US government takes a 10% stake in Intel

[sc94597]

sundin13 said:

sc94597 said:

Eh, the only recent example I can think of is creating the New GM (and owning large shares in it for like three years), and that probably was the right decision on net (which is why the Canadian and American governments did it jointly.) It saved jobs, pensions, and the U.S government barely took a loss (far less than the social costs would've been to let Old GM go without a replacement.) 

My primary contention with the GM deal wasn't that we bailed them out, it was that we didn't extract much out of the deal beyond the inherent benefits of strong businesses. I think it makes sense in certain circumstances to support businesses in this manner but unless there is revenue generation (which, like you said, that deal seemed to be a net loss in terms of revenue), we should really be able to extract more concessions from these companies. 

If the government kept its shares more than the period of the recession, they'd have ended up about neutral. Worse than the S&P 500 (which yes, is an opportunity cost) but better than inflation. 

Most examples of long-term public or mixed ownership bring in decent profits. We see this with the various natural resource funds at the state-level (which fund schools or in the case of Alaska put money back into people's pockets), but also full blown SOEs like the Tennessee Valley Authority. 

If profiting is the main concern though, most of the 2008-era investments in the banks brought back profits. The government is still making a profit on Fannie Mae for example. They made basically $300 Billion since 2008 vs. $187 Billion injected in 2008. Hell, the Fannie/Freddie Mac existence in general was a New Deal success. I'd of course prefer full public ownership, but mixed ownership has shown to work pretty well too, and if the goal is public accountability both are better than full private. 

Last edited by sc94597 - on 27 August 2025