So everyone is on the "Let's build a Fab in the USA" train, will that eventually bring down the chip production costs? (not an expert in the field, so asking naively)
This is more about national security and business continuity than cost. Costs matter most when things are running smoothly. However, COVID has taught us a hard lesson. When SHTF, you better have a back up plan. Making money on IP alone while someone else handles all of the manufacturing and integration work looks great on a spreadsheet. Then some state actor cuts off the supply chain (or a virus) and your genius MBAs start to not look so smart after all.
With any luck, COVID (and tariffs) has transformed business for the future.
> With any luck, COVID (and tarrifs) has transformed business for the future.
Until we're far enough removed from the situation, everything is comfortable again, and the MBAs start saying "you know, if we just offshored fabrication..."
Samsung is probably more accurately described as a multinational company in this context. The location of a company's headquarters is not a primary determining factor for all different types of geopolitical risk. Like other multinationals, they have some ability to pick the jurisdictions they operate, and each of those locations have their own geopolitical contexts.
However, in this case, South Korea is also a close US ally. There is little risk to the US that the headquarters of Samsung is in South Korea.
But TSMC isn't necessarily a multinational company, which can also be said about other notable Taiwanese companies like Foxconn, whose business model depends on exploiting young, cheap, unskilled laborers from rural China and who had been far less successful in operating oversea operations outside China, such as in Brazil or Wisconsin, US.
As insinuated in the pessimitic tone of in the interview, TSMC also appears to be very reluctant to expand beyond Taiwan and China, and is certainly less worried about geopolitical threat from China. I think it's important to note that not everyone in Taiwan is dead set against the CCP. In a pre-pandemic Pew Research Center poll[1], at least 1/3 of Taiwanese still longed for closer economic and political ties with the mainland China. I don't have any recent data, but I doubt it changed much since.
For these risks physical location matters more than the organizational structure. If something (perhaps a conflict, perhaps something else) disrupts manufacturing or shipping around East Asia, supply from the Samsung fabs in Korea and TSMC fabs in Taiwan would be disrupted, but any manufacturing capacity that's physically located in the West would be still available.
Well in principle Texas has lower (almost half) industrial energy costs than Taiwan, which could help reduce wafer production costs especially at the lower resolution nodes. As Moore’s Law slows, things like energy and raw material costs may matter more. And having wafer plants close to fab plants can help.
Rough order of magnitude, but for a lower cost wafer (think like 90nm or above, not 7nm), electricity and energy could be about 10% of the overall cost. As a lot of the capital cost of the automation and industrial equipment is the same wherever in the world you are, that might be an important factor.
Taiwan is an island that imports almost all of its energy. Texas is an energy rich state with lots of wind, solar, and especially natural gas that is exported to the world.
We talk about higher natural gas prices in the US with Texas seeing slightly above $4/MMBTU, but LNG prices in Asia are above $35/MMBTU at the moment, nearly an order of magnitude higher. The government of Taiwan is basically eating half the entire cost of LNG right now to keep costs low for businesses and consumers, but that’s not a sustainable strategy. (At the moment, industrial electricity is about 13¢/kWh in Taiwan even with the government subsidizing most of the LNG cost and 7-8¢/kWh in Texas.)
Why are people concerned about energy and material costs? Semiconductors are probably the highest margin manufactured goods on the planet, with materials and energy being the lowest cost input to the process. The only good that can compete is bottled water or movie theater popcorn.
It takes about 3 kWh per square centimeter to make a high-quality silicon wafer. 90 nm node silicon wafer might cost about three dollars per square centimeter. So it isn’t a rounding error for actual wafer production. The unsubsidized electricity cost in Taiwan is on the order of 30¢/kWh for natural gas vs about 7-8¢/kWh in Texas. So the difference isn’t zero.
Purifying and growing high quality wafers is very, very energy intensive. This becomes more important as Moore’s Law slows and more of chip costs become just the wafer costs.
I was wondering why Texas keep coming up when new US fabs a being talked about. From an outsider it just looks like the low energy cost comes from failing to properly manage and upgrade the Texas energy grid.
The Texas grid has been diversified and transmission upgraded. The problem is that it hasn't been winterized. While this is costly, I doubt this is the main reason why prices are low. Texas has a large, cheap supply of natural gas and good areas for both wind and solar.
The energy prices are low because Texas has tons of oil and gas and wind. The energy grid is actually more efficiently managed than California, which has had similar problems with electricity supply.
But the main reason Texas comes up is it has a very long history in semiconductors with a big workforce and lots of semiconductor companies.
Efficiency in electrical grids can often be counterproductive to reliability.
It is economically efficient to not winterize your generation capacity or build longhaul electrical transport infrastructure to move electricity regionally, but without these rarely used elements you could end up with severe load shedding or a black start event.
In general I wouldn't expect US manufacturing to do a lot to lower production costs. More capacity in general obviously helps, and I could definitely see the US doing a lot to subsidize domestic production, if that counts as bringing down the costs.
> Maybe higher wages will lead to more automation.
Samsung Austin Semiconductor has been fully automated since 2008-ish. One number I was quoted was that you only need 19 technicians on the floor to run the fab, compared to 500+ pre-automation.
Expert here. Worked in a Fab (Automated Material Handling Systems or AMHS group).
You might be suprised how automated it already is [1]. Notice the OHTs (Overhead Hoist Transport)[2] running on a system of highways and superhighways on the ceiling. Each of these OHTs carry a box inside it called a FOUPs (Front Opening Unified Pods)[3] carrying upto 25 wafers. That can easily be worth $1M+ per box. They have standardized JEDEC interfaces so any process tool can accept a FOUP and get wafers out of it. The environment inside these FOUPs is ridiculously clean and each one costs $15k for what most people would think is a plastic box with a door in the front. FOUPs are used internally. If wafers are shipped, they're shipped in a similar box called FOSB or Front Opening Shipping Boxes [4]. These boxes are the reason automation happens with standardized "APIs". We don't need to know who made the process tool to hand them a box of wafers.
Another automation feature are the AGVs or Automated Guided Vehicles [5] that carry the same FOUPs and FOSBs [5]. They also can be equipped with a robot arm that takes a wafer out of the box and hands it over to the tool. The AGVs run on specialized roads inside the Fab and remains docked on the tool during processing.
Usually, there are hardly any humans around the tool. Material (wafer) is fed by AMHS systems, picked up by the same. Fab is probably one of the most automated manufacturing places out there. Way more than Automotive manfacturing.
If you're looking to do software engineering, I would highly encourage people to go work in semiconductor industry. It is just a fucking cool place and lot of room for improvement still.
For someone interested in robotics and automation, what types of groups/jobs would one look for specifically in this industry? Also geographically where are these types of jobs located?
If you want to work on robotics, you should look into working for one of the major semiconductor equipment manufacturers, not a Fab. To name a few: KLA Tencor (US), Applied Materials (US), ASM, ASML (Netherlands), Advantech (US), TEL(Japan), Besi (Netherlands), etc.
So chip production does have a labor cost, but the equipment used is quite pricey, and so the relative cost of labor is less. Also, given how pricey the equipment and how demanding the cleanroom protocol (which, if not followed, reduces yield of saleable products), there are a lot of incentives to make sure you have long-term employees who are well trained and motivated to keep their job.
Also, Austin (and other parts of Texas) already have a fair number of chip fabs, and have for decades. I used to work in some of them. Samsung even has existing fab capacity in Texas. So it's not such a new thing.
>> My next question is how many mask factories have we built in the US since we realized that was important?
There's a guy with a small company that makes N95 masks in the US. He got pissed when they came looking for a production increase. He would be happy to increase production, but nobody was willing to buy from him long-term. They'll just go back to importing cheaper product (probably from China) after the crisis is over. He basically told them to go pound sand.
The "imperialist" model can still work fine if we want to stick with it.
We can keep production in poorer countries with poor worker and environmental protections so long as those countries will clearly side with us and aren't all concentrated in China's sphere of influence. No one's doing a naval blockade of the entire US coastline. And even if they did, we also have some long land borders with allies.
The problem is that US needs to find responsible governments other than the ones close to China. There are not many in the world. They are poor for some reasons.
BTW when I say responsible governments I don't mean democratic, but mean they care about people's education, can keep long term policies and build good infrastructures.
In general, I'd say we've been able to deal with issues by outbidding other countries and exerting international political influence.
> My next question is how many mask factories have we built in the US since we realized that was important?
We're so bad at building.
I'd add to your question with: how custom-built do factories need to be to be efficient?
I expect chip fab is very tailored, but can a t-shirt factory quickly pivot to surgical masks? How about N-95? Can a vacuum cleaner factory start building ventilators? How about HEPA filters? mRNA vaccines?
What are critical things we may need to ramp up rapidly, not just for pandemics, but for the next disaster, and can they be done without building dedicated factories just for those items?
Humans are fabulously general-purpose, so I'd imagine that the more automated the process, the more expensive it is to switch. This would put high-wage countries like the US at a disadvantage with regard to flexible domestic manufacturing. But I've no expertise in this area at all.
These are questions and guesses, not questions and answers. :-)
Thing is, you are assuming that’s what is important.
Look at the billions the US spends on military, all of it domestic. In US, the masks are simply less important than all that, as is healthcare in general.
> My next question is how many mask factories have we built in the US since we realized that was important?
It's not important. Masks don't effectively stop the transmission of SARS2 and N95 masks are only highly effective against something as infectious as SARS2 Delta if you wear them precisely as intended (and to go with that you need to take many other precautions that the mass population is never going to take with great precision on a day to day basis). Even the vaccines don't stop Delta effectively, which you can plainly see from the large outbreaks in highly vaccinated nations.
> My question is why did it take this long?
Because the US Government spends nearly all of its effort on dumb shit, like shuffling papers, playing at admin, processing lobbyist appointments, screeching out empty promises every 2-4 years, going on talk shows and managing PR, managing a globalist superpower clown show, projecting power to every corner of the globe for no great reason other than to fulfill the powerlust of those in control.
They're supposed to be running our government for our people. They're simultaneously running the equivalent of one of the world's largest governments outside of our borders. Think about that for a moment. Do I think the people in power can run the US Government, domestically, effectively? Hell no. Do I think they can then simultaneously run a gigantic other foreign system - military bases, personnel, war, huge embassies, global trade, sticking their noses in every foreign political issue and at all times - on top of that? Triple hell no.
The U.S. supply chains would be completely wrecked. We're probably close to a point where in the event of a global war with China, we wouldn't be able to mobilize industry in the same way we did during WW2 simply because the industrial output fo yesteryear no longer exists in the U.S.
On the other hand, people forget the amount of IP (including semi design) that goes from the world to China/Taiwan to design products.
But that's what the whole point of free trade is supposed to be: increased interdependence, so that everyone has a gun to everyone else's head, and no one is incentivized to pull the trigger.
That's not accurate today. It might be different in 10 years, depending on how successful China is at becoming self-sufficient in semiconductor design and manufacturing.
Global companies didn't just outsource all the work to China. Even in the 90s, they were aware of the risk/reward, and specifically retained high-value, low-headcount/capital work outside of China.
As a result, China makes most of a device, but many core components are imported.
We're not even talking about semiconductors. All of the basic goods you'd need to supply an army, or the industrial capacity for consumer goods that could be shifted to wartime production no longer exists. It's a problem the DoD has been talking about for years, but little action has happened.
Imports, Total Estimated Value by Country, 2017 (most recent) [0]: Canada: 26,200.3, Mexico: 23,541.0, [...] China: 6,159.7
Or energy?
"In 2020, the United States exported about 8.51 MMb/d and imported about 7.86 MMb/d of petroleum1, making the United States a net annual petroleum exporter for the first time since at least 1949." [1]
Or arms?
Based and manufacturing in the US: Honeywell, Huntington Ingalls (ex: Northrup Grumman Shipbuilding), L-3, UTC, General Dynamics, Northrop Grumman, Raytheon, Boeing, and Lockheed Martin [2]
If you're talking a full manpower, total war scenario that requires mobilization of the entire country's non-military industrial base...?
I think there's a reason there haven't been any wars like that between nuclear armed powers. Ever.
Because by the time it gets to that stage now, someone has fired nuclear weapons if they have them.
>> The U.S. supply chains would be completely wrecked.
China: Hey cool, we can destroy the US without engaging with them at all, we can just complete our takeover of Taiwan which we wanted to do anyway. We just need to make it disruptive enough to stop exports for a year or so - maybe a bit longer.
The best way to keep China from invading Taiwan is by upholding the One China Policy. With that policy in place, China has plenty of reasons to avoid a war. Unfortunately the US and many other parties are increasingly tearing this policy down, not seldomly without fully understanding why that policy was invented in the first place.
Yes and you should read the book "The Other Side of the Story: A Secret War in Hong Kong" by Nury Vittachi to learn what the mainstream media wasn't telling you about the whole Hong Kong situation.
My Hong Kong friend who is pro China lives in an appartment complex where lots of yellow vests also live, and prior to the NSL every day he feared for his life, fearing that his neighbors would find out that he's pro-China and then do something to him. So much for the western coverage of the yellow vests being "pro-democracy, pro-rule of law, pro-free speech".
As far as American access to semiconductors goes, it doesn't matter if the takeover is peaceful or not. Chinese control over Taiwan could easily disrupt the supply chain through tariffs, export bans, backdoored hardware, etc etc.
Seeing that Hong Kong was literally an NED-sponsored [1] color revolution, and that every country in the world had a national security law except for Hong Kong until last year, I'd say that the Hong Kong situation is not at all a case study for whether China would invade Taiwan. Since 2019 I've watched for a year how the western public and the protesters yelled that "it's going to be a Tiananmen 2.0" and "the tanks will soon roll in", only for the tanks to never have rolled in. In the mean time, the protesters who were called "pro-democracy" by western mainstream media were doing some very undemocratic things, such as assaulting fellow Hong Kongers for merely disagreeing with them[2].
Two Hong Kong youths have a Youtube channel on which they present views that don't align with mainstream western media. This interview is very telling: https://www.youtube.com/watch?v=zYK-cC9mw6c
The guest on the show interviewed 100 protesters. What's interesting is that none of the protesters were able to explain what concrete change they want. The protesters merely blindly reigurated media talking points without being able to explain what's behind those talking points. None of them have actually read the NSL text.
Sound familiar? Yes: the "anti-voting fraud" Capitol rioters, who were hiding unnoble intentions behind a noble label. Many Hong Kong "protesters" were merely anti-China, not pro-democratic. They literally attacked people merely for speaking Mandarin. Ironically, one guy that was attacked was Taiwanese, not mainland Chinese.
Seeing how they literally burned innocent people[3], vandalized public infrastructure, vandalized mainland Chinese busineses merely for being mainland Chinese, made petrol bombs[4], etc. is it really reasonable to expect China to do absolutely nothing? Bringing back safety to the streets is what any government would do. After it was clear that they'd never send in tanks, people moved the goalpost and started demonizing the NSL but few people know what's actually in the NSL.
Demise of Hong Kong's rule of law are exaggerated. Even after the NSL, Hong Kong's judiciary remains fiercely independent — with evidence.[5]
[1] The NED is the regime change arm of the CIA. Despite the name, they are anti-democratic, having overthrown democratic regimes that refuse to align with the US. They publicly admit having sponsored the Hong Kong protests: https://www.ned.org/region/asia/hong-kong-china-2020/
With many violent protestors being confirmed CCP agents, substantial amounts of social media manipulation, dismantling of the free press (eg, Apple Daily), imprisonment of journalists - this topic is so extremely muddied that none of your sources are going to convince anyone who is paying attention.
> Seeing that Hong Kong was literally an NED-sponsored [...] color revolution ... such as assaulting fellow Hong Kongers for merely disagreeing with them[...].
Your comment is vastly disproportionate, and does not explain what happened.
Your comment suggests the following:
- Hong Kong’s protest was mainly due to sponsorship by the US, that is, it would not happen to this scale without US’s sponsorship (via NED).
- Hong Kong’s protest was mainly undemocratic (using your examples).
When discussing a social movement of this scale (millions went to the street, protests went on for half a year, with aftermath still affecting current events), we must judge whether your examples represent the majority or the extremely rare minority of what happened.
Just like the social movement led by Mahatma Gandhi, the movement led by Martin Luther King, or the recent BLM movement would not change much even if hundreds of protestors did things that go against the main thrust of the movements (which did happen).
To make this concrete: imagine blaming the BLM on CCP because they supported it [1], which is absurd [2].
We know that:
- The pro-democracy group had a landslide victory in the 2019 election (during the protests) [3].
- Many Hong Kongers left Hong Kong after the National Security Law [4][5]: a higher percentage of Hong Kongers left Hong Kong after the NSL than German left East Berlin after the split of Berlin.
Blaming the Hong Kong protests on CIA, NED, and the US does not explain the above events. Just like blaming the BLM on CCP does not explain the trend.
A much simpler explanation is that Hong Kongers do not like CCP rule, and they show it in the protests, in the election (when conducted fairly, without screening of candidates), and in their acts of leaving (when faced with the NSL and screening of candidates in future elections).
I suspect that the popularity rating of CCP, or of Kim’s regime in North Korea, would plummet if people know what is going on (that is, when the state censorship and propaganda are gone) and they are allowed to express themselves (for example, with a fair election). We just see this happened in Hong Kong.
You are right in criticizing me for not being proportionate enough. I did not take the time to make my post more nuanced. So let me clarify.
I do not believe that the HK protests were mainly due to US sponsorship (even if they were a contributing factor). My point was rather that it's unreasonable to expect a country to not respond to foreign sponsorship with security measures.
I do not believe that the HK protests were mainly undemocratic. However, the undemocratic and violent faction had effectively taken over, while the actually democratic faction failed in reigning this former faction in, so in my opinion trying to rhetorically separate them is a waste of time.
I do not agree with you that the CCP's popularity in the mainland is fake. There are multiple studies that show that their popularity is real.[1][2] The difference is between mainlanders and Hong Kongers is that many Hong Kongers don't have first-hand experience with how the mainland is governed and how the mainland has improved, and that the media regularly injects disinformation. Mainlanders know about Hong Kong, but they disagree. You can blame it on propaganda, but even mainlanders who have moved outside the mainland and who have been exposed to western media, don't tend to change their stance on Hong Kong.
What bugs me most is that the criminals are getting away with a good reputation in the west, who wholly paints them as "pro-democracy freedom fighters".
It also bugs me that a lot (not sure how many, but a lot) of protesters don't know what sort of freedom they want. Check the Keybros interview I linked: why could none of the 100 protesters articulate what concrete freedoms they are missing? Why are the protesters mostly younger people who have never lived under British colonial times? There is something deeply disingenuous among a part of the protester movement. I hope they can recognize that economic trouble (e.g. cage houses) is one of the reasons, and I hope that Hong Kong will do something about that. If these protesters think that life in Britain is really better, then they should experience it firsthand and come to their own conclusion on whether their protest was right or not.
What I hope for is more reconciliation between mainland and Hong Kong. I even hope that Hong Kong will get more democracy, namely universal suffrage and a strong Common Law-based rule of law environment. However I want Hong Kongers to be honest about things, and I want more democracy/rule of law at the same time as a Hong Kong that is proud of being part of China, and at the same time where criminals aren't swept under a rug for political reasons. One Country Two Systems, not Two Country Two Systems.
> I do not agree with you that the CCP's popularity in the mainland is fake. There are multiple studies that show that their popularity is real.[...][...].
I am not questioning CCP’s current popularity in Mainland (or Kim’s current popularity in North Korea), given their current control (including in education and media, both propaganda and censorship). When the population were brought up that way, even when presented with opposing view points their thinking is skewed (compared with many other democratic countries), and considers things as conflicts of super powers or humiliation by foreigners. Such thinking frequently persists and affects their actions even after they move outside of China (censor Hong Kong and Xinjiang in FANNG [1]), even in face of opposing evidence (linking Xinjiang to CCP [2]). Many of the Chinese population are effectively exporting their values to the world [3].
For a concrete example, even when foreign sponsorship does not pose material threats, some Chinese would suggest disproportionate responses (such as to consider draconian security measures and the National Security Law, resulting in arrests of the majority of democratic candidates [4]). This is disproportionate because UK and other European nations would not take comparable measures against comparable foreign sponsorship (by CCP). Just like in the US, Texas Secession could be discussed and supported without similar consequences to the NSL in Hong Kong [5]. This shows the resilience of their political systems, and by contrast CCP is overreacting.
Gaining popularity this way may be fine for CCP (or for Kim) for now, but when the system becomes unstable (due to declining economy and shrinking population), things may start to crack. The problem is not that it is fake, the problem is that the system (by censoring dissent and pointing fingers at others inconsistently) is unsustainable. And at least, this is why CCP and Kim do not currently have as high popularity in Hong Kong, Taiwan, South Korea, Japan, Sweden, Czech, Germany, France, or elsewhere.
> It also bugs me that a lot (not sure how many, but a lot) of protesters _don't know what sort of freedom they want_.
Many Hong Kongers want CCP to leave them alone, which was the implicit contract behind the 1997 hand over of Hong Kong. To be more specific, Hong Kongers want to run the city their way (including have their elected representatives not being arrested [4]), and not having laws inserted into their mini-constitution (Basic Law) against their will, to respect their differences—more or less the way Hong Kong was run before 2019. Incidentally, I think that’s what most Tibetans originally wanted, and what most Taiwanese currently want (against unification), too.
Wanting CCP to leave them alone was the main theme behind the 5 demands in the 2019 protest. What they don’t know is how to achieve it, when faced with CCP, the PLA and the massive Chinese population.
I am less worried about them not knowing exactly what or how to achieve the freedom they want, just like the population of Singapore, Taiwan, Japan, or South Korea might not know exactly what they wanted during their democratization (I would not be surprised by a Keybros interview when they democratized. BTW, if you want to know what the protestors think outside of cameras or Keybros, check out https://www.thestandnews.com/). Ignoring the selection bias, not everyone is as articulate, but this does not stop the trend of democratization. They democratized by trial and error 摸著石頭過河, and things work out fine for them. Same for Hong Kong.
> why could none of the 100 protesters articulate what concrete freedoms they are missing?
How did the Keybros interview avoid the selection bias?
> Why are the protesters mostly younger people who have never lived under British colonial times?
The younger ones have less burden and could go to the streets, the older ones with more burden supported them. See the election result for the proof [6].
> There is something deeply disingenuous among a part of the protester movement.
Hong Kongers want to say No to CCP, but this could not be said out loud with the PLA standing by. This is the disingenuous part. (Just like many protests in China would be prefaced with a support of the CCP, however contradictory and disingenuous sometimes it could get. Also, many Taiwanese wanted to say so, but again need to consider the threat of the PLA.) This is why many Hong Kongers left when they still could [6], they vote with their feet, if they could not vote with their hands.
> One Country Two Systems, not Two Country Two Systems.
CCP said that first to Tibet in 1951, then to Hong Kong in 1984. Seeing what happened, now in 2021 even the Nationalist party KMT in Taiwan is rejecting One Country Two Systems. Sometimes we need to learn from history.
Lots of your objection stems from breaking Hong Kong laws (rule of law...being part of China, criminals aren't swept under a rug...).
Worth noting that there is a huge difference between “Rule of Law” and “Rule by Law”: China only has “Rule by Law”, not “Rule of Law” [1][2], because Rule of Law requires Judiciary Independence (hence “having Rule of Law” is incompatible with “being part of China”, as CCP stated explicitly [3]).
To make this concrete, let’s use the recent event of Peng Shuai’s allegation as an example. The accused ex-Premier Zhang Gaoli could be guilty or not, but under Rule of Law—where no one is above law, not even the party or prominent party members—he must go through the same process as other accused. This is the only way to show that criminals aren't swept under a rug for political reasons (such as because Zhang Gaoli was close to Xi Jinping during their time in Shenzhen). Putting the party or prominent party member above law (or behind some opaque process) is NOT Rule of Law.
And a huge disagreement causing the Hong Kong protest is due to deteriorating Rule of Law [4], due to worsening democracy in Hong Kong (the legislative council does not represent the majority opinion). This had been voiced out by a judge of Court of Final Appeal [5] and some prominent lawyer [6].
Indeed, the 2021 Report to Congress by U.S.-China Economic and Security Review Commission points out (p. 458 of [7]):
Judiciary Independent in Name Only
Hong Kong’s historically independent judiciary is no longer reliably impartial on cases related to matters the Chinese government deems sensitive, since the National Security Law has cemented Beijing’s right to determine which judges hear national security cases in which jurisdiction, almost guaranteeing outcomes the CCP prefers.
Given the difficulty of maintaining Rule of Law under One Country Two Systems (as Tibet and Hong Kong showed), your hope of Rule of Law would object One Country Two Systems.
Also, before demonizing Two Country Two Systems, have you experienced it firsthand and come to your own conclusion? Do you know what you are disagreeing with?
Given the disinformation campaign of CCP [10], that is, CCP regularly injects disinformation into media (or in this case, deliberately confusing “Rule of Law” with “Rule by Law” in a newspeak way [1][2]), it is hard for Mainlanders to know about Hong Kong and have an informed opinion, even when they moved outside China.
It doesn't matter if it is a 100 year old artillery piece, they aren't exactly complicated, just large breach loaded guns. The only thing modern guns and artillery have over old guns is accuracy, which doesn't really matter when you have enough of them firing down range at a massive target.
We have fabs in the USA right now. To speak of Austin alone, Samsung's own S2 has been here since the late 90s, and there are a handful of others here, too.
That's so many assumptions you might as well put on a robe and special hat and become a fortune teller.
The effective erosion itself is a policy choice, there is this thing called 'minimum wage' which you can use to make sure that there is more than just 'warm bodies' as the lowest common denominator in job requirements, and as a result everything above that has to be 'upgraded' to a higher standard as well, otherwise people aren't willing to do the work (just like is happening now). The examples are all around you.
There is no onshoring of talent or natural resources since they are not 'constructed' the same way and importing those are against the current ideas/fears of immigration and relying on third parties for goods.
In other words: globalisation isn't a choice, it's a side-effect from the needs of humanity. Reverting to a more primitive state that decreases those needs could be a path, but I doubt anyone would choose that willingly.
Besides those things, there is this concept of ideals or principles which are almost as important and it doesn't require any extreme form of meddling either. If people really care about something (say, the well-being of other humans and therefore not really being happy with an authoritarian regime somewhere) then that can be incentive enough. And if it isn't then some protectionism won't be enough either.
How is this possible? Automation. These plants aren't creating US jobs and increasing wages, they're simply creating more wealth for corporations which they would have done anyway overseas. And since Samsung is a Korean company, the wealth is being created in Korea, not the US.
Yeah I mean look at how China has grown the last 25 years with their fully open markets. </sarcasm>
Every approach has pluses and minuses. Putting your own first is common and healthy. The US has been failing to do this for some time now, and the economy is pinned in a corner with no easy way out.
China is now much more open then they were for a long time and as it happens their growth really started when they did that. The are 1.4 billion people who have embraced mostly 'typical capitalism' that is comparable to most countries in the world do. Its not like they are the first to have the idea of tarrifs or helping strategic industries. China has continental scale and 100s of millions of people living on the coast with billions of people in close distance to export to. Of course they are gone do well, the internal market they generate alone is absurdly gigantic.
Just like the US in the late 1800 century, they also had some protectionism. But it crazy to suggest that is the main reason why they were successful.
Nobody says government should make important technology investment, have some strategic supply chain and so on. However just blanked Trump style protectionism across random industries is not really the solution to anything.
> Putting your own first is common and healthy.
This is a myth of what protectionism achieves. You protect some sector but potentially damaging other sectors considerably. The US protects Flordia suger farmers and as a result everybody else pays more for sugar.
Most of the time its groups that can lobby effectively that get tariffs and those groups then profit against the benefit of everybody else.
The pushback from many whenever it’s suggested that the US should undergo a general trend to bring back manufacturing jobs to America always fascinates me. I always wonder what’s going through their heads when they prefer that things continue to be made on the other side of the world in a sweatshop paying their workers cents on the dollar to make cheap, soulless, throwaway goods in countries with terrible environmental laws, where they’ll then be shipped using a ton of fuel to get those goods across the world to us.
Whatever happened to taking pride in what we make and buy? Quality over quantity? Paying more for something better? Looking out for your neighbors and community by supporting their gainful employment? Independence from countries that literally hate us?
It wasn’t long ago at all that we were making most of the stuff we bought. It’s time to go back to that. Call out every company you see that doesn’t make their products in the USA and ask when they’re going to stop selling out their own neighbors just for a buck.
It is bordering on racist to suggest that because things are US produced they will be Quality over Quantity. What you actually need to win is Quality and Quantity. The same arrogance the US manufactures had about Japan and got their as kicked.
At seems like you have some delusional fantasy that the world could run on locally made artisanal goods and that those goods then magically have more 'soul' (whatever that is) and would be better for the environment. And even if that was the case, these products would still depend on international supply chain.
Its equally false to suggest that everything outside of the US is made in sweatshops. China doesn't dominate because of sweatshops, but because going down stream, mining, refining. These are complex operations, requiring lots of educated engineering, capital and vision. Look at a company like CATL that is powering much of the worlds EVs. This is a company that exploded in growth in a highly complex industry.
> Paying more for something better?
So like car from Japan, Europe and soon China?
Where are you getting those high quality electronics, batteries, refined rare earths and so on? Please tell me the US companies who produce all these amazing things that are so much better then those from the international competition
> It wasn’t long ago at all that we were making most of the stuff we bought.
Who is 'we'? The US? Your family? Are you advocating to go back to per modernism where every woman was doing 40h of weaving for the family to have cloth?
The US never produced everything it needed. In modern history international supply chains are a thing.
And this was most true after the US literally bombed the shit out of Europe and Japan. And China was destroyed by Japan. Soviets and China turned communist. Maybe do that again and you can again do that? Even then it was the US and the British empire.
> Call out every company you see that doesn’t make their products in the USA and ask when they’re going to stop selling out their own neighbors just for a buck.
You can't fix problem by calling people out. If you force companies to make 'everything local' then they will simply no longer be internationally competitive.
If you seriously think to just cut of the US from the rest of the world would lead to a higher standard of living you are sorely mistaken.
Your level of understanding of the connection between international trade and living standards seems to be totally lacking. Your suggestion to just 'guilt' (or assuming with fines or whatever) every company into buying all local is a surefire way to completely destroy the economy and the competitiveness of the US.
And its simply anti-democratic. People might be willing to pay 1% more if something is marketed as locally produced. But most of the time people don't actually care. And they never cared. People care about themselves and their families and their standard of live. If Japan makes better cars, they will not simply buy American because its made in Detroit. The same goes for everything else.
If you want to improve standards of living, just cutting yourself of from international trade is literally the worst thing to do.
Opening up trade doesn’t necessarily make everyone better off. If makes everyone better off overall, at least to first order, but if you have national security requirements for needing domestic capacity anyway, that may make a bigger difference.
And you can make trade better for everyone period if you redistribute some of the gains of trade to those that it makes worse off. But… we don’t always do that…
It's not protectionism. It's anti-fragility. It's having strong domestic capabilities to meet our every need and not suffer when the world is uncertain.
It's having jobs and prospects for our future generations. The hope Millennials and Gen Z have is dim, and I can point my finger at a huge contributing cause.
It only leaves lower tiered hierarchies worse off and only in the short term. Extracting value that way is never a long-term plan since the needs will either be fulfilled or the extraction will be complete and no more value can be created.
If people don't want to buy a product because it is inferior in some way, the solution isn't to ban superior products but to upgrade those inferior products to be superior again. And inferiority/superiority doesn't just mean quality, it can also mean features and the price-quality balance in itself. At the same time, the rest of the world doesn't "go away" if you construct an island within your borders that nobody is allowed to join, so at best it's going to end up in some sort of useless industrial-cold-war.
> It only leaves lower tiered hierarchies worse off and only in the short term.
This is the refrain of those who do not understand reflexivity, and third-order analysis.
This analysis is correct to the first and even second-order effects, but completely misses the importance of slipstreaming floor expertise / experience into design and engineering iterating, or even holistic support. This kind of economic caste system thinking just as surely shackles the US as the Indian social caste system shackles that nation with enormous untapped potential.
I routinely make LinkedIn friends and actively solicit input from the operations people in all of my client organizations, and this has repaid me many times over. Where others within their very own organizations, much less outside consultants, snub these "lower tiered hierarchies", shedding light upon their experiences and expertise has taught me many valuable lessons about software design, debugging, implementation, and product management, among many other areas.
I learned to do this from reading about the nuts and bolts of how Japanese automakers applied Deming's quality principles. IMHO the buried lede in those stories wasn't all the charts and reports artifacts (similar to the Agile artifacts we use in our industry), but to my mind it was the attitudinal changes that flew in the face of common human hierarchical predispositions. Because it is a massive organizational cultural shift often enmeshed in wider prevailing ethnographic contexts, it is one of the most difficult leadership-led transformations to conduct.
One can get away with the hollowing out effect in the beginning, and if there is sufficient "mass" of value to strip in the industry to mask the effect, it can even be carried out through a couple more product and technology cycles to second-order ramifications as various affiliated supply chains are also stripped out. But once it reaches third-order ramifications often loftily projected as, "while we lead the toiling-for-peanuts offshore masses with our brilliant sales/marketing/product/accounting insights, the supercharged stock bonuses will just roll on in!", it is when reality slaps them in the face and they find out that those same "junior", "lower tiered hierarchies" toss aside the "onshore leadership" to cut out the middlemen to the customers.
After one is never too proud nor too lofty to lead from the front, be happily willing to (if even for a moment) do anything one would ask their direct reports or even their recursive direct reports to do, so to speak "sleep on the factory floor" if need be, a torrent of insights that would normally do not occur during design and engineering stages become available.
is there a labor demand for electronic assembly? we can barely get workers for decently tipped restaurants, and we now going to have 1000s lining up to twist a screw for 8 hours straight?
So the Chinese have UFOs and we have a war with China but we are moving chip production to all these countries you mentioned to prevent the ongoing war with China?
I’d like to give you the benefit of the doubt here though. I think if you were able to be a little more clear I’d at least understand what you intend to say, but I find your comments here a bit confusing.
> And nobody is talking about it? This is completely related to the war with china.
Who isn’t talking about it? Assuming you’re talking about poor relations (“Cold War”) and/or loving chip production. It seems to me to be pretty common knowledge and is widely reported in global media sources and the Internet. Don’t the links you provide demonstrate that?
We’re moving fabs to the West to defuse a potential hostage situation where China strangles the global supply of semiconductors.
The UFO releases are either about telling China that we are aware of and can track their surveillance assets, showing China our new highly advanced classified assets, or else demonstrating the superiority of our current Air Force assets.
Both activities serve to dissuade the Chinese military from taking aggressive actions.
Except that 1. It’s the west (in particular the US) that is strangling the semiconductor supplies in order to hamper Chinese industry, and 2. China is completely uninterested in military aggression, as opposed to US, which just finished a war and is probably looking for another one.
The White House recently identified semiconductors as an essential product critical to US national security [1]. These actions by the US and allies to onshore fabs is part of the adjustment to defuse a supply chain risk caused by potential future actions by China.
During the Cold War, both sides used strategic release of classified information on capabilities to notify the war planners on the other side in order to prevent miscalculations that could lead to a nuclear exchange. This is common knowledge and a good tactic to tamper escalation. It would be extremely irresponsible to surprise a nuclear peer with new capabilities.
That's not what this is about. The US is sanctioning SMIC. It forced TSMC to release customer data of mainland Chinese customers, presumably with the goal of checking which more Chinese companies to sanction. The US's goal is to prevent China from building a self-sufficient semiconductor industry. Or conversely: to keep China dependent on the US so that the US can sanction China at any time.
Yes, SMIC looks like one aspect of a global reorganization of semiconductor manufacturing.
I’m not sure I buy your reasoning though. I don’t understand how effective blocking the use of US technology by SMIC will be given the propensity for IP theft, so I don’t see how it furthers the goal of preventing China from becoming self-sufficient. Nor would I really agree with the assumption that they are not already self-sufficient.
US rethoric says that they are concerned about IP theft, unfair economic practices, etc. But if you look at the sanctions then you see that they target pretty much only R&D-heavy sectors. That should be telling.
The semiconductor industry is extremely R&D heavy. You can't just steal your way into success. It is also heavily dependend on a global network of specialized suppliers and is one of the most complex supply chains on earth.
Even Chinese media says that they are not yet self sufficient. They predict that SMIC will become able to produce 28nm and above using only domestic inputs by the end of 2022, but that's just ability and doesn't factor in manufacturing scale to handle the corresponding demand.
Making 14nm fully domestic takes a bit longer -- maybe 2 years more. Chinese media and experts say that if they scale up 14nm and above, then that satisfies 70% of the demand.
To go further than about 7nm you need EUV lithography, which only has 1 supplier in the world, and the US is blocking that. How long it takes for China to independently develop EUV is unknown. Universities have made small breakthroughs in subfields here and there but they're still far away from the full solution.
There’s a difference between self-sufficiency and state of the art. China can be self-sufficient without having cutting edge technology.
For most military applications, 28nm process is comfortably sufficient - USAF 5th generation aircraft were designed and flying before 28nm.
I’m not convinced that there is any real need right now for <14nm process besides striving for market share. Market share which is itself reorganizing around new ISAs. EUV is a (amazingly clever) Rube-Goldberg machine.
> China is completely uninterested in military aggression
Except they increasingly fly their fighter jets in Taiwan's airspace. And regularly engage in deadly border disputes with India. And continue to conduct cyberwarfare.
Except that the border dispute with India was caused by the British, who randomly drew some borders somewhere that parties then later disagree with. India also has border disputes with non-China neighbors. China already tried to solve this diplomatically, for example by trading areas that India claims but are defacto China-controlled and vice versa, but India refused all deals so far because they want to claim in all.
Do note that China (PRC) has already given up land in the past as part of diplomatic deals. Check Vladivostok. Check the whole of Mongolia.
Western coverage of China’s border conflicts are extremely distorted. In the ASEAN summit, southeast asian nations are upgrading strategic ties with China.
>So the Chinese have UFOs and we have a war with China but we are moving chip production to all these countries you mentioned to prevent the ongoing war with China?
>I’d like to give you the benefit of the doubt here though. I think if you were able to be a little more clear I’d at least understand what you intend to say, but I find your comments here a bit confusing.
The blow your mind factor is hard to address because of the roswell factor. I 100% don't believe those UFOs are extraterrestrials.
>Who isn’t talking about it? Assuming you’re talking about poor relations (“Cold War”) and/or loving chip production. It seems to me to be pretty common knowledge and is widely reported in global media sources and the Internet. Don’t the links you provide demonstrate that?
I guess I didn't make that clear. Obviously it's being talked about.
I guess step back for a second. The war with china is obvious. I never even talked about cyber aspect of the war, its not relevant exactly. A nuclear bomb is going to do more in the war than some BGP route stealing tech. The irony of it all, it's China's capitalist zones that are going to be robbed for 'common prosperity' at the same time that the cold war kills those zones like Evergrande situation.
>The easiest (and probably the only) way to prevent a war with China is to convince the US to not start it.
Yes, if there's one thing we should have learned from WWII, it's that capitulating to land-grabs results in the bad-actor stopping. If we just let them take over the entirety of the South China Sea, Taiwan, and maybe just half of the African nations they've been lending money to who will never be able to repay their debts, they'll definitely be satisfied and stop. Korea, Japan, and India have nothing to worry about. Nothing at all...
Your response has literally 0 substance. Ignoring the fact that whataboutism is a tired and lazy rebuttal, remind me which country has the US has annexed in the last decade, or whatever you’re trying to claim. I haven’t heard Canada or Mexico complain that they’re concerned we’re going to invade.
> Remind me what country has China annexed in the last decade?
They’ve been annexing parts of Nepal for the last decade. They are attempting to claim parts of the South China Sea that belong to multiple neighbors.
Violating the agreement they made with the UK is essentially annexing Hong Kong.
The Marshall Plan was absolutely nothing like what China is doing and to claim so is utter ignorance of what is happening whether intentional or not. Given your responses so far I’ll assume it’s intentional.
You still have not provided a single example of what you’re accusing the US of.
>The easiest (and probably the only) way to prevent a war with China is to convince the US to not start it.
Noam Chomsky recently wrote similar to this. The military threat is really against china.
The point of a cold war is to prevent a real war. So when you hear about dick waving of the US military and allies. IT's about warning China from doing anything.
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