back to article Intel boss presses Congress for manufacturing subsidies

Intel CEO Pat Gelsinger on Wednesday urged US Congress yet again to pass $52 billion in funding swiftly to boost America's semiconductor industry – and said Wall Street's negative response to his costly manufacturing expansion plan is proof Intel is worthy of the subsidies. Gelsinger made his comments alongside the CEOs of …

  1. RichardEM

    I would like to know how much the companies looking for help spent on stock buybacks and increases to dividend's to stock holders. What ever they did should be subtracted from what they get from the government.

    1. joed

      Nah, wealth transferred is inherent element of free market. There has to be corporate outlet for taxpayers' money. Paying twice for your chips is the only way to go.

    2. oiseau Silver badge
      Facepalm

      ... how much the companies looking for help spent on stock buybacks and increases to dividend's to stock holders ...

      How much?

      Probably twice what they are asking for ...

      Or more.

      Greedy bastards.

      O.

  2. DS999 Silver badge

    I wish these sorts of investments came with some strings

    If they company wants the cash, they have to grant the government some stock options with a strike price equal to the lowest closing price over the past decade. You simply require in the legislation they must be sold off before they vest on a predetermined schedule so the process is not subject to political influence, and the government never holds any actual shares. It is basically there so they get something for their money if it helps the business.

    The intent of the subsidies is to insure the US is self sufficient on the chipmaking front, but millions of taxpayers are paying for something that mostly benefits large shareholders of the companies getting the subsidies. They seem to think it is a good idea to give top CEOs big wads of options, so why not for a sugar daddy who comes along with a 10 or 11 digit check? I know which one is more likely to create shareholder value.

    1. Yet Another Anonymous coward Silver badge

      Re: I wish these sorts of investments came with some strings

      Government buying shares of a company is socialism, government giving money to companies to give to the shareholders is capitalism

    2. Scene it all

      Re: I wish these sorts of investments came with some strings

      Maybe strings like "spend it all on RISCV".

  3. El Bard

    TMTOWTLI: There Is More Than One Way to Look at It

    "Without the funding, Intel would continue to build out new fabs in Arizona and Ohio, Gelsinger said, but the expansion would take longer, and it wouldn't be as comprehensive."

    I am not sure whether this should be read in a Godfather voice. The same is going on in Germany, France, Italy, Spain, AFAIK.

    One might still see it as a win-win, Intel gets bigger, the US gets more resilience. Maybe... Or it is just big money for Intel (who just wants to finance its IFS project with public money and get a competitive edge) and a pipe dream for the State, since the material supply chain will never be able to be fully localized.

    Something similar is made explicit in other points of view: https://www.eetimes.com/us-electronics-reshoring-plan-risks-missing-the-boat/

    "While U.S. legislators prepare to approve a $52 billion package of incentives to help shore up the domestic semiconductor industry, there are concerns that most of the financial support will go to very profitable chipmakers that don’t need assistance while the struggling PCB segment is overlooked."

    Draft legislation of the incentive package for the US semiconductor industry would allocate about $2.5 billion for advanced packaging. A small part of that money is likely to go to PCB makers, according to the lobbyist." [Concerning the fact that chips don't just plug into hopes and dreams, but need substrates, OSATs, PCBs and all the materials in the bill of materials].

    Moreover, from the same article...

    “I think that there’s a recognition that if you get past May, things start to get more difficult,” the lobbyist said. “We’re in an election year.”

  4. msobkow Silver badge

    ...correcting our mistake of having farmed out all our manufacturing overseas instead of maintaining our own plants. So seeing as we screwed up royally, we'd like you to have the taxpayeer pony up $50 billion plus to cover our own incompetence and greed.

    1. Yet Another Anonymous coward Silver badge

      But these new fans are going to use Dutch lithography machines made with German glass. Surely a great national project should begin with making your own equipment

  5. Ace2 Bronze badge

    These fabulously rich corporations need not one cent of subsidy and they should be ashamed to even ask.

  6. Jonjonz

    F*CK Korporate Welfare

    F*ck Korporate Welfare.

    Look no further for proof Citizens United turned bribery into how to get massive governent handouts 101.

  7. aerogems Bronze badge
    WTF?

    More corporate welfare

    I'm fine with giving them low interest loans, maybe even zero interest in some instances, but the money from that loan must then be spent entirely on some specific project and the entire balance must be repaid. Also, part of the deal means that the government can audit your books while there is still principle to be payed back to make sure the funds are not being misused.

  8. Platinum blond(e)

    When the Feds bailed out the Big Three automakers, they took stock IIRC. And also IIRC the stock was sold shortly after and the funds were repaid in this manner. It worked then, why not now?

    And as far as long term, I predict that US businesses will once again allow the manufacturing to move to wherever is cheapest just like they did since the 50s. Yes kids, going back to the middle of last century. Same as it ever has been in industry, of course.

    Lather, rinse, repeat.

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