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US Intel

(stratechery.com)
539 points maguay | 1 comments | | HN request time: 0s | source
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themgt ◴[] 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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dfxm12 ◴[] 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...

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davedx ◴[] 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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dfxm12 ◴[] No.45029278{3}[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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lovich ◴[] No.45031629{4}[source]
Taking 10% of Intel. Intel was already supposed to get this money and then retroactively were told to give up 10% for it
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pests ◴[] No.45032585{5}[source]
FWIW, in exchange for less restrictions on what they do with the money and less strict clawback terms.
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1. lovich ◴[] No.45034999{6}[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.