Updated December 22, 2025 at 11:08 AM MST
State capitalism. MAGA Marxism. Crony capitalism.
Those are just some of the terms business and political commentators have used this year to describe how President Trump's policies are reshaping U.S. free-market capitalism. There are some differences in definition — but all of these terms underline how dramatically Trump has blurred the boundaries between business and government, to an extent that could have long-term consequences for the U.S. economy and the country's global standing.
"When the American government appears to favor a company over rival companies, that distorts the marketplace," says Ann Lipton, a veteran business law expert and professor at University of Colorado's law school.
"It means that other firms have less incentive to compete on innovation, which is sort of the opposite of how a free market is supposed to operate," she adds. "It's just bad for the economy."
There's ample evidence this year of Trump actively favoring some U.S. companies and investors, while threatening others. In August, he publicly called for the resignation of Intel CEO Lip-Bu Tan — until Tan came to the White House to meet with him, and agreed to give the U.S. government a 10% stake in the tech company.
Several other tech CEOs also spent the year appearing to personally court Trump. Take Nvidia CEO Jensen Huang, who runs the world's most valuable company and is among the donors funding Trump's controversial plans to build a White House ballroom. This month, Trump said the U.S. would grant Nvidia permission to sell one of its more advanced semiconductor chips in China — as long as the U.S. government gets a 25% cut of sales.
Lipton calls this capitalism by "schmoozing," and warns that it could seriously damage the competitiveness of U.S. businesses, thus hurting the overall economy in the long term.
"We're not going to get the best innovations. We're not going to get the best products," she says. "If [businesses] are competing on their ability to schmooze, then that's bad for everybody."
Intel did not respond to an NPR request for comment. In an emailed statement, a spokesperson for Nvidia said, "In our discussions, President Trump focuses on his desire for America to win as a nation and his efforts to protect national security, American prosperity and technology leadership."
China-style 'state capitalism'
Business leaders have always spent some amount of time trying to cozy up to the White House, no matter its occupant. But Lipton and business insiders across the political spectrum say that Trump's direct influence over private companies this year — and the degree to which some of those companies and their leaders have sought to appeal to him personally — is pushing the U.S. economy away from free-market or "rules-based" capitalism.
This system, traditionally embraced by both businesses and Republicans, has helped make the United States into the dominant global economy.
But now, these business insiders say, Trump's policies are creating a government-controlled style of "state capitalism," in which the government — rather than competition between private businesses — shapes the economy. Some go so far as to call it "crony capitalism," meaning that the U.S. government picks winners and losers based on the president's personal relationships.
"We are seeing a shift away from the type of rules-based capitalism that has made America's economy so robust for so long. And there's a lot of risk in that," says Daniella Ballou-Aares, who co-founded the consulting firm Dalberg and served in President Obama's State Department. She now runs the Leadership Now Project, a coalition of business leaders that has endorsed candidates from both political parties.
In October, her group and The Harris Poll surveyed business leaders across the political spectrum — and found that 84% are worried "about the current political and legal climate's impact on their companies."
A White House official, who spoke on condition of anonymity, says "this narrative about how [President Trump] reshaped capitalism is significantly overstated" and calls Trump's policies by and large "the traditional free-market policy-making that you would expect coming out of a Republican Administration."
The official dismissed claims that the White House is engaging in "crony capitalism," and says "there are companies that are benefiting [from Trump's policies] whether or not they have a good relationship with the administration."
The official also notes that so far, the U.S. government has largely sought to take ownership stakes or revenue-sharing deals from companies that play a role in economic and national security: For example, Intel and Nvidia both sell the semiconductors at the center of the artificial-intelligence arms race with China. The U.S. government has also taken stakes or other interests in U.S. Steel and MP Materials, a rare-earth minerals mining company, among others.
"What we're trying to do is very much embracing the free market and the growth that it unleashes, but making targeted interventions where there's too much on the line," the official says.
Tech winners vs. everyone else in corporate America
Businesses largely welcomed President Trump's victory in last year's election, in part due to frustration with what they perceived as a harsh and "anti-business" regulatory climate under President Biden.
And some seem pretty happy with his first year in office — especially the tech billionaires whose "Magnificent Seven" companies are powering the A.I. boom.
"The Magnificent Seven and Trump 2.0 are really on the same page to a large extent," says Daniel Kinderman, a political science professor at the University of Delaware who studies what he calls "authoritarian capitalism" and business responses to right-wing movements.
Some of President Trump's policies, including his sweeping tariffs and his changes to immigration policies for highly-skilled foreign workers, have complicated the business of Big Tech. But most tech CEOs have tried to avoid criticizing those policies publicly, and instead focused on donating to Trump's personal projects. Apple's Tim Cook, for example, this summer presented Trump with a gold-plated and glass plaque as his company promised to invest $600 billion in the United States.
Such gifts appear to have helped: Apple's iPhones have escaped the worst of Trump's tariffs.
Apple did not respond to a request for comment.
Kinderman points out that for wealthy and powerful CEOs, Trump's degree of personal involvement in their businesses at least makes it efficient to deal directly with him — if they can keep him happy — instead of wading through the slow and complicated red tape of federal regulatory processes.
"These companies are a huge portion of the American economy," he says. "And I think Trump is also giving them, to a large extent, what they want."
Still, he and others warn that, taken to the extreme, codependent relationships between political leaders and CEOs don't always end well for the latter.
In more authoritarian countries, where leaders exert much more control over private businesses, the stakes can be especially fraught. Russia, Hungary, and China all exercise some form of state-controlled capitalism, where an autocratic leader cultivates relationships with oligarchic business CEOs — and can quickly force them out of favor.
As one extreme example, Ballou-Aares invokes Jack Ma, the Alibaba founder who built one of China's biggest tech companies before criticizing the country's financial regulations … and then largely disappearing from public view for several years.
"We know that crony capitalism never really ends well for most companies," she says. "I mean, tell Jack Ma that autocracy is okay for business."
'Most CEOs are pretty frustrated'
Outside of Big Tech, many businesses feel a lot more conflicted about how President Trump is reshaping U.S. capitalism. Some have even filed lawsuits against the administration, over its tariffs and its immigration policies.
"Despite the handful of tech titans that do seem to admittedly genuflect at the White House and at Mar-a-Lago, most CEOs are pretty frustrated with what's happening," says Jeffrey Sonnenfeld, a Yale management professor who regularly speaks with CEOs.
Pockets of frustration from corporate America have become more visible recently. The U.S. Chamber of Commerce sued the administration over its plans to start charging $100,000 for H-1B visas for highly-skilled foreign workers — although it did so while praising Trump's "ambitious agenda."
And JPMorgan Chase chief executive Jamie Dimon, who runs the country's largest bank and is one of the most prominent non-tech CEOs in the country, recently told CNN why his company had declined to donate to Trump's White House ballroom.
"Since we do a lot of contracts with governments here and around the world, we have to be very careful about how anything is perceived," Dimon said. "We're quite conscious of risks we bear by doing anything that looks like buying favors or anything like that."
That said, most businesses are reluctant to publicly criticize President Trump or his policies. Smaller companies lack the power to effectively stand up to the White House. And even those running the country's biggest companies are unwilling to draw the personal attacks that Trump can often wield, or the ensuing partisan boycotts and financial damage that can follow.
Many businesses have neither the appetite nor the capacity to take on the U.S. government. They just want to focus on making money, even if that means adapting to dramatic tariffs or other sharp shifts in government policy.
"It's tactical fire-fighting," says Drew DeLong, who advises businesses around the world as head of corporate statecraft for the consulting company Kearney, and who served in the State Department during Trump's first administration.
"Every moment and every hour you spend on tariff mitigation is one less hour that you spend on innovation," he says. "There is an urgency towards fire-fighting as best as they possibly can, but there's also a fatigue."
'Merger review has been weaponized'
The Trump Administration's approach to approving — or not — corporate mergers has drawn some of the highest scrutiny, because of the nexus of political and business issues at stake.
For example, the Federal Communications Commission this year approved several telecommunications mergers only after Verizon and T-Mobile agreed to terminate internal policies around "diversity, equity, and inclusion," or DEI. Then it threatened to take federal action against some ABC affiliates over Jimmy Kimmel's comments about Charlie Kirk's killing on his ABC late-night show; the owners of some of those stations were also seeking federal approvals for mergers. (ABC parent Walt Disney suspended Kimmel's show for almost a week, before reinstating him. ABC did not respond to requests for comment.)
"Merger review has been weaponized into a tool for control," says Elizabeth Wilkins, the former chief of staff to Lina Khan, who oversaw U.S. merger review as chair of President Biden's Federal Trade Commission.
"With those kinds of tools hanging over corporate leaders' heads, we have seen an atmosphere of uncertainty and fear — which breeds silence," adds Wilkins, who now runs the Roosevelt Institute, a progressive think tank.
The exception is, again, for leaders who cultivate close ties with the president. This year, the White House helped broker a deal for a coalition of U.S. investors to buy the U.S. operations of TikTok — and asked for an unusual multibillion-dollar payment to the federal government, which business experts have compared to a "shakedown" or "extortion." Some of those same investors, including Trump ally Larry Ellison and his son, David, are now seeking even more media deals.
Some business experts say now that corporate America has a better idea of President Trump's playbook in this administration, they expect to see companies and their executives feel more confident about how and when to push back against White House policies that they think will damage their businesses and the wider economy.
"I think it is clear that the administration's approach here is broadly unpopular, including with business," says Ballou-Aares.
But Kearney's DeLong, the veteran of Trump's first administration, warns businesses to brace for much more policy change, and uncertainty about what capitalism and the economy will look like in the future.
"This is just year one," he says. "Where do we go [during] the rest of this administration? Where do we go after?"
Copyright 2025 NPR
