For his China love, is Trump eyeing state control of the economy? Hint in push against Intel, Apple & Nvidia

In a striking reversal of old assumptions, it’s no longer China’s economy that’s mimicking America’s — it’s America’s that’s beginning to resemble China’s.

According to a Wall Street Journal report, from pressuring Intel’s CEO to resign, to intervening in chip sales by Nvidia and AMD, and securing a “golden share” in US Steel, President Trump’s recent moves suggest a growing appetite for state-directed control of key industries.

Trump’s push to personally direct $1.5 trillion in investment from trading partners further underscores a shift toward state capitalism — not full-blown socialism, but a system where the government heavily influences corporate decisions, added the report.

As the US government increasingly steers private enterprise under Trump’s leadership, critics are asking: Is his admiration for China’s economic model shaping America’s own?

According to the report, China brands its model as “socialism with Chinese characteristics.” The US hasn’t gone nearly as far — not as far as China, nor as far as more moderate versions of state capitalism seen in countries like Russia, Brazil, or even France. But what’s emerging now might best be described as “state capitalism with American characteristics.” And while it’s not a full departure from capitalism, it marks a sharp shift from the free-market orthodoxy that once defined the US economy, added the report.

This shift wouldn’t be happening without a broad, bipartisan loss of faith in traditional free-market capitalism. That system incentivised CEOs to chase profits overseas, hollowing out American manufacturing, creating dangerous reliance on China for critical materials, and neglecting long-term investments in strategic sectors like clean energy and advanced semiconductors.

The federal government has long intervened in the corporate sector — taking control of production during World War II and using the Defense Production Act in emergencies like the COVID-19 pandemic. It also stepped in to bail out banks and automakers during the 2007-09 financial crisis. But these were largely temporary measures.

Former President Joe Biden pushed further, aiming to reshape entire industries. His Inflation Reduction Act authorised $400 billion in clean-energy loans, while the Chips and Science Act allocated $39 billion in subsidies to boost domestic semiconductor manufacturing. Of that, $8.5 billion went to Intel — giving Trump leverage to demand the removal of its CEO over previous China ties, a demand Intel has resisted.

Biden also blocked Nippon Steel’s takeover of US Steel by overriding management and shareholders, despite his staff seeing no clear national security risk.

Trump later reversed the veto but secured a “golden share” in US Steel, allowing government influence over company decisions — mirroring the golden shares Chinese firms issue to the Communist Party, reported WSJ.

Biden officials considered creating a sovereign-wealth fund to finance high-risk, strategic projects like critical minerals — an area dominated by China.

Last month, Trump’s Department of Defense took a 15% stake in MP Materials, a key critical minerals miner.

While China accelerates growth through massive infrastructure, scientific progress, and industry support, US efforts often stall amid democratic checks and balances.

“China is an engineering state, building big at breakneck speed, unlike the US, a lawyerly society blocking everything, good and bad,” WSJ quoted Author Dan Wang as saying in his upcoming book ‘Breakneck: China’s Quest to Engineer the Future’.

Trump’s appeal lies in his readiness to bulldoze legal and democratic hurdles.

He’s imposed tariffs unilaterally, claiming powers meant for Congress, and secured $1.5 trillion in investment pledges from Japan, the EU, and South Korea, pledges he says he will personally control, despite no clear legal basis and disputes over their validity.

State capitalism has long struggled because governments typically allocate capital less efficiently than markets, leading to waste, distortion, and cronyism. Countries like Russia, Brazil, and France have lagged behind the US in growth.

China’s rapid growth since 1979 largely came from market reforms, not state control. As Xi Jinping tightened state grip, growth slowed, with wasted savings and excess capacity pushing prices and profits down.

The US hasn’t done better. National security-driven interventions often result in failures like Foxconn’s Wisconsin plant or Tesla’s Buffalo solar factory.

Unlike China’s state capitalism — an all-encompassing system run by millions of cadres — the US approach is mostly symbolic Oval Office declarations without real policy or institutional support.

“The core characteristic of China’s state capitalism is discipline, and Trump is the complete opposite of that,” WSJ quoted Wang as saying in an interview.

State capitalism is about political control as much as economics. Xi uses economic power to enforce party dominance — when Alibaba’s Jack Ma criticised regulators in 2020, China swiftly canceled Ant Group’s IPO, fined it $2.8 billion, and Ma vanished from public view.

Similarly, Trump has used executive orders and regulatory power against perceived opponents while rewarding loyal executives. CEOs who once criticised him now mostly stay silent or praise him.

Trump is also pushing for political control over independent agencies like the Bureau of Labor Statistics and the Federal Reserve, echoing China’s fully party-controlled bureaucracy.

While Trump admires Xi’s control, American democracy — with its judiciary, free speech, due process, and power separation — sets limits. The future of US state capitalism depends on how well these checks and balances endure.

With inputs from agencies