US Plans 1:1 Chip Production Rule To Curb Overseas Reliance (reuters.com) 48
The U.S. is considering a rule requiring chipmakers to match the volume of semiconductors that their customers currently import from overseas providers through domestic production, or face tariffs. Reuters reports: President Donald Trump has doubled down on his efforts to reshore semiconductor manufacturing, offering exemptions from tariffs of roughly 100% on chips to firms that produce domestically. Companies that fail to sustain a 1:1 domestic-to-import ratio over time would face tariffs, the Journal said.
U.S. Commerce Secretary Howard Lutnick floated the idea with semiconductor executives, telling them it might be necessary for economic security, the Journal said.
"America cannot be reliant on foreign imports for the semiconductor products that are essential for our national and economic security," the newspaper cited White House spokesperson Kush Desai as saying, who added that any reporting about policymaking should be treated as speculative, unless officially announced. [...] Under the proposal, a company pledging to make chips in the U.S. would receive credit for that pledged volume, allowing imports without tariffs until the plant is complete, with initial relief to help ramp capacity, according to the report.
"America cannot be reliant on foreign imports for the semiconductor products that are essential for our national and economic security," the newspaper cited White House spokesperson Kush Desai as saying, who added that any reporting about policymaking should be treated as speculative, unless officially announced. [...] Under the proposal, a company pledging to make chips in the U.S. would receive credit for that pledged volume, allowing imports without tariffs until the plant is complete, with initial relief to help ramp capacity, according to the report.
The bullshit will continue- (Score:1)
Re:The bullshit will continue- (Score:4, Funny)
The beatings will continue until morale improves.
1:1 ratio is unclear (Score:2)
If I import X mm2 of silicon from TSMC on N3P, can I dodge tariffs if I have a shell company that buys X mm2 of outdated 28nm or 40 nm wafers from a TSMC subsidiary/contract manufacturer? I can have my shell company resell the finished product to the designer that actually wanted the chips fabbed on outdated process.
Seems like GF could make bank just pretending to be a contract fab for TSMC.
Re: (Score:2)
I'm sorry, but when exactly did I vote for "this fucking mess"? You don't know how I voted.
Potential to Sabotage Competitor (Score:4, Insightful)
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Manufacturing that uses chips from TSMC etc. is already outside the US. I believe the tariff is meant to affect contracts for foreign fabs, e.g.NV contracts for a certain number of wafers, then sends the chips to a board partner, and finally the board is shipped to a customer. I haven't read the details (and there might not be any at this point) but maybe the tariff affects the contract rather than physical shipment of the chips to the US as a finished product or as a tray processor to be integrated later
It is disruption as policy (Score:2)
Hard to not see that this is just the administration disrupting as many cozy industries, trade agreements, inter-country subsidies, and more as much as possible.
Maybe the idea is that the US is better positioned that the rest of the world to weather the possible downturn and economic disruption.
It could be a way for the administration to get new and a lot less elderly leaders into leadership positions in corporations, government bodies, NGOs...
Not left or right here, noticed a pattern...
Re: (Score:2)
You are overthinking el Bunko, he isn't. This is project 2025 stupidly thinking the U.S. can build everything it needs thus making it the highest cost producer on the planet. And they expect to grift off the result. el Bunko is just a useful idiot that will do anything they say. He isn't capable of independent thought, that's why the Maggots like him so much. They see him as one of their own.
Strategies (Score:2)
reshore semiconductor manufacturing
Biden - Carrot: CHIPS and Science Act [wikipedia.org] (w/bi-partisan Congressional approval)
Trump - Stick: Tariffs (by edict/fiat)
Re: (Score:2, Interesting)
The CHIPS Act was a slush fund for Intel as their reward for wiping out semiconductor competition in the US. Propping up a failing company that killed off its domestic competition was a terrible idea, and it still is. Forcing Intel into a multinational fab coalition comprised of Samsung, GF, TI, IBM, Micron, ST Micro, Rapidus, and possibly others would have been a much better idea, assuming Intel's IP would be attractive enough to those parties to make such a coalition work.
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The CHIPS Act was a slush fund for Intel ... Forcing Intel into a multinational fab coalition comprised of Samsung, GF, TI, IBM, Micron, ST Micro, Rapidus, and possibly others would have been a much better idea, ...
According to this [wikipedia.org] several of those companies and a *bunch* of others announced projects, including new chip/wafer fabs in the U.S., in anticipation of and after the Act passed. Not really sure why you think this was/is just a windfall for Intel.
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Intel lobbied for it and got the largest allocation (which was delayed because reasons related to the Biden administration). The only way they could sell it to Congress was to make it look like it would benefit all semiconductor fabrication in the US.
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Lawyers (Biden) and money launderers (Rump) have no idea how long it takes to open a factory and get it into production. They think they can wave their magic wands and VIOLA! Factories appear!
Doesn't work that way dumbshits.
Re: (Score:2)
How can this work? (Score:5, Insightful)
I realize there is a "over time" part, but I don't see how this can work in general. New fab facilities don't pop up overnight nor does the general skills (for the all of the work) just grow on trees. So there would have to be lots of time to get the fabs going, as in longer than Trump will be in office ... where the requirement can be repealed as easily as he's trying to put it into place. This is 1 of a number of examples where it's obvious Trump doesn't understand manufacturing.
If I were a business, I'd just sit tight and keep buying the chips from Taiwan. If this goes thru and tariffs are applied, that's gets passed to the consumer along with a little slip of paper that says "Thank Trump for the price hike."
Re: How can this work? (Score:3)
It's not supposed to work (Score:5, Insightful)
Trump does not have the authority to do this. This is very obviously something that would require congressional action.
This is just Trump trying to seize more power for himself.
For a little while there he was being called Taco short for Trump always chickens out but he doesn't actually do that. What he does instead is push the boundaries of what he can get away with knowing full well that is a member of the ruling class he will never be punished so long as he does not act against his fellow members.
So he's just trying to seize power. Maybe it'll work this time maybe it won't but he's always pushing just past the boundaries of legality and sometimes he gets a new power and sometimes he gets pushed back to the line but he never suffers any consequences.
When the Democrats take the house they will impeach him but there's a fat chance in hell of him being convicted in the Senate so. But the rule of law is the rule of law so the Democrats will follow the procedure.
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The Constitution is pretty clear that Rump doesn't just have the ability to create taxes by fiat.
Section 8
The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;
There's a lot more in Section 8 that they're actively violating. (Impost is an old word for tariff.)
Re: (Score:2)
Re: (Score:3)
What he does instead is push the boundaries of what he can get away with knowing full well that is a member of the ruling class he will never be punished so long as he does not act against his fellow members.
Considering how much the economy has been shaken up by this administration, that’s one possible outcome is the collateral damage from his insanity is too much too quick and a real fracture grows to expel him.
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Trump does not have the authority to do this.
LOL, he clearly does have the authority to do it, because it is happening. Just because you refuse to believe that the USA has been taken over, that does not mean it hasn't been taken over. I guess you missed the memo.
Re:How can this work? (Score:4, Interesting)
This is exactly what everyone is counting on - that they can make Foxconn-style press releases about BIGLY INVESTING in US manufacturing, and they buy some cheap industrial-zoned land somewhere in the US after extracting the maximum amount of tax breaks and credits they can from federal, state, county, and city governments. They push around some dirt with heavy equipment and build a parking lot for the heavy equipment and the operators of that equipment to park their F150s on. And then when this administration ends, they put a big FOR SALE sign on the property and walk away.
Big business knows that they're being jerked around by a guy with a sell-by date. They'll placate him until he's gone, and then go back to doing things the way they've always been done.
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So there would have to be lots of time to get the fabs going, as in longer than Trump will be in office
They are betting on the next republican president keeping the same policy in place.
It's certainly not guaranteed but it isn't an unreasonable assumption/hope.
There certainly is not going to be another democrat in the white house for at least one if not two or three election cycles, so they are not concerned with someone just axing it automatically with a near 100% likelihood.
Anything will be less than 100% chances, and with the assumption it will be a low chance, it's not unreasonable to plan it being a lon
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You get what you incentivize (Score:2)
In this case, it'll be more expensive chips and electronics and even less jobs than before. It will reduce comptAAPThis will hand over our lead in tech to China.
Taxes inhibit technological advancement.
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*reduce competition.
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hand over our lead in tech to China.
That horse has left the barn already, it was chased out by executives looking for short term profits over long term planning.
21st Centure Jones Act (Score:5, Informative)
History has shown how this protectionism will work out eventually:
The Merchant Marine Act of 1920 [wikipedia.org] is a United States federal statute that provides for the promotion and maintenance of the American merchant marine ... It requires that all goods transported by water between U.S. ports be carried on ships that have been constructed in the United States and that fly the U.S. flag, are owned by U.S. citizens, and are crewed by U.S. citizens and U.S. permanent residents. ...
The Merchant Marine Act of 1920 has been revised a number of times; the most recent revision in 2006 included recodification in the U.S. Code.
and the end results:
In 2024, China captured over 53 percent of global market share in the commercial shipbuilding industry, while the United States accounted for only 0.1 percent [csis.org]. Just one Chinese firm, the state-owned juggernaut China State Shipbuilding Corporation (CSSC), built more commercial vessels by tonnage in 2024 than the entire U.S. shipbuilding industry has built since the end of World War II. [Japan and South Korea takes up 43% of global market share.]
Of course, US politicians never care about history. They will only drum up accusations (e.g. protectionism, government subsidies, etc.) against US rivals, even though the US itself has practiced such policies for long long time.
There's nothing wrong with protectionism (Score:2)
But this obviously isn't the way to go about getting a semiconductor industry back.
The problem is it would cost hundreds of billions of dollars to build out a proper semiconductor industry and that would require skilled administrators running the government which we frankly do not have.
Re: (Score:2)
A bigger obstruction to making the US a center of chip making again is that we don't have the skilled personnel to do so any longer.
Sounds great (Score:5, Interesting)
From my understanding of the intended goals, this policy aligns well with that.
Wikipedia neatly sums up how this works. [wikipedia.org]
In most cases, fascists discouraged or banned foreign trade, supporting protectionism. Fascists believed that too much international trade would make the national economy dependent on international capital and therefore vulnerable to international economic sanctions. Economic self-sufficiency, known as autarky, was a major goal of most fascist governments.
I think some sticking points and consequences of ratio trade restrictions are:
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You can deadlock an entire industry
That's not going to be an issue, as the US isn't the only customer any longer. People in the BRICS+ countries want computers, phones, and home automation as well, and China, Taiwan, and South Korea will be happy selling them everything they want. The countries of the Third World have slipped their leashes, and they're not going back into the kennel just because the bigwigs in DC tell them to.
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Mostly deadlocked on the US side of the deal. With US manufacturers unable to export products in exchange for the products the US would have to buy in an reciprocal deal. This is problematic when one integrated circuit is not a substitute for another integrated circuit, since chips aren't a commodity.
I agree though, that the world economy will move on without the US.
Can we stop letting Trump rule by fiat? (Score:4, Insightful)
Let's say for some reason you think that's cool because Trump is the bee's knees and he's just the best. He's making America great again.
He's 80 years old folks he's not going to live forever and he will be replaced. And the groundwork he lays and the power he seized on isn't going away when somebody you're not so happy with is in office.
No I don't think that'll be a Democrat if this keeps up but are you always going to agree with everything the Republican party does?
Towards (Score:1)
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At this point it's painfully obvious he's throwing shit at the wall to see what he can get away with ordering people to do regardless of whether it's good or bad. He's just doing everything he can to seize power and nothing else.
This. He's gaslighting his followers and fans that he's "making American great again." However, his only real goal is narcissism. His goal is to aggrandize himself. He bosses people, universities, companies, and nations around. Why? Because he can and no one else can. The effects of those actions are immaterial. That he can order people to do things is what matters to him.
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If he's blocked on anything, he'll say "everything would have worked out if only I had been allowed to do that one thing you guys blocked"
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he's not going to live forever and he will be replaced.
And his replacement is a man dumber even than Shrub and easier to manipulate than Rump, who doesn't hesitate to let everyone know that he is at least as evil as Netanyahu. Vance scares the living crap out of me.
Let's just hope... (Score:2)
... that any foreign consultants and engineers who might be brought in to help with the effort aren't given the "Hyundai treatment" by Trump's ICEholes. Not to mention that if bringing any new US fabs online requires South Korean expertise, well, that dog won't hunt.
Much diddling with the economy for conservatives (Score:2)
I'm guessing MAGA didn't onboard the economic laissez-faire espoused by the traditional - now defunct - Republican party.
So just like the GOP, MAGA pretends to have national interests at heart. But unlike the GOP, MAGA's approach is much more socialist.
A kind of national socialism if you will...
Companies are too greedy (Score:2)
They will NEVER do this without getting some kind of tax break. They demand their 5000000% profit without all the external costs.
Trying to force manufacturing back to U.S. (Score:2)