Senate Defense Bill Would Establish Fund For Government To Buy Into Private Companies

Authored by Kevin Stocklin via The Epoch Times,

A new bill in Congress would enshrine into law the ability of the executive branch to buy into private companies, and create a fund to finance the purchases.

The current Senate version of the National Defense Authorization Act gives the Defense Department explicit authority to take ownership stakes in companies. A provision titled "Equity Investments and Related Matters" establishes a new "Department of Defense Equity Investment Account" within the Treasury Department, which the Defense Department can use to make equity investments in critical minerals, materials, chemicals, and batteries.

While administration officials say this move allows the Defense Department to better align its goals with the private sector and for taxpayers to earn a return if the companies do well, critics have raised concerns about establishing a legal basis for government expansion into the private sector.

Government investments in companies under this bill would be limited to a 50 percent stake, non-voting shares, and a dollar cap of $500 million.

Michael Duffey, under secretary of defense for acquisition and sustainment, stated in January that the Trump administration is "fundamentally shifting our approach to securing our munitions supply chain."

"By investing directly in suppliers we are building the resilient industrial base needed for the Arsenal of Freedom," Duffey