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Hey there. It's the NPR Politics podcast. I'm Miles Parks. I cover voting.
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C
And I'm Danielle Kurtzleben. I cover the White House.
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And NPR's financial correspondent Maria Aspen is here with us as well. Hi, Maria.
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D
Hey there.
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B
So today on the show, is President Trump treating the federal government like a business? Let's start here. Last Thursday, President Trump floated the idea of buying the struggling Spirit airlines.
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I think we just buy it.
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We'd be getting it virtually debt free.
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They have some good aircraft, some good assets, and when the price of oil goes down, we'll sell it for a profit. I'd love to be able to save those jobs. I'd love to be able to save an airline. You know, I like having a lot of airlines, so it's competitive.
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B
Maria, I feel like there are some listeners who are like, how did I miss this completely the last few days? But get us up to speed here. What is going on with Spirit Airlines and kind of what is Trump talking about here?
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D
Budget airlines in general have been kind of struggling for years, but Spirit is really going through it. Back in 2022, it tried to sell itself to JetBlue, but the Biden administration didn't like that deal and a federal judge eventually blocked the merger. Since then, Spirit has had some equipment problems with its planes. It's filed for bankruptcy twice. It's rejected a takeover offer from Frontier Airlines, saying that the wasn't good enough. And now fast forward to today. The Iran war has made oil prices and jet fuel a huge problem for all airlines, but especially budget airlines like Spirit, which is already on the rocks. So Trump is floating the idea of, hey, maybe the US Government bails it out. And I should note that I did reach out to the White House about this. And although the president has talked about this and floated it publicly, a White House official did tell me that the administration has not unveiled any concrete plans for bailing out Spirit Airlines.
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Yeah. And one thing to add here is, yes, Spirit has been uniquely on the rocks with those bankruptcies. But other budget airlines, for example, listeners might know of Frontier Airlines. They've also been having trouble recently since the price of oil and jet fuel have gone way up since the start of the Iran war. So other budget airlines have also petitioned the White House separately from Spirit to say, hey, we would Also like some money to please, because we are, we are suffering.
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I mean, there's a lot to unpack on the kind of broader impacts moves like this could have on the US Economy. But I want to zero in on something Trump said just for a second. Danielle, this idea that Spirit's virtually debt free and it has some good assets, would this be a good investment for the American taxpayer?
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C
You know that Trump quote we played at the top, that was him in the Oval Office, having just been asked about Spirit. And I see that as being part of the grand Trump tradition of off the cuff making pretty big pronouncements, you know, kind of blithely saying, yeah, when the price of oil goes down, we, we could sell it, don't worry about it. And he also saying that they have good aircrafts. I'd like to save some jobs, I'd like to save an airline. So he seems to think it's a good investment. But even people within the administration don't agree on this. For example, Transportation Secretary Sean Duffy told Reuters just recently that, quote, what we don't want to do is put good money after bad. He was saying that about a potential Spirit deal. The idea being he was saying Spirit already has shown it has trouble making a profit. We don't want the government to step in with a failing company and not get any of that money back.
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Although the problem is that if Spirit does, like, completely implode under Trump, especially after a war that Trump has started that has made oil prices go through the roof, that looks bad for Trump. So from an optics perspective, it makes sense why when it's floated to Trump, hey, do you want to save Spirit? He would probably prefer not to have it go out of business under his watch.
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C
Absolutely. And there's one more interesting angle on this, which is one of our colleagues here at npr, Ayanna Archie reported on Spirit and other budget airlines just recently. And there is the possibility that if you have these budget airlines like Spirit having trouble or if one of them goes out of business, you lose some of that lower price end of the airfare market. Because one thing that low fare airlines do is, is kind of anchor prices and force bigger airlines like, you know, Delta, United, American to offer low cost options. So there's competition. So if you lose a budget competitor, maybe that hurts the low airfare part of the airline market.
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On the whole, that makes a lot of sense. And I mean, airline prices have been just going up and up and up in recent years. Maria, I also just want to get bigger picture here because there is sort of a trend during Trump's second administration. Right. I mean, in terms of him using the federal government to make similar deals.
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Oh, yeah. I've spent a lot of time since January 2025 reporting on this and what people across the political spectrum, business and political experts, are calling state capitalism. There are lots of different examples. Two of the big, big ones that got a lot of attention, however, were the US government taking about a 10% stake in intel in August. Intel, of course, being the then struggling computer chip company and US Steel, where under Trump, the US Government took what it calls a golden share in the company, which basically gives it an opportunity to have a veto on business decisions. It's hard to overstate what a big shift in the relationship between private companies and the federal government this is. The Council of Foreign Relations last week put out a report estimating that under the Trump administration, since January 2025, the US government has invested almost $21 billion in 16 deals involving direct ownership. That is pretty unprecedented in non crisis times. We're not in the middle of a global financial meltdown or a global pandemic. And you know, we have seen government bailouts during those periods. We saw, you know, the US Government bailout banks and auto companies during the financial crisis. And that bailout was bigger in terms of overall money spent. But according to Bloomberg, CFR says this is the biggest such push into strategic industries since the Second World War. The other thing that I think is really important to note, and that has been drawing just a lot of raised eyebrows again across the political spectrum, is that Trump has personalized a lot of this and in some cases has exerted pressure on companies like on Truth Social. He called for the resignation of Intel's CEO before the CEO went to the White House, met with Trump and and then later intel and the government said that the US Government would take a stake in Intel. There is very much a public perception that the White House and the President are personally pressuring and in some cases threatening companies to get deals.
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And what's fascinating about all of this is in addition to everything that Maria is talking about, you have money flowing in another direction, which is you have companies, CEOs of companies, rich people of all stripes, donating money to President Trump's ballroom that he's attempting to build. So, for example, Nvidia's Jensen Huang, he is the CEO of that company, donated money to the ballroom. You have other large companies like Amazon, Google, that have donated money. Now, this is not to allege that there are specific quid pro quos. Like Jensen Huang giving money and Trump relenting and letting his company sell chips to China. It's nothing like that I'm seeing. But what it is to say is that business and government in the Trump administration have these new relationships at new places that money is going, government investing in one place, businesses donating to a president's personal project. It is really unusual.
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And Danielle, you're not saying it, but a lot of people, a lot of people who look at this, they're using words like crony capitalism, autocratic capitalism, or just plain old corruption. There are a lot of raised eyebrows here.
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Right.
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And we should note that Amazon and Google are both financial supporters of npr. I mean, I do want to dig into a little bit more and just how unprecedented some of these investments are. Because, you know, the government does give grants. It offers small business loans to companies. Can you guys string out a little bit more? I guess, why this is different from some of these other programs.
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Yeah, I'll rattle off a few. One is that as opposed to a government grant or a loan, that this is the government getting a stake in a company, in some cases, for example, intel, which means that the government gets some profits for it. Furthermore, let's stick with intel as a case study here. Intel is a public company that makes it very different from the hardware store down the street getting a small business loan. Because when you have a public company, it is traded on public markets. And the government taking a stake in your company can affect the price of the company, how investors see the company, et cetera, et cetera. It's two very different beasts there. Besides that, the government, in the case of U.S. steel, with that golden share Maria talked about, it gets a big say in the company's operations. For example, with that golden share, the government didn't buy an equity stake in US Steel, but what it did get is a lot of say so in what the company does. The president needs to approve, for example, if the company wants to move, if, if it wants to relocate jobs, if it wants to change the name of the company, a whole list of things that the president would have a say in there.
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So the White House says that there's no conflicts of interest, that this is, you know, the typical free market capitalism that you would see under a Republican administration. I've talked to economic experts at, say, the Cato Institute, a libertarian think tank, who disagree with that. But the White House says also that it is largely focusing on industries or companies that are crucial to national security and national defense. So like intel, for instance, again makes the computer chips that are so crucial to the AI boom. And there's a lot of concern over how much influence China has In that industry versus how much is, you know, U.S. economic and national security. All of that said, it's not consistent. And part of the problem that has a lot of free market experts raising alarms is that it appears that the government is picking winners and losers versus backing an entire industry. And that's what can distort the market, because if the government invests in one company, but not all companies within an industry, then that company has an advantage and it's harder for competitors to compete with that company or innovate as much or compete on an even playing field. And that is what business experts say is long term damage of this, that all of this will eventually damage the innovation that you're supposed to get in a free market capitalist system.
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Okay, let's take a quick break, but more in just a moment.
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This message comes from NPR sponsor Carvana. Carvana believes selling your car should be refreshingly simple. Enter your license plate or vin, get a real offer down to the penny and schedule a pickup on your time. No surprises. Sell your car today@carvana.com Pickup fees may apply every day. NPR reports stories that keep you informed without fear or favor. That's the promise of a free press in a democracy. It's in the First Amendment. I'm Tom Bowman and I cover the Pentagon for npr. Stand up for independent news coverage today by donating early for public media giving days coming up on May 1st and 2nd. Give now at donate.npr.org and we're back. So, Maria, we've talked about a number of deals, sort of unprecedented deals that President Trump has made during his second term. Do we have any sense on how these deals are working out so far?
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Well, I mean, they seem to be working out kind of great for the individual companies. I mean, look at Intel. Last week, after it reported earnings, Intel's stock jumped like more than 20%. Its stock price is now quadruple what it was when the US Bought into it in August. And I mean, that's worked out pretty well for the U.S. government, too. It spent about $9 billion on a stake that is now worth $36 billion so, you know, the U.S. government backing a private company works out pretty well in the individual case, or tends to. It's just the broader concern of how it distorts the market and creates an uneven playing field for other companies that has so many people worried about this phenomenon.
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Well, I was curious, Danielle, on how other Republicans are responding to some of this, because it does feel like on its face, free market equals, you know, traditional conservative value. I don't know. Have any Republicans weighed in on some of these moves?
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Yeah, and it's really kind of deal specific. For example, the government getting that golden share in U.S. steel. There's reporting from Politico after that happens, that Republicans in manufacturing heavy states like Pennsylvania, for example, that they really lobbied for that because Joe Biden, when he was president, had also blocked the sale of U.S. steel to Nippon, which is a Japanese company. And so these Republicans said, hey, just let this deal go through, please. And so when the US Government got that golden share in US Steel, that happened alongside Nippon in Japan buying that company, it was a. It was those two things at once. Now, besides that, the US had blocked chip maker Nvidia from selling its chips to China because they thought that was a national security concern, because Nvidia makes these really powerful AI chips. Well, suddenly last year, Donald Trump turned around and said, actually, we will allow Nvidia to sell those, but we get a 25% cut of all those sales. That made China hawks within the party really worried. For example, Representative Brian Mass from Florida, he introduced something called the AI Overwatch act, which basically would have just introduced much more oversight to these kinds of powerful chip sales to other countries. One more example is in this whole spirit story, you've had Republican senators like Ted Cruz from Texas, Tom Cotton from Arkansas weighing in and saying that this is just a bad idea. Ted Cruz compared it to the TARP bailouts after the financial crisis, which he also did not approve of. And Tom Cotton said something to the effect of what Sean Duffy, the Transportation Secretary, said is that if this company has trouble getting a profit, why should we help them along? But I do want to zoom out really quickly. I know I've been monologuing, but I want to zoom out really quickly and say this, though. Yes, as Maria has been saying, all of this state intervention into these companies is a distortion of free markets. And, and I kind of see this in a similar vein to the Trump administration's tariff policy, because in both cases, this is a Republican president overturning decades of Republican kind of Chamber of Commerce, Republican free market orthodoxy. To impose policies that he just kind of likes.
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I think the Cotton criticism is really interesting, too, because it does kind of shine a light on this idea that it's kind of an optimistic view of government, the idea that, like, this thing, no one else could figure this out, but, you know, what can? The federal government, which actually contradicts kind of everything that Trump was saying leading up to the campaign. The whole Doge effort, I feel like, was very much like basically arguing that the federal government was defunct or wasn't making good on its promises, which. I don't know. Those two things existing at the same time is really interesting to me. Maria. I. I know that critics of these deals have used this phrase, state capitalism. It's not a phrase I had ever really heard before. Would you mind just explaining to, to our listeners what state capitalism is and what experts kind of think about it?
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Sure. So state capitalism, the way it's being used these days generally is a reference to how things tend to work in countries like China, where there are private companies, but the government has a very active role in helping to run or in determining how private companies run. State capitalism can mean a lot of different things to a lot of different critics along the spectrum. I've talked to some, you know, pro free market business experts who use terms like maga, Marxism, for instance, to criticize what they see happening in the US Today. I've also talked to some critics on the progressive end of things who are generally of the belief that the government should take a stronger hand in private enterprise, at least in terms of regulations, that they want the government to rein in free markets a little bit more, but that they see what this administration is doing, what this president is doing, as more crony capitalism. It's not just the government taking a role in running private companies. It's the government again, picking winners and losers, depending on who's buddies with the president or who's annoyed the president. And that is something that is raising a lot of alarms again, among all kinds of critics, that his relationships, that the fact that CEOs are cozying up to him, as Danielle mentioned, some are donating to his controversial ballroom plans, or their companies are. There's a perception, at least, that there is an element of corruption in this kind of state capitalism that goes beyond just what perhaps the broad definition of state capitalism is.
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Got it. Yeah. It's not just like a what's happening, but why is it happening, essentially? Danielle, do you think we're witnessing a broader change within the Republican Party on how markets work, or is this Another one of those things that can just be chalked up to Trump is Trump. And in a post Trump world, we might move back towards more traditional Republican opinions about some of these things.
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That's a question that kind of melts my brain because you could ask that of so many aspects of Trump. Trump. Does his rhetoric change the way that the Republican Party talks? Does his policy in this or that change the way the Republican Party believes? I mean, Trump has taken ownership of the party and reshaped it in so many ways that that's just a perennial question right now. I mean, one thing that it has suggested, though, is that, you know, for some Republicans, party orthodoxy was malleable. Is malleable. He has shown just how far a party can stretch in terms of ideology. As long as it means supporting the leader, as long as it means a better chance at winning, at least as they perceive it.
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I mean, Maria, I also wonder whether this is just one of those outcome dependent things in terms of how in a few years down the line, how people think about it. I think about like this intel investment quadrupling. That's really interesting to me. This idea of like Spirit Airlines, if, if this does result in the airline prices going way up, obviously that's going to influence how people feel about this. Is this all kind of a little bit of the one of those, like, too soon to tell situations?
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And I think some of this will be kind of hard to unwind. But I also think back to 2008 and the bank bailouts and the auto bailouts that were really controversial at the time, and frankly controversial for years. The Troubled Asset Relief Program had overall a positive outcome for US Taxpayers, but it's still a subject of criticism.
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That's absolutely right. So public opinion may never come to a consensus on this, or if it does, it may take quite a while. I would add that if you look at TARP during the financial crisis, if you compare that to what Trump is doing with businesses, that shows just how far what Trump is doing is from something like tarp. Because TARP in part funded a bailout of the banking industry. Because the Bush administration and then the Obama administration was afraid that the entire banking system could collapse. So, so they bought toxic assets from the banks and bought preferred stock in the banks. But what they were very careful to do was say, this is not state capitalism. That is not what we are doing. We want you to buy this stock back from us within a few years. The government tried to be clear on that. And that is not what the Trump administration is doing.
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All right. Well, we can leave it there for today. Maria Aspen, thank you so much for joining us.
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Always a pleasure.
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I'm Miles Parks. I cover voting.
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And I'm Danielle Kurtzleben. I cover the White House.
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And thank you for listening to the NPR Politics podcast.
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