Who gives a rat’s ass about computer chips, right? Well, at least read the end (highlighted in blue).
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CHIPS Act no panacea for US chip woes
The CHIPS Act of 2022 is a US$52.7 billion subsidy to semiconductor companies in the United States.
The funding, mostly aimed at the construction of new chip fabrication facilities, or fabs in the trade, can be awarded in up to $3 billion chunks of cash to any US-based company making “advanced” semiconductors.
The only US-based companies excluded are those owned by China, although the Act does not actually explicitly name China. However, if China invests through proxies or cutouts, Chinese companies could still get US money.
In theory, the CHIPS Act subsidy is intended to fix a serious problem which is US dependence on two Asian companies, Taiwan Semiconductor Manufacturing Company (TSMC) and South Korea’s Samsung.
The US has experienced severe supply chain problems which have been very costly to the US automobile and truck industries and probably have delayed the manufacture of some weapons such as the Javelin anti-tank missile now being used in Ukraine.
Both automakers and weapons makers were caught by surprise. Had they pre-stocked enough integrated circuits (ICs) to deal with potential supply issues, there would not be a supply problem.
Even now, as chip production has regained momentum in Asia, it would be sensible to build up a chip stockpile, especially given the extreme political volatility in Asia because of China’s incessant and growingly reckless threats against Taiwan.
Unfortunately, the CHIPS Act offers no funds to subsidize building stockpiles, not even for the military. Recently Raytheon told the Pentagon that replacing Javelin and Stinger missiles, used up in the Ukraine war, would take a few years. One of the reasons was the need to procure the right chips from Asia.
The CHIPS Act theoretically solves one problem, i.e. the fact that US-based companies have not invested in advanced semiconductor manufacturing. But until the first new plant in Ohio comes on line in a few years, US companies will remain dependent on Asia for advanced chips.
Chip production is considered advanced if its output has a feature size of 7-nm (nanometers) or less. The Intel Ohio plant, once it is operational, will produce integrated circuits at 5-nm. It is likely Intel will target the auto industry and maybe 5G devices.
However, there is no assurance that Intel will be able to compete against TSMC or Samsung. Both companies use the most modern extreme ultraviolet photolithographic processes and have perfected production techniques through long experience.
US companies such as Intel and other American fabs are inexperienced in applying 5-nm technology, meaning that one can rightly expect their wafer yields will be lower than their Asian counterparts and chip cost will be higher while profitability lower.
Meanwhile, while US companies will be learning how to produce 5-nm chips, companies such as TSMC are already moving on to 3-nm and (possibly) 2-nm feature sizes. US companies will also have to train new workforces, which means another steep learning curve.
On a positive note, there are funds in the CHIPS Act for worker training, even though that money comes with some strings attached.
There is nothing in the CHIPS Act that tells a US semiconductor what to make, aside from making advanced integrated circuits. This means that US-based companies will seek to service the US commercial market and will have little interest in custom projects for US defense companies.
The commercial market does include chips that perform artificial intelligence (AI) functions. AI is of increasing importance for military applications. Three types of chips are significant for AI, namely field programmable gate arrays, applications-specific integrated circuits and graphics processing units.
In addition, there is a trend to produce advanced SoCs (system on a chip). The US military can rely on commercial chips, but unless these chips are somehow controlled, many will end up in China and Russia as they will in Fort Worth or Detroit.
Security standards for subsidized US advanced chip production are not part of the CHIPS Act. While the Act excludes Chinese ownership of subsidized fabs, it does not exclude foreign workers, including from China. Nor does the Act recommend measures to protect intellectual property, or require cybersecurity for the design centers and fabs that will be funded under the CHIPS Act.
The Act also does not take up the issue of US export controls. It is an observable truth that the failure of the US export control system, including the dismantlement of the international COCOM system, has proven to be a bonanza for China.
Along with substantial foreign espionage and cyber spying, it has enabled China to leapfrog the US in many military categories and match the US in most others.
The increasing parity of China’s military and its proximity to potential conflict areas has the US scrambling to see what it can do with older, worn systems to counteract the growing menace of an aggressive China.
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The CHIPS Act’s failure to specify the types of chips needed for US defense also is lamentable. In fact, the Act specifies almost nothing and leaves it up to the US Commerce Department to hand out goodies to US and foreign companies who want to build plants in the United States.
At the most elementary level, one would need to ask why TSMC or Samsung, for example, would build a fab in the United States in order to compete with themselves. Instead, with subsidies in hand, these companies will offload older product production so they can optimize the newest at home.
There also is a key concern that Washington will reward its political friends and shun all others. The penchant of the Biden administration to play favorites with grants, like underwriting failed solar and wind energy ventures while strangling the US oil and gas industry, including refineries and pipelines, is a case in point.
The Act likewise makes no provision that companies that get subsidies stop outsourcing high-end products abroad. So, for example, a US company could keep buying AI chips from Asia while selling other advanced chips to customers.
Others already have remarked that this corporate handout lacks any system of accountability. Here is the money, build the plant and produce chips, no other questions asked. There are no requirements, even, if ventures fail.
In the end, the US semiconductor industry will be rewarded for failing to invest in its own future. The US military won’t be any less dependent on Asian production or will have to pay through the nose to get the parts it needs.
China will continue to have nearly unfettered access to US know-how and technology. And the US probably will not solve its competitive problem vis-a-vis Asia.
SOURCE: Asia Times
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Uncle Shlomo is making muh markets free. Do you even do capitalism, bruh ?
Subsidy Tracker Top 100 Parent Companies
https://subsidytracker.goodjobsfirst.org/parent-totals
People wonder why the drunk hag went to Taiwan. Before passing the CHIPS act her and her drunk husband bought into American chip maker stocks. Then she runs off to Taiwan to secretly meet with chip makers over there to push some production abroad, with some kind of promise for them I am sure. I do expect chip prices to skyrocket now.
One thousand percent agree!! IMHO, that’s the only and real reason she went to TieOneOn. Yet, one can hardly find any article about this anywhere on the internet. Pelosi’s Powerful Pussy … don’t fuck with it is the message.
Congress and all the presidents from Tricky to Brandon went to great lengths to move all our high tech and industry to China to usher in Cold War II and the enslavement, humiliation and destruction of mankind.
Our Kenite owners residing in palatial mansions insist on it.
The Top TWO Things (of several things) needed for a modern country to prosper economically;
— 1) Energy
— 2) Semiconductors (since they are in EVERYTHING)
I’m still very amazed (amazingly) that “Our Kenite owners” can get away with destroying both, and doing so OPENLY.
I agree with Yuri Bezmenov’s reasons. We’ve been too demoralized as a nation to fight back. Using continuous liberal propaganda from preschool through college, we’ become Pavlov’s dog.
That is called “learned helplessness”. Luckily for some of us, we are “slow learners” when it comes to our families, our country, and our standards.
Ask most Americans here in the US about chips and they’ll say either Lay’s or Ruffles.
Exactly…they don’t work for us, and never have…gotta’ git dat money…that’s capitalism, bruh.
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G.R.E.E.D. is the most destructive human trait.
What does G.R.E.E.D. stand for?
Once China absorbs Taiwan, US will need to go backward to survive. Intel’s chip technology is two generations behind TSMC. While Intel is trying to catch up they are actually falling further behind.
With Taiwan under CCP control, so-called supply chain issues will worsen as China slowly closes the spigot that sends needed technology our way. We will be stuck with inferior technology. While China and Russia are playing with their cruise missiles, new space stations, and AI, the US will be back to using Windows 7 and driving cars/trucks without all the fancy electronics. Well I guess the outlook isn’t completely bad.
Going back to windows seven would be a good thing. Windows 10 was designed to cause dependence on booze and psychotropic drugs in seniors. Covid was to get the seniors who survived windows 10.
How does windows 10 engender boozaholism?
Edit to add: I’m still on windows 8. I literally screamed at those fuckmonkeys when they tried to force me into windows 10, worming their way into my system to STEAL an operating system that I paid for and replace it with something I wanted nothing to do with.
Many threats were launched that evening.
And I still have my windows 8.
It was a seniors joke. It’s so frustrating to try to move over to we go insane. I saw what it was like when trying to use my buddy’s with 10. I decided for what I do I can get a Chromebook and have never looked back. I’m already on all the lists and am not doing anything illegal so I don’t care where they store my piddlin amount of info.
Couple days ago, I got a QR code for an incorrect product. I needed the QR because it serves as the RMA which I received via email. When I arrived at the UPS store a kid scanned the code. Problem solved. But just to screw with him, I told him that I had printed it on a dot matrix printer using my Commodore 64.
I was a digital luddite up until 2000. Prior to that I thought if I even touched the keyboard the Anti Christ was going to reach out and grab my hand and drag me into the underground. It was only about Three years ago that Yoji and Mary C. showed me how to post links and drag and paste.
Solyndra comes to mind. All you have to do is make a sizeable investment in the correct politician and you will be rewarded with hundred$ of million$ or even billion$.
US-funded breakthrough battery tech just simply handed over to China
A vanadium redox flow battery (VRFB) design created at Pacific Northwest National Laboratory (PNNL) has wound up in the hands of a Chinese company, which has since gone on to become the largest manufacturer of VRFBs in the world. The US, which owns the patent and invested $15 million of taxpayer dollars into its development, reportedly has no domestic production site for the novel VRFBs.
https://www.theregister.com/2022/08/04/doe_battery_tech_china/
America would be great again if our politicians would go back to just stealing from us.
We’ll see after the new IRS troops.