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    US Intel

    (stratechery.com)
    539 points maguay | 11 comments | 26 Aug 25 10:47 UTC | HN request time: 1.75s | source | bottom
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    themgt ◴[26 Aug 25 13:47 UTC] No.45026515[source]▶
    I’ll be honest: there is a very good chance this won’t work .... At the same time, the China concerns are real, Intel Foundry needs a guarantee of existence to even court customers, and there really is no coming back from an exit. There won’t be a startup to fill Intel’s place. The U.S. will be completely dependent on foreign companies for the most important products on earth, and while everything may seem fine for the next five, ten, or even fifteen years, the seeds of that failure will eventually sprout, just like those 2007 seeds sprouted for Intel over the last couple of years. The only difference is that the repercussions of this failure will be catastrophic not for the U.S.’s leading semiconductor company, but for the U.S. itself.

    Very well argued. It's such a stunning dereliction the US let things get to this point. We were doing the "pivot to Asia" over a decade ago but no one thought to find TSMC on a map and ask whether Intel was driving itself into the dirt? "For want of a nail the kingdom was lost" but in this case the nail is like your entire metallurgical industry outsourced to the territory you plan on fighting over.

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    1. dfxm12 ◴[26 Aug 25 15:41 UTC] No.45028085[source]▶
    It's such a stunning dereliction the US let things get to this point.

    It's a side effect of systemically putting short term gains ahead of long term research. CHIPs act may be too little, it is certainly too late...

    replies(1): >>45028784 #
    2. davedx ◴[26 Aug 25 16:27 UTC] No.45028784[source]▶
    > systemically putting short term gains ahead of long term research

    That's more the stock market than the US government though. You could argue the US government tries to play a long game, and often the way the US plays that game is to let the free market decide (hands off, small government). It's definitely a valid strategy and has worked extremely well in a number of other industries, but for this specific niche, less so, and even then you could argue it's down to Intel's mismanagement than anything the government could or should have done.

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    3. dfxm12 ◴[26 Aug 25 17:00 UTC] No.45029278[source]▶
    It is clear that the government and wall street are generally of one mind on this. One recent specific way the government contributed to this is via the Tax Cuts and Jobs Act (TCJA) of 2017, which increased tax burden of R&D. They've also cut a lot of their own research funding (NIH, NSF).

    I can't make the argument that the government is "hands off, small government" because I simply don't see the evidence of that. To the contrary, I have seen things like TARP, stimulus checks, oh, and the government buying 10% of Intel.

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    4. hobs ◴[26 Aug 25 17:12 UTC] No.45029471{3}[source]▶
    The only people arguing against big government are republicans when democrats are in power, otherwise everyone is happy to expand spending.
    5. macintux ◴[26 Aug 25 17:16 UTC] No.45029513{3}[source]▶
    Now that we have lawmakers openly declaring they would pick capitalism over democracy if forced to choose, I have little hope that the government will be receptive to changing anything structural.
    6. duped ◴[26 Aug 25 17:18 UTC] No.45029525[source]▶
    I would argue that federal and state governments play even shorter games than investors in the stock market. They're constantly putting their thumbs on whichever scales are politically expedient to claim they did something every 2/4/6 years when it's time for reelection.

    Just as an example, the calculus for "where should I build a factory" comes down to "which politicians give the biggest tax incentives" and not any market dynamics.

    7. lovich ◴[26 Aug 25 20:02 UTC] No.45031629{3}[source]▶
    Taking 10% of Intel. Intel was already supposed to get this money and then retroactively were told to give up 10% for it
    replies(1): >>45032585 #
    8. pests ◴[26 Aug 25 21:33 UTC] No.45032585{4}[source]▶
    FWIW, in exchange for less restrictions on what they do with the money and less strict clawback terms.
    replies(2): >>45034999 #>>45071724 #
    9. lovich ◴[27 Aug 25 03:01 UTC] No.45034999{5}[source]▶
    I don’t believe that, I believe it was in exchange for not pressuring the CEO to step down any further.

    This looks like an incredibly corrupt action.

    10. variadix ◴[27 Aug 25 08:18 UTC] No.45036833[source]▶
    The strategy is fine, the problem is there aren’t enough domestic competing players in cutting edge semi nodes for it to work anymore. The US had many competing foundries before its semi industry was hollowed out by Japan and Korea. Now the only player in the US is Intel and, having been mismanaged for the last decade or more, it’s at risk.

    I don’t think propping up Intel is going to work though, they’re a sinking ship and their management seems too risk averse and incompetent. It might be better for the US, long term, to let them collapse and sell off strategic parts to different domestic players (NVIDIA, AMD, micron, TI, etc) and use tariffs or other trade policy to force some amount of leading edge semi fabrication to use domestic manufacturing.

    11. osnium123 ◴[30 Aug 25 03:40 UTC] No.45071724{5}[source]▶
    Yes, Intel won’t have to build out their fabs as aggressively to get the money now.