Commerce Secretary Howard Lutnick just slammed the brakes on a whopping $7.4 billion deal that smells of political favoritism. On Monday, August 25, 2025, Lutnick voided a funding agreement with Natcast, a nonprofit stuffed with former Biden administration insiders, which was set to control billions in semiconductor research dollars. This move is a bold stand for accountability over backroom dealings.
Here’s the crux: Lutnick’s decision scraps a last-minute Biden administration scheme to funnel taxpayer money through Natcast, a Sunnyvale, California-based entity, bypassing oversight from the incoming Trump administration, New York Post reported.
Let’s rewind to the origins of this saga. Back in 2022, the CHIPS and Science Act, signed by then-President Joe Biden, allocated $11 billion for semiconductor research and development, to be managed by the Commerce Department’s National Semiconductor Technology Center. The intent was clear—keep American innovation at the forefront, with proper governmental oversight.
Fast forward to January 16, 2025, just four days before Biden left office, when the Commerce Department rushed to lock in a deal with Natcast. This agreement handed over $7.4 billion in “advance payments” to the nonprofit, effectively sidelining the incoming administration from any say in the matter. Talk about a parting gift that keeps on taking.
Natcast wasn’t just any nonprofit—it was a cozy club of Biden-era appointees. The selection committee featured names like Jason Matheny, a former White House official, and Kendra Wilkerson, who champions progressive causes in tech, while executives like Donna Dubinsky and Susan Feindt held prior roles under Biden’s Commerce Department. It’s hard not to raise an eyebrow at such a tight-knit circle controlling billions.
Even Natcast’s CEO, Deirdre Hanford, had ties to Biden’s Commerce Department through an advisory committee. Add in Jeremy Licht, the nonprofit’s general counsel and former chief counsel on semiconductor incentives under Biden, and you’ve got a recipe for conflict of interest that could spoil any taxpayer’s appetite.
Lutnick didn’t mince words in his letter to Hanford, stating, “Biden Administration officials spent significant time… creating an unaccountable… entity.” That’s a polite way of saying this setup was a dodge around congressional intent. If the CHIPS Act meant for the Commerce Department to oversee funds, why outsource to a private group until 2034?
He went further, asserting, “These actions… flout federal law.” Lutnick pointed to the Government Corporation Control Act, which bars agencies from creating such entities without explicit authorization. It’s a legal slap on the wrist for a deal that looks more like a political favor than a public service.
And don’t miss this gem: “Ending this illegal relationship will ensure… American leadership in the semiconductor industry,” Lutnick wrote. This isn’t just about canceling a contract; it’s about restoring trust that taxpayer dollars won’t vanish into a black hole of cronyism. That’s a win for anyone who values transparency over partisan games.
The plot thickens with revelations from EPA Administrator Lee Zeldin, who uncovered $20 billion parked at Citibank, intended for distribution through questionable pass-through entities. Zeldin noted, “EPA is losing oversight by design intentionally.” It’s a chilling reminder that Natcast might be just one piece of a larger puzzle of rushed, pre-inauguration payouts.
Zeldin also highlighted how Biden appointees were “rushing to get billions… out the door” before January 20, 2025, often to organizations with progressive leanings. While the intent behind such haste could be debated, the lack of accountability is a red flag for anyone concerned about fiscal responsibility.
Back to Lutnick, who warned, “The Department reserves the right… against Natcast.” That’s not just tough talk—it’s a signal that the Commerce Department is serious about clawing back control and ensuring every dime of CHIPS Act funding is spent as Congress intended. Good luck arguing against that principle.
So, what’s the big picture here? Lutnick’s revocation of the Natcast agreement isn’t merely a policy tweak; it’s a full-on effort to return oversight to the Commerce Department, where it belongs. This move counters a troubling trend of outsourcing critical decisions to unaccountable groups with questionable ties.
American taxpayers deserve to know their hard-earned money isn’t being funneled into the hands of political allies under the guise of innovation. The semiconductor industry is vital to national security and economic strength, and it shouldn’t be a playground for partisan agendas. Lutnick’s decision is a step toward ensuring that remains the case.
Ultimately, this story is a wake-up call about the need for vigilance over how public funds are managed. While some may lament the loss of Natcast’s role, the priority must be on lawful, transparent stewardship of resources meant to secure America’s technological edge. Let’s hope this sets a precedent for putting principle over politics.
