Top officials at the Pentagon are “thinking about” whether the U.S. should acquire equity stakes in leading defense contractors such as Lockheed Martin, Commerce Secretary Howard Lutnick said Tuesday.
The Cabinet secretary, in an interview on CNBC’s “Squawk Box,” revealed the Defense Department’s interest in taking those stakes days after the U.S. government acquired 10% of Intel stock in a roughly $9 billion deal.
Lutnick was asked if the Trump administration would repeat that move with other companies that do business with the government.
“Oh there’s a monstrous discussion about defense,” Lutnick replied.
Lockheed, which makes most of its revenue from federal contracts, is “basically an arm of the U.S. government,” he said.
“But what’s the economics of that? I’m going to leave that to my Secretary of Defense and the deputy Secretary of Defense.”
“These guys are on it and they’re thinking about it,” he said.
Lutnick added that President Donald Trump is rethinking how the U.S. ought to finance its munitions and other defense capabilities.
“I tell you, the way it has been done has been a giveaway,” Lutnick claimed. His remark could suggest that the Trump administration is considering a major overhaul of Pentagon appropriations, which are approved annually by Congress.
A Lockheed spokesperson told CNBC in a statement, “As we did in his first term, we are continuing our strong working relationship with President Trump and his Administration to strengthen our national defense.”
The Pentagon did not immediately respond to CNBC’s request for comment.
Lockheed is the world’s top defense company by revenue, according to DefenseNews’ 2024 list. Other top U.S. contractors include RTX, Northrop Grumman, General Dynamics and Boeing.
Trump’s move to take ownership of a chunk of Intel, an embattled chipmaker, is a major escalation in his efforts to achieve his economic goals by exerting more and more government control over the private economy.
Trump said Monday that he would make similar deals “all day long.”
Lutnick said Friday that the agreement Trump struck with Intel CEO Lip-Bu Tan “strengthens U.S. leadership in semiconductors, which will both grow our economy and help secure America’s technological edge.”
But the move has drawn heated criticism — including from some conservatives, who warn that Trump’s action cuts against free-market principles and poses risks for both Intel and the economy.
“The most immediate risk is that Intel’s decisions will increasingly be driven by political rather than commercial considerations,” economist Scott Lincicome of the libertarian Cato Institute wrote in a Washington Post op-ed.
Sen. Rand Paul, R-Ky., wrote in an X post, “If socialism is government owning the means of production, wouldn’t the government owning part of Intel be a step toward socialism?”
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