Washington as a Business Model

On January 20, 2025, Donald Trump placed his hand on the Bible and began his second term as president of the United States. Many expected turbulence. Few expected a presidency that would function like a corporate takeover. But eight months in, investors are discovering that Washington is not merely setting the rules of the game anymore. Washington has become the game.

Trump always claimed he would run America like a business. In his first term, that phrase sounded like a slogan. In his second, it is operational reality. The administration has reshaped government authority into something resembling a controlling shareholder. The White House has demanded royalties on chip sales, pressed for the removal of high-profile CEOs, and secured golden shares in steel companies. Analysts are now adding a new column to their models: not revenue, not earnings per share, but the risk or reward that flows directly from presidential discretion.

Semiconductors have become the showcase. Nvidia and AMD built fortunes on the global hunger for artificial intelligence chips. But in 2025 their financial models began to resemble franchise agreements. When Washington allowed them to resume exports to China, permission came with a condition: a 15 percent cut of revenue funneled directly back to the U.S. government. In effect, export policy turned into a licensing deal, with the Oval Office acting as royalty collector.

The markets treated it as they would any other licensing stream. Sell-side analysts trimmed revenue projections. Hedge funds adjusted discounted cash flow assumptions. The “policy beta”, shorthand for volatility generated by presidential action, became a new input in trading models. Traders started treating presidential approval the way they might treat consumer demand. Without it, the chip cycle no longer mattered.

Intel went even further. The company’s stock, once tied to product launches, now moves with every White House directive. When Trump called CEO Lip-Bu Tan “highly conflicted” and demanded his resignation, Intel lost about 3 percent in a single trading day. Then came word that Washington might convert part of Intel’s CHIPS Act subsidy into a non-voting equity stake. For investors, the message was unmistakable. Intel was becoming a semi-public utility with the U.S. Treasury on its shareholder register.

The U.S. Steel–Nippon Steel merger revealed how far the CEO presidency is willing to go. Clearance came with a golden share for Washington. The instrument carries no dividend but gives veto power and the right to appoint a board member. Governance experts noted that such structures are usually associated with Moscow or Beijing, not Pennsylvania. The White House framed it as a national security safeguard. Market veterans saw something else: state capitalism dressed in American language.

Former Commerce official Jim Secreto called the arrangement “risky and unprecedented.” The Wall Street Journal’s Greg Ip called it “state capitalism with American characteristics.” Whatever the label, the consequence was clear. Washington was no longer refereeing corporate mergers. It was writing itself into the bylaws.

Trump’s trade negotiations now resemble blockbuster contracts. The Japan package was announced with a $550 billion investment headline, and Trump claimed the U.S. would capture 90 percent of the profits. The European Union deal tied tariff relief to $750 billion in American energy purchases and $600 billion in capital commitments. Trump described these as “spending power,” a phrase more familiar to CFOs than to diplomats.

Whether the math holds is almost beside the point. Markets are being instructed to treat international agreements as revenue lines subject to presidential allocation. That framing has left economists scratching their heads and traders rewriting spreadsheets.

Corporate executives now act like managers inside a sprawling conglomerate. Their careers depend on staying aligned with the boss.

Apple’s Tim Cook delivered a 24-karat glass plaque to the White House along with a $100 billion investment pledge. Trump rewarded him with an exemption from new chip tariffs, and Apple’s stock rose on the announcement. Jensen Huang of Nvidia carefully highlighted his company’s role in building domestic AI infrastructure, framing every press comment to emphasize loyalty to the national agenda. Elon Musk shifted between public feuds and quiet rapprochement, acutely aware that Tesla and SpaceX live off government contracts.

Even banks have adjusted. When Trump warned JPMorgan and Bank of America of “payback” over so-called discriminatory account closures, their stocks fell, not because of immediate losses but because presidential ire itself became a tradable risk. Executives are discovering what it means to work under an activist shareholder whose moods shape valuations.

Corporations once operated with a healthy distance from politics. Now they behave like courtiers. Praise publicly, hedge privately, and never assume yesterday’s rules will apply tomorrow.

Disney and CBS have already experienced what happens when executive displeasure turns hostile. Licenses and approvals can tighten. Lawsuits can appear. A tweet can erase billions in market value. Investors, meanwhile, are adopting an unsteady rhythm: bet against Trump and you risk missing a rally; bet with him and you accept volatility that traditional models cannot explain.

For now, the markets remain buoyant. The S&P 500 leans on AI optimism and consumer resilience. But warning lights flash beneath the surface. Lisa Shalett of Morgan Stanley Wealth Management has noted that the equity risk premium has collapsed to “very low levels, leaving almost no room for disappointment.” BlackRock analysts caution that “headline-driven markets” are unlikely to calm down soon. Translation: prepare for turbulence.

Presidents have intervened in markets before. George W. Bush and Barack Obama bailed out banks and automakers in 2008–09, but they treated those actions as temporary. Obama made a point of exiting GM’s equity as soon as possible. Trump, by contrast, is treating government stakes as operating arrangements rather than emergency stopgaps.

The comparison with his business record is inescapable. Trump’s casinos went bankrupt. The Trump Shuttle collapsed within four years. Trump University ended with a $25 million fraud settlement. In each case, creditors and investors bore the cost while Trump walked away. The White House model today looks eerily similar: headline-grabbing deals financed by others, risk passed downstream, and little concern for cleanup.

The difference is scale. A failed casino can wipe out bondholders. A failed presidency that treats America as a balance sheet can dent the credibility of the entire U.S. financial system. Courts and Congress remain counterweights. Lobbying still matters. But day to day, none of those constraints prevent the volatility of a CEO presidency.

America as a meme stock

In some ways, America Inc. now resembles a meme stock. It is too large to avoid, too volatile to trust, and too dependent on the personality at the top. Investors parse tweets, scan press conferences, and recalibrate portfolios on the basis of presidential mood swings.

That leaves Wall Street pricing Washington like it would any other controlling shareholder. But when the controlling shareholder is also the president of the United States, the stakes extend beyond quarterly profits. They reach into the heart of the global financial system, where credibility is currency and trust is capital.

The longer the CEO presidency runs, the more fragile that trust becomes.