WASHINGTON (Reuters) – In a rare show of alignment, progressive U.S. Senator Bernie Sanders on Wednesday endorsed President Donald Trump’s proposal to convert federal grants for chipmakers into government ownership stakes, signaling bipartisan momentum behind a dramatic shift in U.S. industrial policy.
“If microchip companies make a profit from the generous grants they receive from the federal government, the taxpayers of America have a right to a reasonable return on that investment,” Sanders, an Independent from Vermont who caucuses with Democrats, told Reuters in a statement.
At the heart of the debate is Intel, which has been promised $10.9 billion under the 2022 Chips and Science Act, a $39 billion program designed to boost U.S. semiconductor manufacturing and reduce reliance on Asia. But Commerce Secretary Howard Lutnick is now examining whether those grants should be tied to government equity stakes, particularly in struggling firms such as Intel, according to sources familiar with the discussions. Trump administration officials have framed the approach as demanding “equity for investments.”
Sanders’ support marks an unusual ideological convergence with Trump, who has increasingly embraced direct state intervention in key industries during his second term—policies more commonly associated with the left. Trump has already pursued arrangements in which the federal government takes revenue shares or equity positions in private-sector deals:
- Earlier this year, the administration allowed Nvidia and AMD to continue selling AI chips to China in exchange for the U.S. government receiving 15% of revenues from those sales.
- The Pentagon is poised to become the largest shareholder in a small mining company to secure supply of rare earth magnets critical to defense production.
- The administration negotiated a “golden share”—a single equity stake carrying veto power—as part of a controversial deal allowing Nippon Steel to acquire U.S. Steel.
Sanders has consistently opposed what he calls “corporate welfare” for large, profitable firms. Alongside Democratic Senator Elizabeth Warren, he previously introduced an amendment to the Chips Act that would have barred the Commerce Department from awarding subsidies without the Treasury receiving a warrant, equity stake, or senior debt instrument from recipient companies.
“I am glad the Trump administration is in agreement with the amendment I offered three years ago,” Sanders said Wednesday. “Taxpayers should not be providing billions of dollars in corporate welfare to large, profitable corporations like Intel without getting anything in return.”
The outcome of the administration’s review could reshape how billions in pending Chips Act subsidies are distributed. Major beneficiaries—Intel, Micron, Taiwan Semiconductor Manufacturing Co. (TSMC), and Samsung—have yet to receive much of their allocated funding. Tying disbursements to government ownership or warrants would represent a major departure from traditional U.S. industrial policy, putting Washington more directly in partnership with companies at the center of the global semiconductor race.
The push reflects growing consensus across the political spectrum that taxpayer dollars used to bolster strategic industries should come with strings attached. Whether Sanders’ progressive economic stance and Trump’s populist interventionism can translate into durable policy remains to be seen—but for now, both are pushing in the same direction.
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