US Intel

This was a poor business decision for exactly the reasons you’re pointing out. The market is dictating their failure and we’re now undermining it.

Not in the "lots of people would lose jobs" or "ripple effects would cause economic disruption" but in the true national security sense. What allied semiconductor manufacturers have significant cutting edge fabs in Europe?

Secondarily, a TSMC fab on US soil seems like a better investment. In the catastrophic event that Taiwan were invaded — it’s still people, facilities and equipment that remain here.

This trope keeps getting repeated on HN.

No, the point of the top level comment and article is that no US based company will replace Intel's fabs, nor will they form a "better" Intel. This stuff is intensely capital intensive, and nothing short of a government mandate will make any other company spend so much money on such a big risk.

Trust me - if they could have, they would have. Intel's fabs have pretty much been up for sale since Pat was ousted.

The only companies that know how to use the people and the equipment are not US based. TSMC already had an opportunity to buy much of Intel's fabs, and they concluded that shifting their process to match TSMCs would be cost prohibitive.

You’re arguing about logistics under the current economic rules while simultaneously defending a change of rules.

When you put that on the table, then there’s a lot more ways to overcome the obstacles of today that aren’t being discussed.

If a company’s management becomes a risk to national interests, then giving them more money with no added oversight is not really solving anything.

Where I disagree is that if Intel fails, something better (US based) will replace them. It won't.

In the scenario where Intel fails (which would primarily be centered around defaulting on the 50 billion of debt that they built up and can barely service), the US gov could offer strong tax incentives to players who want to form up a new national fab company. Give it favored status essentially (again, if the US is already crossing fairly extreme lines of having US state owned corporations, this doesn't seem so extreme in comparison).

You already have Private Equity interests that are starting to consume Intel. Ex: some of the new fabs are funded by Brookstone, and they have sold off a portion of the profit from the venture, and then collateralized the transaction with the hard assets and put Private Equity at the top of the bankruptcy cap stack.

I think that if the US gave some incentives, the pieces would fall into place extremely quickly. PE would do the actual capital funding in a heartbeat if they had sweetheart tax incentives, and Japan/SK/TSMC would also get involved. Presumably - given the style of the current admin - the "deal" would be "you get favored status by taking part in this project. We will give strong tax benefits to also drive profit. If you turn it down, expect to see tariffs and calls go unanswered while your competition has a direct line."