Intel investment under fire—US officials respond originally appeared on TheStreet.
Intel has been on the hot seat with Washington, D.C., over concerns that it may be slow-walking semiconductor manufacturing plans following a shakeup that removed former CEO Pat Gelsinger and installed current CEO (and former Board of Directors member) Lip-Bu Tan earlier this year.
The worries came to a boiling point in early August when President Trump suggested Lip-Bu Tan was “highly CONFLICTED,” suggesting he should resign after Arkansas Senator Tom Cotton questioned Tan’s ties to Chinese chipmakers, including investments.
The situation was heated enough that Tan boarded a plane only days later to meet with President Trump face-to-face on August 11. This meeting has since led to the possibility that the US may take an ownership stake in Intel (INTC) , an idea that’s sparked concerns that US investments may translate into corporate favoritism.
This week, Treasury Secretary Scott Bessent, a former hedge fund manager who trained under legendary stock picker Stanley Druckenmiller, pushed back on those worries.
President Trump has previously discussed the potential for the US to create a sovereign wealth fund to profit from US business investments similar to those of other countries, including Saudi Arabia.
He’s already created a Strategic Bitcoin Reserve and a U.S. Digital Asset Stockpile funded by seized or forfeited cryptocurrency.
Related: Lip-Bu Tan’s net worth: The Intel CEO’s wealth after White House visit
The idea has drawn praise for its potential to provide a return on government dollars given to companies via grants, and concern over whether it could create an unlevel playing field for rivals.
Secretary Bessent attempted to alleviate some of those concerns in a CNBC interview on August 19.
“The last thing we are going to try and do is take a stake and then try to drum up business,” said Bessent. “There is no talk of trying to force companies to buy from Intel.”
Bessent argued that providing financial stability to Intel, and perhaps other companies in the future, is a matter of national security.
In recent years, the US government has paid significant attention to the high-tech industry over the risks associated with selling next-gen technology to countries, including China, which could potentially use that technology against us.
For instance, earlier this year, Nvidia and AMD faced additional restrictions limiting the sale of artificial intelligence chips to China, resulting in steep write-offs. Last month, those semiconductor companies agreed to share 15% of their China revenue on those chips with the U.S. in exchange for new export licenses.
