Trump's Free Market in Name Only
The president is inserting himself into corporate decisions and manipulating businesses to serve his political agenda.
In a capitalist economy, business leaders have one primary mission: to maximize company value for shareholders and stakeholders. The free market is the arena in which they pursue that mission, attracting and keeping customers who generate the revenue needed to operate and profit — a principle famously championed by management thinker Peter Drucker.
For decades, conservatives and Republicans have argued that the less government interference, the better businesses can operate, generate wealth, and create jobs that sustain a stable economy.
Not in Trump’s America.
President Donald Trump frequently inserts himself into the private sector, not only through broad policy moves but also through direct influence on individual companies. While his administration is cutting regulations and reducing operational burdens, he is also applying demands, coercion, and selective rewards to shape corporate behavior.
A Pattern of Intervention
The latest example came when Trump called for Lip-Bu Tan — CEO of Intel — to resign over alleged ties to China. Tan, an American citizen born in Malaysia with Chinese heritage, is trying to pull the company out of a long slump. Once dominant in computer processors, Intel has fallen behind rivals Nvidia and AMD, which design chips and outsource manufacturing to foundries such as Taiwan Semiconductor Manufacturing Co. (TSMC). Intel still designs and builds its own chips — a slower, costlier model — and faces political as well as market headwinds.
Observers believe Intel’s problem with Trump is that it cannot match the grand U.S. investment pledges others have made, despite receiving billions in federal subsidies to expand domestic production.
This fits a broader pattern in which corporate decisions are shaped by presidential pressure.
Rewards for Allegiance, Penalties for Resistance
Earlier this week, Apple CEO Tim Cook presented Trump with a custom crystal plaque in the Oval Office and announced a $100 billion U.S. investment. Trump promptly granted Apple a tariff exemption.
When tariffs threatened to raise prices on goods from electronics to automobiles, Trump told companies to absorb the costs or face negative publicity and other consequences. General Motors and Walmart complied.
Market watchers have also noted unusual timing in other cases. Many speculated that the Federal Communications Commission’s approval of Skydance’s purchase of Paramount followed CBS’s settlement of a lawsuit Trump filed over an edited interview with Kamala Harris during the 2024 campaign.
This week, Trump signed an executive order penalizing banks for closing accounts or refusing service based on religious or political beliefs. Experts say there is little evidence of widespread “debanking” and that most banks decline certain business — such as cannabis, militia groups, or cryptocurrency — based on federal restrictions, not ideology. Many believe the order stems from banks cutting ties with the Trump Organization after the January 6, 2021 riots.
Together, these episodes show a consistent use of presidential authority to reward loyalty and punish resistance, regardless of market logic or shareholder interests.
Presidential Interventions Aren’t New — But the Motives Are
As The Wall Street Journal has noted, presidents have intervened in the private sector before. Franklin D. Roosevelt seized companies that defied union agreements. Harry Truman nationalized the steel industry during the Korean War to protect supply chains. Barack Obama pushed for the resignation of General Motors’ CEO after the government purchased shares to keep the automaker afloat in 2008.
Those actions were tied to national emergencies or broad economic stability. Trump’s interventions are more selective and personal, aimed at steering company behavior toward his political objectives or punishing those that do not align.
The Risk to Market Independence
Since his re-election, CEOs have flocked to Mar-a-Lago, believing public deference will buy influence. Sometimes it does. Increasingly, though, executives are finding that staying in favor means reacting to whatever the president finds objectionable — whether diversity, equity, and inclusion policies, price increases to offset rising costs, or foreign investment decisions.
One administration official said Trump wants an economy that “puts America and Americans first” and expects businesses to align. But businesses operate on longer timelines than election cycles. Even if Trump’s economic vision succeeds, results will take years to materialize, and companies must still make strategic decisions in the interest of their investors, customers, and long-term competitiveness.
In the traditional American framework, presidents set visions and policy goals; businesses and individuals decide how to respond. Taxes and tariffs can influence decisions, but they are not meant to compel them.
Trump’s approach blurs that line. By using the presidency to insert himself into individual corporate decisions, he undermines the independence of the market he claims to champion. The free market depends on the ability of companies to act in their own best interest, guided by competition and consumer demand — not by political loyalty.
Presidents can inspire and incentivize, but in a healthy capitalist system, the market must remain free to decide. In Trump’s America, that freedom is giving way to something else: a marketplace shaped not by open competition, but by presidential preference.
What Intel needs to understand is if reality does not fit what Trump wants, make the fantasy happen. That's what he has always done--faked profits, inflated values to gain undue financial credit, declared insurrectionists to be the victims and cleared their names. Cook the books, and if you get caught, blame a subordinate. When it becomes advantageous (or you just cannot last any longer) declare bankruptcy and call it "strategy."