Kate Laurensen is a veteran reporter. She started out covering entertainment news for the local city paper before moving up to the City desk. She studied journalism at San Francisco City College for the Arts.
February 4 , 2025
Washington, DC - President Donald Trump signed an executive order on Monday to establish a U.S. sovereign wealth fund, potentially paving the way for the government to acquire popular social media platform TikTok. The move marks a significant shift in economic policy and raises questions about the future of American capitalism.
In typical style, Trump declared, "Americans are ready for more government control of the things they rely on every day." He emphasized that this approach would differ from European socialism, asserting, "U.S. socialism would be different than European socialism because the U.S. government would own American industries—not the EU government."
The executive order directs the Treasury and Commerce Departments to develop a strategy within 90 days for creating the fund. Treasury Secretary Scott Bessent stated, "We're going to stand this thing up within the next 12 months. We're going to monetize the asset side of the U.S. balance sheet for the American people."
Trump specifically mentioned the possibility of using the fund to purchase TikTok, which has approximately 170 million American usera. The popular app faced a potential ban due to national security concerns but was granted a 75-day reprieve by Trump after he took office on January 20. "We could incorporate it into the sovereign wealth fund, depending on what we generate," Trump said, referring to TikTok. This statement comes after Trump's previous efforts to force TikTok's Chinese owner, ByteDance, to sell its U.S. operations.
The creation of a U.S. sovereign wealth fund raises questions about its financing, given that the country operates with a budget deficit. Typically, such funds are established by nations with budget surpluses or abundant natural resources.
Howard Lutnick, Trump's nominee for the Commerce Department, suggested that the government could nationalize companies it engages with, stating, "If we are going to procure two billion Covid vaccines, perhaps we should bring them under direct government control."
This move represents a significant departure from traditional U.S. economic policy and has sparked debate about the role of government in the economy. Critics argue that such a fund could lead to increased government intervention in private industries, while supporters view it as a potential tool for economic development and national security.
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