National Review Online editors pan a proposal from the Trump administration that would insert government into the economy in an unwelcome way.
The federal government has a hard enough time doing the things it should do: securing the border, winning wars, collecting taxes, administering the capital city. It doesn’t need to take on the difficult and nongovernmental task of turning around a struggling semiconductor company.
The Trump administration is reportedly considering taking an equity stake in Intel at public expense. This would be in exchange for the grants the company is already due to receive under the CHIPS Act.
By the way, remember the CHIPS Act? The law that was enacted three years ago for the supposedly urgent task of re-shoring semiconductor production? In those three years, the government has distributed almost no money for that purpose. As we said at the time, the law was so loaded up with extraneous provisions and deficient in specific anti-China provisions that it was never going to a present an effective challenge to China’s chipmaking ascent.
The main Intel project that the CHIPS Act was supposed to support, a facility near Columbus, Ohio, is little more than a hole in the ground. Intel has been in the process of a corporate turnaround strategy since before the CHIPS Act was introduced. It hasn’t gone well. CEO Pat Gelsinger was ousted by the company’s board last year. Intel has already announced that it would be cutting thousands more jobs than the CHIPS Act funding was ever supposed to create.
Intel has been struggling for more than a decade, having become complacent after years of dominance making chips for personal computers and missing multiple technological shifts. The company got beat by competitors in producing newer, advanced chips and took on massive debt to expand its manufacturing business with limited success. …
… Looking at that sad situation, the Trump administration wants a piece of the action. Rather, it wants to use your money to get a piece of the action.
