The power of the golden share

When President Trump approved the merger between Nippon Steel and U.S. Steel he demanded a so-called “golden share.” It gives the White House a say in key business decisions.

So, what happens when the White House controls a private industry?

Todd Tucker, director of the industrial policy and trade program at the Roosevelt Institute think tank. Senior research fellow at Harvard Kennedy School.

Fabio Bulfone, assistant professor at Leiden University in the Netherlands.

Part I

MEGHNA CHAKRABARTI: Today we're going to talk about steel.

DONALD TRUMP: The largest investment of any kind in the history of the Commonwealth of Pennsylvania. And we also will be the largest investment in the history of American steel industry. There's never been a $14 billion investment in the history of the steel industry in the United States of America.

CHAKRABARTI: President Donald Trump on May 30th, he was at U.S. Steel's Irvin Works facility in West Mifflin, Pennsylvania, announcing the buyout of U.S. Steel by Japan's Nippon Steel. The buyout first announced on December 18th, 2023, was finalized this year on June 18th.

TRUMP: This is an incredible deal for American steel workers and it includes vital protections to ensure that all steel workers will keep their jobs and all facilities in the United States will remain open and thriving.

CHAKRABARTI: Okay. So it's a historic and very big deal. And when I say we're going to talk about steel, what I really mean is we're going to talk about steel industry socialism.

Let's start with the classical definition of socialism as found in the American Heritage Dictionary, which includes, quote: The stage in Marxist Leninist theory between capitalism and communism, in which the means of production are collectively owned, but a completely classless society has not yet been achieved. End quote.

ZOHRAN MAMDANI: It's not simply to raise class consciousness, but to win socialism. And obviously raising class consciousness is a critical part of that, and we have to ensure that we are unapologetic about our socialism, right? Or whether it's the end goal of seizing the means of production.

CHAKRABARTI: That is Zohran Mamdani, self-identified Democratic socialist and recent winner of the Democratic primary in New York City's mayoral race.

The clip there is from a live stream he did back in 2021, and that idea of seizing the means of production it sends waves of panic through Democratic party strategists and frissons of glee through Republican strategists because it's instant red meat for President Donald Trump.

TRUMP: Generations of Americans before us did not shed their blood only so that we could surrender our country to Marxist lunatics on the eve of our 250th year. As president of the United States, I'm proclaiming here and now that America is never going to be communist in any way, shape, form --

CHAKRABARTI: That was the president just a couple of days ago, and we're not gonna harp on the fact that Trump elides socialism and full-blown communism there, because that's not really the point. He is on the record hundreds if not thousands of times, decrying socialism specifically.

Here he is way back in 2019 at the United Nations General Assembly where Trump declared socialism, the quote, wrecker of nations and destroyers of society.

TRUMP: Today I repeat a message for the world that I have delivered at home. America will never be a socialist country.

CHAKRABARTI: So pretty standard fare these days, but that's exactly why Trump's recent approval of the U.S. Steel-Nippon Steel deal is so interesting. In the executive order, allowing the deal to go through, Trump included something called the golden share. As he explained on June 13th:

TRUMP: And we have a golden stock. We have a golden share. Which I control or president controls. Now I'm a little concerned whoever the president might be, but that gives you total control. It's 51% ownership by Americans.

CHAKRABARTI: 51% ownership by Americans.

Hang on. Isn't that at least a little bit seizing the means of production? U.S. Steel was created in 1901 by J.P. Morgan, a titan of American capitalism, and as a private company, it was one of the world's largest steel makers. Now it's been bought out by a Japanese steel company, but the American people, or more specifically President Trump, have some kind of control over it. That's why I'm asking this question.

Is this steel industry socialism? Did Donald Trump somehow nationalize U.S. Steel? What exactly is the golden share? Todd Tucker joins us today to help us, or piece all those questions out. He's the Director of Industrial Policy and the trade program at the Roosevelt Institute, it's a think tank.

He's also a senior research fellow at Harvard's Kennedy School of Government. Todd Tucker, welcome to On Point.

TODD TUCKER: Thanks. Thanks so much for having me. Good to be with you.

CHAKRABARTI: It's really great to have you. Let me just let you answer my very blunt question here. Did the executive order allowing the takeover of Nippon Steel of U.S. Steel, does it constitute a form of steel industry socialism in your mind?

TUCKER: No, it's certainly a step in that direction. But it's a very partial step in the grand scheme of things. What this deal will allow for is for the government to have a consultation and a veto right on certain major corporate decisions. But the ownership of the company is going to remain in private hands, and that's a key distinction from more traditional definitions of socialism, which would say that the government needs to not only control the company, but also own it and have all the proceeds go back into the public coffers.

And by that standard, we're still a far cry from socialism and even from some of the arrangements of steel companies around the world with respect to their own home governments.

CHAKRABARTI: Okay. I will note that in the opinion pages of the Wall Street Journal there's quite a bit of a disagreement with you on that. They're talking about this being the nationalization of U.S. Steel. We'll get to that in a minute, but let's get some background together, Todd, about how and why this deal even took place.

What was the financial condition of U.S. Steel when Nippon Steel showed some interest in buying it out?

TUCKER: U.S. Steel and other U.S. steel companies have been going through a very difficult patch for decades now. Especially with China acceding to the World Trade Organization in 2001 that led to several decades of severe over capacity problems in global steel markets, which just meant that China was dumping a lot of low-cost steel and bringing down the price of steel sold around the world. U.S. Steel and other steel companies had been in a difficult competitive position for a while.

And then, shortly before COVID happened, U.S. Steel decided to branch out of its historic business, which as you pointed out, since the early 1900s, U.S. Steel has been synonymous with what's called primary steel, which is the toughest form of steel, most carbon intensive, but also very sturdy and also employs a lot of union workers.

And so since that time, U.S. Steel had been diversifying into what's called recycled steel which tends to be non-union. Tends to be in the U.S. South and lower carbon emissions at the same time. So the labor union United Steel Workers that plays a such a big role in the governance of this industry had been concerned with a series of broken promises over a number of years from U.S. Steel.

And so they had been during the Biden administration pressuring Biden to block the merger between Nippon Steel and U.S. Steel and were successful. This was Biden's, one of his last actions in office, in January of this year of 2025, was to block the merger of the two companies, citing national security and economic security concerns.

And Trump had also--

CHAKRABARTI: Can I just jump in there, Todd, because this is really an important point. As you noted, here's something a little, at least a quote from what President Biden said in January. As you noted, he said, quote: We need major U.S. companies representing the major share of us deal making capacity to keep leading the fight on behalf of America's national interests.

And then he went on and said that it's important that we maintain strong American steel powered by American steel workers. And at that time, I think you were getting to the point that Donald Trump, who's then president-elect also, he actually agreed with Biden on this, that he did not think that Japanese ownership of U.S. Steel was a good idea.

TUCKER: Yeah, that's right. Between Biden, Kamala Harris and Donald Trump, there was the exact same position, which was the same position that the United Steel workers had, which is that U.S. Steel should remain domestically owned and operated.

And, fast forward, into Trump presidency the second time around, he goes a 180 on that. And says, we will allow a foreign company to acquire this sensitive national asset. And then, the sort of guardrail that we're going to put in place is this thing, idea called the golden share, which requires the company to check with us before making major business decisions.

CHAKRABARTI: Okay. So let's, once again, I'm just gonna quote what President Trump said before he changed his mind on this takeover. So this was back in December of 2024 on his Truth Social platform. He put a post out that said quote, I am totally against the once great and powerful U.S. Steel being bought by a foreign company.

And he said, as president, I will block this deal from happening. Buyer beware. End quote. What changed Trump's mind, because was it that Nippon Steel said we want this deal to go through, so we're gonna sweeten the deal a little bit. What exactly happened there? We just got about a minute before our first break, Todd.

TUCKER: Yeah. Nippon agreed to over $10 billion in additional investments that would go to about half dozen facilities across the country. They agreed if they deviate from that investment, they're not allowed to deviate from that investment without approval of treasury and commerce departments of the U.S.

And I think that also just Trump is a transactional guy and he realized that this would look good to be able to seal a major deal in politically key states like Pennsylvania as one of his first acts in office. And with some investments going in and surging into Pennsylvania in 2028 when, he or his successor will be running. So I think the sort of the political Trump kicked in and he went back on his promise.

CHAKRABARTI: Oh, that's interesting. And I'll also note that the Committee on Foreign Investment in the United States, CFIUS, they actually never reached a consensus about whether a Japanese takeover of U.S. Steel would represent a true national security risk, even though that was something that both the Biden administration and initially the Trump administration talked about.

Part II

CHAKRABARTI: Todd, let's talk more about specifically what this golden share would allow the Trump administration, or actually I should be precise, Donald Trump, to do. Things like he could prevent the relocation of U.S. Steel's headquarters from if they wanted to move outside of Pittsburgh, it would allow the President to stop the changing of the name of U.S. Steel.

And then interestingly have an impact on the $14 billion of near-term investments into U.S. Steel, promised by Nippon Steel. So taken as a whole, is this, does this constitute some kind of significant control over company operations, Todd?

TUCKER: Yes, it constitutes certainly key control over some of the major decisions that the firm could do, not necessarily the day-to-day business decisions of the company, but the major ones, like offshoring of production or changing of the investment schedule or changing the business model or the specific products that they make.

The treasury, Trump himself while he's in office, and that's an important thing to note. The control goes to Trump as a person while he's president, and then after that, it reverts to the Treasury and Commerce Department in future administrations.

But this will require that this new, merged company between U.S. Steel and Nippon really seek preapproval from the government before they do anything major, including something like going against Trump's trade policies. They have to coordinate their position and litigation strategies around trade to be in accordance with Trump's wishes. So it's a significant expansion of control over the company.

CHAKRABARTI: Can we talk more about the fact that it's specific to Donald Trump? Because I'm so glad you brought up that point. Because the White House is trying to dance around their own language here. I'm seeing a report from the Associated Press from just a couple of weeks ago, June 25th. And the White House, they'd asked the White House about why is the language specific to Donald Trump.

And the White House responded in a statement saying the golden share is quote, not granted to Trump specifically, but to whoever the president is. But that's like completely opposite of what the wording of the provision actually is.

The wording of the provision is this, that decisions cannot be made, quote, without, at any time, when Donald J. Trump is serving as president of the United States of America, the written consent of Donald J. Trump, or the president's designee is required. Or at any other time, the written consent of CMAs, the Treasury or Commerce Department. If Trump isn't president, that seems really, that's even more unusual.

Already, we barely ever have the deploying of the Golden Share in the United States, but to make it specific to Donald J. Trump, Todd, what do you think about that?

TUCKER: Yeah, if you compare this to some of the partial nationalization that happened during the great financial crisis during the Obama years, they had a set of rules that they put in place to really tie their own hands from exercising control over some of these companies like GM or American Insurance Group, AIG.

That required bailouts, and those bailouts took the form of sort of equity ownership in the company. But it was very limited. It was meant to be time limited. And it was always done in this very technocratic, very professionalized way.

What we see with Trump here is that a lot of his political, theatrical instincts, right? That we have come to understand so well, are being inserted into the core of a major contract for a major U.S. company. Where he himself gets to sign off on things. Now, I think in practice it won't matter that much. Because this is a very politically sensitive decision.

Every major decision of this kind would always go up to the president anyway, just as it did with Biden blocking the merger, back in January of this year. So in practice, the president is always going to have a lot of say. But certainly, at least in the form of the contract, this is putting Donald Trump's populism in the details of this golden share.

CHAKRABARTI: Oh, interesting. Okay. I take your point, that the president always has a large say but what your use of the word technocratic is quite pivotal here. Because the Trump administration is not technocratic, right? It is Trumpocratic. So I think the point you're making about Trump would have an even larger say, because it seems like barely anything does not go through him and his whims or his state of mind at that particular day.

Is that a sensible way to run one of the world's largest steel manufacturers?

TUCKER: I think that there are worries that this could go off the rails right there. There's concern that Trump's self-seeking interest could get in the way of the long-term planning for this company.

This is not a guy, whether in his business or his presidential dealings, that has shown a lot of patience and focus. Certainly not, technocratic is not a word we would associate with Donald J. Trump. And so I think that there is some worry that this, you know, at best just won't go very well with the merger.

And that workers may be worse off as a result. And at worse, you could actually see the company's strategy derailed towards Trump's personal interests. So there's legitimate reasons for concern. But, I think, and we'll probably get to this later in the conversation, this is a tool that's used around the world.

So in that sense, he's not breaking a lot of ground.

CHAKRABARTI: Okay. So we will absolutely talk about that because the history of the golden share is a major part of why it matters for us to understand it here in the United States. Because you said it's not often used in this country, but I heard you say earlier clearly that you don't think that my wonderful tongue and cheek steel industry socialism fully applies here.

But that doesn't mean that other people don't see this as the nationalization of U.S. Steel. I'm looking here at a white paper put out by the Atlantic Council and they say that the golden share is non-economic, right? So the U.S. government didn't make an economic investment into the company.

And as you pointed out, Todd, accurately, the government does not have an equity stake in U.S. Steel. But then the Atlantic Council goes on to say this. However, the golden share gives the U.S. government an extraordinary amount of control over the company. Government's document, sorry. The company's governance documents will outline the areas of strategic and operational decision making over which the U.S. President will now have veto authority.

And here's the kicker sentence. The Atlantic Council says, U.S. Steel may not be state owned, but it is certainly now controlled by the U.S. government. Your thoughts.

TUCKER: Yeah, that's absolutely true. There is this sort of spectrum from full public ownership to full private ownership, and we've moved from what had been before, in early June a fully privately owned, traded on the stock exchange company to now a company that has been taken off of the stock exchanges, is still privately owned by a major Japanese company, Nippon. But there is now, there is less control over the decisions of the company that rest in private hands than we had a few weeks ago.

So that is certainly, that's certainly a big change.

CHAKRABARTI: Yeah. And what's interesting to me is that as you point out, and we'll talk about in a second, this is not uncommon. Globally, it seems to go against what I understood was a sacrosanct belief in how the free market's supposed to operate in the United States, with the government not being a majority decision maker in any business, let alone a major industry like steel.

So with that in mind, Todd, hang on here for just a second because you're right. We want to delve into the history of how the Golden Share was used or has been used in other countries. And to do that, let's first take ourselves back to the 1980s and the United Kingdom.

Because that is when Britain's Prime Minister Margaret Thatcher in her efforts to privatize major industries, used the Golden Share as a way to safeguard the UK's strategic national interests by keeping some special rights, as she aggressively privatized what were once nationalized industries in the UK.

So here's a clip from Thatcher speaking in the House of Commons in 1981.

MARGARET THATCHER: There are calls for a program of investment led growth. But many forget the vast resources which the government is already providing, has direct help to private sector industry, largely under the industry act, and mostly in assisted areas.

This year that will amount to over a billion pounds and twice as much as that is being provided to public sector industries such as British Leyland and British Steel Corporation. This is not to enable them to carry on as they were. But to help them carry out the necessary radical restructuring so that they too can eventually contribute to the recovery.

Now all of those things are being done to lay the foundations for the future of private enterprise and indeed to make public enterprise profitable.

CHAKRABARTI: Margaret Thatcher in 1981. Let's go to Fabio Bulfone now. He's assistant professor at Leiden University in the Netherlands, and his research focuses on the political economy of industrial policy in Europe and the United States.

Professor Bulfone, welcome to On Point.

FABIO BULFONE: Hi, Meghna. It's great to be with you.

CHAKRABARTI: Tell us first the origin stories of the Golden Share. Does it truly begin in Margaret Thatcher's actually privatization revolution in the United Kingdom, or is it older than that?

FABIO BULFONE: No it did indeed begin with Margaret Thacher and then it diffused in the rest of the continent of Europe in the '90s.

This because Thatcher was being a forerunner in privatizing these kind of companies' telecommunication, electricity, defense industry. So companies that were considered strategic, not only economically for an economy, but also for national security. Think about the telecommunication networks.

Think about the electricity grid. She was the first to experiment privatizing these companies and the idea of the golden share in that context, was a bit the opposite of today. So when the government meant was withdrawing was to keep an insurance policy for the government that was privatizing to still have a say of the future of these strategic companies.

CHAKRABARTI: So that's the key thing, right? It was actually done in an event to further in the effort to further privatize huge national industries. And the government wanted to keep a say in the operations of the companies, why? That would indicate not a full trust in the supremacy of the free market and private industry.

BULFONE: Indeed, the issue is that you have to think it back with the mindset of the '80s. And that was really the first time that these delicate industries, that sometimes were not even run as companies, they were run as division of the public administration, were sold to the market.

And so actually, it was also not very popular what the Thatcher government was doing and what other governments around Europe were doing. And so this idea was also a way for public opinion to make these privatizations more acceptable.

So yeah, there wasn't even in the Thatcher government, which we know had a lot of confidence in the market, there was this idea that you needed to have a nuclear button you could press.

CHAKRABARTI: Oh, I see. So a nuclear button in terms of the government would actually stop the private businesses from running in certain ways if it felt like it wasn't in the national interest, but the phrase nuclear deterrence makes it seem like it's more sort of a threat of leverage rather than governments having used that leverage.

Right. Yeah, that's exactly how golden share are more commonly used. Because if you think about it, even if you think about the steel industry today in the U.S., I don't think Japanese company or for the like company from many other country would like to invest huge amount of monies in the U.S. knowing that the government doesn't have the support of the government.

So the idea is even threatening to use the golden share would make a foreign company think twice and maybe reentering negotiations with the government, maybe with the help of their own domestic government. So it's enough to threaten to use the golden share for a deal to be revised.

This is the examples we have in history.

CHAKRABARTI: Professor Bulfone, hang on for a second. Because I do wanna talk about how other nations in Europe and actually also in Latin America have used the golden share. But Todd Tucker, let me bring you back in here. What do you think of this idea of the golden share allowing, potentially powerful leverage, even just the threat of Donald Trump doing something would be enough to get Nippon Steel to reconsider plans that it might have for the company in the future.

TUCKER: Yeah, I think that this is a key power that we now see the Trump administration having. Trump is no stranger to making threats. He could have certainly made threats on a private company. He does it all the time to companies like Carrier and other companies that are engaging in activity he doesn't like.

But having that sort of threat embodied in the core contractual organization of the company is an added power indeed. But I think it's important to draw one distinction from how Thatcher used the golden share from how Trump is using it, which is that, as Fabio has laid out, the golden share in the European context was often used as a way to keep national companies from being overtaken by foreign companies.

And in this case, Trump is using it to facilitate the takeover of a foreign company of a domestic asset. So that's a big difference than from some of the European precedents.

CHAKRABARTI: And the consequence of that difference, Todd, what do you think it might be?

TUCKER: I think that there are real reasons to be concerned, and this was an issue that the Biden administration raised, or that the United Steel workers raised, which is that when push comes to shove and there is some type of crisis in the future, whether it's geopolitical, natural disaster, what have you. I think there's legitimate reasons to wonder whether a foreign owned company would behave in the U.S. national interest.

As much as would a nationally owned company that was responsive, not only to sort of national shareholders, but also to constituencies like mayors, governors, politicians that do have influence over private companies. So I think that the concern is that in a crisis you might see Nippon prioritize its Japanese steel production or even steel production in China or other locations relative to its faltering U.S. production.

Part III

CHAKRABARTI: Professor Bulfone, let me ask you, we talked about how Thatcher really got the idea of the golden share launched in the '80s in the UK. How often was it then used in other European nations and particularly which ones?

BULFONE: Yeah, let me say again that we are talking, first of all, throughout the '90s, all the other large and small economies in Europe and in what was the European Union. And still is, it didn't have the Eastern members back then, but all the central and south and northern parts of Europe. The governments used frequently and introduced frequently the golden share.

So they created it, then how many they used it, they used it very rarely, but throughout the '90s and early 2000s when sectors like telecommunication and electricity were indeed privatized, it was threatened, like the use of the golden share was threatened pretty regularly.

And as Todd was saying, the typical situation where this was done was when a domestic company that was considered strategic by the government was negotiating a merger or an acquisition by a foreign company that wasn't of the liking of the government.

And I can give you concrete examples like between the late nineties and the early 2000s, but the Italian and the Spanish government used their golden share in the telecommunication sector to prevent the domestic company Telefónica in Spain and Telecom Italia in Italy to be taken over by a German company in the case of Italy, and to merge with a Dutch company in the case of the Netherlands. So this is the standard example in which the golden share has been regularly threatened to be activated in this decades.

Okay. So help me understand something, because do the golden share examples that you've been giving us in Europe, do they involve or require any kind of financial investment or direct financial ownership on the part of the governments that we've been talking about or not, because it's not clear to me even how EU courts have ruled on this.

BULFONE: Yeah, sure. There are ways to do the golden share that were historically used in Europe. One involves the retention by the government of a small share. So not a controlling share. Let's say 2%, 5%, 1%, and then the idea that these powers are attached to this small share. The other case is instead, countries that would fully privatize a company and then retain some powers, but they are not tied to the direct ownership of a share.

And actually, the European Court of Justice ruled that the second type of golden share is not in line with European competition law.

CHAKRABARTI: And why?

BULFONE: Because this is a European specificity, okay. It was considered a distortion of the free competition on the European market. In Europe there's this multi-level system where countries and their companies compete in a single market, but then there's not, there's a quasi government that is the commission, but then niche government remains sovereign.

The idea is if a country in this space that has its specific rules on competition creates a golden share without tying it to direct ownership, this would be considered a distortion of competition.

CHAKRABARTI: Oh, interesting. A distortion.

Okay. Todd, how do you respond to that in terms of, if in certain cases the European courts have seen it as the non-economic ownership as a distortion of competition? Wouldn't that in a broad sense apply here in the United States too?

TUCKER: Yeah. And I think that the difference between the U.S. and the EU is that the EU's sort of constitutional documents date to scientists and historians would call the quote-unquote neoliberal era, meaning the era where you have this more of a belief that the government exists to service the interest of private capital. And the EU's rules are much stricter than the U.S. institution when it comes to things like regulating mergers, acquisitions, golden shares.

And it's not surprising that Europe would be more restrained right now in terms of how we can use some of these golden share arrangements, relative to the heyday of the '80s and '90s. In the U.S. context it's also been looked down upon by most mainstream economists to use tools like this.

Just the major difference is that our legal regime allows it to happen while in the EU it's more restricted these days.

CHAKRABARTI: Yeah, to your point, Todd, again, I'm just looking at the pages of the Wall Street Journal's Opinion section, and Andy Kessler there wrote that he calls this straight up nationalization.

That's subject to interpretation, but he says nationalization is against the American capitalist spirit, which thrives on competition. Why? Because profit motives go away and inevitable price control leads to stagnation. Todd, your thoughts?

TUCKER: Yeah, we're seeing a lot of very heated reaction.

If you could look back to, you had a very similar reaction against Biden's blocking of the merger in January. You had Obama's chief economist calling it a pathetic and craven cave to special interest that will make America less prosperous and safe. That's pretty heated rhetoric.

But I think again, if you take a little bit more of a sober look at this and look at some of the international experience. You can see that even though there may be reasons to be concerned that Donald Trump is using policies like this, the policy on its own is not obviously out of line with international practice.

CHAKRABARTI: Okay so Professor Bulfone, on that point, let me turn back to you, because Latin America, and correct me if I'm wrong, there are similar examples of the use of the golden share there. Yes?

BULFONE: indeed. And in Latin America it was introduced pretty often because these countries in the nineties was struggling to pay back their debt.

And so the IMF, the World Bank extended loans to the governments. And as part of these loans they required these countries to privatize again. Telecommunication, electricity industry. So in this case it was even an external lender asking them to privatize these companies. And understandably, the governments there also thought about introducing a golden share.

But let me, if one takes a bird eye view. And I think this could be useful to understand also the use of the golden share today and what, as a U.S. citizen, I would ask.

The golden share is in, per se, is just a policy instrument and it is effective if it is part of a long-term strategy to intervene in a sector.

A golden share alone won't change the destiny, if you want, of the steel industry in the U.S. in one sense or in the other. But the moment the administration wants to introduce a golden share, the question is what are the next steps? What do you want to do next? Because by introducing the golden share, you are saying this industry matter.

So then what is the long-term plan for the steel industry in the U.S.?

CHAKRABARTI: That is a critical question and I appreciate you asking it. Because I don't, I agree. I think it's the right question, but I'm going back to what Todd said earlier in the show and I think he was spot on. With the Trump administration and specifically with the language of this golden share being written around Donald J. Trump himself.

Todd had mentioned that some of this has to do with pumping investment money into the state of Pennsylvania. Circa 2027, 2028, when the next election cycle rolls around. To you, does that indicate the deployment of the golden share in service of a long-term strategy to intervene in a sector or is the Trump administration not giving you that confidence?

BULFONE: Thanks for asking me this, because this is a key issue we have and the Trump administration, but also other governments in the world are now trying, experimenting with industrial policy, with golden shares, with subsidies, with investments. Now, if there is one thing we know from past experiences is that in order to have a long term effective industrial policy, this needs to be insulated from electoral considerations.

So in an ideal world, a sector like steel, a sector like defense, which is in indeed strategic for the U.S. economy, would be run maybe by the two main parties in a bipartisan commission. Where we think, okay, what are the priorities between now and the next 10 years, the next 15 years?

So you shouldn't do industrial policy to win the next election.

CHAKRABARTI: Ah, okay. Todd, so that brings us to the last five minutes or so we have, and I wanna push forward and think a little bit more about what the future implications of the golden share may be. Again, leaning on the Wall Street Journal here, because they've historically been very neoliberal, as you pointed out, and very opposed to government interventions in industry, and they were identifying the fact that in their view, other attempts at government influence in various industries haven't gone well.

They talk about the creation of Amtrak. They talk about Fannie Mae and Freddie Mac in terms of mortgages. And then they ask, the Journal asks this question, they say, they believe there's already too many industries in the United States that are on the nationalism spectrum, as they say, quote-unquote, that are owned effectively by regulators rather than formally by the government. So that's their concern about the administrative state, but they raise this issue.

The Journal says, quote, when companies fail, the worry is that the golden share concept will be used as a precedent to do all sorts of zany things. For example, if Intel loses money for a few more quarters, will the Trump administration nationalize the company in the name of national defense? It could. End quote.

What do you think about that? That this opens the door to a lot more vigorous direct interference with companies by the government.

TUCKER: So the Wall Street Journal's right to say that golden shares are a form of government intervention and there's many other forms of government intervention that have been used or could be used.

But I think it's important to put in context the last 30 or 40 years where we've seen this. We've basically left most of the key decision making about where and what to make to the private sector. And that's coincided with decades of offshoring of jobs, rising income inequality.

And of course, you know, what some economists described as the world's biggest market failure ever. Which is climate change and the climate crisis. We've been leaving it to the private sector, and these have been some of the results. And so I think the question to ask, and Fabio put it correctly, is, what is the right mix?

Not whether to intervene in the economy, but what is the right mix to ensure that private companies are aligned with the public interest. And I think that we saw one answer to that question during the Biden administration, which was through the Inflation Reduction Act, through the CHIPS and Science Act and other policies.

You saw investments in the clean energy future of America, and it was not just one policy tool like golden shares or another policy tool. It was a whole suite of everything from subsidies to grants to loans to research and development support. And we were seeing, we were beginning to see the positive results of that.

We'd had six straight quarters of record manufacturing, construction. We were seeing investments in new industries that had never been in the U.S. We saw all five major semiconductor companies investing for the first time in the U.S. And so it was really starting to bear fruit.

And what we've seen over the last few weeks is that the Trump administration has taken a sledgehammer to those policies and are gutting them, cutting them, making them less effective. And actually, going back to a bad old way of doing industrial policy, which is picking winners and losers.

And there's certain sectors we're gonna favor, but then others like solar and wind, we're gonna try to strangle. And that's the opposite of a smart industrial policy.

CHAKRABARTI: Well, professor Bulfone, one last question for you and one I'm afraid we've only got a minute left.

I keep coming back to, in my mind, to something both you and Todd said that the golden share historically has been used like Europe, et cetera, to actually block foreign ownership of domestic companies. And in this case, it's the exact opposite. It was to facilitate that. So while certain aspects of company ownership are retained by Donald J. Trump. The profit, the economic benefits, the large economic benefits of this company are still going outside the United States to Nippon Steel. So in that case, is this necessarily an America first policy? Fabio, we've got a few seconds here.

BULFONE: I think it's an America does what it can policy, because as you said, the center of corporate decisions will stay in Japan.

And also, I think there a problem of perspective, like when we talk still today, we should talk about how to decarbonize the production of steel, how to make it cleaner. And I don't think that is that much the ownership of a company that matters. That shouldn't be the obsession. We should change a bit the perspective.

The first draft of this transcript was created by Descript, an AI transcription tool. An On Point producer then thoroughly reviewed, corrected, and reformatted the transcript before publication. The use of this AI tool creates the capacity to provide these transcripts.