H. R. 4346: The CHIPS and Science Act of 2022
commerce.senate.gov
commerce.senate.gov
We should, at the very least, get some ownership of these companies in return for our investment, like any other private investor might.
I'm all for investing in these sorts of programs to bring manufacturing back to the US, but not like this.
If we just write them a check, they'll do whatever they want with it. They need to be held accountable, and ownership percentage is a way to do that.
Alternatively, the gov could take this money, start up a corporation of their own, and make their own fab. The language in part of this bill is that they are trying to ensure that older tech and DoD stuff is made in house. So let's make it in house.
We don't necessarily need to say "we're buying intel or nvidia", but we can make the money available to any company in exchange for the ownership percentage. That eliminates the "playing favorites" issue, I would think.
What are you basing this on?
I do see a section that would allow the suspension of new funds, if it's found that these companies aren't upholding the agreement. I don't think suspension of new funds is sufficient.
Implementation is left to the agencies. We're only seeing the Congress appropriating money. Contract specifics are being developed.
The government has plenty of demand-side tools to on-shore development without hurting competition or playing favorites with large incumbents. The DoD and DoE are massive semiconductor purchasers and have a lot of leverage in the market who can adjust their procurement strategies to promote American interests. That's not entirely without the opportunity for corruption and grift either, but at least there's more accountability.
I mean, I think we basically agree that handouts to large semiconductor companies without anything in return is a bad idea.
That's one of the reasons we're doing this in the first place. National security is in the mix as well. What would actually change [edit: beyond citizens gaining ownership and some say in what happens]?
https://www.fabricatedknowledge.com/p/history-lesson-the-198...
What about the safeguards, which are in place, makes you uneasy?
You could also just consider the grants to be loans that never need to be paid back as long as some set of concrete requirements is met by the company.
I would agree that student loans shouldn't be that way either, but, we shouldn't be handing out money upfront without guarantees that the incentivized behavior will actually happen - the two things that come to mind are the 90's fiber rollout and the Foxconn subsidies in wisconsin, both of which the company took the money and then never actually built the infrastructure. If there are going to be outright subsidies, they certainly need to be contingent on meeting milestones, and not just "pretty please build a plant, here's a big check to encourage you but no strings attached".
Think about how the US did the auto bailouts as well - we got a big chunk of equity that we eventually unwound on favorable terms, but we didn't just write a check and be done either. Same thing, maybe if TSMC wants a big grant for expansion, maybe the US should get a big chunk of equity (at guaranteed and favorable terms) and then if milestones are met the equity is again wound down at favorable terms such that the benefit of the "favorable terms" on both sides amounts to the subsidy.
That said, I was looking into it today and it looks like they have actually been meeting some sort of revised hiring target recently [1]. I have heard from some peers that the jobs they are hiring for are basically make-work jobs, but the deal doesn't care what they accomplish -- only how many "jobs" they create.
It's still shady crap which wasted tax payer money (not to mention abused eminent domain), but I don't think in any way involved a big check with no strings attached.
This mischaracterizes the bill. There are a bunch of programs [1], ranging from funding the National Science Foundation to this thing [2]. (Much of the bill is a tax credit, which involves the government forking over no money up front.)
If you're concerned about grants, the Commerce Department is soliciting input for the coming rule making process [3][4].
[1] https://www.commerce.senate.gov/services/files/1201E1CA-73CB...
[2] https://sam.gov/opp/656b39ff64ec4d4fa47ff9820d1c554b/view
[3] https://www.commerce.gov/news/press-releases/2022/01/commerc...
[4] https://www.federalregister.gov/documents/2022/01/24/2022-01...
I love the idea of funding universities for prototyping and discovering new technologies, but the tech developed needs to be open to all, not locked behind a patent owned by MIT.
I don't see any functional difference in tax credits vs money up front. At the end of the day, the company reaps that benefit at the expense of our taxes.
I'll have to check out links 3 and 4 and see about sending in my comments, thank you.
You would like it to be. It doesn’t need to be. In this case, that line would have tanked the bill.
> don't see any functional difference in tax credits vs money up front
You don’t see the difference between buying something with a mail-in coupon and being given the cash up front to buy it?
Partial ownership of the physical facilities and a say in the conditions therein then they can have the money.
> Sec. 10105. Fusion Energy Research. Subsection (a) amends section 307 of the Department of Energy Research and Innovation Act (42 U.S.C. 18645) by authorizing $50,000,000 per year for FY 2023 through FY 2027 for research and development of fusion materials. It extends the authorization for inertial fusion research and development, alternative and enabling concepts, and the milestone-based development program through FY 2027. It authorizes the establishment of at least two national teams to develop conceptual designs and technology roadmaps for a pilot fusion plant, and authorizes $35,000,000 for FY 2023; $50,000,000 for FY 2024; $65,000,000 for FY 2025; $80,000,000 for FY 2026; and $80,000,000 for FY 2027 for these activities. It directs the Secretary to establish a high-performance computation collaborative research program and an associated innovation center in high-performance computing for fusion. It directs the construction of the Material Plasma Exposure Experiment including $21,895,000 for FY 2023 and $3,800,000 for FY 2024 to carry out the project. The subsection also authorizes an upgrade to the Matter in Extreme Conditions endstation at the Linac Coherent Light Source.
This has a poor track record for basic research and complex technologies. The Ansari XPRIZE recipient’s SpaceShipOne is a prime example.
Agreed. But the dollar amounts were small. And in many cases, every qualifying team received a grant.
Fusion research is not that- it needs very large equipment investments for decades for even the most trivial experiments.
If we had tried to get to the moon with the same model we'd still be waiting!
This is what is holding fusion from commercial viability.
Give me a modern tokamak with 75 years of known dynamics, increase the size and magnetic field (i.e. bring high temp superconducting wires to market).
At the very least you get something as a consolation prize that has real uses vs. decades of wacky research ideas that more than likely will go nowhere.
IMO thinking of fusion as needing a "silver bullet" to viability is one of the major issues. Everyone wants the sexy new reactor concept, but nobody wants to be improving the boring donut design that's on the edge of practicality.
“It will be the world's largest magnetic confinement plasma physics experiment and the largest experimental tokamak nuclear fusion reactor.”
Does the $3.9B spent on ITER not count?
https://www.science.org/content/article/cost-skyrockets-unit...
Orders of magnitude matter and fission / fusion R&D has been criminally underfunded for decades.
[1] https://www.brookings.edu/research/gauging-investment-in-sel...
[2] https://www.energy.gov/ne/our-budget
[3] https://www.newsweek.com/nuclear-fusion-report-private-inves...
The DARPA challenge kicked off a many many billions of dollars arms race of private capital and we're only just starting to see a trickle of self driving cars on the road some 18 years later. Not to mention meaningful R&D advancements in AI, sensing software algorithms, HW sensing capabilities, etc that have seen applications outside of self driving.
I looked, but couldn't find when this started becoming a thing. How has this not been common boilerplate for any and all government grants/loans/investments?
Or more likely, I'll use $0.5B for buybacks and use the remaining $0.5B for operations. This way I get to do more buybacks while still utilizing the government money for accomplishing more than I could without it.
Edit - sorry, annual launches.
SLS is not reusable, each unit requires several years of lead time to produce (so any mission on it needs to be planned years in advance), the engines were designed for reuse (part of why they're some of the most expensive engines ever built) yet are thrown away after each flight. The upgraded mobile launch tower for the upgraded SLS version has also already cost hundreds of millions without anything being built, and the current launch tower, which would only be used 2-3 times already cost $1B despite being a modified Space Shuttle tower.
Furthermore, the SRBs make the vibration environment so bad they have to make screens in Orion flicker in sync with vibrations for them to be readable. Europa Clipper would've cost an extra $1B to make it robust enough for SLS (as Congress was initially pressuring them to do), it was enough justification to just go with a Falcon Heavy instead.
It's extremely telling that these orders for SLS aren't coming from NASA requiring them for certain missions, but rather Congress legislating that NASA must use SLS. For example, a few months ago Congress was trying to require that from 2030 onwards, NASA fly SLS for cargo at least once a year. However, even ignoring Starship for now, SLS is $2B per launch and is extremely unlikely to have that drop by much. The upgraded version is expected to be able to carry ~130t to Low Earth Orbit. Falcon Heavy can carry 63t to LEO at a cost of $90M per launch. On the extremely pessimistic end of price estimates for Vulcan Centaur, it can do 27t to LEO for $200M. Thus it's much cheaper to do multiple flights of either of the two than to do a single SLS launch.
Then on top of that, Orion itself is too heavy to get to the surface of the Moon and back anyway and a Lunar variant of Starship was the only lander which best met the requirements and which NASA could afford, so the program still relies on Starship being successful. Starship has pretty much none of the issues of SLS, it's much cheaper (it'd honestly be hard for any rocket to be as expensive as SLS is turning out to be), reusable, doesn't have the vibration issues of SLS by virtue of being fully liquid fueled (although this also isn't an issue on Vulcan Centaur, which does use some small SRBs) and is meant to refuel in space, significantly expanding its capabilities.
SLS is in a bad spot compared to even other non-SpaceX rockets owing to the potential of in-space refueling. Congressman Shelby had previously banned mention of 'depot' in relation to space exploration (threatening to outright cancel the entire space technology program if they were brought up) because of how bad they would be for SLS's future. ULA had also done a study and proposal for an orbital fuel depot in 2011, due to which Boeing tried to get the physicist who was leading the project fired because of the risk to SLS. As a result, Vulcan Centaur's upper stage is effectively the same stage as was proposed in 2011 but without refueling. Comically the word depot was even censored out in NASA's final statement on the selection of Starship for the HLS contract.
To refer back to the price comparison, upgraded SLS can do 48t to the Moon. But if you can refuel in LEO, you have the option of launching up to 63t with Falcon Heavy or 45t with New Glenn, then launching a transfer stage and fueling it up with another launch or two, allowing you to get the Lunar payload capability of SLS at close to a tenth of the cost.
Private companies can see that the approach of the gigantic expensive one-time use rocket is not going to scale up, which is why pretty much every company is working on reuse and mission extension capabilities like orbital refueling.
https://www.livemint.com/news/india/vedanta-group-foxconn-to...
One thing people misunderstand about Congress is that it is primarily a negotiating body. That's why bills have so many unrelated provisions in them - these are not just laws, they are contracts between lawmakers. International treaties work the same way, too. Merely getting program Y or Z into a bill containing program X means that it's a package deal now. Either it all passes or it all fails, and the reps that pushed for Y or Z now have to vote for X, too.
(This is vaguely related to the reason why the line-item veto is unconstitutional. If you could just sign X while vetoing Y and Z, that'd be like striking the data caps out of your cable contract and then suing Comcast for breach of a contract they never signed.)
(Personally, I think security should be out of pocket for the justices. They have the money! They have a lifetime job even if their wives participate in treason! AOC gets worse shit and less protection on a daily basis, but by all means let's armor up the people doing their best to move us to a fascist theocracy.)
https://freebeacon.com/national-security/schumer-stripped-se...
Only conservative outlets are reporting this, and they’re not completely reliable. Then again, sometimes they scoop major stories. I don’t know whether this one’s real or overblown. Maybe someone with more info can fill in here.
The point of this bill is to begin deconstructing this aspect of the globalized economy.
You’re asking how the U.S. government is supposed to enforce its contracts?
I may be misunderstanding. The only research I’ve done on this is to read the article you linked.
The same thing could be said of sanctions on Russian oil. Sometimes it has to be about more than pure economics, even as we try to craft rational economic policy.
And the new act contains way more anti-China language and provisions than the old act. https://www.commerce.senate.gov/services/files/CFC99CC6-CE84...
The problem is, these right-wing "news" sites never cite their sources. They could easily have linked to a version of the bill saying "they removed lines 40-44" and that's the problem. But they don't. Because it's not about news, it's about fake outrage.
The second link should link you to the video of Rubio in session talking about how the amendment was killed.
Rubio's site is the first google result for "democrats block amendment to keep china from receiving chips funds".
https://www.rubio.senate.gov/public/index.cfm/press-releases...
https://www.rubio.senate.gov/public/index.cfm/press-releases...
For one thing, this is Rubio. Wrong senator.
Another thing, did you read his amendment?
This is again, nonsense posturing by people disinterested in the truth. Read his amendment vs the original. The original literally says the Secretary of Defense decides what legacy semiconductors are which aren't protected by the act. His amendment makes congress play a role in that decision in addition to the Secretary. That's it.
It adds no meaningful protections. Unless you think the Secretary of Defense is a Chinese spy.
Indeed. Caveat emptor.
For instance, I'd not expect a far left outlet to look into misdeeds of Bernie Sanders, and I'd not expect a far right outlet to look into misconduct by Trump.
As long as you call a spade a spade and don't pretend things are objective in their presentation, there can be a lot to gain from even super skewed journalism.
Your example is problematic, because the left is willing to hold its leaders accountable and the right simply isn't. If Bernie is discovered to have ever harassed a woman, he'd have to resign in disgrace.
With that background, you have to start with the assumption that the right wing site is making things up and find a reliable source that isn't itself sourcing only from the right wing media universe, as the mainstream media is sometimes known to do.
Horseshit. Pelosi is insider trading like her life depends on it. The leaders on the left generally don’t seem as dangerous to me, but your statement is hilariously false.
https://en.wikipedia.org/wiki/Bill_Clinton_sexual_assault_an...
And this headline from 2015:
https://observer.com/2015/03/the-jeffrey-epstein-affair-impe...
In fact the Clinton-Epstein relationship didn't "imperil Hillary Clinton's Presidential prospects" at all, because none of the major networks reported on it. An ABC reporter had the full story including the Clinton connection as early as 2015, but was told to quash it:
https://thehill.com/homenews/media/469042-abcs-robach-caught...
When Biden leaves office I'm sure we'll be allowed hear more about him, just as it's now become OK to discuss Clinton and Epstein on the mainstream left.
[1] https://www.govtrack.us/congress/votes/117-2021/h239
What's going on?
It would be interesting to see a tabulation of the voting patterns on Dem-sponsored bills vs Rep-sponsored ones.
I also personally don't have an issue with the VC fund ownership rules but my industry (biotech) necessitates it more than maybe others.
They don't fabricate, but they do design quite a lot of them, and are even moving into the ARM CPU arena.