Government Ownership of Private Oil Firms: Socialism Dressed Up as “Dealmaking

Here we go again. The Trump administration is taking a direct ownership stake in a private Venezuelan oil company—North American Blue Energy Partners—so the U.S. government can muscle in on developing tens of billions of barrels of crude. Private capital that actually knows how to allocate resources, assess risk, and deliver returns now has to think twice before competing against a competitor that answers to politicians, not shareholders or the market.

This is textbook socialism and economic illiteracy. When the government owns a piece of a private business, it distorts every incentive: capital is no longer allocated by profit-and-loss signals but by political favoritism and bureaucratic priorities. Efficient private operators will rationally pull back rather than risk competing with an entity that can lean on taxpayers, preferential regulations, and state power. Property rights get shredded, risk is socialized, and the result is slower growth, higher costs, and crony deals instead of genuine wealth creation. We’ve seen this movie before—every time government “partners” with private firms it crowds out the very companies that make the best, most disciplined investments. For example, after the government took an interest in US Steel, promising to be a passive investor, it immediately prevented the company from closing an inefficient steel plant for fear of the politics of the workers losing their jobs.

The principle is simple and non-negotiable: the U.S. government has no business owning private enterprises. Markets work when private owners bear the full consequences of their decisions. Anything less is theft of opportunity and a direct assault on the economic freedom that built this country.