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Chip Industry Wants $50 Billion To Keep Manufacturing in US (bloomberg.com) 191

The U.S. chip industry said as much as $50 billion in federal incentives will be needed to halt a decades-long trend of manufacturing moving overseas as China spends heavily to become a leading semiconductor producer. From a report: The federal government needs to deploy $20 billion to $50 billion to make the U.S. as attractive a location for plants as Taiwan, China, South Korea, Singapore, Israel and parts of Europe, the Semiconductor Industry Association said in a study released Wednesday. Failure to do that threatens U.S. leadership of the sector as a whole, it added. The lobbying group, which represents companies such as Intel and Qualcomm, is making the pitch at a time when it believes Washington is more open to listening. The China-U.S. trade war and supply-chain disruptions caused by the pandemic have revealed the risks of having such vital components made abroad.
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Chip Industry Wants $50 Billion To Keep Manufacturing in US

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  • Corporate Welfare (Score:5, Insightful)

    by Anonymous Coward on Wednesday September 16, 2020 @11:17AM (#60511374)

    Gotta love these welfare queens leaching off the American tax payers.

    Here is an idea - pay your fucking taxes and then we can talk about bailouts or 'incentives' or whatever you hypocrites call your corporate welfare.

    • by Rockoon ( 1252108 ) on Wednesday September 16, 2020 @11:31AM (#60511434)
      I think the essential problem with giving an industry special benefits, as well as an industry wanting special benefits, is the part where its "special."

      How about a non-special tax incentive. How about EVERY industry gets a tax credit for selling 100% American goods within America.

      As far as "special" solutions go, notice how Intel/etc arent asking for "special" Tarrifs on foreign fabrication, and in fact lobby against it. The problem they really wish to solve is clearly not what they are claiming.
      • by AmiMoJo ( 196126 )

        These kinds of things damage international trade. As much as domestic sales benefit, overseas sales suffer because other countries notice you are giving your own companies a boost that theirs have to compete with.

        • by fenrif ( 991024 )

          Is that why no one trades with or does business in China then?

          • by AmiMoJo ( 196126 )

            It's why countries don't do better trade deals with China and just rely on WTO rules instead, yeah.

            • by fenrif ( 991024 )

              And this of course has really harmed China.

              Crippled the country even.

              If only they could trade with bespoke trade deals like literally every other country on the planet, eh?
              One might wonder why the WTO even has a set of rules since they are so awful and lop sided against one of the parties.

              But wait, you said "overseas sales would suffer" not "overseas sales would be conducted with slightly different regulations." Hmm....

              • by AmiMoJo ( 196126 )

                Well actually the WTO rules do limit what they are doing. Just today the WTO ruled against the US trade war with China. Eventually it will lead to some kind of restitution. The US can of course make similar complaints if China breaks the rules.

    • Gotta love these welfare queens leaching off the American tax payers.

      Not really. They are just being realistic. These companies make a fortune by producing in China. It stands to reason that if the government wants local industry they'll have to pay up.

      "Pretty please forgo your profits to help #MAGA" Isn't going to get you very far.

      • by spun ( 1352 )

        No, it stands to reason that if industry wants access to American markets, THEY should pay up. Don't want to make jobs here? Fine, we have plenty of people who will, and THEY can reap the benefits. Fuck China, we won't lose a thing if we cut them off. 100% tariffs for murdering, freedom hating, free market destroying state capitalists.

        • You can try to hide the costs of rolling back globalization by using mandates such as trade restrictions instead of incentives. That doesn't make the costs go away, they're just hidden in higher prices etc. Better to see the costs up front and make the decision.
          • by Rob Y. ( 110975 )

            Well, then you need to equalize the costs. A global minimum wage and global environmental standards would be a good start. Then what you lose in cheap imports, you gain in larger markets of people that can afford your stuff. The trick is to produce a prosperous global middle class without destroying the planet in the process. Easier said than done, but the current trends are sure to destroy the planet, while producing a global lower-middle class - including a large swath of the U.S. population.

        • Fine, we have plenty of people who will,

          No, we dont. The USA has a un-surprising lack of talent in chip manufacturing (or any manufacturing). The reason is that we convince kids to go to college instead of going to manufacturing (because jobs arent there). We dont have people that will produce chips in the USA, and we dont have the capital to produce chips in the USA.

          • by spun ( 1352 )

            The richest country in the world lacks the capital to make modern factories? The country where everyone else sends their kids for an education, lacks the education?

            I don't buy it.

        • by gweihir ( 88907 )

          Sooo, you think the US can do without semiconductors in the future? Because that is pretty much what would happen.

          • by spun ( 1352 )

            Funny thing, as a patriot, I believe in our country and our remarkable citizens. Why don't you?

            • by gweihir ( 88907 )

              Funny thing, as a patriot, I believe in our country and our remarkable citizens. Why don't you?

              A) I am not a patriot. That is a kind of stupidity I stay far away from. It blinds you to the truth.
              B) If I were a patriot, I wold not be cheering mindlessly for the US, but for some entirely different country.

              Also, invalid AdHominem argument is invalid.

              • by spun ( 1352 )

                Patriotism is not nationalism. Learn the difference. Patriotism is mature love, with eyes wide open. If you see your friend is being an asshole, you'd tell them and try to help them not be such an asshole, right? That's patriotism. I love my country and so I want to fix it.

                Nationalism is "My country right or wrong." It's toxic, dependent love.

        • No, it stands to reason that if industry wants access to American markets, THEY should pay up.

          That's not how companies work. That's at best how tariffs work, or how Putin's Russia works. Not something you should ever wish for America. The government has no business deciding winners and losers, they decide performance metrics at best.

          • by spun ( 1352 )

            For fucks sake, the government already decides winners and losers, just look at this story! The industry wants a hand out. Giving it to them would be deciding winners and losers.

            We subsidize all sorts of American industries. We do not have a fee market, and the capitalists who control our society do not want one. They want to capture, corner and control every market they can find. Competition is anathema to capitalism.

      • No.
        Simply taxing them say 5-10% on GROSS sales unless they produce here, will likely move them here.
        • Don't be stupid. At best you can apply a tarrif, but a government taxing a specific corporation to get them to move is some Putin's Russia level of bullshit. An incredible slippery slope.

          I'm not normally an advocate for small government, but fuck you idea is horrible.

    • Re: (Score:2, Troll)

      by coastwalker ( 307620 )

      Interestingly the strategic subsidy of semiconductor manufacturing overseas seems to have stolen America's lunch. It appears that there is and never has been any such thing as the "free market". Don't you think it is time to revisit that ideology and and join the rest of the world?

      • Re: (Score:3, Insightful)

        by spun ( 1352 )

        Join the rest of the world in kowtowing to people who own everything but built nothing? Nah.

        If the free market is a myth, well buddy, I have a system that maybe we should actually try. We run things democratically, and we, the people, own the means of production. No masters, no owners, no landlords, no rich.

        Just because it's your kink to submit to Big Daddy War Bucks, doesn't mean the rest of us share your perversion.

      • by klubar ( 591384 )

        Isn't this about picking winner and losers? I'm ok with corporate welfare as long as the companies are willing to accept the limits that go along with it.

        Some suggestions:
        - Top executive pay limited to 20x lowest paid employee
        - No stock buybacks/no golden parachutes
        - Limited use of contractors/outsourcing
        - Commitment to environmental law

        Others?

    • by cusco ( 717999 )

      Once taxpayers get gouged their $50 billion then they'll ask to be exempted from all pollution and water/air quality rules as well. Grant that and workplace safety rules will be next, and the list will be never-ending.

    • The taxes for chip makers are paid where the chip makers are, silly. Foxconn pays it's taxes - in Taiwan and China, where Foxconn is, making chips.

      Hardly anybody makes chips in the US, and therefore the US gets hardly any taxes from chip makers, because the US has made it far too expensive to produce anything here. "Raise the taxes people will have to if they produce in the US" is exactly how you ensure the problem gets worse, how you make sure *nobody* makes a single chip in the US anymore (and the US then

    • Re:Corporate Welfare (Score:4, Interesting)

      by Anubis IV ( 1279820 ) on Wednesday September 16, 2020 @12:10PM (#60511592)

      Framing this as a "how about you do your part first?" question is cutting off your nose (misbehaving companies) to spite your face (national interests).

      The fact is, if having these production and manufacturing capabilities kept in-country is truly a matter of national security (and the rest of my post will operate on that assumption), the fact that we need them isn't affected by their behavior. If you crack down on them via regulation, they hold all the cards, so they can simply call your bluff and find someplace more accommodating, thus shooting ourselves in the foot. Meanwhile, I'm all for the free market deciding things in general, but the free market fails in cases like these because it doesn't include national interests when valuing companies, just private interests. Until the government puts its finger on the scale to tip how we value those companies in some way, the free market will continue to not recognize the true worth to the country of keeping those capabilities in-country.

      Is it distasteful? Absolutely. But this is reality.

      • by JBMcB ( 73720 )

        Meanwhile, I'm all for the free market deciding things in general, but the free market fails in cases like these because it doesn't include national interests when valuing companies, just private interests.

        This has little to do with a free market. China and Taiwan have huge subsidies and tax breaks to lure high-tech manufacturing. China did this about 20 years ago with contract furniture manufacturing. They built-out entire factories and supply chains, then offered to produce furniture at cost with zero tariffs and practically free shipping (via Mersk, their own shipping company.) And within a decade there are hardly any furniture factories left in the US. Pretty much Herman Miller, Steelcase, Knoll, and a fe

        • by mridoni ( 228377 )

          practically free shipping (via Mersk, their own shipping company.)

          Last time I checked, Maersk was a Danish company.

    • Why do you think its bad for corporate welfare int he USA, but not have issues with China literally financing businesses (and having full control over them because of it)? Frankly, taking jobs out of asia invites war, because right now the USA must make peace (and Trump is doing a great job at making peace, like it or not) or lose access to things made in china.
      • Why do you think its bad for corporate welfare int he USA, but not have issues with China literally financing businesses (and having full control over them because of it)?

        You just answered your own question; "full control". Corporate welfare is just throwing taxpayers money away. You have no real control over the recepiants and if some other country offers a better deal, they're gone again. You need to invest the money into those companies and own them (or at least a significant share of the stocks).

    • by djp2204 ( 713741 )
      Companies don't pay any taxes. Their customers pay the taxes. Taxing companies only raises costs for consumers.
    • by ObliviousGnat ( 6346278 ) on Wednesday September 16, 2020 @12:21PM (#60511668)

      Tax breaks aren't the only form of corporate welfare. Do you remember the story the other day about how oil companies abandon their wells, go bankrupt and then leave the mess for the states to clean up? We need to make companies pay ALL of the societal costs that they create, and don't let bankruptcy get them out of paying.

      Also--and this is important--tax/tariff anything from foreign countries that don't make their companies pay for their societal costs. One reason why chip manufacturing went overseas is because companies there are allowed to pollute with impunity, and that makes manufacturing in those countries artificially cheap. How can our companies expect to compete with that?

    • by gweihir ( 88907 )

      Oh, they will pay their taxes. But not in the US. That ship has sailed. The remaining semiconductor manufacturing in the US will vanish pretty soon.

    • Here is a better Idea. Make the taxes fair. As it is, both China, Ireland, and a number of other nations are basically tax-avoidance havens. So, the best way is simply to change the American (if not western) tax model.

      1) get rid of ALL tax breaks, write-offs, exemptions, etc on corporate and personal taxes.
      2) create a pre-sales tax of say 5-10% on consumed goods/services which move from wholesale to retail. It is also applied to all goods that are shipped directly to customers over borders.
      3) change cor
    • by rho ( 6063 )

      Gotta love these welfare queens leaching off the American tax payers.

      Here is an idea - pay your fucking taxes and then we can talk about bailouts or 'incentives' or whatever you hypocrites call your corporate welfare.

      Gotta love these welfare queens leaching off the American tax payers

      I'm no fan of corporate welfare, but $50B is cheap.

      Half of the federal budget is actual welfare, about $2T, which doesn't exactly go into the pockets of Americans either. It's a big trough where lots of other corporations feed, and millions of middlemen wet their beak.

      Returning the silicon to Silicon Valley (or, more likely, Texas) is a good thing all around for America and Americans. If we can keep our chips from even having a whiff of NSA fingers, that's a competitive advantage to the rest of the world. A

    • by larryjoe ( 135075 ) on Wednesday September 16, 2020 @02:32PM (#60512166)

      Gotta love these welfare queens leaching off the American tax payers.

      Here is an idea - pay your fucking taxes and then we can talk about bailouts or 'incentives' or whatever you hypocrites call your corporate welfare.

      When it's other people, they're "welfare queens". When it's us, it's just the normal system of tax deductions, subsidides, and funding that are part of our "rights."

  • by cellocgw ( 617879 ) <cellocgw@gmaEINS ... minus physicist> on Wednesday September 16, 2020 @11:24AM (#60511406) Journal

    Just ask Wisconsin about FoxConn.

    Or ask any number of cities how long $SPORTS_TEAM stayed after getting a stadium built for free.

    • Hmm... I think the AC FP was more relevant to the topic, but at least you [cellocgw] put your name on this one, shallow though it be. It's even likely that you are aware of the deeper issues and you felt this was the first step in the right direction, but took the short step because of the race condition on FP visibility.

      So let me try to clarity that your issue seems to be the proper relationship between governments and corporations. The level of the story is about national governments and corporations in c

      • by cusco ( 717999 )

        Don't tell a Packers Backer that their team is "non-crucial", they'll come after you with pitchforks and torches.

        • Don't tell a Packers Backer that their team is "non-crucial", they'll come after you with pitchforks and torches.

          I think they use guns now.

        • The Green Bay Packers are a publicly owned team, unlike any other pro sports team in the US.

    • > ask any number of cities how long $SPORTS_TEAM stayed

      Okay. Let's see - Fenway Park, Wrigley Field and Dodger Stadium are least 100 years old. Looks like about half the MLB teams have been in the same *stadium*, not just the same city, for at least 25 years. I'm not a sports guy, so I don't have a bunch of stats memorized, but the one I know of that moved is the Chargers - after 56 years in San Diego. So I guess there's your answer to how long they stay - somewhere between 56-100 years.

      > built for

      • Okay. Let's see - Fenway Park, Wrigley Field and Dodger Stadium are least 100 years old.

        LOL, Dodger Stadium isn't even close to 100 years old.

        By the way, are you a good artist, or a musician? I ask because you suck at logic, but I'm sure you're good at something.

        Uh huh. Insulting someone after making an error like that is not a good look. For anyone.

        • I stand corrected. Quoting Wikipedia:

          --
          Opened 58 years ago on April 10, 1962, it was constructed in less than three years at a cost of US$23 million.
          --

          Hopefully over those 58 years, the city got their $23 million back. Oh wait, the city didn't pay a dime of that. It was it privately funded.

      • One thing you said is correct, you're definitely not a sports guy (I'm not either but at least I can do research and math). The Dodgers played in Brooklyn until 1958, so LA must have had a lot of foresight to build them a stadium 40 years in advance. There are only 2 ballparks over 100 but lots under 20. The average age of an MLB ballpark is 27 years. The average age of an NFL arena is 31 years. The average age of a NBA stadium is 16 years. The average age of an NHL rink is 21 years.
        • > The Dodgers played in Brooklyn until 1958, so LA must have had a lot of foresight to build them a stadium 40 years in advance.

          You're right, it's only 58 years old. Of course the city didn't build it either, it was 100% privately funded.

    • multiple studies have shown that sports is just a money sink for the cities. All the profits go to the associations. They get away with it because people _love_ sports. As someone completely indifferent to them it's just extra taxes I have to pay.
  • Okay, sure (Score:5, Informative)

    by Dutch Gun ( 899105 ) on Wednesday September 16, 2020 @11:27AM (#60511416)

    Great. Then let's impose $20 to $50 billion in taxes and tarrifs on companies that refuse to build any manufacturing capabilities in the US. Problem solved.

    Oh, that wasn't what you meant? You get all the benefits and security of being a US company, but don't want to invest a little back in the US manufacturing economy? You instead want US taxpayers to foot that bill? Fuck that.

    • The tax payers always foot the bill. Whether it be for a tax bailout, whether it be loss of economic competitiveness due to the rise of China, or whether it would be the subsequent bail out of a company the government unintentionally sunk.

      Typically the government isn't going to fuck over an employer of 110 thousand people, just because #MAGA. The world is a big place, and there's no reason for a company to stay in a country hostile towards them anymore.

      • Of course taxpayers always foot the bill in the end. I'm hoping a bit of sarcasm came through in this post, although that's sometimes tricky in writing,

        Taxing corporations too heavily simply causes prices to rise (which consumers ultimately pay for) and makes them noncompetitive in a global marketplace. That being said, it's a far cry from simply giving them taxpayer money. Many of these companies are already hugely profitable. We can surely work out some reasonable compromises that encourage them to br

    • Tax them all, then give incentives to mission critical industries and call it National Security. Sooo many problems solved!
    • You get all the benefits and security of being a US company

      There are no benefits to being a US company.

      America imposes extraterritorial taxes on companies headquartered in America, putting American companies at a disadvantage to their foreign competitors.

      Many companies have re-incorporated overseas to avoid these taxes.

      America has passed multiple laws to prevent American companies from fleeing American jurisdiction, with limited success.

      Perhaps we should make America attractive to investors rather than punishing those who try to build their businesses here.

      • Does it really need to be said that there should be a rewards for 'good behaviors' and a punishments for 'bad behaviors' ...

        But then a lot of the crowd here these days is from a generation that got rewards just for participating.
        • Does it really need to be said that there should be a rewards for 'good behaviors' and a punishments for 'bad behaviors' ...

          Since we currently do the opposite, yes, it does need to be said.

  • Honest question:
    Is this giving money to companies, or just tax brakes?

    I'm not into giving money, like writing a check, but the tax brakes make sense. Keeping the manufacturing here is really important. As far as I know Intel is the only company with their own fabs. There are other fabs in the US, but are foreign owned.

    • This sounds like collusion and acting as a cartel.

      Arrest the boards of the colluding manufacturers.

      • This sounds like collusion and acting as a cartel.

        Arrest the boards of the colluding manufacturers.

        That ship sailed in the 1880s.

        • I am, unfortunately aware.

          But permanent, immortal corporations need not be a fact of life. They used to be chartered (and that was the only way to legally create one) for a limited time and purpose, by the Congress.

    • by shanen ( 462549 )

      I appreciate your honesty, but it's hard not to laugh at your brakes on taxes. Please give us a break and think about your homonyms.

      But the answer to your question is that it is ALWAYS giving money to corporations, though sometimes the money is disguised as tax breaks. The game is crooked and the lobbyists for the largest corporate cancers and always bribing the cheapest politicians to bugger the rules harder with each piece of fresh legislation. (Not sustainable, but that's not how cancers think. [Double e

      • There is a polite way to correct an error in language, and there is a jerk way. Please let us know if you can tell which is which.

        I appreciate your effort, but it's hard not to laugh at your homonyms as homophones. Please give us a break, and yourself a brake, and think about your cognates.

        I think you meant homophones here, instead of homonyms. That's a tricky one because the two words that refer to slightly different types of similarity between words are themselves very similar.

    • Is this giving money to companies, or just tax breaks?

      There is no difference.

      A direct subsidy is money. A tax break is money. Money is money.

      Both the cost and the incentives are the same.

  • by Smidge204 ( 605297 ) on Wednesday September 16, 2020 @11:41AM (#60511476) Journal

    Money and taxes are not the only thing a business - especially a high tech manufacturing business - is looking for.

    We don't invest enough in education in the US. High tech manufacturing needs technicians and engineers to design the processes, build the machines and lay out the plants. A lack of an educated workforce is a major problem, and our recent streak of racism/xenophobia prevents us from importing that talent. The result? If the talent can't come to high tech manufacturing, high tech manufacturing will go to the talent.

    We don't invest enough in infrastructure in the US. Manufacturing requires lots of infrastructure; Roads, rails and waterways to get raw materials in and finished products out. Water and power. Support for a workforce - education, healthcare, food etc - who lives locally. Locations without these things will be passed over for locations that do, even if the local taxes are cheaper.

    We don't invest enough in basic research in the US. I mean really *basic* research, the kind that has no obvious commercial or industrial potential, but becomes the foundation for the technology that becomes new products and processes. It's a hard business case for a private, for-profit company to spend money doing fundamental science if there's no known payback. The space industry exists only because governments poured billions into inventing rockets and satellites. The nuclear industry exists only because governments poured billions into nuclear physics. What future technologies will not be invented in the US because we're not investing in basic science?

    Maybe instead of throwing money at corporations to get them to stay, we could spend that money on things that make it worthwhile for them to do business here? Probably not, since getting results will take longer than an election cycle and nobody can think farther ahead than that...
    =Smidge=

    • We don't invest enough in education in the US.

      As an alternative to home-grown education, we invest in immigration. Some very stupid people are trying to put an end to that as well.

  • You want to move overseas? How would $50 billion in new tariffs sound?
    • You understand that it's the end consumers that pay tariffs, right? That making imported goods more expensive make no fucking sense if there are no locally manufactured alternatives?

      =Smidge=

  • by ravenscar ( 1662985 ) on Wednesday September 16, 2020 @11:44AM (#60511490)

    Honestly, I could see these arguments back when the US corporate tax rate was one of the highest in the developed world. It's now very competitive - meaning significant funds that used to go the government have already been shifted to these business. Now they want more? Let's see, they are asking for substantial support from US citizens while also making the argument that it is extremely risky to have these vital components manufactured overseas. It sounds like they are building a really solid case for nationalization. Seems like a dangerous road for them to start down.

    For the record, I don't support nationalization of industries, but plenty of people do and making these arguments in a political climate that is in upheaval could result in the opposite of what these companies want.

  • Bullshit (Score:5, Insightful)

    by smooth wombat ( 796938 ) on Wednesday September 16, 2020 @11:50AM (#60511504) Journal
    Intel's effective tax rate is 14% [csimarket.com]. Qualcomm's effective tax rate [csimarket.com] varies between less than 3% to over 60%.

    How many other billions have they received in taxpayer money? What did they do with all the money from the tax cuts they've received? Did they squander it on stock buybacks and executive bonuses? Yes [fool.com]. Yes they did [fool.com].

    Use your own money. The taxpayers are not a bottomless piggy bank. Whatever happened to pulling yourself up by your bootstraps?
    • And the reason why they do these things is because BOTH dems and GOP have fucked badly with the taxes.

      Taxing a company who is re-investing $ back into the local economy is STUPID.
      Taxing dividends/bonuses a fraction of what we tax wages/salaries is STUPID.
      Allowing executives of publicly traded companies to be paid in stock options is STUPID.

      Until we fix these things, stupid items like what I and you mention will continue to happen.
  • Comment removed based on user account deletion
  • Selling th future (Score:4, Insightful)

    by The Grim Reefer ( 1162755 ) on Wednesday September 16, 2020 @12:00PM (#60511544)

    Unfortunately many of these companies have become very short sighted. Since CEO's are willing to sell a companies future for short term gains in order to get their bonus, we have this issue.

    Of course China will give tech companies any incentive to get them to move manufacturing to China. But China is thinking ahead by decades.5 to 10 years after moving, China will have taken all of the IP and manufacturing processes. As well as trained workforce, they will stand up their own companies as competitors and sell the same product at half the price an put the US companies out of business. But by then, the CEO who off shored the company will be long gone along with their tens of millions of dollar bonuses with them from all of the quarterly profits they made.

  • 1. Move manufacturing plants overseas.
    2. Ask for federal funding because, oh no!, manufacturing plants keep moving overseas!
    3. Profit.

  • by rsilvergun ( 571051 ) on Wednesday September 16, 2020 @12:05PM (#60511572)
    but all anyone can remember about him is a couple of tin pot dictators used his books for rhetoric. Not that communism is the solution, but we need to get over our irrational fear of every idea that came out of it. Maybe ask ourselves where that fear came from and why...
    • To start with Americans tend to confuse socialism with communism. Communism is a type of socialism, but it's not the only type. The type of socialism found in Europe is Social Democracy, which still encourages free enterprise, but creates a social safety net and at least attempts to create a framework of corporate responsibility. The US has done the same, but because of a strong allergic reaction to anything that looks vaguely socialistic, implements systems badly. Health care in the US is far more expensiv

  • by Goldsmith ( 561202 ) on Wednesday September 16, 2020 @08:32PM (#60513452)

    As pointed out elsewhere, large US chip manufacturers have spent more than $20 billion in stock buybacks. This lack of investment in infrastructure can pretty much be laid at their feet. However, this is still our problem.

    (As an aside, let's say we make stock buybacks illegal. What will happen is simply that companies will issue dividends instead. While this removes the ethical problems of stock buybacks, it doesn't change the calculus of internal investment versus investor return.)

    Meanwhile, small chip manufacturers (I work with several small fabs), really struggle to get loans, investment, access to hardware, and knowledge of modern processes. There are tools and techniques that I need to use that are common in Asia, not uncommon in Europe, and very rare here. It's not always that it requires more capital. In many cases, the tools used in Asia are better and cheaper than the tools used for "standard" processes in the US. Why is that?

    There are PLENTY of people in the US who know how to fab chips. However, almost all of them have been trained in university clean rooms stocked with equipment from a fabrication node that is 40 years out of date (100 mm wafers, 1 micron node). Industry and academic clean rooms (Stanford, Cornell, Georgia Tech... there are ton of them) speak different languages. Because the exchange between industry and academics has generally broken down, we have professors teaching today who have only used fab technology based on that 1980 node, and who were themselves taught by people who only knew technology up to that node. So that node has cemented itself into place. Until recently, you could use old 150 mm lines to bridge that gap when you get out into the real world, but those lines are almost all shut down now. The difference in tooling between 200 mm lines (the current cheap, fully paid for fab lines) and the 100 mm lines universities train people on is tremendous. The philosophy of how to approach fabrication is different. Intel and Qualcomm can afford to retrain everyone, but it's hard for small fabs to find people who know what they're doing. If there's an area the government has failed, it's in managing the grants and programs that were supposed to update university facilities over the last 20 years. We got a lot of newly made equipment for an out of date node.

    There are really three things that we're trying to accomplish around chip fab from a government point of view. One, we want to perform chip fab in an environmentally sustainable way. Two, we want to treat workers with respect, including reasonable wages. Three, we want to protect American jobs in this area. We have failed at all three.

    Instead of handing over billions to big chip companies, we should institute 0% loan programs for people building and running smaller fabs, tooling companies, and consumable companies in the US (with all the conditions you want on that). We need to take the university facilities programs away from everyone involved in NNCI (National Nanotechnology Coordinated Infrastructure) and get it in the hands of someone who's run a professional modern cleanroom, and we need to hold the universities responsible to prioritize education and training in this space over research with those facilities (there is SO MUCH industry driven research). Instead of tariffs, we need to outright ban materials made in ways that violate our environmental protection laws or labor practices. That needs to be the last step, or we're simply hurting every other part of our economy.

    None of those things involve handing money over to the large companies.

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