US government It aims to take part in Intel in Intel in exchange for subsidies that the company was already obliged to receive in accordance with the Act on Era Biden, in accordance with the comments of the Secretary of Howard Lutnicka in Interview with CNBC. This movement is part of the government’s efforts to augment the production of chip in the USA.
“We should obtain capital shares for our money, so we will provide money that has already been committed as part of the biden administration,” said Lutnick. “In return we will receive equity.” Earlier, the government discussed the acceptance of 10 percent of the Intel shares, According to New York Times.
The agreement can aid the venerable chipmaker finance American semiconductor or Fab production plants, which required billions of dollars for construction and maintenance, even as the demand for Intel systems in recent years. Some experts from the chip industry and members of the Trump administration say that maintaining intel on the surface is necessary for US national security, because it reduces the relying of the country from chip producers abroad.
But analysts and one significant economist say that the potential connection between the Intel and the US government may present a conflict of interests and cannot cause the domestic chips industry, which the administration approaches.
“It is not a proper policy of having their own states of the US government, privatization in the opposite part,” says Stephen Moore, visiting the Heritage Foundation and a former Economic Advisor of the Trump campaign in 2016. “This is similar to the European industrial model and we often did not do it here in the US, because many of them fail.”
Government intervention
The US government has the history of investing in the private sector. Moore cites a program from the 1980s called Synthetic Fuels Corporation, federally directed by a federal multi -billion investment in companies producing liquid fuels from coal, oil slate and sands. He was hailed as the president of Jimmy Carter “the cornerstone of our energy policy” and he had it Break down until 1986.
Then, after the financial crisis in 2008, the US government entered saving many billion dollars to stop the car manufacturer and some banks. These funds were spent either as part of a restless asset assistance program in which the US Department of the Treasury bought or guaranteed toxic assets or in the form of bridge loans. Many were finally pay off.
Recently, the Department of Defense agreed to finance an American company dealing with a occasional magnet, MP Materials, through own capital and loans to expand production and reduce the relying of the country in China. The agreement would theoretically give MP materials capital to augment its production capacity from 3000 to 10,000 metric tons.
Moore claims that the ideal scenario is that these findings between the government and the private industry have a end point. “It should be a contract for having a short-term share and then sale,” he says.
But the current administration of Trump went a step further public-private: in June the administration approved the partnership between the Japanese Steel and Pittsburgh US Steel company, depending on the National Security Agreement and A The so -called golden participation. The government insisted that in Stal’s decisions in the USA, including appointed management and future relocation plans. (This agreement has also been designed to aid the USA to compete with China for steel production).