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> It has also received some $30 billion in government subsidies to help That's such an incredible amount of money. It would be fair to say they are really just

> It has also received some $30 billion in government subsidies to help That's such an incredible amount of money. It would be fair to say they are really just an arm of the government right ?

f6v 3y ago
It’s kind of space industry. Does US government own Starlink? Yes and no.
Matl 3y ago
I mean they're clearly vital to China, but private industry receives tons of subsidies in the U.S. too, 'defense' contractors, fossil fuels, farming... It's a pretty normal thing for a government to do regarding sectors it considers important. Obviously that buys them influence, in China and in the US alike.
rhamzeh 3y ago
Yes, just as much as airlines are an arm of the US government: > U.S. airlines avoided broad bankruptcies and cuts with the record $74 billion in government Covid-19 aid (https://skift.com/2021/07/29/federal-aid-saved-u-s-airlines-from-the-worst-of-the-pandemic-but-was-it-a-success/ https://skift.com/2021/07/29/federal-aid-saved-u-s-airlines-...) Or the US semiconductor industry > Most of the money is going into industry and supporting industry investments. Of the $52.7 billion in subsidies, the bulk of that will end up going to private companies. (https://www.scientificamerican.com/article/nearly-53-billion-in-federal-funding-could-revive-the-u-s-computer-chip-industry https://www.scientificamerican.com/article/nearly-53-billion...) Of course there's more examples for almost any country. I'm not debating your conclusion. I think it is spot on. I am calling out the tone though as if this was not the norm for all the mega corps/mega industries.
- throwaway29812 3y ago
  Yes but no government puts listening devices into their planes to spy on passengers considering they have full control. Wait, that's actually a good idea. Probably likely that one of China/Russia/N Korea/Iran have done this.
  - throwaway29812 3y ago
    ..a good idea from the perspective of an authoritarian government. Not saying it's good for airplanes to do this.
shapefrog 3y ago
Musk has pocketed $5bn and that excludes "government contracts". It would be fair to say they are really just an arm of the government right ?
- analognoise 3y ago
  Absolutely?
  - k7sune 3y ago
    At this point we are definitely treating SpaceX as the US space agency and not a private business. People were outraged when Musk was considering whether to continue supporting Ukraine with StarLink. Imagine if he refused to do the same when China cuts the cables to Taiwan, someone will probably try to charge him with treason, only to realize that a private business has no obligation to do so.
    - inemesitaffia 3y ago
      Support as in keep charging $500 for $1500 equipment and allowing use that wasn't agreed on at the outset?
- dotnet00 3y ago
  Government contracts are work done in exchange for money. They are not subsidies as much as you might wish for them to be. If the government buys 1000 pens because it literally needs them to do its job, it isn't subsidizing the pen industry.
  - georgeg23 3y ago
    In the case of Musk, that isn't true. The COTS contract awarded half the money ($150M) without any hardware built--it was up-front. This amounted to more than the total amount Elon invested and more than covered Falcon 1, meaning he never had to spend his own money.
Kognito 3y ago
Not to say you’re wrong, but “TSMC seeks $15 billion in US subsidies for Arizona chip plant”[1] and the fact they may get a sizeable share of the EU’s $46 billion subsidy pot [2], suggests that this is just the sort of money that governments are willing to spend to secure access to one of the 21st century’s most critical resources. If anything, given China will not have access to ASML’s latest tech and will need to develop much of the tech itself, the $30 billion seems a bit low for a whole “network” of fabs. [1] https://finance.yahoo.com/news/tsmc-seeks-15b-subsidies-wants-130836706.html https://finance.yahoo.com/news/tsmc-seeks-15b-subsidies-want... [2] https://www.reuters.com/technology/tsmc-feeling-good-about-possible-germany-plant-talks-subsidies-2023-06-06/ https://www.reuters.com/technology/tsmc-feeling-good-about-p...
wpwpwpw 3y ago
What about the CHIPS act and its $52 billion in subsidies and tax benefits? Is Intel just another arm of US government now? And EU will do the same. I believe it's understandable that every political block wants to be independent in such important technologies.
- bilekas 3y ago
  > CHIPS act and its $52 billion in subsidies and tax benefits? This is a fair point, and I don't know or will assume but is all of that going to 1 company ?
  - wpwpwpw 3y ago
    It should be safe to assume they are pumping money to other companies, such as SMIC and, more recently, Moore Threads. Although they are years behind and, for example, MTT S80 is at 750Ti levels in lots of aspects, it's quite astonishing the advancements they made in such short amount of time.
- sneak 3y ago
  There is a pretty strong argument that there are a set of companies that the USG considers "too big/important to fail" given the roles they have played in defense and associated industries. Boeing and Lockheed certainly, Microsoft and Intel and Dell most probably. Without Intel, the CIA and NSA can't do CIA and NSA stuff. I think they're safe. I can't see them changing their domain controllers and sharepoint out for macs and mediawiki any time soon, any more than I can see them flying A330s.
  - HFguy 3y ago
    Dell??? Agree on Intel, MS, Boeing. And there are others. But how is Dell strategic?
    - FirmwareBurner 3y ago
      Want your government to buy Lenovo instead of Dell?
analognoise 3y ago
You think Intel, AMD and NVidia aren't? It's a carrot not stick model over here, but they're absolutely arms of the government and this is squarely in the realm of industrial policy. Everything else is pretend. Intel is supposed to capture how many billions from the CHIPS act (alone - then add in state subsidies) and NVidia can't sell it's most powerful GPUs to China (they have capped memory bandwidth of 600GB/s). AMD tiptoed around x86 designs in "mainland" China through a complex subsidiary agreement - and none of those designs were the most complex (they were reduced in various ways). The gloves are off and we've stopped pretending it's a free market.
RobotToaster 3y ago
The US Chips and Science Act gives $52bn in subsidies and $24bn in "tax credits" to semiconductor companies.
goodbyesf 3y ago
> That's such an incredible amount of money. It would be fair to say they are really just an arm of the government right ? If so, then every major US bank, oil, car, tech, transportation, banana, etc company is just an arm of the government. It's not just trillions in subsidies that we've provided for them over the past few centuries. We've fought wars to help these industries. The US government committed genocide against native, asians, middle easterners, etc to help these companies and industries.
paxys 3y ago
Every Chinese company is an arm of the government, whether they have state funding or not. Look at what happened with Jack Ma and the Ant Financial IPO. If the CCP can exert this level of control over a $280B company is anyone out of reach?
- hunglee2 3y ago
  Government definitely is above the Corporations in the China. Perhaps the reverse in the US
unmole 3y ago
> That's such an incredible amount of money. For reference, Huawei reported a revenue of $92 billion last year. I might be biased by my time there but I never got the impression that Huawei particularly cared about anything beyond business. Sure, the ownership structure meant management could take a more long term view but finally it was still about the bottomline.
rdevsrex 3y ago
Pretty much all companies in China are required by law to co-operate with the government. They don't need a warrant or anything like that. There is no such thing as a truly private enterprise in China. Plus, as paranoid as the CCP is, they probably have agents in these big businesses keeping track on things. Hmm, that sounds a lot like the Twitter files story :)
- powerapple 3y ago
  It is true, but normally CCP is not worried about private companies. Many times, they would ask private companies to help in developing an area, creating jobs. Sometimes private companies are asked to take over a bankrupted company to save jobs at the cost of private company, very few companies would say no because they know they are going to be rewarded later. It is very interesting dynamic in business sector. If CCP does have agents in those big businesses, there would be no recent bad news from the real estate companies.

> It has also received some $30 billion in government subsidies to help That's such an incredible amount of money. It would be fair to say they are really just an arm of the government right ?

f6v 3y ago

It’s kind of space industry. Does US government own Starlink? Yes and no.

Matl 3y ago

I mean they're clearly vital to China, but private industry receives tons of subsidies in the U.S. too, 'defense' contractors, fossil fuels, farming... It's a pretty normal thing for a government to do regarding sectors it considers important. Obviously that buys them influence, in China and in the US alike.

rhamzeh 3y ago

Yes, just as much as airlines are an arm of the US government: > U.S. airlines avoided broad bankruptcies and cuts with the record $74 billion in government Covid-19 aid (https://skift.com/2021/07/29/federal-aid-saved-u-s-airlines-from-the-worst-of-the-pandemic-but-was-it-a-success/ https://skift.com/2021/07/29/federal-aid-saved-u-s-airlines-...) Or the US semiconductor industry > Most of the money is going into industry and supporting industry investments. Of the $52.7 billion in subsidies, the bulk of that will end up going to private companies. (https://www.scientificamerican.com/article/nearly-53-billion-in-federal-funding-could-revive-the-u-s-computer-chip-industry https://www.scientificamerican.com/article/nearly-53-billion...) Of course there's more examples for almost any country. I'm not debating your conclusion. I think it is spot on. I am calling out the tone though as if this was not the norm for all the mega corps/mega industries.

throwaway29812 3y ago
Yes but no government puts listening devices into their planes to spy on passengers considering they have full control. Wait, that's actually a good idea. Probably likely that one of China/Russia/N Korea/Iran have done this.
- throwaway29812 3y ago
  ..a good idea from the perspective of an authoritarian government. Not saying it's good for airplanes to do this.

shapefrog 3y ago

Musk has pocketed $5bn and that excludes "government contracts". It would be fair to say they are really just an arm of the government right ?

analognoise 3y ago
Absolutely?
- k7sune 3y ago
  At this point we are definitely treating SpaceX as the US space agency and not a private business. People were outraged when Musk was considering whether to continue supporting Ukraine with StarLink. Imagine if he refused to do the same when China cuts the cables to Taiwan, someone will probably try to charge him with treason, only to realize that a private business has no obligation to do so.
  - inemesitaffia 3y ago
    Support as in keep charging $500 for $1500 equipment and allowing use that wasn't agreed on at the outset?
dotnet00 3y ago
Government contracts are work done in exchange for money. They are not subsidies as much as you might wish for them to be. If the government buys 1000 pens because it literally needs them to do its job, it isn't subsidizing the pen industry.
- georgeg23 3y ago
  In the case of Musk, that isn't true. The COTS contract awarded half the money ($150M) without any hardware built--it was up-front. This amounted to more than the total amount Elon invested and more than covered Falcon 1, meaning he never had to spend his own money.

Kognito 3y ago

Not to say you’re wrong, but “TSMC seeks $15 billion in US subsidies for Arizona chip plant”[1] and the fact they may get a sizeable share of the EU’s $46 billion subsidy pot [2], suggests that this is just the sort of money that governments are willing to spend to secure access to one of the 21st century’s most critical resources. If anything, given China will not have access to ASML’s latest tech and will need to develop much of the tech itself, the $30 billion seems a bit low for a whole “network” of fabs. [1] https://finance.yahoo.com/news/tsmc-seeks-15b-subsidies-wants-130836706.html https://finance.yahoo.com/news/tsmc-seeks-15b-subsidies-want... [2] https://www.reuters.com/technology/tsmc-feeling-good-about-possible-germany-plant-talks-subsidies-2023-06-06/ https://www.reuters.com/technology/tsmc-feeling-good-about-p...

wpwpwpw 3y ago

What about the CHIPS act and its $52 billion in subsidies and tax benefits? Is Intel just another arm of US government now? And EU will do the same. I believe it's understandable that every political block wants to be independent in such important technologies.

bilekas 3y ago
> CHIPS act and its $52 billion in subsidies and tax benefits? This is a fair point, and I don't know or will assume but is all of that going to 1 company ?
- wpwpwpw 3y ago
  It should be safe to assume they are pumping money to other companies, such as SMIC and, more recently, Moore Threads. Although they are years behind and, for example, MTT S80 is at 750Ti levels in lots of aspects, it's quite astonishing the advancements they made in such short amount of time.
sneak 3y ago
There is a pretty strong argument that there are a set of companies that the USG considers "too big/important to fail" given the roles they have played in defense and associated industries. Boeing and Lockheed certainly, Microsoft and Intel and Dell most probably. Without Intel, the CIA and NSA can't do CIA and NSA stuff. I think they're safe. I can't see them changing their domain controllers and sharepoint out for macs and mediawiki any time soon, any more than I can see them flying A330s.
- HFguy 3y ago
  Dell??? Agree on Intel, MS, Boeing. And there are others. But how is Dell strategic?
  - FirmwareBurner 3y ago
    Want your government to buy Lenovo instead of Dell?

analognoise 3y ago

You think Intel, AMD and NVidia aren't? It's a carrot not stick model over here, but they're absolutely arms of the government and this is squarely in the realm of industrial policy. Everything else is pretend. Intel is supposed to capture how many billions from the CHIPS act (alone - then add in state subsidies) and NVidia can't sell it's most powerful GPUs to China (they have capped memory bandwidth of 600GB/s). AMD tiptoed around x86 designs in "mainland" China through a complex subsidiary agreement - and none of those designs were the most complex (they were reduced in various ways). The gloves are off and we've stopped pretending it's a free market.

RobotToaster 3y ago

The US Chips and Science Act gives $52bn in subsidies and $24bn in "tax credits" to semiconductor companies.

goodbyesf 3y ago

> That's such an incredible amount of money. It would be fair to say they are really just an arm of the government right ? If so, then every major US bank, oil, car, tech, transportation, banana, etc company is just an arm of the government. It's not just trillions in subsidies that we've provided for them over the past few centuries. We've fought wars to help these industries. The US government committed genocide against native, asians, middle easterners, etc to help these companies and industries.

paxys 3y ago

Every Chinese company is an arm of the government, whether they have state funding or not. Look at what happened with Jack Ma and the Ant Financial IPO. If the CCP can exert this level of control over a $280B company is anyone out of reach?

hunglee2 3y ago
Government definitely is above the Corporations in the China. Perhaps the reverse in the US

unmole 3y ago

> That's such an incredible amount of money. For reference, Huawei reported a revenue of $92 billion last year. I might be biased by my time there but I never got the impression that Huawei particularly cared about anything beyond business. Sure, the ownership structure meant management could take a more long term view but finally it was still about the bottomline.

rdevsrex 3y ago

Pretty much all companies in China are required by law to co-operate with the government. They don't need a warrant or anything like that. There is no such thing as a truly private enterprise in China. Plus, as paranoid as the CCP is, they probably have agents in these big businesses keeping track on things. Hmm, that sounds a lot like the Twitter files story :)

powerapple 3y ago
It is true, but normally CCP is not worried about private companies. Many times, they would ask private companies to help in developing an area, creating jobs. Sometimes private companies are asked to take over a bankrupted company to save jobs at the cost of private company, very few companies would say no because they know they are going to be rewarded later. It is very interesting dynamic in business sector. If CCP does have agents in those big businesses, there would be no recent bad news from the real estate companies.