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The Trump administration has accepted direct share of companies in scale, rarely meeting the US outside the military time or economic crisis, pushing the Republican Party, which traditionally advocated the capitalism of the free market to accept state intervention in the fields that are regarded as important for national security.
Japanese Nippon Steel has agreed to give President Donald Trump “Golden Fate” in the United States as a condition for a contradiction of two companies. Now Trump personally owns I swept the veto over the main business decisions made in the country The third largest manufacturer became.
“Do you know who has a golden fate?
The US president’s golden share in the United States is similar to the nationalization of the company, but without any advantages that the company usually gets, for example, direct investment from the government, said Sarah Bauerle Dansman, foreign investment expert and national security in the Atlantic Council, an analytical center focused on international affairs.
But the Trump administration demonstrated earlier this month, which is also ready to buy directly in the trading corporation. The Defense Ministry has agreed to purchase 400 million shares of stock In the rare ground miners MP’s materialBy making the Pentagon the largest shareholder of the company.
This level of support for the federal government for the mining campaign is unprecedented, said Grekelin Basqueran, expert on critical minerals of the Center for Strategic and International Studies.
“This is the largest private cooperation that has ever been in the United States in the US,” Basqueran said. “Historically, DOD never made justice in a mining company or a mining project.”
Danzman said the unique maintenance of Trump over the Republican Party gives him the opportunity to intervene in campaigns that will be politically difficult for a democratic president.
“The Democrat would have been accused of communists and many other Republicans would probably not felt comfortable, moving in this particular direction because of greater commitment to market principles,” the Danzman said. Trump expands the range of what is possible in the US in terms of state intervention on the markets, she said.
The White House did not immediately respond to a comment request.
More state investment, probable
More interventions can be on the horizon, as the Trump administration is developing a policy on supporting US companies in strategic fields against state competition from China.
Secretary of Internal Affairs Doug Burgum – said in April In order for the US government to need to make “capital investments in each of these companies receiving China in critical minerals.” Pentagon investments in MP is a model for future state-owned partnerships, said James Litinsky CEO.
“This is a new way to accelerate free markets to get the supply chain to the shore we want,” said the CNBC Litinsky. The US government helps the mining industry fighting “Chinese mercantilism,” the CEO said.
Meanwhile, the “golden share in the United States” is a potential model of foreign transactions “that really affect our national security, but where it will be great for our economic growth,” said Senator Dave McCormik, PA.
“Having made a share in the American steel and a deputy, we now wondered where this administration would find its following investments,” wrote Don Belson, analyst Gordon Khasket, wrote in the note to customers earlier this month.
Trump suggested in January what the US should Take 50% stock In addition to social media Tiktok as part of a joint venture. Chinese see forbidden in the US Trump has extended the byte execution until September 17.
Past precedent
The US has a long-standing history of interference in industry, especially in the national defense, said Mark Wilson, a historian from the University of North Carolina, who studies the military-industrial complex.
But past interventions were often temporary and usually occurred during the war, the economic crisis, or took the rescue form to prevent a bankrupt participant in the critical field.
US Government bought most General Motors shares to prevent the authentic destruction as a result of the 2008 financial crisis By selling your shares With the loss of the taxpayer. In the 1970s, the Lokhid Defense Giant and the Krydler carmaker received government salvation.
During World War I President Wood Wilson nationalized by railBut he returned them to private property after the conflict. Roosevelt’s administration has made extensive events during the Great Depression and World War II to establish Tennessee Power Make great investment in the country’s production capacity.
China emerges great
The United States is not fighting the economic crisis or war today, but the return of great competition with Russia and China and the Povid-19 Pandemic supply chains has led to a more nationalist economic policy, Wilson UNC said.
The United States has increasingly acknowledged that China’s economic model is based on a production exceeding product “to world markets that make it difficult to compete in other markets,” Danzman said.
Basqueran, who threatened the domination in China in a rare earth supply chain, became apparent when Beijing imposed restrictions on export against the United States, Basquera said. For a few weeks, automakers have warned that they would have to stop production due to a rare deficit, forcing the US to return to the dining talks with Beijing, she said.
“The historical moment when we are, it seems the one where there is such a reassessment of the previous generation of markets and free trade to solve all our national security problems,” Wilson said.
The question is whether the state’s interference can resolve the inability of the free market to solve national security problems in areas such as rare land, Danzman said.
“If you come up to try to solve one of these failures on the market with such a government intervention, you can have a cascade of new setbacks on the market,” she said. “You’re more distorted by the market.”
