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Those who have long preached in favor of free markets and against socialism are being thrown for a loop with President Trump’s move to have the U.S. government take a 10 percent stake in struggling chipmaker Intel — and his willingness to make similar deals with more companies.

It’s a major development in the battle for the dominant economic philosophy on the political right as free-marketers and populists duke it out over the appropriate level of government intervention in the age of Trump and beyond.

Libertarian-leaning Sen. Rand Paul (R-Ky.) called the deal a “terrible idea,” suggesting on social media the Intel stake is a “step toward socialism.” Rep. Warren Davidson (R-Ohio) warned in another post that “America will not outperform China by being more like China.”

Sen. Eric Schmitt (R-Mo.), meanwhile, made a national security argument when asked about the government taking a stake in Intel.

“You can’t have the only chipmaker in the United States go down, which is what the concern is,” Schmitt told NewsNation on “The Hill Sunday,” adding that he thought the Intel arrangement would be a "temporary” move.

The Intel deal — made after Trump had a meeting with its CEO, whom he had called on to resign — gives the government a nearly 10 percent stake in the chipmaker, paid for with about $11 billion in grants from the CHIPS and Science Act and other U.S. government grants.

It might not end there. National Economic Council Director Kevin Hassett said Monday morning on CNBC that it is “absolutely” possible that the U.S. government takes more equity stakes in U.S. businesses. Trump posted on social media: “I will make deals like that for our Country all day long.”

It’s quite the change from Tea Party-era rhetoric bemoaning government “picking winners and losers” and “crony capitalism” — and has won a thumbs-up from self-described democratic socialist Sen. Bernie Sanders (I-Vt.).

Trump had already shaken the free market capitalists with his protectionist and retaliatory tariff policies, but they were pleased by Trump’s extension and expansion of tax cuts in the One Big Beautiful Bill Act.

His embrace of taking ownership of private companies as a part of American industrial policy, though, is an affront to not only the reigning economic wisdom on the right, but the philosophical principle of independence for private companies.

“Conservatives for years have bemoaned exactly this kind of muddling of the public and private sector — when it came to baking the cake, questions about DEI, and all these other things,” Akash Chougule, president of the pro-free market Foundation for Research on Equal Opportunity, told me. “Government is now one of the major drivers of Intel, and conservatives are not going to be in control of government forever, and now have to ask ourselves what that means.”

Scott Lincicome, vice president of general economics and trade at the libertarian Cato Institute,

© The Hill