Trump's industrial policy kicks off

The idea of "state capitalism" has been anathema to generations of U.S. politicians, especially Republicans. Former U.S. president Barack Obama, a Democrat, took heat after solar panel maker Solyndra went bankrupt despite receiving a $535 million Department of Energy loan guarantee, for instance. In another case, Republican leader Mitt Romney in 2008 argued against a government bailout of the top U.S. automakers.
    
That was then. In the wake of U.S. President Donald Trump's deal for a 9.9% stake of computer chip maker Intel investors now are taking stock of how top chipmakers and other companies should and will behave in what could become a new era of U.S. industrial policy.
    
Among other things boards must now consider a shareholder base that includes political leaders tied to the same Washington, D.C. institutions that regulate them like the U.S. Federal Trade Commission, or that buy their products like the Pentagon. They must also pay closer attention to barrages of social media messages from the current occupant of the Oval Office.
    
You can read more about these concerns in my main story this week, linked below. I've also put in links to our coverage of new stewardship leaders at top fund managers and an update on China's carbon market.
    
Please follow me on LinkedIn and/or Bluesky. You can reach me via ross.kerber@thomsonreuters.com. 

The U.S. government's new stake in Intel is making some investors nervous that President Donald Trump's deal heralds an era of public meddling in private industry, particularly as the arrangement followed Trump's call for the resignation of the computer chip maker's CEO.
    
The deal, announced on Friday, converts $11.1 billion in Chips Act grants and other government funding into a 9.9% equity stake in Intel. The company's press release announcing the deal included statements from the CEOs of Microsoft, Dell and other companies praising the move.
    
Investors said this level of tractability was not usually associated with relations between businesses and Washington. Trump had said on social media that Intel CEO Lip-Bu Tan wanted to keep his job and "ended up giving us $10 billion for the United States."
    
"It sets a bad precedent if the president can just take 10% of a company by threatening the CEO," said James McRitchie, a private investor and shareholder activist in California who owns Intel shares. The statement, he said, effectively sends the message that "we love Trump, we don't want 10% of our company taken away."

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An Apple Watch Ultra 2 is showcased as Apple holds an event on its campus in Cupertino, California, U.S. September 9, 2024. REUTERS/Manuel Orbegozo/File Photo

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