The Trump administration has been quietly building quite the investment portfolio. Over the past six months, the government has poured more than $10 billion of taxpayer money into private companies, taking minority equity stakes in at least nine firms deemed essential to national security.

Following the Money

According to The New York Times, these investments span strategic sectors including steel, minerals, nuclear energy, and semiconductors. The driving force? National security concerns and a push to reduce America's dependence on foreign nations, particularly China, for critical resources.

The government isn't just writing checks either. Its growing portfolio includes options to acquire additional stakes down the line. Some officials are betting these equity positions will eventually deliver returns for taxpayers, though that outcome is far from guaranteed. Many of these companies are currently struggling financially, and profitability could be years away if it arrives at all.

Breaking with Tradition

This strategy represents a dramatic shift from previous Republican orthodoxy, which typically trusted free markets to pick winners and losers. Taking equity stakes in private companies is exceptionally rare for the U.S. government, and the approach has triggered concerns about transparency, potential favoritism, corruption, market distortions, and the risk of taxpayer losses if these bets go south.

The administration isn't backing down, though. White House spokesman Kush Desai defended the strategy, arguing that targeted equity stakes ensure taxpayers get a fair deal while encouraging additional private sector investment.

Interestingly, this more interventionist approach has gained bipartisan traction among officials worried about China's dominance in strategic industries. Sometimes national security concerns make for strange bedfellows in economic policy.