Commerce Secretary Howard Lutnick said Tuesday that Pentagon officials are "thinking about" whether the U.S. government should acquire equity stakes in top defense contractors.
President Donald Trump late last week announced that the government will take a 10% equity stake in chipmaker Intel.
Appearing Tuesday on CNBC's "Squawk Box," Lutnick was asked whether the Trump administration would consider equity acquisitions with other companies.
"Oh, there's a monstrous discussion about defense," Lutnick said. "I mean, Lockheed Martin makes 97% of their revenue from the U.S. government. They are basically an arm of the U.S. government. They make exquisite munitions. I mean, amazing things that can knock a missile out of the air when it's coming towards you.
"But what's the economics of that? I'm going to leave that to my Secretary of Defense [Pete Hegseth] and the Deputy Secretary of Defense [Steve Feinberg]. These guys are on it and they're thinking about it."
He added, "There's a lot of talking that needs to be had about how do we finance our munitions acquisitions."
Lockheed Martin, RTX, Northrop Grumman, General Dynamics, and Boeing are among the top U.S. defense contractors.
Lutnick defended the administration's move with Intel, which had been targeted to receive funding from the Biden administration's CHIPS and Science Act.
"The Biden administration gave ... G-A-V-E ... gave Intel, an American company, [an] $11 billion grant ... for nothing, to help them build semiconductors in America, which would be a really good thing but why would you ... I mean, talk about corporate welfare," Lutnick said on CNBC.
"So, Donald Trump sits in the room with me and Lip-Bu [Tan], the CEO of Intel and says, 'C'mon, we have to make it fair for America,' and we agree. We get 10% of the company, which brilliantly equals $11 billion."
The secretary disagreed with the notion that the Trump administration got a stake in Intel "for free."
"It's correct in that the Biden administration had contracted $11 billion out the door, and Donald Trump and the Trump administration turned that into $11 billion of equity, but the money was already out the door," he said.
"So, I think the key is, where is the United States of America adding fundamental value to your business. If we are adding fundamental value to your business, I think it's fair for Donald Trump to think about the American people."
Charlie McCarthy ✉
Charlie McCarthy, a writer/editor at Newsmax, has nearly 40 years of experience covering news, sports, and politics.
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