Probably an unpopular opinion, but defending Taiwan was always a bluff. Americans aren’t going to die en masse over some random island in the pacific. We will heavily sanction China and use economic tools, but we aren’t going to start World War 3 over some small island in the pacific.
he did say this day one. And despite feelinig like eternity, we're only entering week 5. This would be considered "fast" by any other administraion.
But yes. I remember when Americans used to care about politicians creating American jobs as a populist stance. Those days feel like decades ago now with people celebrating the literal slashing of government jobs (who surprise, is the biggest US employer).
Yup, I'm sure glad all that money went towards those workers and we could get more washing machines into homes, right?
> We find that in response to the 2018 tariffs on nearly all source countries, the price of washers rose by nearly 12 percent; the price of dryers—a complementary good not subject to tariffs—increased by an equivalent amount.
Government spending doesn’t necessarily create jobs, since the money it spends is taken from other people (as either taxes or inflation). It merely redistributes jobs.
From a micro level, a person gets money and they get to go about their business. I imagine that's the level of thinking many everyman has on this.
But sure, The government is redistributing its wealth and helps stimulate the rest of the economy with the workers they employ. Even for private sector it keeps the wheel turning.
By taking trillions away from the private sector (in taxes, inflation), it costs the economy tens of millions of jobs.
It then spends that to create new jobs. Some of that spending has a positive ROI, such as employing 100 police, to allow 10,000 people to focus about innovating rather than their own safety. On the flip side are many of the jobs in Washington, which dont create any multiplicative benefits for society and are net negative.
You can call it a royal "it". We pay taxes, they provide our taxes to various aspects to benefit society.
Congress allocates that, so any grievances on what they agree to spend should be take to your reps. The deadline is in 3 weeks, so be swift!
---
But to go back on-topic: the everyman just sees a job they get money from and can use to invest or stimulate the economy. The other economic overhead is not affecting their day to day... Usually. At least not to a point they complain.
Most Americans care about creating American jobs in the private sector not about growing the government by creating more government jobs. More Americans are employed by industry and small businesses (as it should be) than by government.
Why would you think there needs to be one giant employer instead of a healthy market of many?
Stats:
The Bureau of Labor and Statistics puts the total number of Americans employed by government (at any level, federal, state, local, or military) at roughly 23 million, as of Feb 2025. At the same time, private businesses employ roughly 132 million Americans, vastly outstripping the employment of the government.
This is what you want. More teachers than administrators. More private employment than tax-supported services. We need government. We need good and effective bureaucrats, even. But we should always be cautious about the economic friction that increases in the government sector usually cause.
>More Americans are employed by industry and small businesses (as it should be) than by government.
sure, millions of businesses if you divide it that way. Meanwhile the government is still the largest single employer in the us. Wal-Mart's global market, by comparison (the largest private market in the US) is 2.1m.
>Why would you think there needs to be one giant employer instead of a healthy market of many?
Why is Google bigger than a startup? They deal with more money and people. The government isn't running like a business but is still running on a scale of managing trillions of dollars and caring for hundreds of millions of americans. Why wouldn't our government be large?
Also, private sector hasn't exactly been stable the last 15 years if you're a normal worker. That's pretty much the one advantadge of public sector until employers can't throw out employees like livestock whenever they fancy. People claim to want more teachers but treat them horribly.
Some segment of the population wants more teachers, but is not willing to pay them more to attract them, because taxes would have to increase. Over 1k school districts in the US are on a four day week, as it’s the only way to retain those teachers on the budget they have. Americans want more private employment. Where? If healthcare and construction, where demand is greatest, do they think laid off government workers will retrain? Or retire? The last administration attempted to create well paying, union jobs in clean energy technology manufacturing and this admin is rolling all of that funding back (much to the detriment of red states, to their self inflicted surprise). The economy is at 4% unemployment, and 4M Boomers are retiring per year, ~11,200 per day.
If this is an attempt to free up labor for private industry to further diminish worker power and wages, the demographics crunch comes regardless due to the compressing working age population pyramid. The federal government creates jobs for both unprofitable yet necessary work and is an employer of last resort in the ways it offers and structures work available (military spouse flexible work arrangements, locating offices and working spaces for federal work in communities where no other employer will offer jobs, etc).
> Most Americans care about creating American jobs in the private sector not about growing the government by creating more government jobs. More Americans are employed by industry and small businesses (as it should be) than by government.
The American electorate, broadly speaking, is grossly uneducated and unsophisticated in these matters unfortunately. They don’t even know who pays tariffs, why they’re inflationary, etc.
Keeping high-paying semiconductor jobs out of red states would keep the red states poor, devoid of liberal-leaning professionals, and full of resentment. Sound like a win-win to Trump.
Will not be great when China invades Taiwan and global supply of TSMC output evaporates as TSMC destroys the fabs to prevent takeover.
> Earlier this year, he said: "Disabling or destroying TSMC is table stakes if China is taking over Taiwan. Would we be so insane as to allow the world's key semiconductor company [to] fall untouched into the hands of an aggressive PRC? Taiwanese should realize that would be the least of their problems."
> Earlier this year, the US Secretary of Commerce Gina Raimondo told the House Appropriations Committee that a hypothetical Chinese invasion of Taiwan and seizure of TSMC would be “absolutely devastating” for the United States.
> She said that “the United States buys 92 percent of its leading edge chips from TSMC in Taiwan,” meaning any disruption to that supply chain would have a significant impact on the US economy
Trump doesn't give two shits about Taiwan. My guess is he'll break out his great negotiation skills to get China to … agree that Taiwan is part of China and that we should pay them more for chips (except he'll sell it to us as paying less by just flat out lying about it).
because if you look at Big Law, investment banking, or private equity, there are a lot of highly-educated Americans who are willing to work as hard as anyone on earth.
so it's got to be something about TSMC's recruiting pipeline, or perhaps what motivations the Americans who get educated for the skills they need have, rather than specifically American laziness.
In finance you can strut around wall street and cause a bidding war. In chip design you can move your life to a specific shitsville to work for the other employer and get sued before they decide to close down again.
It's very simple: the pay at TSMC is shit by American tech standards and Americans capable of doing the job generally have much better-paying options. Paying US-competitive salaries would basically double TSMC's labor cost.
Yeah, this is just simple principles: Garbage in, garbage out. If you're only offering little more pay than an entry level fast food worker, your quality and productivity will match that.
The real theme of the post-08 crash is "no one wants to pay americans anymore". And it's only been spreading from industry to industry as the billionaires figure out how to cut american labor but benefit from american consumerism.
TSM has found few American workers willing to work inhumane 9/9/6 hours and still not pay rent. They also cannot threaten the CCP on them.
>So likely no great loss for hem.
This I agree with. This whole tariff deal was supposed to encourage this exact behavior. Have more foreign companies setup on american soil so they can provide american jobs. So we arguably lose out a lot more on this action.
That’s my exact point. The population isn’t all Chinese or considers themselves China. Taipei itself is divided into Japanese, Korean, and Chinese areas all with a distinct culture. There is also an evolving Taiwanese culture. The government is the Republic of China and is a completely different government. It broke away because it does not consider itself China or invest in those values. The island and nation are Taiwan. It is a complex situation for sure, but Taiwan is not China. Once you leave Customs/Immigration at a port you will not see China mentioned anywhere.
Broke away is a charitable way of saying kicked off the land and utterly losing with maximum emotional damage.
It’s not that complex.
The parallel Chinas are an amusing mockery of the nation state concept trying to leverage western paranoia of coming across as insensitive, to masquerade and cope with their utter loss. All while some of a newer generation in exile are trying to uphold an independent Taiwanese identity, while also trying to leverage western sensibilities about confusing people of asian descent to avoid further discussion. When the reality is even more silly and amorphous.
and yet, you have created an even more absurd standard because there’s …. diversity? wait, there’s not diversity, there’s segregation. And you didnt even mention the indigenous populations yet, specifically choosing to highlight colonizers. Amazing. I'm almost at a loss of words,
This is not the dunk you think it was.
The ROC retains claims to all of mainland China including some territorial dispute the PRC has with neighbors. The PRC is in a better position to the finish the job. TSM's relevance and geographic location within the ROC is the only thing keeping the PRC at bay, and TSM is delaying their geographic diversification with weak excuses for this obvious reason.
This one really doesn't make sense if you actually want to MAGA, since advanced chips is a critical area for the US to maintain leadership. China is meanwhile pouring many $billions into catching up.
The Chinese can't believe their good luck. No need for them to do anything -- just let the US self-destruct.
Also worth noting the 50% tariff on Chinese semiconductors (and other tech components). So US companies can’t even get low-priced imports to make their products competitive. We’re stuck with high-priced domestic labor, who are not sufficiently skilled for the work, whose companies can’t fund or complete the work, and aren’t allowed to hire and/or buy foreign. Some American dynamism…
> Delete subsidy carrot, replace with tariff stick?
Tariffs are both subsidies and taxes at the same time; see "Tariffs Give U.S. Steelmakers a Green Light to Lift Prices":
> Executives from U.S. steel companies were enthusiastic backers of the 2018 tariffs and have urged Trump to deploy them again in his second term. They have called for the elimination of tariff exemptions and duty-free import quotas, saying those carve-outs allow unfairly low-price steel to enter the U.S. and undermine the steel market.
[…]
> Higher prices for imported steel are often followed by domestic suppliers raising their own prices, which then get passed through supply chains, manufacturing executives said. For consumers already reeling from rising retail prices and inflation, pricier steel and aluminum could further lift costs for durable goods like appliances and automobiles, as well as consumer products with aluminum packaging, such as canned beverages.
> “The issue with tariffs is everybody raises their prices, even the domestics,” said Ralph Hardt, owner of Belleville International, a Pennsylvania-based manufacturer of valves and components used in the energy and defense industries. Steel and aluminum are Belleville’s largest expenses.
So tariffs are taxes in the sense that consumers are paying higher prices. But they are subsidies in that domestic companies don't have as much pressure on prices and can get more money.
So if you want to help a particular industry might as well just go with subsidies directly instead of the taxation add-on as well.
In the sense that Ukraine was fine in 2021, sure. Ignoring years of threats from Russia.
Taiwan is the Ukraine of Asia right now. And even without that we are worse off because Trump increased tariffs to Taiwan this month. expect any electronics you buy this year to surge in pricing.
China is racing to catch up. Sure, they're still behind, but as much as I dislike their autocratic government, they're actually smartly spending many many $billions to create a domestic chip design and manufacturing. And once they do that, well, it'll just be one more area in which we'll have handed leadership to the Chinese, except with much more critical ramifications.
That’s incredibly expensive - orders of magnitude more than the CHIPS act – and likely isn’t even possible any more without massive loss of life. China does not have the huge but technologically unsophisticated military of the 1970-80s where American aircraft carriers could prevent an invasion. They’ve spent a lot of effort and espionage building up more equipment and I highly doubt they’ll prove a paper tiger like Russia. If it came to a shooting war with a large, well-equipped adversary with stealth aircraft, good missiles and drones, advanced submarines, etc. you’re looking at a lot of American casualties very quickly – and that’s before we consider a Pentagon headed by people who were selected for political loyalty rather than merit.
The CHIPS act is expensive, but I doubt we would do nothing if Taiwan was invaded, so we would end up spending money on both.
Let’s just save the money upfront by scrapping CHIPS and be ready to defend Taiwan from Chinese invasion? Trump was one of the first presidents to recognize Taiwan with a direct phone call.
I see it a bit differently: there’s no way to reliably deter a military invasion of Taiwan short of committing to a nuclear response - the Chinese military is too advanced to be stopped if they make a serious effort. That leaves the primary deterrent as economic: China depends on the global economy and would suffer significantly if they started a war of aggression. That becomes less of a deterrent when the President’s negotiating tactic with authoritarians is to give them what they want and envy their control over the country while his family members negotiate real estate deals. If the Chinese government thinks the United States won’t coordinate global sanctions, the risk is a lot lower.
The CHIPS act doesn’t deter conflict, but it does reduce the damage if it happens. Losing Taiwan now cuts off the most advanced processors in the world but if they’re making them in Arizona that goes from no supply to short supply with a straightforward path to scaling capacity. That’s a big improvement and it’s a fraction of the cost of a conflict.
It's not the business of the federal government to encourage or discourage investment in an industry. When it does subsidize investment, it often comes with strings attached that don't help the industry in the long run.
- subsidize farmers so consumers have cheaper groceriess
- help fund public schools so education is less limited by socioeconomic status
- fund science to advance the future
- offer tax credits to encourage adopting environentally-friendly technology
- apply taxes to disincenivize bad habits (e.g. tobacco)
So I'm not sure where you're coming at with this angle. That's government's greatest effect on society.
> imposing tariffs to protect industries.
Trump is doing it wrong and recklessly, so no disagreement in reality
But there are smart tactics for this short term inefficiency that can cause long term competitiveness. You can apply a high tarriff if you trust that domestic competition can catch up in a few years so you don't lose your own market to overseas competition. Long term, encouraging domestic stimulation is much better and more reliable than relying on foreign products for consumption. Especially essentials.
What about when the lack of advanced chips are a real threat to our technological advantage, in addition to the fact that our largest threats are pouring billions of subsidized currency in to their own comparable industry.
I think it requires a lot of mental gymnastics to dismiss the semiconductor industry as anything but critical to all modern economies and militaries. I think it takes similar willful blindness to lump "encourage investment" in with "bring on shore in the name of national security" as if they are exactly the same.
We do a lot of corrupt/wrong subsidizing in this country but that doesn't mean throw the baby out with the bathwater.
If I had a magic wand we'd still have tariffs and subsidize critical infrastructure and expertise - for example I find it very surprising that we don't make sure we always have wartime level of doctors and farmers trained and ready.
to be clear, this is an opinion pertaining to the preferred behavior of eg the american government and not anything like a summary of its history in this regard. that is, the tech industry since its inception in the 60s has accepted, to its benefit, [massive] federal subsidy.
Probably an unpopular opinion, but defending Taiwan was always a bluff. Americans aren’t going to die en masse over some random island in the pacific. We will heavily sanction China and use economic tools, but we aren’t going to start World War 3 over some small island in the pacific.
Fully expected, surprised it took this long.
IIRC, the funds went to mostly red states. So MAGA people, happy your guy came through for you again ?
he did say this day one. And despite feelinig like eternity, we're only entering week 5. This would be considered "fast" by any other administraion.
But yes. I remember when Americans used to care about politicians creating American jobs as a populist stance. Those days feel like decades ago now with people celebrating the literal slashing of government jobs (who surprise, is the biggest US employer).
> I remember when Americans used to care about politicians creating American jobs as a populist stance.
That's what the tariffs are for. Trump 1.0 gave the US washing machine tariffs and got 1800 jobs on-shored at the cost of $800k/job:
* https://www.nber.org/papers/w25767
Yup, I'm sure glad all that money went towards those workers and we could get more washing machines into homes, right?
> We find that in response to the 2018 tariffs on nearly all source countries, the price of washers rose by nearly 12 percent; the price of dryers—a complementary good not subject to tariffs—increased by an equivalent amount.
Government spending doesn’t necessarily create jobs, since the money it spends is taken from other people (as either taxes or inflation). It merely redistributes jobs.
From a micro level, a person gets money and they get to go about their business. I imagine that's the level of thinking many everyman has on this.
But sure, The government is redistributing its wealth and helps stimulate the rest of the economy with the workers they employ. Even for private sector it keeps the wheel turning.
Government doesn’t really have “its wealth”.
By taking trillions away from the private sector (in taxes, inflation), it costs the economy tens of millions of jobs.
It then spends that to create new jobs. Some of that spending has a positive ROI, such as employing 100 police, to allow 10,000 people to focus about innovating rather than their own safety. On the flip side are many of the jobs in Washington, which dont create any multiplicative benefits for society and are net negative.
You can call it a royal "it". We pay taxes, they provide our taxes to various aspects to benefit society.
Congress allocates that, so any grievances on what they agree to spend should be take to your reps. The deadline is in 3 weeks, so be swift!
---
But to go back on-topic: the everyman just sees a job they get money from and can use to invest or stimulate the economy. The other economic overhead is not affecting their day to day... Usually. At least not to a point they complain.
Most Americans care about creating American jobs in the private sector not about growing the government by creating more government jobs. More Americans are employed by industry and small businesses (as it should be) than by government.
Why would you think there needs to be one giant employer instead of a healthy market of many?
Stats:
The Bureau of Labor and Statistics puts the total number of Americans employed by government (at any level, federal, state, local, or military) at roughly 23 million, as of Feb 2025. At the same time, private businesses employ roughly 132 million Americans, vastly outstripping the employment of the government.
This is what you want. More teachers than administrators. More private employment than tax-supported services. We need government. We need good and effective bureaucrats, even. But we should always be cautious about the economic friction that increases in the government sector usually cause.
>More Americans are employed by industry and small businesses (as it should be) than by government.
sure, millions of businesses if you divide it that way. Meanwhile the government is still the largest single employer in the us. Wal-Mart's global market, by comparison (the largest private market in the US) is 2.1m.
>Why would you think there needs to be one giant employer instead of a healthy market of many?
Why is Google bigger than a startup? They deal with more money and people. The government isn't running like a business but is still running on a scale of managing trillions of dollars and caring for hundreds of millions of americans. Why wouldn't our government be large?
Also, private sector hasn't exactly been stable the last 15 years if you're a normal worker. That's pretty much the one advantadge of public sector until employers can't throw out employees like livestock whenever they fancy. People claim to want more teachers but treat them horribly.
Some segment of the population wants more teachers, but is not willing to pay them more to attract them, because taxes would have to increase. Over 1k school districts in the US are on a four day week, as it’s the only way to retain those teachers on the budget they have. Americans want more private employment. Where? If healthcare and construction, where demand is greatest, do they think laid off government workers will retrain? Or retire? The last administration attempted to create well paying, union jobs in clean energy technology manufacturing and this admin is rolling all of that funding back (much to the detriment of red states, to their self inflicted surprise). The economy is at 4% unemployment, and 4M Boomers are retiring per year, ~11,200 per day.
If this is an attempt to free up labor for private industry to further diminish worker power and wages, the demographics crunch comes regardless due to the compressing working age population pyramid. The federal government creates jobs for both unprofitable yet necessary work and is an employer of last resort in the ways it offers and structures work available (military spouse flexible work arrangements, locating offices and working spaces for federal work in communities where no other employer will offer jobs, etc).
> Most Americans care about creating American jobs in the private sector not about growing the government by creating more government jobs. More Americans are employed by industry and small businesses (as it should be) than by government.
The American electorate, broadly speaking, is grossly uneducated and unsophisticated in these matters unfortunately. They don’t even know who pays tariffs, why they’re inflationary, etc.
https://www.cnn.com/2024/10/14/politics/the-biggest-predicto...
Keeping high-paying semiconductor jobs out of red states would keep the red states poor, devoid of liberal-leaning professionals, and full of resentment. Sound like a win-win to Trump.
Elon is making sure his enterprises have no competition for federal funds.
Musk is generally anti-subsidy, and has overall saved the taxpayer billions in reduced launch costs compared to the incumbents.
If you want to attack Elon, there are valid angles without resorting to conspiracies.
So much for TSMC’s Arizona expansion and Intel’s foundry plans.
TSM has found few American workers willing to work as hard as Taiwan's, so likely no great loss for them.
Will not be great when China invades Taiwan and global supply of TSMC output evaporates as TSMC destroys the fabs to prevent takeover.
> Earlier this year, he said: "Disabling or destroying TSMC is table stakes if China is taking over Taiwan. Would we be so insane as to allow the world's key semiconductor company [to] fall untouched into the hands of an aggressive PRC? Taiwanese should realize that would be the least of their problems."
> Earlier this year, the US Secretary of Commerce Gina Raimondo told the House Appropriations Committee that a hypothetical Chinese invasion of Taiwan and seizure of TSMC would be “absolutely devastating” for the United States.
> She said that “the United States buys 92 percent of its leading edge chips from TSMC in Taiwan,” meaning any disruption to that supply chain would have a significant impact on the US economy
https://www.datacenterdynamics.com/en/news/trumps-undersecre...
Trump doesn't give two shits about Taiwan. My guess is he'll break out his great negotiation skills to get China to … agree that Taiwan is part of China and that we should pay them more for chips (except he'll sell it to us as paying less by just flat out lying about it).
If that is the case, the timing is strange with the US State Department changing website content indicating otherwise.
https://www.bbc.com/news/articles/clyzy300vlzo
i often wonder about this.
because if you look at Big Law, investment banking, or private equity, there are a lot of highly-educated Americans who are willing to work as hard as anyone on earth.
so it's got to be something about TSMC's recruiting pipeline, or perhaps what motivations the Americans who get educated for the skills they need have, rather than specifically American laziness.
In finance you can strut around wall street and cause a bidding war. In chip design you can move your life to a specific shitsville to work for the other employer and get sued before they decide to close down again.
It's very simple: the pay at TSMC is shit by American tech standards and Americans capable of doing the job generally have much better-paying options. Paying US-competitive salaries would basically double TSMC's labor cost.
Yeah, this is just simple principles: Garbage in, garbage out. If you're only offering little more pay than an entry level fast food worker, your quality and productivity will match that.
The real theme of the post-08 crash is "no one wants to pay americans anymore". And it's only been spreading from industry to industry as the billionaires figure out how to cut american labor but benefit from american consumerism.
TSM has found few American workers willing to work inhumane 9/9/6 hours and still not pay rent. They also cannot threaten the CCP on them.
>So likely no great loss for hem.
This I agree with. This whole tariff deal was supposed to encourage this exact behavior. Have more foreign companies setup on american soil so they can provide american jobs. So we arguably lose out a lot more on this action.
Uggh, what sad replies & lack of defense amid the replies for TSMC America! 'Lazy American worker!' yada yada.
Arizona fab has had top notch quality, out-pacing Taiwan's yields. https://www.tomshardware.com/tech-industry/semiconductors/ts...
They're making 4nm chips too now, doing fine. https://www.tomshardware.com/tech-industry/semiconductors/ts...
Yes but they only achieved this because they brought in a lot of workers from Taiwan. Half the workers in the factory are brought in from Taiwan.
https://www.nytimes.com/2024/12/29/business/tsmc-phoenix-tai...
[flagged]
Taiwan is not China. It has been colonized by many Asian cultures over the century.
the administration we address is an exiled government, and population, of China and its still in the name.
nice try.
That’s my exact point. The population isn’t all Chinese or considers themselves China. Taipei itself is divided into Japanese, Korean, and Chinese areas all with a distinct culture. There is also an evolving Taiwanese culture. The government is the Republic of China and is a completely different government. It broke away because it does not consider itself China or invest in those values. The island and nation are Taiwan. It is a complex situation for sure, but Taiwan is not China. Once you leave Customs/Immigration at a port you will not see China mentioned anywhere.
Bad try.
Broke away is a charitable way of saying kicked off the land and utterly losing with maximum emotional damage.
It’s not that complex.
The parallel Chinas are an amusing mockery of the nation state concept trying to leverage western paranoia of coming across as insensitive, to masquerade and cope with their utter loss. All while some of a newer generation in exile are trying to uphold an independent Taiwanese identity, while also trying to leverage western sensibilities about confusing people of asian descent to avoid further discussion. When the reality is even more silly and amorphous.
and yet, you have created an even more absurd standard because there’s …. diversity? wait, there’s not diversity, there’s segregation. And you didnt even mention the indigenous populations yet, specifically choosing to highlight colonizers. Amazing. I'm almost at a loss of words,
This is not the dunk you think it was.
The ROC retains claims to all of mainland China including some territorial dispute the PRC has with neighbors. The PRC is in a better position to the finish the job. TSM's relevance and geographic location within the ROC is the only thing keeping the PRC at bay, and TSM is delaying their geographic diversification with weak excuses for this obvious reason.
They do seem to have difficulties related to differences in work culture: https://www.tomshardware.com/tech-industry/semiconductors/ts...
Why are we subsizing Apple when they have $200B in cash laying around?
Repatriate and give them sme tax credit.
This one really doesn't make sense if you actually want to MAGA, since advanced chips is a critical area for the US to maintain leadership. China is meanwhile pouring many $billions into catching up.
The Chinese can't believe their good luck. No need for them to do anything -- just let the US self-destruct.
Also worth noting the 50% tariff on Chinese semiconductors (and other tech components). So US companies can’t even get low-priced imports to make their products competitive. We’re stuck with high-priced domestic labor, who are not sufficiently skilled for the work, whose companies can’t fund or complete the work, and aren’t allowed to hire and/or buy foreign. Some American dynamism…
Delete subsidy carrot, replace with tariff stick?
> Delete subsidy carrot, replace with tariff stick?
Tariffs are both subsidies and taxes at the same time; see "Tariffs Give U.S. Steelmakers a Green Light to Lift Prices":
> Executives from U.S. steel companies were enthusiastic backers of the 2018 tariffs and have urged Trump to deploy them again in his second term. They have called for the elimination of tariff exemptions and duty-free import quotas, saying those carve-outs allow unfairly low-price steel to enter the U.S. and undermine the steel market.
[…]
> Higher prices for imported steel are often followed by domestic suppliers raising their own prices, which then get passed through supply chains, manufacturing executives said. For consumers already reeling from rising retail prices and inflation, pricier steel and aluminum could further lift costs for durable goods like appliances and automobiles, as well as consumer products with aluminum packaging, such as canned beverages.
> “The issue with tariffs is everybody raises their prices, even the domestics,” said Ralph Hardt, owner of Belleville International, a Pennsylvania-based manufacturer of valves and components used in the energy and defense industries. Steel and aluminum are Belleville’s largest expenses.
* http://archive.is/https://www.wsj.com/economy/trade/trump-ta...
So tariffs are taxes in the sense that consumers are paying higher prices. But they are subsidies in that domestic companies don't have as much pressure on prices and can get more money.
So if you want to help a particular industry might as well just go with subsidies directly instead of the taxation add-on as well.
A bit earlier including a NIST staffer weighing in: https://news.ycombinator.com/item?id=43106478
I dislike the fact that humanities departments ultimately caused Trump to be elected, but that STEM is being hit.
(Trump won due to the public backlash from social policies that originated within the humanities departments)
Even more comically evil. Like just why dude, this doesn’t help anyone except your oligarch buddies.
Sounds like you already figured out the why.
I honestly don’t even see how this benefits them.
We don't really know who has paid their bribes, anyone could have bought trump coin and so on ... doesn't even have to be a local oligarch.
Trump is China and Russia's best asset.
He’s being played like a fiddle.
I don’t get the doom and gloom, isn’t this just taking us back to before the CHIPS act, 2022? Weren’t we fine then?
Some folks support the idea behind the CHIPS act, the rest is the slow motion train wreck for the US that is the current administration.
In the sense that Ukraine was fine in 2021, sure. Ignoring years of threats from Russia.
Taiwan is the Ukraine of Asia right now. And even without that we are worse off because Trump increased tariffs to Taiwan this month. expect any electronics you buy this year to surge in pricing.
We’re fine until China invades Taiwan and the tech companies that prop up our economy can’t buy high-end chips anymore.
That's not the only threat.
China is racing to catch up. Sure, they're still behind, but as much as I dislike their autocratic government, they're actually smartly spending many many $billions to create a domestic chip design and manufacturing. And once they do that, well, it'll just be one more area in which we'll have handed leadership to the Chinese, except with much more critical ramifications.
Agreed. This is nothing to worry about unless you have the ability to predict probable future events.
All signs point to an invasion within the next 5 years.
What if we simply do not let China invade Taiwan?
That’s incredibly expensive - orders of magnitude more than the CHIPS act – and likely isn’t even possible any more without massive loss of life. China does not have the huge but technologically unsophisticated military of the 1970-80s where American aircraft carriers could prevent an invasion. They’ve spent a lot of effort and espionage building up more equipment and I highly doubt they’ll prove a paper tiger like Russia. If it came to a shooting war with a large, well-equipped adversary with stealth aircraft, good missiles and drones, advanced submarines, etc. you’re looking at a lot of American casualties very quickly – and that’s before we consider a Pentagon headed by people who were selected for political loyalty rather than merit.
The CHIPS act is expensive, but I doubt we would do nothing if Taiwan was invaded, so we would end up spending money on both.
Let’s just save the money upfront by scrapping CHIPS and be ready to defend Taiwan from Chinese invasion? Trump was one of the first presidents to recognize Taiwan with a direct phone call.
I see it a bit differently: there’s no way to reliably deter a military invasion of Taiwan short of committing to a nuclear response - the Chinese military is too advanced to be stopped if they make a serious effort. That leaves the primary deterrent as economic: China depends on the global economy and would suffer significantly if they started a war of aggression. That becomes less of a deterrent when the President’s negotiating tactic with authoritarians is to give them what they want and envy their control over the country while his family members negotiate real estate deals. If the Chinese government thinks the United States won’t coordinate global sanctions, the risk is a lot lower.
The CHIPS act doesn’t deter conflict, but it does reduce the damage if it happens. Losing Taiwan now cuts off the most advanced processors in the world but if they’re making them in Arizona that goes from no supply to short supply with a straightforward path to scaling capacity. That’s a big improvement and it’s a fraction of the cost of a conflict.
So instead of spending _billions_ to support a domestic advanced chip design and production, we spend _trillions_ on a war with China?
That’s probably not possible anymore given China’s increasingly large and advanced military.
It's not the business of the federal government to encourage or discourage investment in an industry. When it does subsidize investment, it often comes with strings attached that don't help the industry in the long run.
That has not ever been true in the history of governments. Even when John Smith's version of laissez-faire was at its most influential
Many governments do things that are economically inefficient, for example imposing tariffs to protect industries.
And they also
- subsidize farmers so consumers have cheaper groceriess
- help fund public schools so education is less limited by socioeconomic status
- fund science to advance the future
- offer tax credits to encourage adopting environentally-friendly technology
- apply taxes to disincenivize bad habits (e.g. tobacco)
So I'm not sure where you're coming at with this angle. That's government's greatest effect on society.
> imposing tariffs to protect industries.
Trump is doing it wrong and recklessly, so no disagreement in reality
But there are smart tactics for this short term inefficiency that can cause long term competitiveness. You can apply a high tarriff if you trust that domestic competition can catch up in a few years so you don't lose your own market to overseas competition. Long term, encouraging domestic stimulation is much better and more reliable than relying on foreign products for consumption. Especially essentials.
What about when the lack of advanced chips are a real threat to our technological advantage, in addition to the fact that our largest threats are pouring billions of subsidized currency in to their own comparable industry.
I think it requires a lot of mental gymnastics to dismiss the semiconductor industry as anything but critical to all modern economies and militaries. I think it takes similar willful blindness to lump "encourage investment" in with "bring on shore in the name of national security" as if they are exactly the same.
We do a lot of corrupt/wrong subsidizing in this country but that doesn't mean throw the baby out with the bathwater.
If I had a magic wand we'd still have tariffs and subsidize critical infrastructure and expertise - for example I find it very surprising that we don't make sure we always have wartime level of doctors and farmers trained and ready.
to be clear, this is an opinion pertaining to the preferred behavior of eg the american government and not anything like a summary of its history in this regard. that is, the tech industry since its inception in the 60s has accepted, to its benefit, [massive] federal subsidy.