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President Donald Trump’s decision to give the federal government a 10% stake in ailing American chipmaker Intel made the United States government Intel’s largest shareholder and prompted predictable outrage among conservatives.

“I don’t think that’s socialism. I think it’s going to make this country richer and richer,” Trump said at a press conference Thursday when he announced the deal. “It’s one of these things where you’re going to say, ‘Boy, I hope I’m going to have many more cases like this.’”

Critics, though, say Trump’s economic nationalism crosses into socialism. For decades, scholars have defined socialism partly as state ownership of the means of production for the public good. By that standard, Trump’s decision is not so different from what happens in China or Russia.

The political reversal is doubly ironic. When President Barack Obama sought to seize control of Chrysler and General Motors during the financial crisis of 2008–2009, conservatives acknowledged that he was at the very least acting out of emergency, to keep the iconic American companies from collapsing. But if Obama had taken a 10% stake in Intel, many Trump allies would have cried communism.

To be sure, Trump maintains that the Intel case is different because it’s an investment, not a bailout. And he’s not wrong that he gave the government equity in Intel without giving the government money. Trump said he “converted” nearly $9 billion in government grants already promised to the company under President Joe Biden’s bipartisan Chips Act into U.S. government equity. That means Trump came up with a deal that effectively generates $10 billion to $11 billion of “value” to taxpayers right now, he said. “Why are ‘stupid’ people unhappy with that?” Trump asked.

The reaction from conservatives has been intense. Larry Kudlow, Trump’s former top economic adviser, said Thursday night on Fox Business that he was “very, very uncomfortable with that idea.” Steve Moore, an informal Trump adviser, was more direct: “I hate corporate welfare. That’s privatization in reverse. We want the government to divest of assets, not buy assets. So terrible, one of the bad ideas that’s come out of this White House.”

The conservative National Review published an editorial saying that “government shouldn’t get into the chip business.” Senator Thom Tillis said the move risked turning Intel into a “semi-state-owned enterprise a la CCCP,” a reference to the former Soviet Union. Senator Rand Paul made a similar point in a tweet: “Wouldn’t the government owning part of Intel be a step toward socialism? Terrible idea.”

But progressive Senator Bernie Sanders was celebrating the move, saying the government should use its power to guide industry for the public good. Commerce Secretary Howard Lutnick went on Laura Ingraham’s show to defend Trump: “That is not socialism. That’s the best businessman in the United States of America in the Oval Office doing fair things for us.”

Intel itself raised some warnings. In a Securities and Exchange Commission filing required by the government, the company said the arrangement could “limit our ability to obtain government grants in the future,” hurt our ability to sell globally, and subject the company to more government regulation. Intel has had a bad run: The company said in February that it planned to lay off 15% of its employees, and its stock has lost half its value since the start of 2024, giving it a market capitalization of about $110 billion. Shares ticked up 4% after Trump’s announcement, but not by much.

The Wall Street Journal reported that Trump initially demanded that Intel CEO Lip-Bu Tan resign for his past connections to China, and only relented after personally visiting Tan in the White House. “I liked him a lot, I thought he was very good,” Trump said after the meeting.

Critics also say Trump’s move to have the federal government take a controlling stake in Intel could give the president enormous power and influence at the company, even if the U.S. government is only a non-voting shareholder and has no say in how Intel is run. The president of the United States has now become the largest shareholder in the world’s largest chipmaker, and when that happens, influence is influence.

If the company rights itself and prospers, Trump will take the credit for saving a pillar of American industry. If it continues to struggle, American taxpayers foot the bill. Trump has said that he would make deals like this with other companies, so it’s likely that this fight over whether Trump has crossed into socialism will only intensify in the future.

For now, at least, Trump’s decision to take a controlling interest in Intel has made it clear that Trump has redefined the relationship between the federal government and private enterprise, and the Republican Party’s approach to economics.