US House passes bill to boost chip manufacturing and R&D On Friday the US House of Representatives passed a bill that will to equip America to boost semiconductor production and lift its economy to better compete better with China. The law bill, called America Competes Act of 2022, includes $52bn in funding to help semiconductor companies build new factories, and to fund research …
Yep. Send billions overseas to "cheap offshore factories", letting your own fall into disuse, disrepair, and past useful life, and then give those same businesses that spent those billions offshoring their manufacturing billions of taxpayer dollars to "correct" their own greed-induced mistakes!!!
Only in America...
Corporate welfare at its finest.
If the US gov is going to spend that kind of money building factories, the factories should be gov owned and operated. Put the corps that screwed it up out of business by outcompeting them, and ALL the profits go directly to the gov.
Or instead of handing money to the corps, hit them with a 100% tax on any profits derived from offshore production. Spend the $52b on housing the homeless instead.
>should be gov owned and operated
Not necessarily. Back in the dawn of time (60's and 70s) when the UK government got involved in financing companies that had been systematically undercapitalized they got equity in the company in return. Just like any other investor. Worked great until the arrival of Thatcher's government in the 1980s. They sold their stakes to their friends, often at steep discounts.
This situation is a little different because the companies involved are making gobs of money so really don't need investments or subsidies. We probably need an initiative like SMIC but I can't think of how you could pull this off politically, much less maintain what would be an uneconomic enterprise for however long it needs to jump start a local capability.
>Spend the $52b on housing the homeless instead.
Haven't read the bill (nobody does)
But generally only 50% of the headline figure will ever be handed over (eg it's over 10years, subject to the next president reconciliation etc)
Then 50% will be kickbacks "other vital investments" of interest to the senators supporting it. So it will go on college sports stadiums, farmers/miners/modern dance studios/whatever the committee member from NoWheresville needs to agree to sign up.
it's most likely just another form of "Corporate Welfare" with "strings" attached to "solve" a problem that may very well be directly related to government regulations and policies in the FIRST place...
"Doing like China" (government money and interference in private business) is NOT how you COMPETE with China.
I suspect that one of the biggest cost savings "over there" comes from the ability to do things _LIKE_ dumping all of that toxic waste "over there"... (not saying to grossly pollute, which NOBODY wants, but making it easier and less expensive to dispose of such things that are necessarily a part of fabricating semiconductors, as an example, re-processing and transporting the stuff being two major parts of this)
icon, because, facepalm
The EU are trying a similar thing but, with less money than the US, it is hard to see how it will do anything but fail and cost a lost of Euros. The US already has experience of building and running IC plants The EU doesn't. With 27 countries involved (and 27 languages) all with their own agendas it is difficult to see fast or easy agreements on anything.
While the EU is still "discussing" the US will be up and running.
But, the US will still have to contend with other countries expanding IC production including China, Japan and Taiwan.
In 2023 we could have over-production and mothballing of unwanted capacity. We have been here before.
The 27 EU countries have 24 official languages.
And technically English no longer is one of them - while Ireland and Malta both use English they nominated their own languages to be their official languages partly because Enlish was already coverd since the UK was an EEC/EC/EU member but that is no longer the case ... and the French seem keen on taking the line that as no EU member has English as their official language then English should not be being used in any EU activities.
"and the French seem keen on taking the line".
That is a very old English slur and has nothing to do with the reality.
English will remain an official language in the EU, or as it's said "bad English".
Please try to stop weeping and tearing your hair, it's pathetic.
PS. English become important in Europe not because of the British but the Americans.
@Lars
"PS. English become important in Europe not because of the British but the Americans."
Being a common language spoken far and wide. Still amusing to remember Juncker joking to a crowd about the end of English in the EU, but having to switch to English to be understood.
https://www.forbes.com/sites/timworstall/2017/05/05/jean-claude-juncker-insists-english-is-losing-importance-in-europe-in-english-to-be-understood/?sh=3b55b4757f2d
I would find that very surprising given how many French technologists and scientists do a huge amount of their international work in English already. English is the defacto international language of technology by result of the weight of the combined populations of the USA, Canada, UK, Australia, New Zealand, and a plethora of smaller nations.
But I do realize "old wives tales" to slander the French or any other nationality will arise from time to time...
… they nominated their own languages to be their official languages partly because English was already covered since the UK was an EEC/EC/EU member but that is no longer the case …
Technically, English is still one of the EU’s official languages, since some states have more than one official language — for example, Ireland (both Irish and English are official) and Malta (both Maltese and English are official).
… and the French seem keen on taking the line that as no EU member has English as their official language then English should not be being used in any EU activities.
Would you provide a citation of the French taking that line for the specific reason that no EU member state has English as an official language?
It's hard to compare a union of 27 countries to one country alone. Then again the USA is a country of 50 states with lots of different state laws too.
Still I think steamnut is perhaps downplaying the EU a bit too much..
So lets compare some numbers here, using the CIA World factbook, they have numbers for the EU combined, numbers a bit old and would then include the UK, but still there are some interesting differences.
Real GDP (purchasing power parity)
EU $19,885,625,000,000 (2019 est.) USA $19,846,720,000,000 (2020 est.)
Real GDP per capita
EU $44,436 (2019 est.) USA $60,200 (2020 est.)
GDP (official exchange rate)
EU $17.11 trillion (2017 est.) USA $21,433,228,000,000 (2019 est.)
Labor force
EU 238.9 million (2016 est.) USA 146.128 million (2020 est.)
Exports
EU $7,102,345,000,000 (2019 est.) USA $2,127,250,000,000 (2020 est)
Imports
EU $6,649,513,000,000 (2019 est.) USA $2,808,960,000,000 (2020 est.)
Population below poverty line
EU 9.8% (2013 est.) USA 15.1% (2010 est.)
I agree with your overall point that the EU bloc is the right comparator, and of size to USA. But, although the CIA world factbook is commonly cited, their figures are often badly wrong, and these ones are dubious/contradictory. World Bank figures are both much more meaningful, and better presented. Or ourworldindata.org
CIA Factbook list US GDP per capita is 36% higher than EU. And yet they are producing 25% more total nominal GDP with only 61% of the labour force. So, the US is literally twice as productive per labour force. That’s just not right.
Also CIA Factbook list the EU is import/exporting roughly 7 trillion? That’s also not right. Germany’s total exports are only 1.4trillion, of which 69% is within the EU. CIA figures are just adding up the total exports of each country, double-counting intra-EU trade, rather than looking at what EU does as a bloc. It’s like counting Arizona shipping to Colorado as both import and export.
World Bank has EU import/export at roughly $2.2 trillion, similar to USA, which sounds more sensible.
https://wits.worldbank.org/CountrySnapshot/en/EUN/textview
But one always needs to be very careful in “what exactly are you measuring”. For example: oil exports/imports. Extracted oil comes in particular flavours, whereas an economy needs a mix of global types to run. Sweet vs sour, heavy vs light. So the import-export figures are partly a technical re-balancing rather than a true measure of trade importance.
@Justthefacts
As I wrote the EU is not a country but 27 countries and it goes without saying that those countries export and import a lot more than the USA alone and I think there is a lot of strength in that.
Regarding the US GDP per capita, I am sure those numbers would become more similar if the 0.1 per centers were deleted from that comparison on both sides.
As for the numbers the World Bank is just a private bank and we find this about it.
"In 2021, an independent inquiry of the World Bank's Doing Business reports by the law firm WilmerHale found that World Bank leaders, including then-Chief Executive Kristalina Georgieva and then-President Jim Yong Kim,[89] pressured staff members of the bank to alter data to inflate the rankings for China, Saudi Arabia, Azerbaijan and the United Arab Emirates."
https://en.wikipedia.org/wiki/World_Bank#Criticisms_and_controversy
Some EU countries exports here:
Germany $1.672 trillion (2020)
France $746.9 billion (2020 est.)
Britain $742 billion (2020 est.)
Netherlands $719.8 billion (2020 est.)
Italy $558.3 billion (2020 est.)
Spain $392.9 billion (2020 est.)
Poland $333.5 billion (2020 est.)
Sweden $240.1 billion (2020 est)
Denmark $191.5 billion (2020 est.)
Finland $119.9 billion (2019 est.)
Total 5716,9
The individual countries export figures you list look about right, but you have to exclude exports from Germany to France as exports *from the EU*. No more than you can count trucks going from Dusseldorf to Berlin as German exports. When compared equally as similar-size trading blocs, the EU and USA have similar export footprints.
I think you are just being silly about the World Bank, they are fairly well respected, but worldindata will give you similar answers and is backed by top academic researchers from around the world.
One of the problems you run into with “internal exports” can be seen from a quick sanity-check of the figures you list. The Netherlands is apparently a bigger exporting nation than either Italy or Spain. That’s obviously not a good representation of reality. What’s actually happening is two things:
1) Netherlands contains the Port of Rotterdam, the largest port in the EU. The Netherlands is reporting a good chunk of the exports of the whole of the EU as it’s own, where it goes through Rotterdam. And imports. But all those goods do is drive straight through on trucks to other EU countries.
2) Production supply chains span the Netherlands border to Germany repeatedly. Many goods shuttle back and forth, getting double-counted.
Numbers are just a representation of reality. And individual EU countries export figures just doesn’t represent the reality of how things operate on the ground any more.
But one always needs to be very careful in “what exactly are you measuring”. For example: oil exports/imports. Extracted oil comes in particular flavours, whereas an economy needs a mix of global types to run. Sweet vs sour, heavy vs light. So the import-export figures are partly a technical re-balancing rather than a true measure of trade importance.
And another thing to keep in mind when looking at those figures are crude vs. distillates. Thanks to a large petrochemical sector, the Netherlands is scoring high in both importing and exporting oil.
@Lars
"Population below poverty line
EU 9.8% (2013 est.) USA 15.1% (2010 est.)"
Curiosity here, does that account for the different methods of counting for welfare? For example the US counts cash welfare but not all the rest of it when counting poverty while the EU I believe counts welfare first (as it should be).
No, EU countries do *not* have the right to build your own industries any more. You haven’t been paying attention to what you signed up for. There are EU “rules” for what industries may be supported, by whom, and the strings attached. And of course by “rules” I just mean, the ultimate and final decision of the Commission, as informed by lobbying behind closed doors.
Sorry, boomer, the world you thought you had been sold disappeared twenty years ago. Hard lines, stop whingeing about it.
ST have a fab in Crolles which (at least back in the 65-30nm days) is/was state of the art (and was developing process technoogy alongside TSMC) ... however it was limited in size as to avoid French Government funding breaking "level playing field" rules it had to be able to be trreated as an "r&d fab" and not a production fab.
EU countries are not allowed to build their own industries if it distorts competition
Yes, a failure *exactly* like the Ariane launch vehicle. Like the $3bn Ariane 6 that took 12 years to design, based on an existing fully flight-proven Ariane 5, and existing experienced team. And still hasn’t flown yet.
Compared to a $0.09bn Falcon 9 development that took 10 years from a blue sky “I’d like to make a spaceship”, no design, and recruiting a new team from nothing. So far from “quick and dirty” that it is now the most reliable launch vehicle in history, *including* its early prototype blowups. And is already more cost-effective than Ariane 6 will be if it reaches target.
And *exactly* like the horrific Galileo program that after spending $10bn, over twenty years, and seven years after it became nominally “operational”……has still to reach Full Operational Capability. And very likely never will. Because they just lie, and lie, and lie. Every year it’s “this year”, when everyone involved with the program knows they are just manipulating the milestones endlessly.
What's up with you Justthefacts.
Galileo is a global navigation satellite system (GNSS) that went live in 2016.
The Galileo system has a greater accuracy than GPS, having an accuracy of less than 1 metre (3 ft 3 in) when using broadcast ephemeris (GPS: 3 metres or 9.8 feet)[20] and a signal-in-space ranging error (SISRE) of 1.6 centimetres or 0.63 inches (GPS: 2.3 centimetres or 0.91 inches, GLONASS and BeiDou: 4–6 centimetres or 1.6–2.4 inches) when using real-time corrections for satellite orbits and clocks.
Effective 1 April 2018, all new vehicles sold in Europe must support eCall, an automatic emergency response system that dials 112 and transmits Galileo location data in the event of an accident.
Or is it this that annoys you.
"Until late 2018, Galileo was not authorized for use in the United States, and as such, only variably worked on devices that could receive Galileo signals, within United States territory.[179] The Federal Communications Commission's (FCC) position on the matter was (and remains) that non-GPS radio navigation satellite systems (RNSS) receivers must be granted a license to receive said signals.[180] A waiver of this requirement for Galileo was requested by the EU and submitted in 2015, and on 6 January 2017, public comment on the matter was requested.[181] On 15 November 2018, the FCC granted the requested waiver, explicitly allowing non-federal consumer devices to access Galileo E1 and E5 frequencies.[182][183] However, most devices, including smartphones still require operating system updates or similar updates to allow the use of Galileo signals within the United States."
https://en.wikipedia.org/wiki/Galileo_(satellite_navigation)
SpaceX is doing well but the Falcon 9 was just too small and expensive for the James Webb telescope.
Well, I *worked* on the Galileo program for a while. I managed the development of one of its network components, responsible for a team of about twenty engineers. So I probably know a lot more technically about this than you do.
Galileo is famously and horrifically *unreliable*. The average SISRE is Ok, but that isn’t very useful if you are one of the unlucky 0.1% driving over a cliff. Here’s the most recent official quarterly performance report
https://www.gsc-europa.eu/sites/default/files/sites/all/files/Galileo-OS-Quarterly-Performance_Report-Q3-2021.pdf
In September, average SISRE 2cm, 95% better than 35cm (hmmmm….’! However, the 99.9% point was….539 *metres*. You read that right. And 99.9% isn’t even that high as a metric. That’s *nearly an hour a month* that’s its off by half a Kilometer. That’s insane. But this is actually a huge *improvement*. Since “initial launch”, 2021 was the first year they actually managed to do better than 99% of better than 30 meters! Think about that for a second. Never mind landing a plane, if you were a lorry driver using Galileo alone in 2020, it would have placed you a city block away from true position up to *7 hours per month*.
Galileo “went live” in 2016, but it does *not* have Full Operational Capability. The main problem it has, and by no means the only one, is that it doesn’t have enough satellites. This makes its accuracy *usually* ok, but *sometimes* very bad. So when it tries to provide a guaranteed service, eg. relied upon to land an aeroplane, it fails badly. It’s *supposed* to have 30 satellites in each of 3 orbital planes. It *needs* 8 per orbital plane, and because of the way orbits work it’s no good having 7 in one plane and 10 in the other two. And it needs a spare in each orbital plane, so that if any one satellite fails, there are still sufficient to provide the stated accuracy. What it actually *has*, right now, is 22 usable satellites, and 2 under commissioning. They only have production capability to launch 4 per year. They won’t have the required 9 satellites in each of the 3 orbital planes until end 2024. Unfortunately, these satellites only have 12 year nominal life. The oldest satellites in the current constellation were launched in 2011. Hence, they are *expected* to start dying at the rate of 4 per year in about 2023/2024. Unless the satellites exceed their design life, Galileo will *never* have 9 operational satellites per orbital plane. Perhaps they will? Well at the moment, signs aren’t good. The onboard atomic clocks of the first ten launched turned out to have a design problem, causing them to degrade early. They have onboard redundancy, but frankly it’s a real race at the moment.
Galileo also suffers because the Ops Centre needs to uplink corrected orbits to every satellite every day, without fail. But there simply aren’t enough uplink stations to do that every day. Brexit hasn’t helped it, because they lost two uplink stations. Until quite recently, at least a couple of days a week, several of the satellites had quite badly degraded timing, which affects accuracy. In October 2020 they added more uplink capacity, but it still fails quite often. Notice how the public haven’t been told anything about this.
https://berthub.eu/articles/posts/galileos-ground-segment-problem/
There are also some really bad design failures in the way it handles the distribution of time. Basically, one network element depends on another element which depends on…..etc, with circular definition. This has the effect that once the ground network has the slightest failure, it can take up to *several days* for the timing state to converge back to nominal. The USA GPS people actually told Galileo program about this quite early in the system definition. When they designed theirs in the seventies they made the same mistake and wanted Galileo to learn from their experience. But Galileo project was too arrogant and ignored their advice. This was the root cause of the six-day outage in July 2019. And it simply can’t be fixed, because it is implicit in the network architecture. It absolutely will happen again identically with a six-day outage next time a single timing component fails.
And finally….even intrinsically on average SISRE, Galileo is no more than accurate than GPS. This was an official myth put out in the early days by people who didn’t understand it, and just repeated on paper what they had heard, or would like to have heard. The truth is, the only physics difference comes from satellite power. More power, more accuracy, that’s all. In 2000, the new Galileo system was spec’d to have a higher power than the then-current GPS Block II satellites. The GPS Block III satellites launched from 2018 onwards have much higher power, and 3x better accuracy. And now better accuracy than Galileo. Probably next block Galileo from 2030 onwards might have higher power still, but there really isn’t any intrinsic difference in performance between the two systems.
Only you could draw that conclusion from what I wrote. How about, Galileo was *intended* to be an exact copy of GPS, as specified by a non-technical committee.As “cargo cult” science, it has the same line-item list of features and performance.
But in practice, the top-level engineering architecture and program-level decisions made are so flawed that it is intrinsically doomed to poor performance and unreliability. Those decisions were made right at the top, before it even got to be contracted out to any of the companies, so that none of the implementing companies have any control at all.
@steamnut
"In 2023 we could have over-production and mothballing of unwanted capacity. We have been here before."
The good news is for all the other countries (UK here) who will get lots of cheap chips. But if the US and EU are willing to stump up the cash for home production then good for them, and us.
The US (and other countries) should take a page from the book of the General Motors bailout. Funding should result in the US being given shares of stock in the company receiving the funds.
Not that it will happen.
Also remember that this money is in addition to state and local funds and tax breaks the companies are already getting.
BTW, this isn't going anywhere fast. The Senate doesn't like the House bill and vice versa.
I don't like bailouts at ALL. "Too big to fail" probably means that anti-trust legislation most likely didn't work as intended, and now "here we are". But if government were to, for example, help to broker a deal with banks and unions [and THEY got stock ownership in return] it might be a good thing.
I did not like the banking bailouts from 2008-ish either, though the reason behind THAT one is actually connected to gummint policies for mortgage loans (but I digress).
It is just WRONG to do any kind of "bailout" like that. Government regulations, when properly formed and applied, are supposed to PREVENT this sort of thing. But, you know politicians...
And as for the corporate welfare, wouldn't it be better to do this: ONLY purchase military and NASA hardware that is 100% made in the USA, from circuit boards and chip resistors to microprocessors and RAM and assembly, and let private industry GET IN LINE to provide these goods and services at THE BEST OVERALL BID. This is kinda how the integrated circuit revolution happened in the FIRST place.
and a few tax breaks, loan guarantees, and waivers on specific regulations, i.e. getting gummint OUT of the way, can't hurt either.
(gummint regulation is not ALL bad, just MOSTLY bad, In My Bombastic Opinion)
>ONLY purchase military and NASA hardware that is 100% made in the USA
Which will cost 10-100x as much because the suppliers will "cooperate" to be the only supplier of eahc aprt.
And you will have no export market because all your foreign customers will demand that a % is built there. So your costs will go up again.
And of course you can't use any foreign equipment/designs so no ASML lithography kit or ARM cpu cores.
North Korea is certainly one economic model, but perhaps not one to emulate ?
The Magic Money Tree doing its US dollar debt and deficit thing ...... https://demonocracy.info/infographics/usa/us_debt/us_debt.html
And whenever there are no foreign suckers to buy that debt, marketed and provisioned via Treasury auctions/Gilt sales etc etc., is one obliged to buy it oneself creating an ever more evident death spiral of monetary incontinence?
Is that the current state of international monetary play these days??
Rather than creating conflict and chaos and mayhem and madness with competition and opposition, how about deciding upon constant cooperation and reinforcing support. Such almost immediately irons out and destroys all bugs and viruses in any system of executive administration.
Surely that is not too difficult for humans to understand and conspire to deliver as a Unifying Default IntelAIgent Driver?
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