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Nine governors press U.S. lawmakers to pass semiconductor funding bill

136 points by graderjs 5y ago

malchow 5y ago
This is a pork bill from Intel, which used to know how to build competitive fabs and now does not. Federal pork will not make our country better at semi autolines.
- deleted 5y ago
  [deleted]
- jdkee 5y ago
  Absolutely it is pork. Domestic production of microchips is a national security issue and should be subsidized like the manufacturing of aircraft and weapons systems.
  - malchow 5y ago
    Pork doesn't work. Ask people inside DOD who are increasingly frustrated at the Primes leading DOD around by the nose with outdated ideas and outmoded products. For national security, we need a state of affairs wherein it is profitable to build and run a plant in the U.S. that responds primarily to the dynamic needs of private actors. All of the issues there are on the cost side of the ledger.
    - beauzero 5y ago
      Primes? ...sorry not familiar with the lingo.
      - stagger87 5y ago
        The major defense contractors.
      - ms512 5y ago
        Prime Contractor. It is a company that is responsible for the final integration of a system, but often fans out subcomponents to a large assortment of other companies.
      - pebcack 5y ago
        The contracting company that wins a bid for a contract is the Prime contractor. Often times these companies will then subcontract out some of that work (and sometimes it's even required by the contract to do so) to other contracting companies which would then be the Sub-contractor. That's where the "Prime" and "Sub" lingo in re: to DoD contracting comes form.
        airstrike 5y ago
        And the sub-contractors are sometimes further broken down into Tier 2, Tier 3... depending on how far down the value-chain they are
    - vkou 5y ago
      > For national security, we need a state of affairs wherein it is profitable to build and run a plant in the U.S. The way to do that is massive tariffs, not pork. They will be met with retaliatory tariffs.
    - dragontamer 5y ago
      > Pork doesn't work. Seemed to work when Taiwan basically funded TSMC. If they can do it, why can't we do it? I mean, the USA is also funding TSMC to move to Arizona. I don't got nothing against this, but domestic chip-makers should also get a piece of the pie, right? -------------- In any case, this isn't "Pork". Pork is when you build something useless in somebody's state (aka: The Bridge to Nowhere), so that those "somebodies" vote on some other bill. Aka: Build a bridge in Alaska to nowhere, and __suddenly__ your Alaskan senators / house members starts the process of log-rolling and helps out on other bills. ------ Pork was incredibly common in the 80s and 90s, and has been cut down in the modern era. Today, its impossible to get logrolling, because too many people have demonized pork. If you want to get Senators / House members to support a large-scale bill, you HAVE to have something in there for them. Imagine how much easier it would have been to get Joe Manchin to vote for the infrastructure bill if we tossed in a few coal subsidies (aka: West Virginia Pork) into the infrastructure bill. Alas: today's citizens are ignorant to the wonders of pork. Its actually very easy to convince other senators / house members to do something useful. You just gotta give them a bit of pork. ------- Pork isn't about making the underlying thing more efficient. Its about convincing leaders to support the project to begin with and get it greenlit in the first place. Without pork, you can't effectively build a coalition. And today's Senate / House is proof of that, its incredibly difficult to get anything done because of our anti-Pork culture. Life was better with pork. We did our grand experiment over the past 30 years by demonizing pork, and it failed. Time to bring Pork back.
      - paganel 5y ago
        Pork is a pretty efficient way for the richer part of the country to subsidize back the poorer ones without making it look like socialism/communism. It partially makes up for the huge demographic subsidies the richer parts of the country receive from the poorer ones as a result of internal migration.
        dragontamer 5y ago
        Your discussion point is interesting, but I'm not sure if I'm willing to take the stance that "Pork is Good". I'm simply a pragmatist. We know Congress is perpetually deadlocked and that we haven't had a proper budget in damn near a decade. Maybe its time to whip out the old Pork technique. That's all I'm saying. Anyone who studied how these budgets got passed 30 or 40 years ago knows: Pork was essential in building coalitions (especially across party lines). You scratch my back, I scratch yours. If you help me pass X Bill, I'll write a useless thing into the Bill that benefits your state. Lets bring it back. Lets get Congressmen working together again.
    - arrosenberg 5y ago
      Pork works really well actually, it's the grease that allows useful projects to go forward. The DOD is getting lead around by the nose because they themselves insisted on consolidation during the Reagan era, and none of the administrations since have bothered to correct the problem. They've been hoisted on their own petard. > For national security, we need a state of affairs wherein it is profitable to build and run a plant in the U.S. that responds primarily to the dynamic needs of private actors. National Security should revolve around the profit motives of a handful of private actors? Hard pass.
    - throwawaygh 5y ago
      > Ask people inside DOD... DOD is a rural jobs program. It functions as intended. Other branches of the federal government that aren't designed to be jobs programs (e.g., NSF) do tend to make good investments and get things done.
- onedognight 5y ago
  This may be pork from Intel, but even TSMC is getting subsidies to build fabs in the US. The US see strategic interest in chip fabs.
  - consumer451 5y ago
    > This may be pork from Intel, but even TSMC is getting subsidies to build fabs in the US. The US see strategic interest in chip fabs. We sit around and argue about this while TSMC was founded by the Taiwanese government. The Taiwanese gov't is likely still a giant shareholder. I am curious as to what HN readers think is different about the two situations. As in, why can't it work in the USA? Fun TSMC fact: Morris Chang was never given any options as part of his original pay package. He used his own money to buy shares.
    - arrosenberg 5y ago
      > I am curious as to what HN readers think is different about the two situations. As in, why can't it work in the USA? Unfortunately we are still stuck with the legacy of Reaganism, which was essentially the undoing of the New Deal notion that the government could do good for the country and the average person.
      - gruez 5y ago
        >which was essentially the undoing of the New Deal notion that the government could do good for the country and the average person. The new deal involved governments giving billions in grants to multibillion dollar multinationals?
        arrosenberg 5y ago
        The New Deal governments have a legacy of getting a ton of bang for it's buck - Rural Electrification, the Hoover Dam, the Interstate Highway System, and the Apollo program just to name a few. The entire point of Reaganism was to destroy that legacy by making government ineffective, wasteful, and disdainful of the very people it is meant to serve.
- mtmail 5y ago
  For anybody (outside the United States) wondering: https://en.wikipedia.org/wiki/Pork_barrel https://en.wikipedia.org/wiki/Pork_barrel "is a metaphor for the appropriation of government spending for localized projects secured solely or primarily to bring money to a representative's district."
  - newbamboo 5y ago
    In other words infrastructure.
    - blagie 5y ago
      No. The Wikipedia article makes it sound that way, but a lot of pork is in subsidies to specific industries, mandatory purchasing, research initiatives, or similar. For example, if the military must buy 50,000 of something it doesn't need from some military contractor located in some senator's district, that's a canonical example of pork. The line here is subtle. The exact same purchase could be made through a competitive bidding process. If I'm doing space research, that's probably good. If I mandate that NASA do a specific research project through a specific vendor, that's probably pork. In most cases, pork isn't obvious. The bill won't say "NASA will give $50 million to Acme Inc," but rather "NASA will purchase $50 million worth of sheet metal from a veteran-owned company with at least 7 years experience in aluminum-matrix composite manufacturing, ..." and by the time you include all the requirements, what do you know, there's only one business which fits the bill.
      - whoknowswhat11 5y ago
        Pork is identifiable a mile away. Space Launch System - I think the funding line both required they use a bunch of tech (only made by certain vendors) but also prohibited any competitive bidding or evaluation of other approaches. $20B later we might get a rocket that costs $2B per launch? OUCH! More common are the funny requirements docs. 5 years of experience but not more than 10 to reserve project for "new entrants". Located in a XXX district (improvement, benefit etc).
      - newbamboo 5y ago
- Server6 5y ago
  I don't understand why people are so opposed to pork spending? Pork is how things got done historically. Sure on the surface it's wasteful, but it promotes compromise and greases the wheels of government. None of the great works in the US would have been completed without it. Pork reform in my opinion is one of the reasons why things are so partisan these days - everyone is in their own corner and there's no incentive for Democrats to help Republicans and vice versa.
  - JoeAltmaier 5y ago
    And how some of the biggest boondoggles got built. Never mind bridges to nowhere. The Arkansas river has a multi-billion dollar lock and dam system. To take all those Arkansas products to market presumably. From a state near the bottom rank in GDP. That's pork.
    - Server6 5y ago
      Yeah, I agree there's some waste and boondoggles. I'm just arguing that they're necessary in order for government to function.
      - lazide 5y ago
        How do? It’s clear corruption. They could do the same thing with a competitive bidding system more cost effectively no?
      - 1123581321 5y ago
        I see what you’re saying, but it’s only true in the sense that dysfunctional government refuses to operate without a dysfunctional incentive. It is possible to improve the percentage of wisely chosen projects.
    - analognoise 5y ago
      On the other hand, if a state has the bottom rank in GDP, wouldn't we want to provide infrastructure to lift them up? Saying "They're already poor, let's not invest in their infrastructure" sounds like a self-fulfilling prophecy to me - they'll stay poor unless we invest in them?
- zitterbewegung 5y ago
  You always should be giving the pork bill to the company doing the worst to increase competition. Giving it to the best only gives their margins. Giving it to the worst possibly gives it the ability to innovate . Also Alder Lake looks somewhat promising.
  - joconde 5y ago
    Performance is probably correlated with good governance, so that has a high risk of wasting money on a company that's unable to spend it efficiently. It even gives their leaders a break from having to improve efficiency, because the pork keeps them from going bankrupt whatever they do.
    - zitterbewegung 5y ago
      Totally agree with your statement. Yes you are wasting money on a company so that they are still selling something at the end of the day regardless of quality or sales . That is my point .
- blagie 5y ago
  It's a bill from Intel and friends, but I don't think it's pork. Chip manufacturing (like food, energy, etc.) is a national security issue. Specialization is more efficient in the short term. Free market pushes chip manufacturing to be a monopoly or duopoly. That's not resilient, though. I don't mind my tax dollars subsidizing these industries remaining in the US, though. Indeed, I think it's good policy to have all major regions of the world be self-sustaining (e.g. not France, but the EU as a whole).
  - lazide 5y ago
    Just because it is a national security issue doesn’t mean the spending and way it will be allocated isn’t a corrupt waste of time (unfortunately). If it is a corrupt waste of time, it’s pork.
  - rapsey 5y ago
    Yes but how do you know the money actually will be spent productively. The main problem is this kind of money often just lines pockets.
    - blagie 5y ago
      The trick, really, is good governance. These problems have been solved before. For example, the government can: 1. Provide market incentives. For example, the federal government can give a 25% subsidies for school Chromebooks/laptops/etc., require the CPUs and RAM to be manufactured in the US. 2. Provide guaranteed markets. The US military is an efficient place to do this. 3. Provide subsidies with outcomes. If Intel wastes the money, Intel stock moves from investors to taxpayers. Personally, I'm also a big fan of tariffs. Free trade zones are great, but tariffs between free trade zones on essential goods can encourage local production. If US CPUs cost 25% more in the EU, and EU CPUs cost 25% more in the US, there's a strong incentive to have local manufacturing infrastructure.
      - rapsey 5y ago
        Well they obviously can make sure the money is spent as intended. The problem is they wont.
- trzy 5y ago
  If Chinese pork can make them competitive, American pork can make us competitive. If implemented properly. Is it anti-competitive and will it reinforce inequality by picking winners? Unfortunately, yes.
jimbob45 5y ago
Why wouldn't Texas have signed on to this? One would think they'd want to keep Musk happy after he moved to their state.
- csours 5y ago
  Texas is being very contrary for the past 12 years or so, moreso now that Biden is President.
harikb 5y ago
> which would set aside $2 billion for the kind of older-technology chips of which there is a deep shortage
OldHand2018 5y ago
> Illinois, Wisconsin, North Carolina, Kentucky, Pennsylvania, Kansas and California. Do these states (aside from California) have fabs, or rather any hope of getting new fabs? What's in it for them?
- pacoWebConsult 5y ago
  Current resident of NC so I was curious. Looks like we have several, but I don't see any for KS or KY at first glance [1] [1] https://en.wikipedia.org/wiki/List_of_semiconductor_fabrication_plants https://en.wikipedia.org/wiki/List_of_semiconductor_fabricat...
  - jjk166 5y ago
    If your state has businesses that build the equipment for fabs, building of new fabs will bring business to your state even if they aren't located there. For example Kulicke and Soffa's wirebonders are made in PA.
- edaemon 5y ago
  Many of them have manufacturing industries that have been affected by the chip shortages. Illinois, North Carolina, Kentucky, and Kansas all have sizable automotive industries, for example.
- throwawaygh 5y ago
  You forgot Alabama and Michigan. Kentucky, Alabama, and Michigan are huge automobile assembly states [1] who are hurting from chip shortages. KY/AL are especially dependent on the auto assembly industry for non-ag employment. California has Tesla, of course, but also likely to benefit from chip fabrication. Wisconsin is kind of a historical auto state, so some solidarity makes sense. More importantly, though, I think WI+IL see potential for chip fab in their states because of their globally-unique fresh water source (Lake Michigan), and NC is probably on board because they see potential to benefit from domestic chip fabs in research triangle. Pennsylvania probably fits into this "one foot in because of auto suppliers and the other foot in because of tech" camp also. The huge elephant in the room is that Ohio, also a huge auto assembly state, isn't on board. I can't really explain why Ohio's not on board, other than maybe their governor playing petty politics. [1] https://en.wikipedia.org/wiki/List_of_automotive_assembly_plants_in_the_United_States https://en.wikipedia.org/wiki/List_of_automotive_assembly_pl...
lbriner 5y ago
With these sorts of proposals, I don't understand why government funding would make much difference (other than cash can sometimes help a bit). How does it help to recruit specialists? How would it help them buy the manufacturing hardware which I heard is usually on 1 year+ lead times? What do you actually physically do with the money if you get it? People like Intel have the cash to build a plant, if they can get hold of the hardware, they have almost guaranteed 100% utilisation as soon as the plant is open and will quickly recoup their costs to extend faciliites. If they can't get the hardware and people to operate it, then the money seems useless?
- capableweb 5y ago
  From the article: > “The global auto chip shortage has hit Michigan and states across the country hard, idling plants and slowing production, threatening thousands of auto-related jobs up and down the supply chain,” Whitmer said in a statement. “With no end in sight, it’s clear we have no time to lose if we’re going to protect jobs and maintain our competitive edge." Seems what they want to money for is not to build new hardware, to recruit new specialists or buy new plants, it would be to retain the current workforce and I guess provide funds for the plants while they recover from something. What they are recovering from is unclear.
  - lazide 5y ago
    You’re confused I think. She is talking about saving auto jobs by fixing a chip shortage, and that does nothing to address the parent posters question of ‘if they just want cash to fix the chip shortage, what are they going to do with it that would actually fix this problem, since it is going to take a year+ To actually bring more capacity online - and they already have sufficient cash’
tuyguntn 5y ago
Bunch of MBAs come up with idea of how to increase profits, aha! let's outsource some parts to China. next batch of MBAs, hey we are having too much expenses and issues with assembly and logistics, let's outsource more parts to China so we can assemble there cheaply and ship ready product to warehouses globally directly from China! next batch of MBAs, hey why do we need those bunch of old grumpy engineers? let's decrease salaries and get rid half of them, we operate as a franchise/brand operator now. next batch of MBAs, hey we are having high employee attrition rate of engineers in our Chinese facilities, let's increase their salary or outsource to Urumqi, doesn't matter if they are having human right issues, its cheap anyway. CEO, Hey government we need bailout, we need your money, we are creating jobs (not here), we can't innovate fast enough (yeah sure, we don't have hands on talent anymore), China is leading now (yeah of course) I wonder will China make same mistake in the future when outsourcing jobs to USA, thinking it has cheap labor?
- deepnotderp 5y ago
  That’s not what happened with chip making, the major foundries are Taiwanese (TSMC, UMC) and it wasn’t due to labor costs but rather the extreme capital cost of fabs. With all due respect, you don’t know what you’re talking about regarding this industry.
- r3trohack3r 5y ago
  > Bunch of MBAs come up with idea of how to increase profits, aha! let's outsource some parts to China. This wasn't my understanding of what started the Phyisical Tech -> China exodus. Growing up in the 90's, my understanding was we started outsourcing manufacturing to other countries to side-step export controls. In the U.S., you could export a research paper on encryption but couldn't export the implementation. So chip manufactures were faced with a decision: create two chips, one w/ encryption for domestic and one w/o encryption for foreign markets OR produce a single product overseas. I think they made the right decision, when faced with the crypto wars, but it knee-capped our domestic manufacturing and contributed to China's dominance in manufacturing. An article going into the incentives created during this era by EFF founder John Perry: https://www.eff.org/pages/decrypting-puzzle-palace https://www.eff.org/pages/decrypting-puzzle-palace
rektide 5y ago
I keep thinking about the Silicon Foundry days, about how chipmaking arose so strongly in the US by giving students access to foundries & technology & letting them explore. Now that we're so much more advanced it's hard to imagine how something like this could apply or work again. Google bankrolling some runs of 130nm chips is one of the rare few examples we have, of accessible means to re-learning how to make chips. But whatever it takes, I feel like the US must create not just chipmaking capabilities, but conditions for talent to arise & develop & grow; we must re-create the Silicon Foundry. We've got to put these capabilities into the hands of our people, people of all kinds. My ideal bill includes provisions that these fabs have to provide some runs to small to entities/schools, and has to have like 1/3rd or 1/2 their output be open to whomever. If the goal is only to make more chips, the US is not going to create a sustainable chipmaking pipeline. It won't develop the talent & knowledge that is essential to being a capable, competent power at chipmaking. Morris Chang, founder of TSMC, outlined four advantages Taiwan has. Talent was the top[1]. Taiwan is a country rich chipmaking knowledge, there's seemingly no pool of talent like it. The US can't simply fund our way through this problem, can't create effective competition just by throwing money at companies: we need to create the conditions for ongoing success. We need to create our own talent. Open fabs are needed to allow new companies & talents to grow. Giving students & learners access to chipmaking is required to create the lifelong dedication & pursuits that great great yields. Currently there is little access to the means to personal success in chipmaking, and the US needs to change that, if it want's to turn things around. [1] https://interconnected.blog/morris-chang-global-semiconductor-competition-make-making-stuff-cool/ https://interconnected.blog/morris-chang-global-semiconducto...
- mountain_peak 5y ago
  It's also interesting to look at how Taiwan historically built knowledge and expertise in technology manufacturing. In the mid- to late-1970s (far before Korea entered the fray), Taiwan was the global epicenter of illegal clone manufacturing. Markets around the world - but especially Hong Kong - had a steady supply of cheap Taiwan-made Apple and (later) IBM clones. The ironic part of the story is that cloning provided Taiwan with manufacturing expertise, and in short order, they were awarded legal contracts to manufacture legal computers from US companies for export to Europe and America. The Taiwanese government sent Taiwanese engineers to the US for training, and they returned to kickstart companies such as Acer, which originally started out manufacturing OEM clones for Canon and Siemens, but later started releasing computers under its own brand. The conditions for incubating talent in Taiwan arose from piracy and a demand for cheap computers and parts - not sure if there's any modern equivalent to start the next wave of talent in Europe and North America.
datavirtue 5y ago
Nine governors press U.S. lawmakers to pass workers' rights bill. Nine governors press U.S. lawmakers to pass data protection and privacy bills. The two headlines that don't exist but which flash into my mind when I see something like this.
- diggernet 5y ago
  Of course, governors are free to pass such bills in their own states, without pressuring anyone else to do it. And in the case of your two fine examples, if they aren't, why aren't they? (Like CPPA.) The key word in this title is not "bill", but rather "funding". That is, they could subsidize the industry in their own states without any involvement from U.S. lawmakers, but instead choose to ask for outside money.
pezzana 5y ago
From an article covering the congressional testimony by industry experts: > Hunt, who co-authored a report on the subject [bolstering the US semiconductor workforce at all levels] last year, noted that 40% of the domestic semiconductor workforce is foreign-born and that, despite the field’s growth, the number of U.S.-born graduate students in it has been stagnant for 30 years. He said the U.S. should admit more foreign workers with specialized skills to help satisfy the demand for talent that CHIPS Act funding could spur. In the longer term, he said the U.S. should build up domestic talent, such as through fellowships and ensuring university students have access to equipment used in industry. https://www.aip.org/fyi/2021/house-hearing-airs-cases-and-against-semiconductor-funding-surge https://www.aip.org/fyi/2021/house-hearing-airs-cases-and-ag... The article touches a few times on the issue of staffing new domestic production facilities. I can't help but think that the prospect of staffing fabs, paid for in no small part by taxpayer dollars, with foreign workers is a recipe for blowback.
analognoise 5y ago
For everyone who says this is government spending, pork, and bad: We're already competing against governments subsidizing this work. The Chinese, the Europeans, everyone else who is competitive is subsidizing their industries, to bring, keep, and grow the knowledge base locally. To be against government spending here, is to hand all of semiconductor manufacturing over to other countries in the name of the "free market" - it is not free, and we've decided to "play ball" by subsidizing the industries here. FINALLY.
whoknowswhat11 5y ago
Heads up - we should be WELCOMING foreign masters / PhD students in chipmaking - we don't need the pork, we need the people. Taiwan in particularly, the salaries these guys get and how many there are is rediculous (low salary, lots of folks in field).

136 points by graderjs 5y ago

This is a pork bill from Intel, which used to know how to build competitive fabs and now does not. Federal pork will not make our country better at semi autolines.

deleted 5y ago
[deleted]
jdkee 5y ago
Absolutely it is pork. Domestic production of microchips is a national security issue and should be subsidized like the manufacturing of aircraft and weapons systems.
- malchow 5y ago
  Pork doesn't work. Ask people inside DOD who are increasingly frustrated at the Primes leading DOD around by the nose with outdated ideas and outmoded products. For national security, we need a state of affairs wherein it is profitable to build and run a plant in the U.S. that responds primarily to the dynamic needs of private actors. All of the issues there are on the cost side of the ledger.
  - beauzero 5y ago
    Primes? ...sorry not familiar with the lingo.
    - stagger87 5y ago
      The major defense contractors.
    - ms512 5y ago
      Prime Contractor. It is a company that is responsible for the final integration of a system, but often fans out subcomponents to a large assortment of other companies.
    - pebcack 5y ago
      The contracting company that wins a bid for a contract is the Prime contractor. Often times these companies will then subcontract out some of that work (and sometimes it's even required by the contract to do so) to other contracting companies which would then be the Sub-contractor. That's where the "Prime" and "Sub" lingo in re: to DoD contracting comes form.
      - airstrike 5y ago
        And the sub-contractors are sometimes further broken down into Tier 2, Tier 3... depending on how far down the value-chain they are
  - vkou 5y ago
    > For national security, we need a state of affairs wherein it is profitable to build and run a plant in the U.S. The way to do that is massive tariffs, not pork. They will be met with retaliatory tariffs.
  - dragontamer 5y ago
    > Pork doesn't work. Seemed to work when Taiwan basically funded TSMC. If they can do it, why can't we do it? I mean, the USA is also funding TSMC to move to Arizona. I don't got nothing against this, but domestic chip-makers should also get a piece of the pie, right? -------------- In any case, this isn't "Pork". Pork is when you build something useless in somebody's state (aka: The Bridge to Nowhere), so that those "somebodies" vote on some other bill. Aka: Build a bridge in Alaska to nowhere, and __suddenly__ your Alaskan senators / house members starts the process of log-rolling and helps out on other bills. ------ Pork was incredibly common in the 80s and 90s, and has been cut down in the modern era. Today, its impossible to get logrolling, because too many people have demonized pork. If you want to get Senators / House members to support a large-scale bill, you HAVE to have something in there for them. Imagine how much easier it would have been to get Joe Manchin to vote for the infrastructure bill if we tossed in a few coal subsidies (aka: West Virginia Pork) into the infrastructure bill. Alas: today's citizens are ignorant to the wonders of pork. Its actually very easy to convince other senators / house members to do something useful. You just gotta give them a bit of pork. ------- Pork isn't about making the underlying thing more efficient. Its about convincing leaders to support the project to begin with and get it greenlit in the first place. Without pork, you can't effectively build a coalition. And today's Senate / House is proof of that, its incredibly difficult to get anything done because of our anti-Pork culture. Life was better with pork. We did our grand experiment over the past 30 years by demonizing pork, and it failed. Time to bring Pork back.
    - paganel 5y ago
      Pork is a pretty efficient way for the richer part of the country to subsidize back the poorer ones without making it look like socialism/communism. It partially makes up for the huge demographic subsidies the richer parts of the country receive from the poorer ones as a result of internal migration.
      - dragontamer 5y ago
        Your discussion point is interesting, but I'm not sure if I'm willing to take the stance that "Pork is Good". I'm simply a pragmatist. We know Congress is perpetually deadlocked and that we haven't had a proper budget in damn near a decade. Maybe its time to whip out the old Pork technique. That's all I'm saying. Anyone who studied how these budgets got passed 30 or 40 years ago knows: Pork was essential in building coalitions (especially across party lines). You scratch my back, I scratch yours. If you help me pass X Bill, I'll write a useless thing into the Bill that benefits your state. Lets bring it back. Lets get Congressmen working together again.
  - arrosenberg 5y ago
    Pork works really well actually, it's the grease that allows useful projects to go forward. The DOD is getting lead around by the nose because they themselves insisted on consolidation during the Reagan era, and none of the administrations since have bothered to correct the problem. They've been hoisted on their own petard. > For national security, we need a state of affairs wherein it is profitable to build and run a plant in the U.S. that responds primarily to the dynamic needs of private actors. National Security should revolve around the profit motives of a handful of private actors? Hard pass.
  - throwawaygh 5y ago
    > Ask people inside DOD... DOD is a rural jobs program. It functions as intended. Other branches of the federal government that aren't designed to be jobs programs (e.g., NSF) do tend to make good investments and get things done.
onedognight 5y ago
This may be pork from Intel, but even TSMC is getting subsidies to build fabs in the US. The US see strategic interest in chip fabs.
- consumer451 5y ago
  > This may be pork from Intel, but even TSMC is getting subsidies to build fabs in the US. The US see strategic interest in chip fabs. We sit around and argue about this while TSMC was founded by the Taiwanese government. The Taiwanese gov't is likely still a giant shareholder. I am curious as to what HN readers think is different about the two situations. As in, why can't it work in the USA? Fun TSMC fact: Morris Chang was never given any options as part of his original pay package. He used his own money to buy shares.
  - arrosenberg 5y ago
    > I am curious as to what HN readers think is different about the two situations. As in, why can't it work in the USA? Unfortunately we are still stuck with the legacy of Reaganism, which was essentially the undoing of the New Deal notion that the government could do good for the country and the average person.
    - gruez 5y ago
      >which was essentially the undoing of the New Deal notion that the government could do good for the country and the average person. The new deal involved governments giving billions in grants to multibillion dollar multinationals?
      - arrosenberg 5y ago
        The New Deal governments have a legacy of getting a ton of bang for it's buck - Rural Electrification, the Hoover Dam, the Interstate Highway System, and the Apollo program just to name a few. The entire point of Reaganism was to destroy that legacy by making government ineffective, wasteful, and disdainful of the very people it is meant to serve.
mtmail 5y ago
For anybody (outside the United States) wondering: https://en.wikipedia.org/wiki/Pork_barrel https://en.wikipedia.org/wiki/Pork_barrel "is a metaphor for the appropriation of government spending for localized projects secured solely or primarily to bring money to a representative's district."
- newbamboo 5y ago
  In other words infrastructure.
  - blagie 5y ago
    No. The Wikipedia article makes it sound that way, but a lot of pork is in subsidies to specific industries, mandatory purchasing, research initiatives, or similar. For example, if the military must buy 50,000 of something it doesn't need from some military contractor located in some senator's district, that's a canonical example of pork. The line here is subtle. The exact same purchase could be made through a competitive bidding process. If I'm doing space research, that's probably good. If I mandate that NASA do a specific research project through a specific vendor, that's probably pork. In most cases, pork isn't obvious. The bill won't say "NASA will give $50 million to Acme Inc," but rather "NASA will purchase $50 million worth of sheet metal from a veteran-owned company with at least 7 years experience in aluminum-matrix composite manufacturing, ..." and by the time you include all the requirements, what do you know, there's only one business which fits the bill.
    - whoknowswhat11 5y ago
      Pork is identifiable a mile away. Space Launch System - I think the funding line both required they use a bunch of tech (only made by certain vendors) but also prohibited any competitive bidding or evaluation of other approaches. $20B later we might get a rocket that costs $2B per launch? OUCH! More common are the funny requirements docs. 5 years of experience but not more than 10 to reserve project for "new entrants". Located in a XXX district (improvement, benefit etc).
    - newbamboo 5y ago
Server6 5y ago
I don't understand why people are so opposed to pork spending? Pork is how things got done historically. Sure on the surface it's wasteful, but it promotes compromise and greases the wheels of government. None of the great works in the US would have been completed without it. Pork reform in my opinion is one of the reasons why things are so partisan these days - everyone is in their own corner and there's no incentive for Democrats to help Republicans and vice versa.
- JoeAltmaier 5y ago
  And how some of the biggest boondoggles got built. Never mind bridges to nowhere. The Arkansas river has a multi-billion dollar lock and dam system. To take all those Arkansas products to market presumably. From a state near the bottom rank in GDP. That's pork.
  - Server6 5y ago
    Yeah, I agree there's some waste and boondoggles. I'm just arguing that they're necessary in order for government to function.
    - lazide 5y ago
      How do? It’s clear corruption. They could do the same thing with a competitive bidding system more cost effectively no?
    - 1123581321 5y ago
      I see what you’re saying, but it’s only true in the sense that dysfunctional government refuses to operate without a dysfunctional incentive. It is possible to improve the percentage of wisely chosen projects.
  - analognoise 5y ago
    On the other hand, if a state has the bottom rank in GDP, wouldn't we want to provide infrastructure to lift them up? Saying "They're already poor, let's not invest in their infrastructure" sounds like a self-fulfilling prophecy to me - they'll stay poor unless we invest in them?
zitterbewegung 5y ago
You always should be giving the pork bill to the company doing the worst to increase competition. Giving it to the best only gives their margins. Giving it to the worst possibly gives it the ability to innovate . Also Alder Lake looks somewhat promising.
- joconde 5y ago
  Performance is probably correlated with good governance, so that has a high risk of wasting money on a company that's unable to spend it efficiently. It even gives their leaders a break from having to improve efficiency, because the pork keeps them from going bankrupt whatever they do.
  - zitterbewegung 5y ago
    Totally agree with your statement. Yes you are wasting money on a company so that they are still selling something at the end of the day regardless of quality or sales . That is my point .
blagie 5y ago
It's a bill from Intel and friends, but I don't think it's pork. Chip manufacturing (like food, energy, etc.) is a national security issue. Specialization is more efficient in the short term. Free market pushes chip manufacturing to be a monopoly or duopoly. That's not resilient, though. I don't mind my tax dollars subsidizing these industries remaining in the US, though. Indeed, I think it's good policy to have all major regions of the world be self-sustaining (e.g. not France, but the EU as a whole).
- lazide 5y ago
  Just because it is a national security issue doesn’t mean the spending and way it will be allocated isn’t a corrupt waste of time (unfortunately). If it is a corrupt waste of time, it’s pork.
- rapsey 5y ago
  Yes but how do you know the money actually will be spent productively. The main problem is this kind of money often just lines pockets.
  - blagie 5y ago
    The trick, really, is good governance. These problems have been solved before. For example, the government can: 1. Provide market incentives. For example, the federal government can give a 25% subsidies for school Chromebooks/laptops/etc., require the CPUs and RAM to be manufactured in the US. 2. Provide guaranteed markets. The US military is an efficient place to do this. 3. Provide subsidies with outcomes. If Intel wastes the money, Intel stock moves from investors to taxpayers. Personally, I'm also a big fan of tariffs. Free trade zones are great, but tariffs between free trade zones on essential goods can encourage local production. If US CPUs cost 25% more in the EU, and EU CPUs cost 25% more in the US, there's a strong incentive to have local manufacturing infrastructure.
    - rapsey 5y ago
      Well they obviously can make sure the money is spent as intended. The problem is they wont.
trzy 5y ago
If Chinese pork can make them competitive, American pork can make us competitive. If implemented properly. Is it anti-competitive and will it reinforce inequality by picking winners? Unfortunately, yes.

jimbob45 5y ago

Why wouldn't Texas have signed on to this? One would think they'd want to keep Musk happy after he moved to their state.

csours 5y ago
Texas is being very contrary for the past 12 years or so, moreso now that Biden is President.

harikb 5y ago

> which would set aside $2 billion for the kind of older-technology chips of which there is a deep shortage

OldHand2018 5y ago

> Illinois, Wisconsin, North Carolina, Kentucky, Pennsylvania, Kansas and California. Do these states (aside from California) have fabs, or rather any hope of getting new fabs? What's in it for them?

pacoWebConsult 5y ago
Current resident of NC so I was curious. Looks like we have several, but I don't see any for KS or KY at first glance [1] [1] https://en.wikipedia.org/wiki/List_of_semiconductor_fabrication_plants https://en.wikipedia.org/wiki/List_of_semiconductor_fabricat...
- jjk166 5y ago
  If your state has businesses that build the equipment for fabs, building of new fabs will bring business to your state even if they aren't located there. For example Kulicke and Soffa's wirebonders are made in PA.
edaemon 5y ago
Many of them have manufacturing industries that have been affected by the chip shortages. Illinois, North Carolina, Kentucky, and Kansas all have sizable automotive industries, for example.
throwawaygh 5y ago
You forgot Alabama and Michigan. Kentucky, Alabama, and Michigan are huge automobile assembly states [1] who are hurting from chip shortages. KY/AL are especially dependent on the auto assembly industry for non-ag employment. California has Tesla, of course, but also likely to benefit from chip fabrication. Wisconsin is kind of a historical auto state, so some solidarity makes sense. More importantly, though, I think WI+IL see potential for chip fab in their states because of their globally-unique fresh water source (Lake Michigan), and NC is probably on board because they see potential to benefit from domestic chip fabs in research triangle. Pennsylvania probably fits into this "one foot in because of auto suppliers and the other foot in because of tech" camp also. The huge elephant in the room is that Ohio, also a huge auto assembly state, isn't on board. I can't really explain why Ohio's not on board, other than maybe their governor playing petty politics. [1] https://en.wikipedia.org/wiki/List_of_automotive_assembly_plants_in_the_United_States https://en.wikipedia.org/wiki/List_of_automotive_assembly_pl...

lbriner 5y ago

With these sorts of proposals, I don't understand why government funding would make much difference (other than cash can sometimes help a bit). How does it help to recruit specialists? How would it help them buy the manufacturing hardware which I heard is usually on 1 year+ lead times? What do you actually physically do with the money if you get it? People like Intel have the cash to build a plant, if they can get hold of the hardware, they have almost guaranteed 100% utilisation as soon as the plant is open and will quickly recoup their costs to extend faciliites. If they can't get the hardware and people to operate it, then the money seems useless?

capableweb 5y ago
From the article: > “The global auto chip shortage has hit Michigan and states across the country hard, idling plants and slowing production, threatening thousands of auto-related jobs up and down the supply chain,” Whitmer said in a statement. “With no end in sight, it’s clear we have no time to lose if we’re going to protect jobs and maintain our competitive edge." Seems what they want to money for is not to build new hardware, to recruit new specialists or buy new plants, it would be to retain the current workforce and I guess provide funds for the plants while they recover from something. What they are recovering from is unclear.
- lazide 5y ago
  You’re confused I think. She is talking about saving auto jobs by fixing a chip shortage, and that does nothing to address the parent posters question of ‘if they just want cash to fix the chip shortage, what are they going to do with it that would actually fix this problem, since it is going to take a year+ To actually bring more capacity online - and they already have sufficient cash’

tuyguntn 5y ago

Bunch of MBAs come up with idea of how to increase profits, aha! let's outsource some parts to China. next batch of MBAs, hey we are having too much expenses and issues with assembly and logistics, let's outsource more parts to China so we can assemble there cheaply and ship ready product to warehouses globally directly from China! next batch of MBAs, hey why do we need those bunch of old grumpy engineers? let's decrease salaries and get rid half of them, we operate as a franchise/brand operator now. next batch of MBAs, hey we are having high employee attrition rate of engineers in our Chinese facilities, let's increase their salary or outsource to Urumqi, doesn't matter if they are having human right issues, its cheap anyway. CEO, Hey government we need bailout, we need your money, we are creating jobs (not here), we can't innovate fast enough (yeah sure, we don't have hands on talent anymore), China is leading now (yeah of course) I wonder will China make same mistake in the future when outsourcing jobs to USA, thinking it has cheap labor?

deepnotderp 5y ago
That’s not what happened with chip making, the major foundries are Taiwanese (TSMC, UMC) and it wasn’t due to labor costs but rather the extreme capital cost of fabs. With all due respect, you don’t know what you’re talking about regarding this industry.
r3trohack3r 5y ago
> Bunch of MBAs come up with idea of how to increase profits, aha! let's outsource some parts to China. This wasn't my understanding of what started the Phyisical Tech -> China exodus. Growing up in the 90's, my understanding was we started outsourcing manufacturing to other countries to side-step export controls. In the U.S., you could export a research paper on encryption but couldn't export the implementation. So chip manufactures were faced with a decision: create two chips, one w/ encryption for domestic and one w/o encryption for foreign markets OR produce a single product overseas. I think they made the right decision, when faced with the crypto wars, but it knee-capped our domestic manufacturing and contributed to China's dominance in manufacturing. An article going into the incentives created during this era by EFF founder John Perry: https://www.eff.org/pages/decrypting-puzzle-palace https://www.eff.org/pages/decrypting-puzzle-palace

rektide 5y ago

I keep thinking about the Silicon Foundry days, about how chipmaking arose so strongly in the US by giving students access to foundries & technology & letting them explore. Now that we're so much more advanced it's hard to imagine how something like this could apply or work again. Google bankrolling some runs of 130nm chips is one of the rare few examples we have, of accessible means to re-learning how to make chips. But whatever it takes, I feel like the US must create not just chipmaking capabilities, but conditions for talent to arise & develop & grow; we must re-create the Silicon Foundry. We've got to put these capabilities into the hands of our people, people of all kinds. My ideal bill includes provisions that these fabs have to provide some runs to small to entities/schools, and has to have like 1/3rd or 1/2 their output be open to whomever. If the goal is only to make more chips, the US is not going to create a sustainable chipmaking pipeline. It won't develop the talent & knowledge that is essential to being a capable, competent power at chipmaking. Morris Chang, founder of TSMC, outlined four advantages Taiwan has. Talent was the top[1]. Taiwan is a country rich chipmaking knowledge, there's seemingly no pool of talent like it. The US can't simply fund our way through this problem, can't create effective competition just by throwing money at companies: we need to create the conditions for ongoing success. We need to create our own talent. Open fabs are needed to allow new companies & talents to grow. Giving students & learners access to chipmaking is required to create the lifelong dedication & pursuits that great great yields. Currently there is little access to the means to personal success in chipmaking, and the US needs to change that, if it want's to turn things around. [1] https://interconnected.blog/morris-chang-global-semiconductor-competition-make-making-stuff-cool/ https://interconnected.blog/morris-chang-global-semiconducto...

mountain_peak 5y ago
It's also interesting to look at how Taiwan historically built knowledge and expertise in technology manufacturing. In the mid- to late-1970s (far before Korea entered the fray), Taiwan was the global epicenter of illegal clone manufacturing. Markets around the world - but especially Hong Kong - had a steady supply of cheap Taiwan-made Apple and (later) IBM clones. The ironic part of the story is that cloning provided Taiwan with manufacturing expertise, and in short order, they were awarded legal contracts to manufacture legal computers from US companies for export to Europe and America. The Taiwanese government sent Taiwanese engineers to the US for training, and they returned to kickstart companies such as Acer, which originally started out manufacturing OEM clones for Canon and Siemens, but later started releasing computers under its own brand. The conditions for incubating talent in Taiwan arose from piracy and a demand for cheap computers and parts - not sure if there's any modern equivalent to start the next wave of talent in Europe and North America.

datavirtue 5y ago

Nine governors press U.S. lawmakers to pass workers' rights bill. Nine governors press U.S. lawmakers to pass data protection and privacy bills. The two headlines that don't exist but which flash into my mind when I see something like this.

diggernet 5y ago
Of course, governors are free to pass such bills in their own states, without pressuring anyone else to do it. And in the case of your two fine examples, if they aren't, why aren't they? (Like CPPA.) The key word in this title is not "bill", but rather "funding". That is, they could subsidize the industry in their own states without any involvement from U.S. lawmakers, but instead choose to ask for outside money.

pezzana 5y ago

From an article covering the congressional testimony by industry experts: > Hunt, who co-authored a report on the subject [bolstering the US semiconductor workforce at all levels] last year, noted that 40% of the domestic semiconductor workforce is foreign-born and that, despite the field’s growth, the number of U.S.-born graduate students in it has been stagnant for 30 years. He said the U.S. should admit more foreign workers with specialized skills to help satisfy the demand for talent that CHIPS Act funding could spur. In the longer term, he said the U.S. should build up domestic talent, such as through fellowships and ensuring university students have access to equipment used in industry. https://www.aip.org/fyi/2021/house-hearing-airs-cases-and-against-semiconductor-funding-surge https://www.aip.org/fyi/2021/house-hearing-airs-cases-and-ag... The article touches a few times on the issue of staffing new domestic production facilities. I can't help but think that the prospect of staffing fabs, paid for in no small part by taxpayer dollars, with foreign workers is a recipe for blowback.

analognoise 5y ago

For everyone who says this is government spending, pork, and bad: We're already competing against governments subsidizing this work. The Chinese, the Europeans, everyone else who is competitive is subsidizing their industries, to bring, keep, and grow the knowledge base locally. To be against government spending here, is to hand all of semiconductor manufacturing over to other countries in the name of the "free market" - it is not free, and we've decided to "play ball" by subsidizing the industries here. FINALLY.

whoknowswhat11 5y ago

Heads up - we should be WELCOMING foreign masters / PhD students in chipmaking - we don't need the pork, we need the people. Taiwan in particularly, the salaries these guys get and how many there are is rediculous (low salary, lots of folks in field).