According to the Wall Street Journal, the United States Department of Defense (also known as the Pentagon) intends to purchase shares in three American drone manufacturers: among these is Unusual Machines, where Donald Trump Jr. – the president’s eldest son – is an advisor.
TRUMP’S POLITICAL CAPITALISM
The American government’s entry into the shareholding of private companies is unusual, but not entirely new. The Donald Trump administration, in fact, has already invested in several mining companies, such as Mp Materials and Usa Rare Earth, as well as having bought a 9.9 percent stake in the microchip producer Intel. The extraction and processing of certain minerals, as well as the manufacturing of semiconductors and drones, are considered activities relevant to the national security of the United States: for this reason, it seems, the White House wants to exercise direct control over them.
These operations seem to suggest a departure by Washington from its traditional model, based on the free market and external constraints on companies, such as export controls, and a move closer to the so-called European “state capitalism,” where direct state intervention in the economy is greater.
DRONE COMPANIES IN THE PENTAGON’S SIGHTS
The three companies with which the Pentagon is negotiating are Unusual Machines, Performance Drone Works, and Neros Technologies. Neros produces drones equipped with first-person view systems, Unusual Machines supplies drone components, while Performance Drone Works had already secured contracts with the U.S. armed forces for the supply of reconnaissance drones.
However, the Pentagon would not be interested in directly purchasing drones or components but would like to finance these companies with the aim of increasing their production capacities and promoting the reduction of prices of remotely piloted aircraft in the United States. At the moment, however, no agreement has been signed.
THE PROBLEM WITH UNUSUAL MACHINES (AND DONALD TRUMP JR.)
A potential government funding of Unusual Machines would be controversial, given that Donald Trump Jr. owns shares in the company and is a member of the advisory board.
Beyond his role in Unusual Machines, Donald Jr. has also invested in other drone manufacturing companies: in Powerus, for example, which builds drones for heavy cargo transport (among its clients is the Pentagon itself), and in Anduril Industries, a defense technology startup founded by Palmer Luckey and specialized in autonomous systems.
THE INCENTIVE FOR DRONE PRODUCTION
The possible public investment in Unusual Machines, Performance Drone Works, and Neros Technologies was preceded by an executive order from President Trump to increase national drone production.
The White House has also banned imports of new models of foreign drones and critical components (though exemptions are expected until the end of the year). Meanwhile, the Pentagon has developed a $1.1 billion program to build a stockpile of 300,000 low-cost attack drones.
