he won't develop 14A without commitments from customers.

If Intel is going to cease semiconductor development, then why should they get the rest of the taxpayer money? Even under Biden and Pat Gelsinger, the government was signaling to Intel that they may not get the full money if they don't make progress.

AnIrishDuck
What was the legal basis for this "purchase"? Because as I understand it, Trump came in, saw a law he didn't like (CHIPS), and unilaterally "altered the deal"

I don't think it's fair to characterize this as some kind of standard stock sale, as the terms were never set out as such from the start. (And to be fair, there are lots of valid criticisms of CHIPS)

Instead, funding was voted for by Congress... and then a third party came in, threatened to kill it on a dubious legal basis, and extracted protection money (well, shares). That's textbook extortion.

jawiggins
The US Government wanted companies to build fabs in the US so it offered them money to do it. Intel, which was one of those companies, but not the only one, took them up on the offer and was paid to begin construction on a fab in the US.

Normally when we pay businesses to do things we don't demand equity stakes in the businesses afterwards.

Notably, the biggest shareholders in Intel appear to be retirement funds of Americans - so Trump has just pilfered some money from the retirement accounts of Americans.

downrightmike
All in so far it is $11.1 billion
righthand
As much as I dislike Trump, he didn’t extort anything. He renegotiated the profit-sharing terms for an equity stake in Intel.
cpncrunch
This is the correct answer. All the news articles seem to be lacking in details, but the deal did indeed waive the profit-sharing and claw-back provisions:

https://www.intc.com/news-events/press-releases/detail/1748/...

mrcwinn
Why take issue with Trump alone then? Go ask Bernie Sanders. This is a peak at what socialism looks like in America. The country taking a stake is the people taking a stake. Strange bedfellows, perhaps, but anyone far anti-Trump should actually take this as a model of sorts.
tkel
I read all of Bernie's platform in 2016 when it was most thoroughly developed, and he didn't call for state ownership of companies like Intel. The closest he got to what you are thinking was calling for public ownership of utilities, which is standard in most capitalist countries, namely buying out/converting private electricity utility monopolies into either public or cooperative ownership.

Also, socialism means whatever the ruling class says it means. For example in China they've redefined socialism to just mean nationalism, which is the opposite of the original intent. Read about "Xi Jingping Thought" and "Socialism with Chinese Characteristics". It seems when ideas like socialism become popular, they are co-opted and stripped of meaning.

BeetleB
> and he didn't call for state ownership of companies like Intel.

But during the CHIPS act debate, he was against the Act unless the US gets a piece of the company.

In general, this is in line with his views.

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