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Senate passes bipartisan bill to subsidize U.S.-made semiconductor chips
- tomohawk 4y agoIf it moves, tax it. If it keeps on moving, regulate it. If it stops moving, subsidize it. - Ronald Reagan
- culi 4y agoFunny but it turns out subsidization is pretty much the only way we've ever gotten things done. The most productive economies have ever been have always been wartime economies when gov't basically takes full control of every aspect Look at your iPhone. That touch screen, GPS, the internet, voice-assistant AI, etc. It's all a collection of government technologies. Economist Mariana Mazzucato has written[0] about the myth of private sector innovation in depth. Even the industrial revolution was driven through purposeful government investment. Another economist, Ha-Joon Chang, has written[1] extensively about this as well. The same tools the US used to build itself up (subsidization, tariffs, gov't programs, etc) are the first things that the US (through World Bank and IMF) bans with "structural adjustment" policies when these countries inevitably can't pay back the loan that was shoved down their throats. They "liberate" the economy. In other words remove any local protections from competition by US companies that are themselves heavily subsidized. And also get rid of any government services and leave it up to the "free market" The thing is that this is just the way anything gets done. Just look at Walmart.[2] Internally, it's the largest planned economy ever invented. Many magnitudes larger than the Soviet Union ever was. Anybody who's sold a product at Walmart stores knows that once you make the deal you've basically given up all control to them. They decide what gets produced in what factories and when and how much Contrast that with something like Sears that tried the "free market" approach internally. They let their stores compete with each other and tried to have minimal centralized intervention in what each store does. Sears failed... And so did their Ayn Rand-obsessed CEO. [0] https://marianamazzucato.com/books/the-entrepreneurial-state https://marianamazzucato.com/books/the-entrepreneurial-state [1] https://anthempress.com/kicking-away-the-ladder-pb https://anthempress.com/kicking-away-the-ladder-pb [2] https://www.versobooks.com/books/2822-the-people-s-republic-of-walmart https://www.versobooks.com/books/2822-the-people-s-republic-...
- JadeNB 4y agoWith no context, I'm not sure what you mean by this; but, without saying anything about the validity of the position, it's probably worth noting (as you surely know) that Reagan said this to satirize "big-government" perspectives on taxation. It was not his policy statement.
- notlukesky 4y agoThe headline is wrong and deceiving. The semiconductor part is 52 billion. Still a lot of graft and corruption for negligent management. They could have given them tax subsidies for capex investment for example instead of corporate handouts and payoffs to the Pelosi stock positions.
- shadowpho 4y ago>Pelosi stock positions Pelosi isn't even the worst offender...
- ziddoap 4y agoPutting aside the fact the HN title is completely different from the article title, I don't even see where $280B (in the HN title) comes from... There's a $250B mentioned in the article body, not a $280B.
- lettergram 4y agoLol I updated it? But there’s a lot of articles with different values (interesting …) https://www.msn.com/en-us/news/politics/senate-passes-280b-semiconductor-and-science-bill-aimed-at-china/ar-AA101Pnl https://www.msn.com/en-us/news/politics/senate-passes-280b-s... It’s also interesting because it appears the title on the fox article changed so idk man
- trhway 4y agoCouple senators walking to lunch just had a small talk with a lobbyist, and the number got adjusted a bit.
- dmitrygr 4y ago
- theplumber 4y agoWhat stocks? Intel & AMD dont seem to have moved much. Asking for a friend.
- camjohnson26 4y agonvidia, which they sold today at a large loss.
- cbsks 4y agoHas Nvidia announced they are building a fab? I haven’t heard anything about it.
- Alupis 4y agoI'm pretty sure Nvidia is a fabless design house (like AMD these days). Perhaps they are looking to change that.
- braingenious 4y agoBy “they” are you talking about Paul Pelosi? Can somebody explain how buying stock for $100(1) and selling at $165 causes a loss? I’m not being flippant, it’sa serious question. 1. https://www.businessinsider.com/nancy-pelosi-stock-trades-paul-pelosi-nvidia-visa-apple-2022-7 https://www.businessinsider.com/nancy-pelosi-stock-trades-pa...
- deleted 4y ago[deleted]
- faet 4y ago>In a periodic transaction report, the senior Democrat disclosed that her husband, financier Paul Pelosi, sold 25,000 shares of Nvidia for about $4.1 million, ending up with a loss of $341,365. He bought options in July 2021. Basically, he said he'd buy 20k shares stock for X price regardless of the price in the next year. If the stock goes up he can sell the options without having to buy said stock (for a profit). He can also give up what he paid for the options and choose not to buy the shares and they'd expire worthless. As the stock was below what he bet it would be within a years time he decided to exercise his right to buy the 20k shares rather than lose his initial investment. He then sold, for a loss, but possibly a smaller one than if he just let them expire worthless.
- spraveenitpro 4y ago
- jasondc 4y agoThe beginning of the undoing of globalization, countries will start bringing industries back home with bills like this.
- pm90 4y agoGlobalization is here to stay. The economics are just too sweet to “go back”.
- upupandup 4y agoI think so as well, in particular I believe that countries with a large population of young will be the biggest beneficiaries of companies exiting China. It's going to take some time to get back to scale but I believe India, Vietnam, Southeast Asia stands to be the biggest winners. I do not see China returning to status quo anytime soon. It's more likely that they will fall victim to nationalistic fervor and close its doors.
- trevorboaconstr 4y agoNo, I don’t think so. The last few years have been no more than a speed bump in the 100 year trend of increased global interconnection.
- culi 4y ago"Global interconnection" is not the same thing as "globalization". In many ways they're actually opposed. With globalization comes increased strength of patent and copyright laws and much more control over what crosses what borders There's a direct relationship between international trade agreements and border security
- trevorboaconstr 4y agoSo, your position is that this century long trend of globalization is over and all systemic mechanism that enable it will somehow, someway, cease. Or, what exactly? What is your position? Because, if for example, the crisis in Ukraine has shown, countries need more diversification, not less.
- 01100011 4y agoSuch a monumental scam and a gross theft from taxpayers. Companies making billions of dollars in profits don't need free money. I could be onboard with a subsidized loan, but handouts are not needed. FWIW, I work at a company that stands to benefit from this bill. Does the US need to secure reliable semiconductor supply chains free of China? Sure. This is not the most cost effective way to do it.
- qaq 4y agoWhat would be a good way?
- frgtpsswrdlame 4y agoUnited States Semiconductor - aka spinning up a nationalized firm.
- drexlspivey 4y agoAnd that’s gonna be cheaper?
- dangrossman 4y agoThe goal isn't to be cheaper, it's to have a reliable domestic supply chain.
- drexlspivey 4y agoWhich the bill will provide for a fraction of the cost
- alldayeveryday 4y agoAgreed with this. Has many benefits, including that the profits flow back to the taxpayers rather than to corporations and shareholders. Semiconductors are too important to national security to be controlled by profit seeking corporations whom have little allegiance to the nation or the people.
- Xeoncross 4y agoWhat's important here is that, like all other funding and stimulus bills, we know that less than 25% of it will go towards the actual thing.
- pm90 4y agoWaPo article, which has more details about the bill and less details about what different “personalities” are saying: https://www.washingtonpost.com/politics/2022/07/27/senate-chips-funding-bill-pass/ https://www.washingtonpost.com/politics/2022/07/27/senate-ch.... Overall, it looks great. We absolutely need to fund more semiconductor manufacturing. Losing that ability to China/Taiwan was just a terrible strategic mistake. The US hasn’t lost this battle (over semiconductors) just yet. While current manufacturing is indeed dominated by East Asian countries, the vast majority of research still happens in US universities. This legislation allocates more funding for that research, fantastic. Theres some political gamesmanship over some silly stock options of congresspeople… my response is, who gives a single shit. The country needs this bill.
- WebbWeaver 4y agoCan we not frame this as a battle or even a war? The US lost this capability a long time ago due to labor costs and natural resource consumption. From the labor cost and natural resource consumption a operation of this size can easily fail. We need more partners in this not just a handout. This action should have little to no input on any globalized leverage system. For this to be successful we need more partners
- onepointsixC 4y ago>We need more partners in this not just a handout. This rings hollow when all of America's major partners are pumping massive subsidies to their domestic companies to win. Case and point SK is subsidizing their Fabs to the tune of $450 Bn.[1] [1]: https://www.bloomberg.com/news/articles/2021-05-13/korea-unveils-450-billion-push-to-seize-global-chipmaking-crown https://www.bloomberg.com/news/articles/2021-05-13/korea-unv... [1 Non paywalled]: https://archive.ph/9Gs8q https://archive.ph/9Gs8q
- WebbWeaver 4y agoI did not mean to strike a hollow note. I do not see such vision being applied outside of lets increase competition and spend locally. How much further will their their money go locally than ours? I want us to spend our money on the next generation but what economic window are we planning to occupy?
- abrichr 4y agoUnpaywalled: https://archive.ph/DISce https://archive.ph/DISce
- lettergram 4y agoI disagree that subsidizing R&D to a few companies is going to make us more competitive. Look at GE or Boeing, it didn’t work out. What works is a free market. Raise import costs on CPUs and you’ll incentivize building in the US and more companies to form. It costs $0 tax dollars and brings in revenue and high paying jobs. Similar to what we did with car manufacturing.
- connicpu 4y agoTariffs on products we don't have immediate domestic manufacturing capacity for will hurt the economy in the short term, which is not a great move during a period of rising inflation. It's a tough decision though, because it does feel like the better move for the long term.
- lettergram 4y agoThe US still produces a lot of computer chips… Intel is still a very large player in chips and dominate in some areas. Even TI which has tons of fabs (not highest end) as well. I don’t really understand this.
- wildzzz 4y agoRelatively few consumer electronics use Intel chips. Even in the devices that do use Intel chips, it's one Intel CPU versus dozens of others.
- Buraksr 4y agoTI's fabs are mainly focused on analog, so the requirements are a bit different. IIRC we have 3 130-65nm layers for digital in our mixed signal designs which is roughly on par with a the process technology Intel used in 2005.
- anfilt 4y agoThe majority ICs used for products and such do not need bleeding edge node sizes.
- vxNsr 4y agoThe sane way to do this would have been to give the handouts on condition of no stock buybacks for 10 years and cap total exec compensation for similar amount of time for any company that accepts the handouts. This should be true for any company that accepts gov money. The gov doesn't give money to benefit the stockholders, they’re doing it to benefit the larger economy and country. Stock holder shouldn’t even be considered as beneficiaries in these deals.
- djbebs 4y agoProfit isn't a sin, and if you want shareholders to do something for you, why do you think they will want to do it if there is nothing in it for them?
- vxNsr 4y agoNo one is asking shareholders to do anything… We’re having the government give the company money for a joint venture. If the company uses it wisely in the way they promise they would, everyone, including the shareholders benefit. If the company cynically takes the money, intentionally fails to uphold their side of the contract, and then rebuffs attempts by the government to reclaim the money, while that might be in the interest of the shareholders they haven’t actually done anything there and don’t deserve to benefit. In fact they should be punished (along with the executives) for being unethical.
- jdasdf 4y ago>No one is asking shareholders to do anything… We’re having the government give the company money for a joint venture. If the company uses it wisely in the way they promise they would, everyone, including the shareholders benefit. The company belongs to the shareholders, that's what being a shareholder means. Let me quote you: >The sane way to do this would have been to give the handouts on condition of no stock buybacks for 10 years and cap total exec compensation for similar amount of time for any company that accepts the handouts. >This should be true for any company that accepts gov money. >The gov doesn't give money to benefit the stockholders, they’re doing it to benefit the larger economy and country. Stock holder shouldn’t even be considered as beneficiaries in these deals. You'll note that not a single word in that post said anything about the company not holding up its end of the bargain. And indeed you made no mention as to why "stock buybacks" or "total exec compensation" would prevent the company from holding up its end. Let's be clear here about what you're doing, you're so focused on hurting shareholders, you don't even care if the results you get are compatible with what you state you want.
- StillBored 4y agoOh, joy more money to monopolistic companies. This is completely the wrong way to go about it (tax individuals and give the money to big corps). If you want a protectionist measure then implement a protectionist measure, like I don't know, tariffs. Yet another bill that follows at least the last 40 years of congress doing exactly the wrong thing. (and to be clear this isn't a rant against the Democrats).
- ParksNet 4y agoBanning Proof of Work cryptocurrencies from being traded on licensed exchanges would achieve the same improvement of chip availability, as well as saving a huge amount of electricity, for $0. I guess sensible measures like this don't boost the share portfolios of politicians' spouses though.
- dangrossman 4y agoAre the kind of chips being used to mine crypto the same kind that are keeping Ford from building trucks?
- _fizz_buzz_ 4y agoThey are not, but they are made in the same fabs.
- cwkoss 4y agoNope. Sour grapes reaction. US should use the demand to fund an effective semiconductor industry, not shrink the pie to account for its ineffectiveness.
- smoldesu 4y ago"Sensible measures" like that don't get picked because ultimately all cryptocurrency is a zero-sum game, and getting rid of all of them would save us a lot of time, manhours and wasted Internet conversations. But ideas like that are too sensible, so we give people the freedom to build whatever blockchain-garbage they want, because that's their sovereign choice.
- cowtools 4y agobanning cryptocurrency is easier said than done.
- thfuran 4y agoNo, it should be pretty easy to effectively end them. Just make it illegal to possess, buy, or sell them and suddenly all the corporate interest vanishes, the exchanges disappear, and all the crypto bros quiet down. Sure, some people would still use them but it'd be a rounding error compared to current adoption.
- samstave 4y agoWhen will senate pass a technological test. Lets make these blokes take a MINIMAL entry level exam; * What is a data base * What is personal identifiable identification and why does it mattter * What does a walled garden mean So many functionally identifiable comms These fucking morons cant even state the above. De-Seat them all.
- mjevans 4y agoI agree at least half of the lawmakers probably couldn't correctly (enough) answer those questions. Though there are a number of really savvy ones like Wyden (D-OR) https://en.wikipedia.org/wiki/Ron_Wyden https://en.wikipedia.org/wiki/Ron_Wyden That senator has done good work, even if I don't live in Oregon anymore.
- kube-system 4y agoPeople in leadership positions don't necessarily need to be domain experts to be good leaders. The problem with Congress is money, not a lack of domain expertise. A leader with the right incentives, without domain expertise, knows how to ask questions to the right people. Your congressperson doesn't know what a database is because they don't care, not because they're dumb.
- samstave 4y agoim not saying they are dumb, im saying they are obsolete
- nitrixion 4y agoI don't mean to be rude, but your list of questions is a perfect example of why this type of test would be meaningless. * What is a data base - Are you asking what type of military base stores data? Or did you mean database? * What is personal identifiable identification and why does it matter? - Do you mean PII (personally identifiable information)? Or are you talking about a driver's license? * What does a walled garden mean - Are you talking about what is in my back yard? What is around a castle? Or Apple's App Store?
- encryptluks2 4y agoSocialism for the rich
- Bloating 4y agoWhat would happen is congress subsidized last mile internet access?
- madengr 4y ago
- andrewstuart 4y agoIt'll be money wasted. They should be paying out a large sum ONLY on completion, defined as when the first 10 million semiconductors are delivered to commercial customers.
- jason-phillips 4y agoAs a side note, that's like a couple of days of production for one fab. A billion chips would be more meaningful in your example.
- deleted 4y ago[deleted]
- tootie 4y agoI'm not an expert but that could be considered dumping by the WTO
- laxatives 4y agoSo who is the primary benefactor of this Pork? Seems like this hasn't already been done is because it isn't profitable or scaleable like software is. It's not like there is a shortage of investors in technology.
- deleted 4y ago[deleted]
- jmyeet 4y agoAnyone remember how the capital-owning class and their pet politicans were blaming inflation on Covid stimulus checks (eg [1])? I want you to remember that when you see bills like this one. Why? Because most of the Covid relief didn't go to individuals. It went to companies. In many cases, the stimulus was to avoid layoffs. Companies laid people off anyway (eg [2]) and used the money for share buybacks. Some governments used the money to build prisons (eg [3]). Biden, before testing positive for Covid, was intending to announce the use of Covid money for increased police funding [4]. My point is that very little of that Covid stimulus made it to consumers but it had a dramatic impact on temporarily eliminating or reducing poverty [5]. Yet giving people money is often viewed as a moral hazard. Yet we're so willing to give away hundreds of billions to companies while not expecting them to take any sort of haircut on record profits in an era of massive inflation. Also, let's not forget what happened to Wisconsin and Foxconn [6]. [1]: https://www.cbsnews.com/news/jeff-bezos-joe-biden-inflation-tweet/ https://www.cbsnews.com/news/jeff-bezos-joe-biden-inflation-... [2]: https://publicintegrity.org/inequality-poverty-opportunity/covid-divide/companies-took-covid-19-aid-they-laid-off-90000-workers-anyway/ https://publicintegrity.org/inequality-poverty-opportunity/c... [3]: https://www.splcenter.org/news/2022/07/01/alabama-diverts-400-million-covid-funds-to-prisons https://www.splcenter.org/news/2022/07/01/alabama-diverts-40... [4]: https://apnews.com/article/biden-police-pennsylvania-wilkes-barre-c3d8e3ee5190adde35b1b7932a47dc4b https://apnews.com/article/biden-police-pennsylvania-wilkes-... [5]: https://www.vox.com/22600143/poverty-us-covid-19-pandemic-stimulus-checks https://www.vox.com/22600143/poverty-us-covid-19-pandemic-st... [6]: https://www.chicagotribune.com/suburbs/lake-county-news-sun/ct-lns-foxconn-investment-fact-check-st-0202-20190201-story.html https://www.chicagotribune.com/suburbs/lake-county-news-sun/...
- jscipione 4y agoNo wonder the economy has been destroyed, our “leaders” are spending us into oblivion.
- Someone1234 4y agoIt should be noted that the US decided not to extend the universal free school meals program, because it was "too expensive" at $11B. They also stopped the expanded and early payment of family tax credits, causing a double-whammy hit to poor families (then pile on inflation/food prices, and gas prices). But $50B to large monopolistic companies isn't "too expensive," and we can afford that. Unfortunately 52 senators get to control the agenda, and they get to decide what is "affordable" and "too expensive."
- PragmaticPulp 4y ago> It should be noted that the US decided not to extend the universal free school meals program, because it was "too expensive" at $11B. Tragic, yes, but note that you can’t compare the price tags directly on bills like this because the headline number tends to be a mix of tax breaks combined with spending authorization stretch out over many years. For example, $100 billion of the bill goes to domestic funding scientific research and fostering technology hubs. It’s spread out over 5 years. I need to read the fine print of how this is all spread out, but it’s incorrect to read the headline and assume that chipmakers are getting $280B of checks next year. For comparison, a bill authorizing the domestic lunch program over a similar 5 year term would likely be said to cost $65-70 billion due to the 5-year term and the inevitable rising prices over that term. (Note I’m not making any moral judgments about this, just putting it in context. I also didn’t verify any cost numbers from the parent comment, so don’t take my example as a fact)
- guelo 4y ago
- mattnewton 4y ago51 senators could change that rule any time though, it’s just an accidental convention that hasn’t had the best track record imo
- listless 4y agoNobody changes it because they know they are going to need it when they are the minority. Someone is gonna have to take one for the team and pull the plug on it, but I have little faith in our government ever doing the “principled” thing.
- gdsdfe 4y agoLet see how fast they're going to waste a quarter of a trillion dollars
- Jerry2 4y agoThis is the biggest theft of taxpayer money since the inception of the US!
- dang 4y agoRelated. I'm sure there have been others? H. R. 4346: The CHIPS and Science Act of 2022 - https://news.ycombinator.com/item?id=32250207 https://news.ycombinator.com/item?id=32250207 - July 2022 (77 comments) House Bill Funds CHIPS Act, Stresses R&D - https://news.ycombinator.com/item?id=31560844 https://news.ycombinator.com/item?id=31560844 - May 2022 (111 comments)
- jeffwask 4y agoYey for Corporate Welfare
- butterfly771 4y agoAs a Chinese, I would like to say that as far as I know, China is investing heavily in semiconductors, but without high-end production equipment, it is difficult to produce high-precision chips
- upupandup 4y agoThere's a good reason these litography machines and other CNC equipment have GPS sensitive tracking. Even a slight deviation renders the equipment non-operable and dials home immediately if they lose connectivity.
- alexb_ 4y agoFor your convenience, the text of the bill is here: https://docs.house.gov/billsthisweek/20220725/BILLS-117HR4346SASA.pdf https://docs.house.gov/billsthisweek/20220725/BILLS-117HR434.... Relevant text for semiconductor funding is on page 10. The bill says "for section 9902/9906 of Public Law 116-283". This can be found on page 1460 here: https://www.congress.gov/116/plaws/publ283/PLAW-116publ283.pdf https://www.congress.gov/116/plaws/publ283/PLAW-116publ283.p...
- nceqs3 4y agoKing!
- fmakunbound 4y agoShould have put it into fundamental STEM education
- LdSGSgvupDV 4y agoIt won't work. Most of them would go to software industry after graduated.
- asg101 4y agoLet the congressional insider trading begin!
- treeman79 4y agoAlready done. Speaker of houses husband bought 5 million dollars of Nvidia stock right before this bill. https://nypost.com/2022/07/23/nancy-and-paul-pelosi-are-trading-large-with-a-wealth-of-hypocrisy/amp/ https://nypost.com/2022/07/23/nancy-and-paul-pelosi-are-trad...
- ab_testing 4y agoLet the stock buybacks begin!!
- snikeris 4y agoI guess inflation isn’t a concern after all.
- yonaguska 4y agoWhen you can hedge against inflation with insider trading, no. It's not your problem. It's just a problem for the little people.
- mwattsun 4y agoWe support strategic defense industries [1] in the U.S. so I don't understand how offshoring chip making was ever allowed to happen [1] As a former sub sailor, I'm aware that we kept submarine building capability afloat at New London, CT and Newport News, VA even when there is no current demand, but this was long ago and may no longer be true
- abvdasker 4y agoThat's capitalism, baby! It turns out domestic chip fabrication wasn't competitive (in this case a rare double-whammy of failing to compete on both cost and capability). The global market determined that Taiwan and South Korea made the best and cheapest chips so that's where all the manufacturing went. Demand for semiconductors is overwhelmingly not created by the military so it doesn't really make sense to compare it to submarines.
- mwattsun 4y ago> Demand for semiconductors is overwhelmingly not created by the military That may be true, but semiconductors are absolutely crucial to the military. I suppose the military has their own fabs locally located in partnership with Intel, AMD, IBM, TI, etc...
- mhneu 4y agoThis was what Andy Grove wanted - more investment in chip manufacturing. Good news. Grove was a visionary in many ways and his writing on this back in 2010 or so impacted my thinking. https://prospect.org/environment/andy-grove-trade-globalization-defending-america-s-economy/ https://prospect.org/environment/andy-grove-trade-globalizat... In retirement, Grove became concerned about the decline of American manufacturing: When he was CEO, Intel not only performed its research and development in the United States, but its manufacturing as well. He was greatly disturbed that more and more American companies produced their products abroad. Concerned about the erosion of the American middle class, he also helped Service Employee International Union leaders Andy Stern and David Rolf conceptualize new ways that the American labor movement might once again flourish.
- ravenstine 4y agoI can't help but conclude that this is too little too late. R&D isn't the problem, which is what this bill seems more focused on. The ability to produce affordable chips domestically at affordable prices is the actual problem. North America's first priority isn't access to bleeding edge tech. > The bill also includes about $100 billion in authorizations over five years for programs such as expanding the National Science Foundation’s work and establishing regional technology hubs to support start-ups in areas of the country that haven’t traditionally drawn big funding for tech. I can only imagine how bureaucratic the process for accessing those funds will be. More likely, Medium Tech and even Big Tech will be the ones who feed from that trough because they're the only ones willing or able to cut through the red tape.
- dwiel 4y agoI've received money from the NSF SBIR grant program and know another half a dozen others who have as well, and while there is certainly a process, it isn't too bad. All the people I know who have received them are at startups and small companies. That said, the NSF does more than just SBIR and I can't speak to any of that.
- bilbo0s 4y agoEven worse, it'll be some senator's niece and nephew who all of a sudden create a startup that "is just crushing it on the funding!"
- mberning 4y agoMore pork for their cronies and donor class buddies. Much like the pandemic aid such as the PPP I’m sure fractions of a dollar actually make it into anything of use.
- alexpotato 4y agoDidn't get a ton of points when it was last posted but this "Taiwan is now Arrakis" post seems even more timely now: https://news.ycombinator.com/item?id=24576242 https://news.ycombinator.com/item?id=24576242
- balozi 4y agoJust more public money to develop private intellectual property. In a few years we'll be paying more for chips and IP that was developed using tax payer coin.
- fabfabfab 4y agoFab guy here. This is excellent news and much needed, but vigilence is needed to make sure it doesn't end up being devoured by crony corporate agenda and it actually results in favorouble pro-US climate for semiconductor manufacturing. I'd like to share personal experience with how we bankrupted American leadership in cutting edge nodes. Although, it is not lithography related, I was part of a few billion $ ROI program where we'd hot test the chip for binning, best I don't disclose too many details. Let's just say, it was critical so much so that I sat in unmarked buildings. I saw that get transfered under my personal watch to China. We had Chinese employees visit US for 6 months at a time and during this rotation, we'd teach them everything. Had to take a Chinese culture course. Process charts, metrics, drawings and schematics, whitepapers, how everything works, be part of troubleshooting process and then test them for their acuity. This was around 2012-2014. Usually, US semiconductor manufacturers do not transfer fab capabilities to China, only assembly/packaging. But, here, the was a clear violation of backend fab activities that were transferred to China and built out. I visited China for 3 months to get things up and running. This was a brand new process that no one in the world has. All custom equipment from a major Japanese equipment manufacturer. This process was so insane that it took 10 years of development internally to come to this point. Even today, in 2022, no one has replicated it. This should not have happened IMO from a national security standpoint. But, these things continue to happen and US gov does not have enough insight into America's semiconductor industry when it comes to protecting IP. Far too many things do not require ITAR and are exported without oversight. I am pretty much against over-regulation, but here there needs to be strict regulation for exporting any semiconductor technologies whether it is fab or assembly or what have you. The entire industry needs to be hamstrung with export control.
- beambot 4y ago> In a 64-33 vote, the Senate passed the $280 billion “Chips and Science Act,” the final iteration of a bill that was years in the making. About $52 billion would go to microchip manufacturers to incentivize construction of domestic semiconductor fabrication plants And the remaining $228B...?
- fleddr 4y agoFairly cynical comments on this thread, many trying to uphold American values like "free market", "protectionism is bad", "what about the consumer", "not from my tax money". I find those remarks pretty naive. Every major power block heavily subsidizes strategic industries, now and forever. It's in no way new or remarkable, nor does it violate some principle. Most of the above concepts are pure fiction. Semiconductors are not a "free market" in any ordinary sense. It costs tens of billions to enter the market and you'll buy an ASML machine, speaking of dependencies. It's pretty obvious that this is in response to geopolitical instability. Being geo locked and this not really being a free market at all justify the "unusual" decision. As is stands, food, energy, and yes...also semiconductors are foundational to a modern digital society. And they're interconnected, without semiconductors you won't have food either. If you want to know what happens when semiconductors dry up, watch modern Russia. Arguably it's hard to do because of all the propaganda, but pretty much every domestic industry is falling apart, and therefore society falls apart. Bottom line, don't be naive. Sure it sucks to give rich companies even more money but if that's what it takes, so be it. Also, rich is just one side of the coin, the other is that they spear-headed the information revolution.
- tootie 4y agoHere's my cynical take: This bill will subsidize a lot of jobs when we already have zero slack in our labor market. I think it's an excellent target for spending and would have a positive multiplier in normal times but in 2022 this seems likely to just goose inflation another inch. Unless we actually start seeing cyclical job losses finally hit right when this money starts being spent. Which is entirely possible.
- andrekandre 4y agoany way to stop inflation without a needing job losses?
- diordiderot 4y agoTaxes. People fear capital flight. Where you gonna go?
- yababa_y 4y agoIs now a good time to enter the industry? Who is doing the most innovative work?
- maskil 4y agoFor some reason, I have a feeling that handouts would only make these giant corps only more bloated, bureaucratic and inefficient
- PaywallBuster 4y agoTax based on manufacturing concentration? e.g. at current market shares, we could - 10% tax for Asia manufacturing - 20% tax for Taiwan manufacturing By moving away from these centers, taxes would be adjusted say annually I think this would be interesting for other industries too #ChinaDecoupling
- mikewarot 4y agoIf we had sufficient capacity to make all of our chips onshore, what about all the other components to go along with them. Do we have enough domestic production of passive components, circuit board stock, solder, etc?
- cudgy 4y agoInstead of subsidizing the semiconductor industry (and others) with free subsidies, why not invest the money in the companies and issue shares to every registered tax payer equally. At least then the citizens might see some benefits from yet another huge act of corporate welfare.
- andreime 4y agocause as individual investors you can't force the company to build fabs. company will make money for investors in other ways.
- cudgy 4y agoThe investment could be a special class of stock that would be contingent upon building fabs with installments on completion of milestones or a penalty to the company applies. The penalty could be applied in many ways like direct tariffs on that company, penalty tax, direct cash penalty, or even nationalization of the company in extreme circumstances.
- Blackstrat 4y agoWhile unquestionably semis, etc. are of vital US concern. However, why should the companies be subsidized by the taxpayer? All of these companies are profitable. All are multi-national. All can sell every chip they make, etc. This smacks of Soviet style industrial policy or crony capitalism, if you prefer. And in the end, when the subsidies cease, they will again shop themselves to the highest bidder. Strikes me as extremely short sighted.