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Comment by Scoundreller | Hacker News Reader

Many countries have a funny concept of strategic industries.

In mine, dairy is a strategic industry that is coddled by government so that we can have a local source. But every country thinks that so there’s foes and allies that can supply us UHT or powder milk on a moment’s notice. And if our milk supply disappeared tomorrow, everyone over 1y could substitute with 10000000 different things for nutrition.

Cars are another. Every country props up its auto industry, so why worry about a domestic supply?

Meanwhile, there are critical components, pharma ingredients or other inputs built in 1 factory in a country we could likely end up in a big dispute with.

Just goes to show that industry protection has nothing to do with risk/dependence on that product, and everything to do with picking and choosing which industries are important voting bases.

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How much would it cost to set up TSMC inside US borders? One president cycle? 4 F-35s? One SLS? A nuclear submarine?

According to this page, sorting by cost, https://en.wikipedia.org/wiki/List_of_semiconductor_fabricat...

the most expensive fab is 33 Giga$. TSMC is 17G$. pennies on the dollar in our 1-3Trillion infrastructure bill.

Make america fab again.

EDIT: it appears this is in the 2T infrastructure bill. https://www.eetimes.com/biden-ups-ante-to-50-billion-for-chi...

Isn't TSMC working on expanding into the US?

They are indeed, in Arizona. First they are going to have employees train on-site in Taiwan (will get housing for themselves and their families for duration).

This makes it easier for the US to spin up more, since we gain more trained workers who understand these processes.

I thought similarly - this is true if we can have lossless knowledge transfer. I imagine we would have to put what is learned into practice before translating it into distributed knowledge for a US fab workforce.

The US does produce ~10% of the global chip supply today, and much of the equipment used in the world's factories, and a very significant portion of the software needed, is made in the U.S.A. This is an economic issue. Not a knowledge gap.

> it easier for the US to spin up more, since we gain more trained workers who understand these processes.

Given that they will return

Yes, but from what I understand, it won't be the most advanced plant making the smallest feature sizes, so it's not like Apple is going to be utilizing that plant (maybe for ancillary chips, but not main processor). Understandably, TSMC keeps a tight reign on their top-tier production methods, which is their reason for being #1.

It's also 3 years away from opening in AZ (2024). Then they have to fine tune the equipment and processes over x runs. New plants tend to have low yields until those processes are smoothed out and perfected. You don't just set up a plant and start churning out chips with 98% success rate at 5nm once the factory is built. It probably takes 5-6 years from construction start to churning out quality chips in numbers that are actually profitable.

And the machines they’re going to be running take years to build. And they have to be built custom for each site. Not just for each site, but also each location within the site. Just moving a machine a couple of feet can cause massive delays as they have to effectively rebuild the machine for the new location.

ASML has engineers who go out and spend months or a year or more, just taking various measurements of the location inside the building at the site where the machine will be operating. Then those engineers go back to Eindhoven to oversee the building of that machine from the ground up, and run through proving cycles. Then the whole thing has to be taken apart and shipped and then rebuilt at the site. And then there are months afterwards as the team does further work and testing before they can finally use that machine for production purposes.

The Saturn V rocket was much easier to build and move. Nothing the rocket industry has can compare to the difficulty of building and moving these machines.

Disclaimer: I worked as a consultant at ASML for several months, helping them to rebuild their Unix infrastructure systems that they used to support the engineers who did all that design and build work.

Seems like long term the human race is going to lose this ability if something serious is not done to reduce the complexity of building these things. This pandemic has shown that everything is super fragile and with Climate Change on the horizon I cannot believe they decided to build this damn thing in Arizona of all places. Maybe the collapse people were right and we should be working on CollapseOS

[1]: https://collapseos.org/

What makes Arizona a bad place vs other places it might go to? No place will be spared the effects of climate change. Water use is a concern, but it sounds like they plan to recycle nearly all of it.

Arizona is already nearing the edge for what constitutes livable. If something isn't done to mitigate Climate Change soon, I can start to see land being abandoned. This is such a critical factory and a disruption will have massive ramifications. They probably built it there due to tax breaks that may not matter anymore in the future if climate change wrecks havoc.

I assume that is if you already have the know-how. Starting from (almost) scratch would require more upfront work, right?

The US isn't starting from scratch. And presumably the total cost includes all the R&D cycles. TSMC was started by a Texas Instruments employee.

But, if we assume they were, just double the cost as a sign-on bonus for all the engineers and poach away.

This is problem that can be solved with money, and not a lot of it in the grand scheme of things.

You vastly underestimate the institutional knowledge necessary to operate state of the art fabs. Intel has been at the forefront of the field for decades, and even they are stumbling vs the current challenges. TSMC was founded over 3 decades ago. That it was founded by a TI employee says nothing about the situation today.

The US is subsidizing a TSMC plant here, which should help the situation, as it'll give us access to their engineers and cross pollination. But it's still tiny compared to the need if we want to move the majority of our chip imports to domestic.

I agree that I'm underestimating the startup cost. That's inevitable, I think. I can only counter by saying that I think we're also underestimating the benefits of being self-sustaining at the scale of TSMC, especially with the changing political landscape re: China.

This is a huge hurdle. There is actually some chip/silicon fab sites that never left (only scaled down considerably from their peak). A family member has worked at one for many years as an engineer/manager. When he tells me stories about the insane complexity of their process engineering it really hits home. Impurities at the nanometer scale can ruin 10 million dollar batches of silicon. Nasty chemicals are piped everywhere at the plant - the kind that explode if touching oxygen in the atmosphere or acids that dissolve bone before they noticeably affect your skin.

Running such a production is difficult.

Government can't make a website, let alone a chip fab. Talk to Intel and ask them why we've fallen behind. Do any VCs want to fund a direct Intel competitor? I doubt it.

Making chips seems to be quite a bit more complicated than making and launching rockets, I don't think even Elon Musk could do it.

>Government can't make a website, let alone a chip fab.

Tbf, many (most?) government websites are built and maintained by private companies. Remember the ACA website debacle a few years back? The government was mad at the contractor for building a shoddy product. They claimed they would take action against them but I’m not sure anything happened. If the government should be held to task on anything it should be an inability to write good contracts or hold companies feet to the fire. I’ve heard civil servants are unwilling to to the latter because they don’t want to hurt businesses or are afraid of legal protests.

Anecdotal, I know, but the saddest interview I’ve ever done was a state government web developer. I was writing a js on the whiteboard, setting up a problem that started something like

var a = 1; a = 2;

Before I got any further they blurted out “that’s false! The second line is false” and this was someone who had been writing production code for the government for the last five years.

I honestly just felt really bad for them, more than anything.

I wonder how much of this is due to being forced to select lowest bid contractors.

I’ve seen some orgs rely on rely bad programmers because they were relatively cheap. Programmers who make changes on the fly in meetings to live production systems or say their test plan is to push it to production and just wait for customers to send in work tickets when they encounter a bug. Or blatantly lie about feasibility because they would prefer to work in an antiquated framework rather than learn a new one.

The govt owns some responsibility for lack of technical oversight but I can’t help but think a lot of it is due to business contracting incentives.

Just subsidize it. I'm not asking for the Fab Czar, I'm asking for the NSF, DARPA, and national subsidies for it. Accelerated permitting, tax breaks, tarif support, state vs national investments, accelerated green cards for key personnel, and price breaks for a "buy US Chips" initiative for the first 5 years until things get serious and exports ramp up. I'm spitballing over morning coffee, but come on, this seems obvious.

Exports won't offset operating costs here in the USA, but perhaps we could apply some ingenuity to that through national research investments and the ensuing startup ecology. The ancillary benefits of funding research and small business infrastructure around the big fabs would be huge.

Sandia national labs has a ~3.5 annual Giga$ budget! That's _entirely_ publicly funded and represents about half of TSMC's operating budget (https://investor.tsmc.com/english/encrypt/files/encrypt_file... , looking at 50% profit yielding ~12 G$)

Will this do? https://www.eetimes.com/biden-ups-ante-to-50-billion-for-chi...

Yes. That's precisely what I'm asking for.

We are lucky to have a Dem in office so we at least get something vs just spinning our wheels. Who knows, the next republican might just tank this strategy in the long run anyway.

EUV LLC was already heavily funded by DARPA in the 90s and is why we are able to have export restrictions on ASML machines used by TSMC for the latest EUV nodes etc.

And people seem to be forgetting that ASML is a Dutch company. It’s the worlds leading producer of the chip lithography equipment, and the other quality companies in this space are in Japan.

Why do you keep using Giga $ instead of $3.5bn?

There's no good reason.

The 18F group is more than capable: https://github.com/18F

They are probably referring to the Obamacare initial rollout which predates 18F right?

The US government manufactures a lot of classified chips in house. It’s unclear what their exact capabilities are, but looking at funding they could in theory be ahead of the industry.

The UK Gov seems to be doing an ok job - https://github.com/alphagov

Cost isn't the issue, it's that we have incompetent buffoons as presidents these days.

https://www.youtube.com/watch?v=TuW4oGKzVKc

That's what a president sounds like.

It's not just incompetent presidents, it's incompetent politicians at every level.

That's not a bug, it's a feature.

Politicians like MTG and Boebert are part of the system just to cheapen it. The crazier they are, the more off-tilt they are, the better the strategy works, the more it weakens the average Americans faith in the system. This strategy started with Trump, but it's started permeating every level of politics. The more wild they act, the more they can insist that the other side is being just as crazy.

It started with Reagan. People just didn't realize that it was the boiling frog scenario. It won't end with MTG and Boebert.

I agree that a president speaking to goals like that would be incredible. But he didn't have almost half the country supporting complete fantastical claims and a decent fraction trying to overturn elections.

But look what he did against racism vs Johnson (not that much compared to J.), and they both still pushed the Vietnam war. Kennedy had to work around the edges on entrenched racism to maintain his Democratic majority with southern votes. At least the parties are more honest about their proclivities today.

Well, to be frank, there's precedent for why presidents won't be like Kennedy.

Nerva and Orion were both cancelled, it's not like they just delivered everything. If Joe Biden said tomorrow "I'm going to wave a magic wand and we will have non-intel x nm fabs tomorrow" then loads of people would be moaning about big gov. or the cost etc.

We're doing it but obviously Taiwan isn't going to give up their smallest die processes (only older processes) since it keeps the US at least unofficially allied with them.

Part of the reason fabs are spread out is capitalism: if you manufacture the part in the country, you don't pay import taxes (e.g., Intel's Ireland fab debacle).

Another part is lax environmental laws. Hillsboro Oregon is embroiled in a suit with Intel where Intel dumped 100x the fluorine into the air that they claimed when D1X was first pitched. Don't need to worry about that stuff in Asia (for now).

Also, lead time. The x-ray litho machines take years to build and test. There are only two companies that make Intel's testers, and the lead time is years. So a "quick fix" isn't possible.

Speaking opinion: in the long term, it is mostly rich people trying to get richer that caused this. If greedy CEOs and shareholders would just be humans for once and think about the future we wouldn't have this trainwreck. That ain't ever gonna happen.

Speaking opinion: in the long term, it is mostly rich people trying to get richer that caused this

And the chips in question exist in the first place because...?

Because Gordon Moore, Andy Grove and Robert Noyce wanted to improve integrated circuits to do amazing things with technology. Not rape the planet to become trillionaires. You realize there are other motivations in the world for doing things, other than just money, right? Perhaps you don't based on your reply.

Building it is one thing. Making it operational without importing talent and running it profitably is another. Taiwan has some of the best fab engineers who work at US minimum wage salaries. Of course you can pull them away with higher pay like China is doing, but that means profitability will likely go for a toss.

Do you have a source for the best Taiwan engineers working for minimum wage?

Monthly salary for a TSMC fab engineer is about NTD$48,000/month [1]; I saw another source on the web that listed NTD$612K/year, which is consistent. The exchange rate is 1 USD ~= 28 NTD, so that about USD$1700/month or about USD$10.50/hour, which is pretty close to what McDonald's pays these days.

Prices in many foreign countries are wonky though, because of different cultural & economic systems. You can have a good lunch out (the equivalent of fast-casual; most eateries are like that) in Taiwan for about USD$2-4, and because the expectation is that you live with your parents until you get married, housing expenses are minimal. There's also a big oversupply of 20-30something labor, because the older engineers who built the company (and get paid significantly more) aren't retiring and so those skilled jobs aren't opening up. That's behind both the low prices for food (many young Taiwanese open small restaurants) and for entry-level fab engineer jobs.

[1] https://www.glassdoor.com/Monthly-Pay/TSMC-Process-Engineer-...

McDonald's is paying $15 where I am now, and begging for applications.

McDonald’s is also forcing noncompetes on new hires. Nobody should work for them

Edit: my source (potus) was mistaken apparently. A better source is below and involves non poaching and different restaurants (not McDonald’s as far as I can tell)

> About 80 percent of fast-food workers are constricted by no-poaching clauses, according to Healey's office. The other fast-food chains targeted by the states' investigation are Arby's, Five Guys, Little Caesars and Popeyes Louisiana Kitchen.

https://www.washingtonpost.com/news/wonk/wp/2018/07/09/11-st...

That was a bogus claim made by Biden. Looks like hourly employees don't sign non-competes.

See:

https://www.factcheck.org/2020/07/bidens-false-claim-about-m...

https://www.politifact.com/factchecks/2020/jul/28/joe-biden/...

> Prices in many foreign countries are wonky though, because of different cultural & economic systems.

You should just adjust for PPP. The world bank estimates taiwan's GDP (nominal) to be 759M, but adjusted for PPP it's 1,403B. If we do the same adjustment for wages, we get $3165 per month, or $18.19/hr.

Even adjusting for PPP is complex though, because different goods have different cost adjustments. Actually buying a condo in Taiwan isn't cheap - I think my in-laws said it was around USD$500K for a 3BR/2BA in one of the Taipei exurbs, and can go up past $1M for luxury condos near a city center. That's close to Bay Area prices on McDonalds wages. A lot of Taiwanese youth are pretty much priced out of many markers of adulthood (not unlike many American Millennials), and can't do much other than eat, work, and play videogames. To have a house of their own and a job with the potential for career advancement, they basically need to wait for their parents to die. That's not really captured in PPP numbers, the same way that rampant asset inflation hasn't been captured in the American CPI.

+1 to these Taipei real estate price estimates. Note that TSMC is headquartered in Hsinchu County, and I think real estate is much cheaper there (please fact check me on this though).

source: Parents are from Taiwan, and I have relatives in Taiwan who tell me similar price estimates.

Not minimum wage certainly, but less. Not sure how significant an expense salary is for the TSMC though as a fab is very capital intensive.

https://focustaiwan.tw/business/202106300017

"The median employee salary at Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest contract chipmaker, reached NT$1.81 million (US$64,874) in 2020, up from NT$1.63 million a year earlier."

https://www.glassdoor.com/Salary/TSMC-Salaries-E4130.htm

Process engineer is like $73K/yr

So these, very skilled, employees probably get like ~15% less in Taiwan. No idea what Taiwan's employer tax situation looks like.

The US has a bunch of fab engineers as well. The problem isn't having the engineers, it's having the actual higher tech fabs.

With respect, we don’t have that many fab engineers any more. At least, not of that quality. And most of the ones we do have are already locked up by other employers, like Intel, IBM, and the other companies that still have some fabs here in the US.

Sure, we can do small scale cutting edge prototype fabs, but the few production fabs we have here are not TSMC quality (go ask Intel), and they are already fully allocated. Many of those might not exist here in the country at all, if it weren’t for the requirements from the US military and certain other classified customers to have certain types of chips made here domestically.

We used to have a lot more fab engineers here in the US, but we outsourced those jobs and sent them overseas. And the people who used to do that work have moved on to other careers, or retired.

And the reason why Silicon Valley has so many EPA disaster area cleanup sites is because of the fabs(and related businesses) that used to be endemic in that part of the country. Fabs aren’t clean businesses to run. You’re going to have to find a place where you can run those dirty kinds of businesses, and that’s either going to be extraordinarily expensive, or even impossible, due to legal restrictions on the use of toxic chemicals, etc….

There’s a reason why those fabs are overseas. And all those reasons are why it’s going to be extraordinarily hard for us to pull that work back. There’s a reason why Steve Jobs and Tim Cook have both said “those jobs aren’t coming back”.

We pay junior engineers who work at social media companies six figures so why cant we pay taiwanese fab engineers enough?

The risk model is different. The cost of setting up an gorgeous tech company office in pre-Covid San Francisco is trivial compared to setting up even poor-quality fab. Not that we (the US) should shy away from doing it - the Silicon Valley is called that because semiconductors are made out of silicon, but SV is also full of Superfund sites (for many reasons, but IC manufacturing isn't a light industrial process, and is ridiculously capital intensive. A few million dollars, and a few months, and that social media company will have an MVP and started proving traction in their chosen niche. (It'll take closer to a decade to actually get somewhere with it eg tiktok, but MVP can be demoed to investors far sooner.) A few years, and closer to a billion dollars, and you might have broken ground on the fab.

We do pay them "enough." They do the job for that price. Why are they not payed more? Consumers care more about price, and capitalism cares more about the bottom line, than the ethical treatment of workers.

I agree with your points, but poaching talent is just fine in my book. And profitability should be considered, but not required. Most national defense programs are ``profitable'' in that they are paid by us. Chips are a cheap strategic win in the scope of things. TSMC's entire operating budget is a miniscule line item next to the cost of threatening supply chain to downstream industries, or strategic loss from TSMC being nationalized by China (or ... going to war to defend against that)

Surely that depends on the staffing costs versus the overall costs (interest/financing cost I would be the largest cost?).

If staffing costs are 5% of of marginal costs, then making them 10% is fine if your residual income/profit is high enough.

I suspect you put a fab in Asia because you get higher profitability, not necessarily because you wouldn’t make a profit at all in the US.

Can anyone comment on what percentage of costs for say TSMC go on staffing?

dont worry - we print USD locally

So few people realize the untapped, and unique, power this provides the US.

for now. wait for food and housing prices ...

The US isn't Venezuela, and the USD isn't the Bolivar.

in a few years there will be 10x number of factories. Covid just sped things up. It's too critical for army and other industries. Food and army cannot be outsourced.

> Make america fab again.

America does fab. However not newest nodes at high capacity. It just doesn't take building an identical factory and hiring away engineers. There is a complete supply chain of specialist companies which produce or fix the part the part that goes into a machine that that ... . Not mentioning that those construction costs are at economies of scale of building factories.

Such a thing can't be build in the US as every state needs a piece of the pie. An US run copy will be more expensive even when you ignore wages. Extra spare capacity for emergencies is not sound either.

Yeah, people underestimate the complexity of chip production. It is not one fab that you need to build, it is an entire ecosystem around it.

EU has lately been thinking about localizing chip production here, but they seem to be stuck in the same fallacy: we need a huge, gleaming fab on our soil. No, that is just the tip of the iceberg, unfortunately.

Heck, didn't Apple finance expansion of TSMC so Apple could ensure that they received priority when ordering chips?

Reuters previously reported that TSMC plans to build as many as six factories at the Arizona site over a 10- to 15-year span. https://www.reuters.com/technology/tsmc-says-construction-ha...

What are Intel doing then?

Highly visible industries tend to get a disproportionate number of subsidies, because the population can relate to them, and politicians aren't that clever either. Film and television are good examples, and fishing tends to get a lot of attention too.

Pretty much everyone understands that computer chips are needed for everything these days though.

The population can relate just fine. It's just there's no one rich and powerful who wants to make the investment that is making it an issue.

I'm not sure that the population can relate to building a semiconductor ecosystem in the USA -- when a state gives incentives to bring movie production there, people think "Well look at all of those jobs and movies give our state great exposure", but when the government wants to spend billions helping to build a next-gen fab plant here, then it's like "wait, I paid thousands of dollars for my phone and computer, why are we paying them to build plants here, don't we pay them enough!?"

You may say "But semiconductors are used in far more devices than phones and computers", but I'm not sure the average person realizes that. Well maybe they are now when they can't buy the car they want because it's delayed due to semiconductor availability.

I’m pretty sure the average person knows computer chips are important.

> wait, I paid thousands of dollars for my phone and computer, why are we paying them to build plants here, don't we pay them enough

This line of reasoning isn’t generally extended to any other area of production, so I don’t see why it would apply here.

Yet there's plenty of people that speak out specifically against semiconductor subsidies:

https://foundersbroadsheet.com/does-the-semiconductor-indust...

Supply and demand shocks will work themselves out fairly quickly if just left to market forces without government involvement. But a large section of the US population is under the delusion that if there’s a problem, only government can fix it.

https://thehill.com/opinion/international/560338-government-...

One part of the legislation, the CHIPS Act, allocates $52 billion to subsidize the construction of new chip factories in the United States. Officials believe it could result in seven to 10 new U.S. factories. Although a national security case can be made for it, too much subsidy can do more harm than good.

People understand just fine. They understand that pretty much everything they own these days has a computer chip inside it.

Using a simple example people understand they can't get consumer electronics like Xboxs, Playstations, and Switches because of the electronics shortage. People understand there is a car part shortage due to electronics. These aren't high information people talking to me about this. It's understood there's a chip shortage right now by the general population.

People are fine with and nobody really argues that America should support a steel industry. Frame the argument the same way and most people would be ok with supporting a technology infrastructure local to America.

The other issue that hasn't been touched on is that a chip subsidy will probably only benefit 1 or 2 states, where as agriculture and other commodity level subsidies get spread out so there's less political will to make it happen. (along with a zero sum attitude in politics that if X state is getting money it means my state is not getting that money)

It's actually a pretty critical geopolitical issue, sense there's a real chance that China makes a move on Taiwan soon (soon being within the next 10 years), which will result in either the destruction of alot of the chip infrastructure or China with global control over chip infrastructure.

I'm kinda surprised countries like Japan and Korea aren't making moves to address this by starting their own fabs. (Maybe there are?)

Note that Samsung is frequently considered to be the second best chip fabrication company in the world, behind TSMC. That’s part of why Samsung is the single biggest supplier of technology to Apple.

Canon is the other major vendor of chip lithography equipment, but I don’t know where their EUV processes are, or what the major chip manufacturing companies are in Japan that they would be sourcing for.

Samsung of South Korea already has multiple leading-edge fabs in South Korea and Austin, Texas. Remember when Tim Apple defended their Chinese outsourcing practices, claiming that the engine of the iPhones were made in America in a rare CBS interview years ago? Tim Apple switched to TSMC in Taiwan shortly after that. The company also announced a plan to spend $110+B in capex over next 10 years to expand their busines.

Japan really has no presence in this business. Japanese automotive chip makers like Renesas had fabbed chips in-house, but decided to outsource everything to TSMC back in 2018. In fact, most automotive chip makers, such as Infineon and NXP also use TSMC -- the company has something like 70% of the market share.

Now, the real issue here is that the automotive chip business is fairly low-tech and low-margin business. TSMC has been around and has been making MCUs used in cars for a long time, but it seems others are less willing to jump in b/c it's going to take years to recoup their investment.

> Every country props up its auto industry, so why worry about a domestic supply?

War. In the event a war breaks out, a running auto plant can be re-tooled relatively rapidly into a light and heavy armor plant. It's not even a question of whether allies could supply tanks and troop transports; it's about having domestic capacity to make them because enemies could execute blockades and disrupt allied resource supply.

Is that still true now?

Great question. It's still doctrinally true (i.e. governments believe it is true; it was one of the reasons cited for the US federal government buying key stake in domestic auto manufacturers instead of letting them go bankrupt during the real estate market crash), but whether light and heavy armor is actually of military worth in an era of drones and air power is a question I don't have the military training or knowledge to answer.

Yes, because heavy industry produces light and heavy armour, and heavy industry is also required to produce military drones and other weapons.

I'm unsure whether you can still retool an automotive factory to produce war materiel. During WWII Ford automotive plants produced aircraft, but back then the construction techniques needed to build a bomber weren't all together different from a car (think larger engines and chassis).

> whether light and heavy armor is actually of military worth in an era of drones and air power is a question I don't have the military training or knowledge to answer.

On this point, it obviously depends on what kind of war we're fighting. The British used unarmoured and open top Land Rovers with 50cals mounted on the rear for the first few years in Afghanistan until the government got its act together (they looked cool, but were IED death traps). There's a similar story with the Humvee.

Nonetheless, civilian style vehicles had their use.

Yes.

One scary fact that I learned is that, in war games between China and the USA, China almost always wins due to superior production capacity. Those $100B American battle carriers and $40MM advanced fighter jets can be taken out by $50,000 rockets/missiles produced at a rate of hundreds or thousands per day.

This is in line with my intuitions; do you have any sources so I can read more?

Sure!

https://www.stripes.com/theaters/us/2021-07-27/US-China-mili...

That doesn't support your core thesis that the US will lose a protracted war and that mass producing missiles is going to actually led to planes being destroyed. That's not how that works.

Notice this resembles somewhat (in reverse) the WW2 situation with high quality German tanks and Japanese Zeros etc and the us making many more tanks and planes compared to the Germans and Japanese. But we are on the other side of that now.

Isn't the reverse also true?

Yup, but that leaves you at a draw for existing assets and you depend on production capacity after that.

How many tomahawks does it take to destory these factories?

So, apparently the best opening salvo is to take out USA comms satellites and that essentially cripples American offensive capabilities. Modern tomahawks are heavily reliant on comms networks to hit long-range ground targets.

Plus, any destroyer launching these at targets deep in Chinese territory will be within range of Chinese missiles. And, as we saw in Syria, Russian air defense systems are pretty effective against Tomahawks, and we should expect Chinese systems to be at least as effective.

>So, apparently the best opening salvo is to take out USA comms satellites and that essentially cripples American offensive capabilities. Modern tomahawks are heavily reliant on comms networks to hit long-range ground targets.

No they aren't. They were designed with the assumption that GPS wouldn't be available and instead will rely on terrain tracking.

>Plus, any destroyer launching these at targets deep in Chinese territory will be within range of Chinese missiles. And, as we saw in Syria, Russian air defense systems are pretty effective against Tomahawks, and we should expect Chinese systems to be at least as effective.

What are you talking about? We had satellite imagery with holes in the ground that disproved the Russian claims that they shot down most of it.

Nothing you said is factual.

I can't decide if some of these scaremongering stories are from the military industrial complex to convince more funding into new things, or just anti-propaganda to give pause to rushing into new conflicts.

It's neither. The US is in an incredibly bad position right now because of three decades of under investment. After closing too many public yards after the cold war now the USN is barely able to keep up with regular maintenance during peace time of it's vessel's, let alone during a war. The average age of most American vessels is greater than that of their sailors. All while they're asked to face down the PLAN which now outnumbers them and is newer.

Probably not too many. But I wonder, are there more Chinese factories or Tomahawk missiles? I'm not totally sure. China is a very large country.

I'm sure the manufacture of tomahawks is pretty much on stand-by for the order to increase production. Civic pride and what not. Totally has nothing to do with the stock price.

How many subcomponents do they have on hand, especially cpus? I bet not many.

So the opening move would be to invade a non-hostile country to ensure you have all of the chips! Then once that is secure, you can then target the country you actually want to have hostilities with. I can see no flaws with this plan. Execute!

The issue is that China needs energy and other natural resources to sustain production which the US and allies can effectively blockade. It always puzzles me why China is so antagonistic with its neighbours. Indochina is very difficult to invade, and the whole South China Seas situation means that China has no blue ocean access into the Pacific. In a global war, the only reliable lifeline into China is through Russia.

That's why the Chinese are so keen on taking over Taiwan as it will give them that access. The core theory that the PLA repeats is that they could overwhelm US assets in the region and quickly crush Taiwan in hopes of forcing the US to agree to a cease fire and peace deal.

How does Taiwan block mainland blue water access - any more so than Okinawa?

China has a plausible pretense to invade Taiwan. Okinawa? Not so much.

> It always puzzles me why China is so antagonistic with its neighbours.

> The issue is that China needs energy and other natural resources to sustain production which the US and allies can effectively blockade.

You just answered your own question.

They are so hostile, and aggressive exactly because of that immense insecurity, and fear.

It's the mental model you pickup growing in any red country: you never acknowledge your weaknesses, lest you want them being instantaneously exploited.

On other hand, you feign a polar opposite. It's everywhere in China:

— Far from rich people in small towns buying fake Ferraris

— Dumb companies hiring fake "big name foreign executives" to mumbo jumbo their plans to investors

— "Advance to retreat" tactic

— Chinese businessmen hiring a service of "fake thugs" and tatooing themselves to appear "tough mafia men" to scare off actual mafias

Interestingly, fear of Western blockade and interruption of import of vital resources was what motivated the Japanese to go to war in 1941.

Yes, and it was the completely unexpected success in Hawai which emboldened them further.

This is just wrong.

The US loses many war-games against China in the short term as China has local numerical superiority of weapons. US armed forces are spread all around the world while almost all of the PLA is near mainland China. In the opening salvos of a Taiwan conflict China would flatten US bases in the region which would be devastating.

But long term China is effectively an Island. Its geography means that it imports nearly everything it needs by Sea. It imports 10 Million barrels of oil a day. It is not food secure. It imports nearly all of the raw materials it needs. While the PLAN could dominate their near shore, they cannot escort super tankers from the Middle East all the way back to China. The USN has had a carrier strike group in the Persian Gulf for decades.

The missile argument is also just nonsense.

Explain how a war between nuclear superpowers ends with anyone winning?

You have 1 superpower, and 2 upcoming challengers.

US has enough nuclear munitions to outright defeat 1 equal superpower in a first strike scenario.

> US has enough nuclear munitions to outright defeat 1 equal superpower in a first strike scenario.

I wouldn't call half the population of the US dying in 30 minutes, and most of the other half over the next 30 days to be much of a 'victory', and I don't want the DoD to even consider employing anyone who would.

It's definitely not true today in 2010 because auto plants in 2021 cannot be 're-tooled' to make tanks.

Also, US China conflict depends on entirely 'where' and 'over what' and what each nation is holding up it's sleeve.

China does not have $50K rockets that it can use to down 'reasonably stealthy fighters' and as we have seen before, tactics combined with good tech gives overwhelming odds. For example, if (big 'if' but entirely plausible) the US can maintain air superiority in a particular region ... then it will basically maul whatever is before it. As just one example.

China is building 100 subs that are a pretty big threat to any navy ... but we also don't know about advanced US tech that may render them completely moot.

If there is no huge leverage by one side, it happens on land, and over a long time ... the then 'home team' will win.

Apparently (and I don’t really have hard sources for this since it’s embarrassing for NATO), in big naval exercises it’s not unusual for run of the mill diesel submarines to penetrate the defensive ring around a US carrier group.

Stealth is a lot easier in water than it is in the air.

Yes, I remember an article on HN a while back that referenced a DoD report stating a dwindling manufacturing base as a major national security risk. Related, they track a “manufacturing readiness” metric

Armored vehicles are a little over 100 years old invention. That's only a few human generations.

Nuclear armed countries going to war is supposed to be an extinction level event. That's the whole point. It's supposed to be unthinkable. https://en.wikipedia.org/wiki/Mutual_assured_destruction

That's the same reason why food security is so high up on domestic priorities also. If a country is dependant on other nations for food, then in case of war you just need to target their logistics chain to starve them into submission. All those subsidies make sense, if you view the nation-state as primarily concerned with its own survival.

This is Canada. We ain’t going to run out of food.

The funny thing about a centrally-planned dairy system is that it takes very little disruption to destabilize it.

As a fellow Canadian (living in the UK currently), we may like to think of ourselves as an independent and sovereign nation, but we are very much tied to the hip with the US in terms of defence. Our food security strategy hence is also aligned as such.

this. If you look at all the strategic industry subsidies, you will see this common denominator. Corn in the US is stupidly subsidized, so much corn that it ends up in car tanks. But guess who will not have a famine even if the worst war + disasters strike?

Car factories might not make good tanks, but the mechanical engineers and tooling knowledge is invaluable and can't be scaled up overnight.

Same with solar panels, there's a reason both Obama and Trump imposed protective tariffs. One of the few areas both parties agree to. PV panels are the future of energy, so you need to have domestic factories no matter the cost.

> PV panels are the future of energy, so you need to have domestic factories no matter the cost.

Another benefit of domestic factories is domestic innovation. It's much harder for an engineer coming out of university and going through their career working at an office computer terminal to ever make a breakthrough innovation, if they can't step inside the factory to see how things are really done.

If that factory is down the street, it's much easier to do an apprenticeship, get a tour, or chat with the manager about their pain points. If it's in another country, you'll have to schedule a formal visit and you'll probably need to be a very important customer for that to happen.

Grad students coming out of a research lab would tend to focus on getting an extra 0.2% cell efficiency, but it's more likely that the innovation that makes PV competitive is something like reducing the scrap rate, or figuring out how to run cells through the QC machines more quickly.

> Corn in the US is stupidly subsidized, so much corn that it ends up in car tanks

What would the land be doing without subsidies?

Serve nature? Keep bio diversity and be a buffer for nature.

> guess who will not have a famine even if the worst war + disasters strike?

Worst? Really? You think corn fields survive nuclear war? An asteroid the size of you know what?

Except for getting subcomponents and today ics are the crucial thing. What do you bomb first, the ic manufacturing of the other side? Or take it away by force (like Taiwan's).

I am skeptical that a modern automobile factory could be converted to make tanks or airplanes at any kind of scale using current designs.

The stuff is so specialized and automated now that even the workers probably wouldn't have much translatable knowledge as WW2 days. You would i guess have a supply of welders to lean on at least that would ramp up faster than someone fresh.

But I doubt a factory that makes modern cars can handle making M1 Abrams without so much additional tooling and extra equipment that you are halfway to making a new factory anyways. (they could probably handle making light vehicles like cars and bikes at least)

Maybe if we had mass production style designs that were built purpose first to get cranked out. But we don't, and there isn't profit in that for the Military Industrial Complex.

> picking and choosing which industries are important voting bases.

And on a bribes and corruption basis, to some extent, too?

For example, I never thought about what are the strategic industries, when voting.

Indeed. The goal is to not have the government pick industries. Politicizing who gets aid to any greater degree would only serve to further subdue innovation.

> For example, I never thought about what are the strategic industries, when voting.

You're clearly not a dairy producer in Wisconsin, a military contractor in Virginia/Maryland, or a property owner in Southern Pines, NC.

Yup! In 2008 I was in my first job, working for a defense contractor, and my boss seriously could not wrap his head around the idea of me voting for Obama. In his mind that should have gone completely against my own self-interest.

But he also saw the job as a lifetime career, which is partly generational and partly just a different mindset because a lot (most?) of the engineers there were former military.

I will say, though, that his mindset generally made for a very friendly and nurturing team experience.

Is there something uniquely strategic about property owners in Southern Pines?? If anything, based on my knowledge, military contractors would be the strategic play down there (just as in VA/MD).

Camp Mackall, Fort Bragg, the complex around those two, and an officer corps/civilian contractor base that enjoys golf.

I was just giving it as an example of how whole tertiary industries that aren't directly part of the military-industrial complex will none-the-less vote (R) like their lifestyle depends on it, and for the same reason as contractors.

Most voters aren't as rational as you are. Though, I suspect that you would not vote against your livelihood if it became a political topic.

West Virginia has "Friends of Coal" license plates. Indiana has IUOE license plates. etc.

> West Virginia has "Friends of Coal" license plates

Wow, I had no idea

I work with software, maybe in a way then I'm in a happy bubble

Are you in Canada by chance? I have fond childhood memories of smuggling cheese across the border from the US because the dairy protectionism has resulted in prices that are 3x higher. We used to do that with electronics too, but Canada has no electronics industry so it's weird why it was so much more expensive. The gap has decreased in recent years.

It's definitely worth keeping a skeptical eye on non-market interventions, but there are a ton of good reasons for it.

For auto - companies do not exist in isolation. They're a huge pillar for other things, especially the local economy.

If you were the CEO of a 'region' that actually owned all of the businesses, this would show up in your balance sheet: it would be perfectly acceptable to lose money in your auto-making 'division' if it meant that the 'education division', 'healthcare division', 'civic division' were made profitable.

Japan also makes a ton of money exporting it's cars so it's valuable.

Finance, telecoms, farming and entertainment all have different reasons for being supported but the impetus in most cases is rational.

If anything we probably need more high end fabs and this whole 'single source with 24/7 operations' is maybe not worth it, we might just have to be paying a little more for our chips.

Yea this is very interesting. I suspect another side to this though is I don't know that one country can easily or safely not participate in this chosen industry support.

Especially in capital intensive industries, say cars, all of the competing countries are propping up or bailing out their auto industries. So even if companies should theoretically die and get replaced, there is a structural disadvantage as the competition in other countries has an insurance policy against companies failing (bailout / subsidy / tariffs / strategic protection / etc).

Indeed, there seems to be a difference worth noting between "industries that currently employ a large number of the population with little transfer of utility to other industry" and "objectively basic needs for a society".

I figure there are also different definitions of strategic depending on the size and capability of an economy. The US is large and geographically fortunate enough that it theoretically "could" be almost entirely self-sustaining if it set its mind to it. Fuel, semiconductors, transport, lumber, food, guns.

> Indeed, there seems to be a difference worth noting between "industries that currently employ a large number of the population with little transfer of utility to other industry" and "objectively basic needs for a society".

Did you consider that it's because people need an income to survive? Employment is objectively a basic need for anyone who doesn't own sufficient capital being that they have nothing else to sell but their labor.

I didn't say that keeping people employed was a bad thing. I was making a distinction in definition, not in value.

On that matter, I think (just a not-so-well-informed opinion but still plausible) most countries should urgently protect their software development industry and dramatically reduce taxes on those companies. Because the day US/China automated-production AIs will get to its prime, nothing produced in your county will have any value whatsoever beside land. Ferrari and Rayban? Near-zero market value tomorrow.

"Because the day US/China automated-production AIs will get to its prime"

I think this time is quite a bit far off. But eventually will have sourcing price of just the raw materials. That said and regarding your next point -

"Ferrari and Rayban? Near-zero market value tomorrow."

On this I disagree strongly. Current trend is that IP becomes constantly more important. So that while manufacturing costs for said items may tumble, IP laws likely protect the sale of items branded as such. And the price difference does not likely result in cheaper prices, but in a bigger revenues.

That's interesting thanks. I guess there is a limit to the price of IP. Say if the glasses cost $0.50, can you sell that $400 really?

How the essential farma became nearly 100% reliant on foreign manufacturers is I think the most exemplary case of this nonsense.

I read some year ago that there were laws in US which at least somehow discouraged the pharma from shipping manufacturing abroad, and it was the big pharma itself which lobbied these laws out.

This is how China held US at gunpoint in the early days of COVID — "Stay put, or we pull 90%+ of your antibiotics supply"

I don't think china did that, any supporting news articles?

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