A 35 percent U.S. military stake in a Venezuelan oil company is “nationalization,” according to the editors of National Review, and turns the Defense Department into “a hedge fund unconstrained by law.” The September 2 editorial, The American Nationalization of Venezuelan Oil, argues Trump shouldn’t take financial stakes in companies, then points to PDVSA as proof — because state-run oil is a documented disaster. The argument skips the half that does the work. Private capital won’t show up under the conditions the editorial won’t change fast enough, and every year of waiting is another year the current regime collects the rents.
State ownership of oil can be a disaster. PDVSA is the receipt: pervasive mismanagement, corruption, infrastructure collapse, production down roughly 70 percent from its 1998 peak. A state oil company captured by an unaccountable regime does not run a competent oil company. That part isn’t propaganda.
But “PDVSA was captured by an authoritarian regime” does not mean “government equity stake is wrong.” The first is governance. The second is ownership. Different problems, different remedies. Norway’s Government Pension Fund Global holds over $2 trillion in public oil wealth, equal to about 1.5 percent of every listed company on earth. It returned 15.1 percent in 2025 and operates under ethical rules that exclude weapons manufacturers and tobacco companies. Norway is state oil ownership working. PDVSA is state oil ownership captured. The difference isn’t ownership; it’s whether anyone is watching.
Norway isn’t a thought experiment. The American version sits in Alaska. The Alaska Permanent Fund has mailed a dividend to every resident every year since 1982. It works because the rules are written down, the books are public, and the fund can’t be looted by whoever sits in the governor’s office this term. Public oil wealth, governed transparently, has a working American blueprint the editorial never mentions.
The editorial’s preferred alternative has a track record too — just not the one it cites. ExxonMobil’s Venezuelan assets were expropriated in 2007. ConocoPhillips spent the 2010s unwinding its exposure. Chevron operates under constrained terms. International oil companies don’t deploy billions where they can’t reliably own what they extract, and the property-rights protections the editorial wants have been pending for the better part of two decades. The capital didn’t stay away because of this deal. It stayed away because the protection wasn’t there, and the regime was — still is — extracting the rents.
Every year of the editorial’s preferred gradual reform is a year the regime uses oil revenue to fund what it funds. The editorial calls the U.S. stake “sweetheart deals” and “collectivization.” The Venezuelan people have a different name for the last twenty years of “legal conditions gradually improving”: a diaspora now over seven million people, the largest displacement in the Western Hemisphere, and a government that has had no reason to change. The private capital would arrive on a clock ordinary Venezuelans cannot afford to wait on.
The Defense Department should not be a hedge fund — agreed. But the alternative the editorial reaches for is no better. Who currently holds large equity stakes in U.S. energy production? Blackstone, Apollo, KKR — the same private-equity firms that buy oil companies with borrowed money loaded onto the company’s books, extract fees and special dividends, and exit the husk. The “free marketplace” alternative the editorial invokes isn’t a public-spirited oil major. It’s a private-equity fund doing exactly what the editorial accuses the government of doing, with less transparency and no public accountability. If the objection is to unaccountable financial control of strategic resources, the private-equity version is the same problem with worse paperwork.
So what to build instead. A Venezuelan oil sector modeled on Norway, not PDVSA — transparent sovereign wealth structure, ethical governance, public books, dividends delivered back to the Venezuelan people, and an institutional firewall between the fund and whoever sits in Caracas this decade. The U.S. stake, structured properly, is closer to that model than to PDVSA. Show that private capital will actually deploy under the conditions the editorial isn’t willing to change fast enough, or retract the blanket claim. The piece doesn’t need less government involvement in Venezuelan oil. It needs the Norwegian kind.