Industrial policy
Updated
What it is
Industrial policy refers to deliberate government intervention to shape or support specific domestic industries judged strategically important, through tools like subsidies, tariffs, direct funding or equity stakes. The 2025-2026 US wave built on the 2022 CHIPS and Science Act's semiconductor subsidies and extended it with direct government equity stakes in companies including Intel, US Steel and MP Materials. Officials, including Treasury Secretary Scott Bessent, framed the approach as a response to competing with non-market economies such as China for control of critical supply chains.
Why it matters lately
The Trump administration converted part of Intel's roughly $10.9 billion in CHIPS Act grants into an approximately 10% non-voting equity stake in 2025. The Pentagon separately took a 15% equity stake in rare-earths producer MP Materials for about $400 million, and the government also acquired a golden share in US Steel, with Bessent saying further government stakes in private companies would not be surprising.
Asymmetric Analytics view
Inference (AA): AA expects US industrial policy to stay structurally elevated even after any Russia-Ukraine armistice, treating it as a separate, durable driver in its US macro playbooks.