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Chipmakers warned: US CHIPS Act funds are not for 'stock buybacks'

16 points by LinuxBender 4y ago

rektide 4y ago
But 5% YoY dividend... maybe that's happening?[1] Uggghhh. Im in favor of the US spending a sizable chunk of money on semiconductors. But this dont feel great. [1] https://news.ycombinator.com/item?id=32291356 https://news.ycombinator.com/item?id=32291356
- olliej 4y ago
  If you’re getting bailed out by taxpayers that means you don’t have the money to issue dividends or anything similar, so bills should be written such that issuing a dividend or whatever would mean you committed fraud in your application for a bailout, or should trigger an immediate repayment of the entire loan.
  - rektide 4y ago
    This isn't a bailout. Intel posted their first net loss in a long long long long time. They still have a 15B revenue, and plenty of cash on hand. This is funding for investing in US chipmaking. Frankly, America is uncompetitive, owing to a an expensive labor pool (high cost of living) and adversarial operating environment (lots of legal & regulatory hurdles). As I see it, this funding exists to pay the difference, to get chip-makers like Intel to do it here anyways, even though there's no business sense. Because chipmaking is an existential risk, a necessity for modern civilization, and the thought of not having access to it is unimaginably awful. If this money came with a million strings strings attached, Intel probably wouldn't take it. This money is a carrot. But hopefully one that indeed does end up encouraging the needed results.
    - olliej 4y ago
      The strings are: use this money to invest in production. That doesn't seem like much of a string. If that string is too much, would a better law be "give money to executives and stockholders of semiconductor companies and ask the semiconductor companies to invest money that they're claiming they don't have"? If you disagree with that interpretation of what you're saying, I'd like you to explain how prohibiting then from simply taking the money and forwarding it to execs and stockholders is a problem?
afinlayson 4y ago
Fool me 10 times… and I’ll write a strongly written statement in bill.
olliej 4y ago
Does the bill include language that prohibits it? Or dividends? Or buybacks? Or increasing executive compensation? Or doing similar through shell companies/“investments”? Because you can’t pass a bill, and then say “that’s not what the bill intended” when the groups that profit from it just forward the free taxpayer money they received to the already rich. At some point there should be legislation that prohibits free money, and requires it to be a loan with no fixed repayment schedule only a requirement that it be paid back in full the moment the recipient does any of the above. Which also means the recipients can’t simply report having increased assets in their financial reports.
bravetraveler 4y ago
That's what the employee purchase program is for!

16 points by LinuxBender 4y ago

But 5% YoY dividend... maybe that's happening?[1] Uggghhh. Im in favor of the US spending a sizable chunk of money on semiconductors. But this dont feel great. [1] https://news.ycombinator.com/item?id=32291356 https://news.ycombinator.com/item?id=32291356

olliej 4y ago
If you’re getting bailed out by taxpayers that means you don’t have the money to issue dividends or anything similar, so bills should be written such that issuing a dividend or whatever would mean you committed fraud in your application for a bailout, or should trigger an immediate repayment of the entire loan.
- rektide 4y ago
  This isn't a bailout. Intel posted their first net loss in a long long long long time. They still have a 15B revenue, and plenty of cash on hand. This is funding for investing in US chipmaking. Frankly, America is uncompetitive, owing to a an expensive labor pool (high cost of living) and adversarial operating environment (lots of legal & regulatory hurdles). As I see it, this funding exists to pay the difference, to get chip-makers like Intel to do it here anyways, even though there's no business sense. Because chipmaking is an existential risk, a necessity for modern civilization, and the thought of not having access to it is unimaginably awful. If this money came with a million strings strings attached, Intel probably wouldn't take it. This money is a carrot. But hopefully one that indeed does end up encouraging the needed results.
  - olliej 4y ago
    The strings are: use this money to invest in production. That doesn't seem like much of a string. If that string is too much, would a better law be "give money to executives and stockholders of semiconductor companies and ask the semiconductor companies to invest money that they're claiming they don't have"? If you disagree with that interpretation of what you're saying, I'd like you to explain how prohibiting then from simply taking the money and forwarding it to execs and stockholders is a problem?

afinlayson 4y ago

Fool me 10 times… and I’ll write a strongly written statement in bill.

olliej 4y ago

Does the bill include language that prohibits it? Or dividends? Or buybacks? Or increasing executive compensation? Or doing similar through shell companies/“investments”? Because you can’t pass a bill, and then say “that’s not what the bill intended” when the groups that profit from it just forward the free taxpayer money they received to the already rich. At some point there should be legislation that prohibits free money, and requires it to be a loan with no fixed repayment schedule only a requirement that it be paid back in full the moment the recipient does any of the above. Which also means the recipients can’t simply report having increased assets in their financial reports.

bravetraveler 4y ago

That's what the employee purchase program is for!