D. Trump's State-Monopoly Capitalism

Soviet political economy of the 1960s and 70s contributed to Marxist economic theory and Leninist theory of imperialism by developing a profound and in its own way beautiful theory of state-monopoly capitalism (SMC). Hundreds of monographs and thousands of articles exposed the essence of SMC as a mechanism for intertwining the interests and tools of domination of the exploitative bourgeoisie and the top state bureaucracy. Irrefutable facts were presented and logical concepts were built, recalling Lenin's journalistic articles of 1916-17, where this issue of the link between the state and capitalists was excellently described using the material of the First World War.

One of the manifestations of SMC has always been state ownership (full, but more often partial) of corporate assets producing goods and services for private purposes. For example, the French Renault, nationalized after the war, still retains, albeit a decreasing one year by year, a state share in its share capital.

However, in the 1980s, with the advent of neoconservative and neoliberal forces, obsessed with the values of economic freedom and small government, a series of privatizations was carried out and the state's share in the capital of European companies was significantly reduced. The theory of SMC in the USSR ceased to receive nourishing juices, and by the beginning of the 1990s, when neoliberal hysteria seized Russia, it became downright indecent to remember this section of Soviet political economy.

Well, the United States, unlike Europe, never thought about increasing and subsequently deflating the state's share in the business sector – it has always been minimally stable or practically absent there, even in the military industry. All leading military-industrial and aerospace concerns were built on private investment. True, after the end of the Second World War, they got the opportunity to receive for free the production facilities built at state expense during the war period. Well, let's not notice this trifle, detailed in S.A. Dalin's book "Military-State Monopoly Capitalism in the USA" from 1961. And we haven't heard about the famous farewell speech of the same year by President D. Eisenhower, in which he warned about the formation in the USA of a sinister force in the form of a military-industrial complex as an alliance of corporations, the military, and congressmen, i.e., a typical SMC. And we have already forgotten such high-profile cases as in 1979 when Washington saved Chrysler Corp., a Detroit automaker, from collapse by providing it with a huge package of loan guarantees worth $1.5 billion USD, and when in 2009, immediately after the Great Recession, the federal government provided loan guarantees to General Motors Co. and Ford Motor Co. to support the other two members of the so-called "Big Three" American automakers, receiving a portion of the companies' stock packages as collateral for a time. Let's assume that the USA, as a model of the most liberal capitalism under the banners of Friedman and Hayek, never engaged in such a shameful act from the point of view of market orthodoxy as the nationalization of private capital.

The return of the "tall blond" to power in the US was accompanied by expectations of a further weakening of the state's role in the economy after the left-liberal experiments in state interventionism by J. Biden. Especially since Trump "rode" on his anti-state, anti-bureaucratic rhetoric during the election campaign and began his second term with a demonstrative dispersal and reduction of some government departments! Many analysts have already "nailed" Trumponomics 2.0 to ordinary Reaganomics, comparing the rhetoric and deregulation practices of both prominent presidents.

However, hello!? What has been happening in Washington in recent weeks!? Has President Trump been replaced by a double with socialist beliefs? He began to carry out the nationalization (!!!) of American powerful private corporations with deep traditions.

It started in early August when the Trump administration demanded that Nvidia and AMD – two perfect examples of the private entrepreneurial innovation sector - pay the federal government 15 percent of their income from sales to China to obtain export licenses. The administration found another way to extract financial benefits by imposing restrictions on electronics trade, after the "war" of tariffs it unleashed. The ban on supplies to China of H20 accelerators was introduced by Donald Trump almost immediately after his inauguration in January 2025. The H20 is Nvidia's latest AI accelerator, production of which began in 2024. The Trump administration banned AMD in April 2025 from selling an AI chip called the MI308 to China. These restrictions were explained by fears that the technology could be used to close the gap between the US and China in artificial intelligence development. In July 2025, US authorities declared a softening of trade restrictions and permission to supply computing accelerators to entities from China, but since then have virtually not issued licenses making these sales possible. The "15%" deal was made a month after Nvidia again received permission to sell a version of its H20 AI chips in China.

Well, okay, this tribute on technology companies is not yet systemic SMC. But the story with Intel fits perfectly into the concept of Soviet political economy from 60 years ago! At the end of August, news appeared that the US Government is investing $8.9 billion in Intel common stock, which will give the Trump administration approximately a 10% stake in the struggling chipmaker. The government is acquiring 433.3 million shares at $20.47 per share, representing 9.9% of the company's shares.

"I am greatly honored to announce that the United States of America is now the full owner and in control of 10% of INTEL, a great American Company with an even more incredible future," Trump wrote in a Truth Social post on Friday.

But the most delightful charm of this new American SMC is that Intel will receive these billions not as additional investment from the government (which has always been the most common practice), but as a condition for releasing $5.7 billion from the CHIPS Act and the Science Act and $3.2 billion from the Department of Defense. That is, this money was already supposed to go to the corporation through established regulatory channels, but Trump stalled this process and in a "hop-stop" mode got a hefty share of the pie for money that had already been promised earlier! Ostap Bender would say about this: "Learn! This guy knows how to work. And he knows 300 relatively honest ways to take money"!

Although Intel was once one of America's most important technology companies, it has fallen behind competitors by failing to anticipate subsequent technological waves. In March, a new CEO came to Intel and is trying to lead the company out of the crisis. Last month, Intel said it had nearly completed plans to lay off 15% of its employees as part of efforts to restore the company.

Three days after the United States agreed to acquire a stake in chipmaker Intel, President Trump on Monday signaled he would make similar investments in other large companies, describing his new economic strategy as an attempt to "get as much as we can." Mr. Trump's promise highlighted a substantial and potentially risky shift in the relationship between government and private business. And his faithful courtier and "oprichnik", known as the chief ideologist of tariff increases, Commerce Secretary Howard Lutnick even floated the idea of acquiring stakes in defense contractors like LockheedMartin because they are "essentially weapons of the US government."

The deal has also alarmed Intel's competitors, who wonder if they will be next. The Trump administration is already pressuring companies, demanding they increase investments in the US to receive funds under the CHIPS Act promised to them under Biden, suspending grant payments pending a review of the program. In recent months, Taiwan Semiconductor Manufacturing Company and Micron have announced plans to increase investments in the US, although critics say some of these plans are already in the works or may never materialize.

Proponents of deeply rooted American traditions of private enterprise fear the government will start looking for leverage over companies simply to secure concessions. Political priorities could outweigh sound business sense. This means pressure to keep an unprofactory plant open in a swing state or to align corporate strategy with whatever social policy goals the incumbent administration wants to promote. Companies, in turn, will resist even beneficial rules, fearing becoming a bargaining chip. Many Republicans criticized the Biden administration for linking CHIPS Act funding to childcare or union labor requirements. But this new and much more "socialist" approach by Trump opens the door for even greater politicization of private enterprise.

Some conservative economists found these actions by Trump both strange and problematic. A whole generation of Republicans preached the idea that the state should not interfere with the free market and put taxpayer money on winners and losers — and yet the president himself seems to have acknowledged his tactic as a new form of industrial policy.

"I think what we're seeing is less a strategic, thoughtful move toward state capitalism and more an opportunistic demonstration of corporate shakedown," said Michael R. Strain, an economist at the conservative American Enterprise Institute. "In any case, it creates significant risks for the companies making these deals and for the long-term well-being of the American people." By the way, Strain almost spoke in the language of Soviet political economists about state capitalism and SMC.

However, the well-known American democratic socialist Bernie Sanders, who usually sharply criticizes Trump, welcomed the president's partnership with Intel. "I am glad that the Trump administration agrees with the amendment to the CHIPS Act that I proposed three years ago," Sanders said. "Taxpayers should not be handing out billions of dollars in corporate welfare to large and profitable corporations like Intel without getting anything in return."

Trump's pro-socialist vector was also noticed by us in the example of state regulation of the pharmaceutical industry.

Well, if we abstract from hasty ideological cliches accusing Trump of socialism – what are the deeper reasons for Trump's nationalization?

The most accessible version is the implementation of the long-standing idea of Republican activists that power should run the federal government like a business. In this regard, for them, Trump's "pressure" on corporate America is a normal process of "making deals," which corresponds to managing Washington like a business.

But there is a deeper version that within the Republican Party (and therefore among the real masters of America) there are serious forces that want to abandon the old conservative strategy of market thinking. These "conservatives of state power" believe that the old ways of interaction between corporations and the government and state policy have failed America for decades, and therefore power must be open to new approaches. There is reason to believe that these new approaches involve using state power to "achieve conservative goals," which are currently defined by the desires of Trump and his secret powerful masters. Trump, enjoying the influence he has been able to exert on American corporations and the titans of industry who manage them, does not bother to downplay or soften his intervention in the supposedly free market economy of the United States.

In other words, the new world economic and technological order dictates new "mobilization," regulatory, and completely "non-market" rules. Trump currently believes that through such mobilization he can stop China's victorious technological march! But at the same time, quietly, it's possible to engage in non-market redistribution of property from one corporate clans to others.

But most of all, the army of American academic intellectuals, sitting in universities and research centers, who have absorbed the sacred covenants of a free market economy with their mother's milk, is confused! Well, okay, economics does not and cannot by definition have answers to the questions of Trump's "socialism," since it is constrained by unimaginable ontological limitations. But even more "humanitarian" specialists like University of Cincinnati Law School professor Joseph P. Tomain, co-author of the book "How Government Built America," which showed that the Federal government has a long history of providing subsidies, grants, tax breaks, and other forms of benefits and assistance to privileged sectors of private business through laws approved by Congress and signed by the president, throw up their hands at Trump's initiatives and believe it completely contradicts any market thinking.