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they would buy cars, lattes and pay tax on non-subsidized jobs, too. Why should the latte shop owner have to pay tax to run their business, while the chip mfg d

they would buy cars, lattes and pay tax on non-subsidized jobs, too. Why should the latte shop owner have to pay tax to run their business, while the chip mfg doesn't? it just creates two classes of people. > America as a nation has decided we need to produce semiconductors here for economic and national security purposes a few decades ago we decided to move manufacturing jobs overseas because paying people who had families and bought "cars and lattes" here was just too expensive. Why reneg on that commitment?

ericmay 3y ago
> they would buy cars, lattes and pay tax on non-subsidized jobs, too The point here was that your assumption of the economic effects of the subsidies didn’t include other meaningful factors.
bee_rider 3y ago
> a few decades ago we decided to move manufacturing jobs overseas because paying people who had families and bought "cars and lattes" here was just too expensive. Why reneg on that commitment? Because it was dumb, changing away from a path when you see it is a dead end is a good thing to do. Also I’m not sure “we” (to the extent that there even is an “we” here, there are always winners and losers with these sorts of policies so I bet the whole country didn’t agree) ever intended to move high-tech manufacturing away from the US. I think we want to outsource the bad jobs and keep the good ones. Of course it is a game everybody is playing, we’re shifting our strategy to hopefully more effectively keep the high-tech stuff.
- octacat 3y ago
  The game the manufactures are playing is to get extra good conditions for them by pressing the government that they would produce abroad. Local manufacturing in any reasonable volume is not coming back. Highly automated - yes, maybe, if there are dotations/tax cuts/high import tariffs. Highly automated means 1.5k people working on a giant fab and rest are robots.
- gosub100 3y ago
  why is building a washer that keeps peoples clothing clean a 'bad job' and building tech components a 'good job'?
  - bee_rider 3y ago
    Because computer chips are cool and washing machines are boring.
  - earthwalker99 3y ago
    [flagged]
- jdewerd 3y ago
  Everyone involved with floating the dollar and running a deficit understood that it would pump the asset sector and dump the export sector. There were fights about it. Keynes got himself ejected from elite circles by lobbying a bit too hard for his pet alternative. If you want a more visible and recent datapoint, look to the perennial fights in the UN over the opposite, where a country that promised not to devalue their currency devalued their currency. Note that these discussions generally start from a point where everyone understands why it might be desirable to devalue one's currency, pumping exports & the real economy while dumping assets. This is macroeconomics 101 stuff. The surprising thing is not that high tech manufacturing left, it's that for a while it was actually able to compete with a money printer for access to talent and resources.
- Dalewyn 3y ago
  >I’m not sure “we” ever intended to move high-tech manufacturing away from the US. Until the recent turnaround, it was understood the west was moving to a service industry. Someone Else(tm) (read: China) would manufacture everything (the "dirty", "cheap" work) and we would provide the service (the "clean", "expensive" work). Of course, an economy can't be valuable if it can't actually make anything. As it stands, the US can't even make chopsticks by itself let alone microprocessors. I actually have significant doubt CHIPS will be successful in bringing back microprocessor manufacturing, and more broadly bringing back manufacturing in general to the west at all, but we have to start somewhere if we don't want to be beholden.
  - bee_rider 3y ago
    I’m not sure what you mean by “can’t even make chopsticks by itself,” which is to say, obviously that is an exaggeration but on the other hand, lots of products do touch multiple countries… Anyway, US manufacturing output still seems to be second in the world, around 1/2 that of China with 1/4 the population. Microprocessors are already made in the US, Intel (despite their struggles) is still making plenty of chips here. I’m not really sure what the plan is with Global Foundries, in the sense that they presumably won’t keep up with TSMC or even Intel… but maybe 7nm will be the next or next-next generation automotive chip node or something.
    - Dalewyn 3y ago
      Intel designs their chips here, but Intel makes their chips in Israel, Vietnam, Malaysia, Costa Rica, etc. This is what the west was trying to do before: Providing services like microprocessor design for the manufacturing industries overseas. But of course, simply drawing stuff on paper for others to peruse doesn't actually produce value. It's the act of making something that produces value, and we finally realized that grave error. Not to mention the people doing the manufacturing work will inevitably accrue the know-how to also just do the designing themselves too, and then we in the service industry really are worthless fools. >I’m not sure what you mean by “can’t even make chopsticks by itself,” I mean that quite literally. I know Georgia (the state, to be clear) has (or had) a robust disposable chopstick manufacturing industry, but nearly every disposable chopstick I see sold or given out are Made In China these days. If we can't (or won't) even figure out the means to making some wooden sticks, we definitely aren't manufacturing microprocessors.
edgyquant 3y ago
Why continue to ignore the answer given in favor of purely economic arguments? We need chips built at home so we’re making it happen, it isn’t complicated.
- gosub100 3y ago
  "we" is doing a lot of work there. a multiple-trillion-dollar company could do the investing (since their products depend on this silicon) instead of the American taxpayer. But lets blur the lines with the word "we".
  - edgyquant 3y ago
    All of their competitors are subsidized by their governments and chips are as important as energy or agricultural today. It’s not realistic for us to expect a free market to compete with non free ones

ericmay 3y ago

> they would buy cars, lattes and pay tax on non-subsidized jobs, too The point here was that your assumption of the economic effects of the subsidies didn’t include other meaningful factors.

bee_rider 3y ago

> a few decades ago we decided to move manufacturing jobs overseas because paying people who had families and bought "cars and lattes" here was just too expensive. Why reneg on that commitment? Because it was dumb, changing away from a path when you see it is a dead end is a good thing to do. Also I’m not sure “we” (to the extent that there even is an “we” here, there are always winners and losers with these sorts of policies so I bet the whole country didn’t agree) ever intended to move high-tech manufacturing away from the US. I think we want to outsource the bad jobs and keep the good ones. Of course it is a game everybody is playing, we’re shifting our strategy to hopefully more effectively keep the high-tech stuff.

octacat 3y ago
The game the manufactures are playing is to get extra good conditions for them by pressing the government that they would produce abroad. Local manufacturing in any reasonable volume is not coming back. Highly automated - yes, maybe, if there are dotations/tax cuts/high import tariffs. Highly automated means 1.5k people working on a giant fab and rest are robots.
gosub100 3y ago
why is building a washer that keeps peoples clothing clean a 'bad job' and building tech components a 'good job'?
- bee_rider 3y ago
  Because computer chips are cool and washing machines are boring.
- earthwalker99 3y ago
  [flagged]
jdewerd 3y ago
Everyone involved with floating the dollar and running a deficit understood that it would pump the asset sector and dump the export sector. There were fights about it. Keynes got himself ejected from elite circles by lobbying a bit too hard for his pet alternative. If you want a more visible and recent datapoint, look to the perennial fights in the UN over the opposite, where a country that promised not to devalue their currency devalued their currency. Note that these discussions generally start from a point where everyone understands why it might be desirable to devalue one's currency, pumping exports & the real economy while dumping assets. This is macroeconomics 101 stuff. The surprising thing is not that high tech manufacturing left, it's that for a while it was actually able to compete with a money printer for access to talent and resources.
Dalewyn 3y ago
>I’m not sure “we” ever intended to move high-tech manufacturing away from the US. Until the recent turnaround, it was understood the west was moving to a service industry. Someone Else(tm) (read: China) would manufacture everything (the "dirty", "cheap" work) and we would provide the service (the "clean", "expensive" work). Of course, an economy can't be valuable if it can't actually make anything. As it stands, the US can't even make chopsticks by itself let alone microprocessors. I actually have significant doubt CHIPS will be successful in bringing back microprocessor manufacturing, and more broadly bringing back manufacturing in general to the west at all, but we have to start somewhere if we don't want to be beholden.
- bee_rider 3y ago
  I’m not sure what you mean by “can’t even make chopsticks by itself,” which is to say, obviously that is an exaggeration but on the other hand, lots of products do touch multiple countries… Anyway, US manufacturing output still seems to be second in the world, around 1/2 that of China with 1/4 the population. Microprocessors are already made in the US, Intel (despite their struggles) is still making plenty of chips here. I’m not really sure what the plan is with Global Foundries, in the sense that they presumably won’t keep up with TSMC or even Intel… but maybe 7nm will be the next or next-next generation automotive chip node or something.
  - Dalewyn 3y ago
    Intel designs their chips here, but Intel makes their chips in Israel, Vietnam, Malaysia, Costa Rica, etc. This is what the west was trying to do before: Providing services like microprocessor design for the manufacturing industries overseas. But of course, simply drawing stuff on paper for others to peruse doesn't actually produce value. It's the act of making something that produces value, and we finally realized that grave error. Not to mention the people doing the manufacturing work will inevitably accrue the know-how to also just do the designing themselves too, and then we in the service industry really are worthless fools. >I’m not sure what you mean by “can’t even make chopsticks by itself,” I mean that quite literally. I know Georgia (the state, to be clear) has (or had) a robust disposable chopstick manufacturing industry, but nearly every disposable chopstick I see sold or given out are Made In China these days. If we can't (or won't) even figure out the means to making some wooden sticks, we definitely aren't manufacturing microprocessors.

edgyquant 3y ago

Why continue to ignore the answer given in favor of purely economic arguments? We need chips built at home so we’re making it happen, it isn’t complicated.

gosub100 3y ago
"we" is doing a lot of work there. a multiple-trillion-dollar company could do the investing (since their products depend on this silicon) instead of the American taxpayer. But lets blur the lines with the word "we".
- edgyquant 3y ago
  All of their competitors are subsidized by their governments and chips are as important as energy or agricultural today. It’s not realistic for us to expect a free market to compete with non free ones