Pentagon is 'thinking' about taking equity stakes in defense contractors

cnbc.com

8 points·belter··4 comments

This is starting to get real concerning. All our largest companies are going to have gov ownership now?

Big Tech wouldn’t confront the bully and sat behind him at the inauguration. That cowardice will cost Azure and AWS a stake in their company.

So from Trump's point of view, he thinks the government should get a piece of companies that rely on government money. Ok. I can understand.

From a market/capitalism point of view, there will always be a conflict of interest. The US government would be biased in awarding contracts to companies it owns even if competitors offers are better.

The thing that drives me nuts is that this is extremely similar to a corporate tax. By itself this is fine - I actually favor corporate taxes in at least some situations. The problems are:

- It is being imposed at least semi arbitrarily, which is obviously a massive corruption risk. You point out part of the risk, but there are other parts too.

- This administration both ran and executed on corporate tax cuts. Backdoor re-introducing a very similar thing does not give confidence.

If the policy was to take a stake in the S&P 500 or something, and it was not implemented by an administration that is otherwise leaning into corporate tax cuts, I would be basically fine with it.

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