The line between state power and private profit just got thinner. For years, the Trump administration has quietly bought up pieces of private companies using your tax dollars. It is a massive expansion of executive overreach. Now, Capitol Hill wants to make it permanent.
Buried deep inside the Senate’s massive 2027 National Defense Authorization Act is a quiet little provision. It sets up a brand-new piggy bank. They call it the Defense Equity Investment Account. Under this scheme, the Pentagon can dump up to $500 million of taxpayer cash directly into private firms. They are targeting batteries, chemicals, and critical minerals.
It is venture capitalism, federal style. The government gets stock, warrants, or revenue-sharing deals. The only real rules? No buying more than half of any single company, and keep the total under half a billion. That is it. No other guardrails exist.
Naturally, the swamp smells opportunity. During a secret meeting, the Senate Armed Services Committee killed an amendment that would have banned the administration from investing in companies tied to the president, his family, or his cabinet. Why? Fear. Senator Elissa Slotkin, a Michigan Democrat, spilled the beans. She noted that her Republican colleagues were terrified of hurting the president’s feelings.
We have already seen how this plays out. Take Vulcan Elements. They make rare earth magnets. They also snagged a cool $620 million loan from the Pentagon’s Office of Strategic Capital. Oh, and Donald Trump Jr. happens to be a partner there. Just a coincidence, surely.
This is state-sponsored capitalism. It is corporate welfare wrapped in a flag. If the government actually wanted more domestic minerals or batteries, it could just slash red tape. It could use normal procurement. Instead, Congress is codifying a system where the state acts as investor, regulator, and political godfather. It is a terrible idea. But in Washington, bad ideas are the ones that get fast-tracked.
