What You Need to Know

The United States is now the largest contributor to one of the largest semiconductor companies.

US President Donald Trump announced on August 22 that the United States government had a direct share in Intel worth about $ 11 billion, and it represents about 10 percent of the giant’s share. Intel will issue the required shares to the Ministry of Commerce, according to an organizational deposit by the company that announced this deal.

The agreement with Intel is the latest example of Trump for a deal agreement with private companies for government work or organizational relief. But he does this in a way that experts say is unprecedented and perhaps troublesome.

Here is what you need to know.

Where does the money come from?

In Trump’s narration, the United States governmentNot paying anythingFor stocks, but Intel still gets taxpayers technically.

Intel explained that the sale of shares will be funded to a large extent by granting or promising the company under the Chips and Science law – one of Trump’s signing policies, former President Joe Biden, which aims to return the chips factories to the beaches of the United States.

Biden Administration Gave Intel is approximately $ 8 billion last November, adding to another 3 billion dollars He pledged to the company through the Ministry of Defense program, known as the Secure Enclave, to make chips for the American army.

But Intel has only received $ 2.2 billion of this funding so far, as the Trump administration has obtained a 10 percent share effectively in exchange for issuing the rest. “We have agreed that it would be fair to be the same money it provides to a company, America must have its shares, because it is fair,” said American Trade Minister Howard Lootnick. While sitting with the lip lips, CEO of Intel on August 25.

How did the deal appear?

Trump said he negotiated the deal with the company. “The very respectable CEO, “leaving the fact that he called for Tan Immediate resignation Just three weeks ago to the CEO of Intel Alleged investments In many Chinese companies. “There is no other solution to this problem,” Trump posted at the time.

But later interview It seems that Trump and Tan at the White House have identified the problem – and resulted in the United States’ government to become the largest contributor to Intel.

“I said, “I would like you to give 10 percent of Intel to the United States of America, not mine, to the United States of America.” And I said, “If you have a partner, you have the United States as a partner.” I think this will be a very good thing for Intel, “Trump He told reporters On Monday, he listed his meeting with Tan. He thought about it a little different, and he said: “I love this idea a lot. We have a deal.

It is not clear whether Trump has asked Tan to strip any of his Chinese investments as part of the deal. in statement Earlier this month, Tan referred to reports on these investments in the name of “” “Wrong information” He said, “He was always working within the highest legal and ethical standards.” Intel did not respond immediately Foreign policyClarification request.

Why Intel?

Intel has emerged as one of the American technology industry champions in contracts since its foundation in 1968, in the Silicon Valley, which was then, and dominates the semiconductor and global computing industry through its peak in the nineties and early first decade of the twentieth century. However, recently, the company has decreased in relatively difficult times preceding both the current CEO and the current American president.

Intel Backwardness Industry leaders such as the semiconductor manufacturer in Taiwan (TSMC), Samsung and Nvidia, whose chips have been specially designed to the mutation of artificial intelligence that swept the world over the past few years. Intel has lost more than half of its value in the past five years, and Gelsiner, who seized the company as an executive president in 2021 to try to operate it. It is said He was forced to retire early last December.

Tan, an old warrior in the semiconductor industry Leave the Intel panel Months before Gelsiner stepped down, it was exploited last March to replace it and lead a transformation on its own. In the July Memorandum of Employees, Tan He said The company plans to reduce global workforce by 25,000 employees this year.

Trump said on Monday: “He came under a little cloud,” Trump said on Monday. “With a company like Intel – as you know, I have difficulty – I want them to do well. I want them to do a good job anyway, but I want them to do a good job in particular now.”

Despite the Intel struggles, although the company is still a market value of more than $ 100 billion and is important for Trump’s goal of stimulating the manufacture of American conductors. “I think the government really hopes that if an American company will make pioneering chips, it will be Intel,” Nicak Nicakht, a partner at the Lawyer Office, Wale Ryan, who worked in the Ministry of Commerce during the first Trump administration, said.

Will Trump’s deal actually solve Intel problems?

It is not clear whether the last deal will activate Intel. Trump also alluded to himself, the United States government does not pump additional money in the company, exceeding what the Biden administration has already promised.

“I don’t think it is a rescue plan,” he said Sarah Bourle Danzman, a professor at Indiana Bloomington and his non -resident colleague in the Atlantic Council. “Yes, Intel faces problems, but it does not give Intel a large injection of money … There is a feeling that this may mean that in the future, the US government will do so. But nothing we have seen guarantees this.”

There is also an opportunity to end the deal by hurting Intel, as the company itself was placed in an update Organizational deposit. The file said that Trump’s decision that the United States will become the largest contributor to Intel could limit the company’s ability to secure future government grants (or force it to give up more shares for these grants). The company said that the ownership of the United States government for Intel could also constitute regulatory issues to deal with other governments, noting that 76 percent of its sales came from outside the United States.

So why is Trump this?

Cutting deals with private companies for government intervention was a feature of Trump’s second term, as administration officials argue that the United States government needs to obtain a greater return on its investments in taxpayers dollars. It is the same motivation that prompted Trump to order the United States Sovereign wealth fund Early his mandate (although this has not been achieved yet).

Trump has been drifting to the state’s capital as an economic policy in recent weeks, as a deal for the Pentagon to obtain a 15 -percent stake in MATERIALS, a rare mining company, in addition to taking the so -called “golden share” for itself in person in the United States as part of the acquisition by the Japanese Nippon Steel.

The Intel deal is also considered Trump’s second attempt for several weeks to direct more revenues towards the United States government of semiconductors, an important and strategic industry that Trump and Biden realized that it is vital to winning major technology competition with China. In the middle of August, Trump concluded a deal with NVIDIA and AMD to allow them to sell semiconductors to China, which was previously banned, in exchange for 15 percent of all Chinese sales.

“I think the United States government is very cautious – especially in the semiconductor sector – to provide prizes and then companies are not able to implement, and the delivery of taxpayers of taxpayers ends.” “At the same time, [the Intel deal] Unprecedented. “

Bauerle Danzman assumed a more clear explanation: Trump takes the share of an American government in Intel just because he can. She said: “The tools used are different, but the general view of the presidential authority and what he is trying to do is similar, which is that he looks at the position of the president, and thus the position of the US government, in exchange for these companies is very strong.” “Since these companies need the approval of the US President in order to be able to continue to work the way they want to run, and therefore he is seen as the ability to lead those who take it.”

Trump himself gave credibility to that argument. He said on Monday: “I want to try to get as much as possible,” he said on Monday. “If people come and need something – for example, as a real estate person, if I have an agreement and I have any form of stopping, where I can prevent someone from doing something, right?

Is this legal?

This is not clear. congress controls government wallet chains, and any spending will need congressional approval. The chips law, according to which grants were disbursed to Intel, have already been approved by Congress, but the law does not explicitly express these grants in the share of property rights.

“Nichekht, who indicated that the government rescue of the car manufacturers of GM and Kirisler during the 2008 financial crisis was punished for one of the 2008 financial crisis in 2008, which indicated that the government rescue of the auto industry companies struggled with by General Motors and Kursler during the 2008 financial crisis during the financial crisis of 2008 Foundation To prevent them from collapsing. “The constitution appears to indicate that it is only allowed when Congress allows this,” she added.

Trump presented a window in his thinking on this question on Monday, although this is in the context of his desire to rename the Ministry of Defense to the Ministry of War and the approval of the Congress required to do so. “We’ll only do that, I’m sure that Congress will go in full swing,” Trump He said.

As for the Intel deal, Trump also indicated that it is unlikely to be his last nature. “Now in the case of Intel was interesting, but I hope I have many cases like it,” he said.