CCU in the News
The conference is a week away and we’re already getting media coverage. Check out this terrific Substack article about the challenges of semiconductor production.
CCU and our New York partners were cited in several recent stories. Hundreds of community members participated in the environmental review process for Micron, thanks to the hard work of Jobs to Move America. And here’s a great article questioning the idea that Micron is the best company for tech workers.
Meanwhile on the left coast, the UAW has a vision for Green Industrial Policy in California.
National News
The administration is considering various proposals to encourage domestic chip production. One option is to impose tariffs on foreign electronic devices based on the number of chips in each one. Another is to require chipmakers to produce domestically as many chips as they import. According to tech industry reporters at Toms Hardware, the new policy “would require semiconductor companies to match their domestic production with the number of chips their customers import to the U.S. If chipmakers fail to maintain 1:1 ratio over time, they would have to pay a massive import tariff… potentially reaching 100%.”
We mentioned recently that the federal government has clawed back $7.4 billion committed to Natcast, a non-profit set up by the CHIPS Act to drive R&D for the semiconductor industry. Politico has a great article on Natcast and its dissolution. Before the axe fell, “Natcast signed on 200 members — notably, Nvidia, Intel, Apple, Samsung, Google and AMD — to pursue breakthroughs in the foundational technology that powers virtually every modern asset from AI to defense systems. The group spent its year-and-a-half existence trying to set up and eventually run a national hub where that R&D would happen, along with programs to ease the semiconductor industry’s severe talent crunch.”
The commentary continues on Trump’s decision to turn CHIPS Act grants into an equity share in Intel. One of our favorites comes from Todd Tucker at the Roosevelt Institute. “The United States has entered a new era of state capitalism. The real question is no longer whether the state will act, but whose interests it will serve. Will it merely prop up incumbents and invite capture? Or can public ownership and golden shares be harnessed for resilience and equity? If progressives don’t seize this moment to define a democratic, public-minded industrial policy, they will find themselves living in one designed by the Trump administration.”
Here’s more good analysis: What could a Democratic administration do with a 10% share in Intel? “A new Democratic administration in 2028 might not sell off the government’s stake in Intel. But it might add some conditions to any new government investment in the company. It might also take a hard look at Intel’s progress toward fabricating TSMC-level chips in America, and adjust the terms of the investment accordingly.”
News from Around the Country
California: California lawmakers – who in June exempted semiconductor production and other advanced manufacturing from the state’s environmental review process – promised to fix their overreach. But they haven’t. “The advanced manufacturing exemption was part of the overhaul of the California Environmental Quality Act that Gov. Gavin Newsom got lawmakers to sign off on in late June in the name of speeding up housing development, mere days after introducing it. The last-minute deal irked some lawmakers, some of whom said they only voted for the package with the understanding that follow-up legislation would rein in the carve-out for advanced manufacturing and address other environmental concerns.” CCU and our environmental and labor partners want stricter review of these polluting facilities, not loopholes!
New York: Not sure if this goes under New York or Idaho. Here’s a video of Micron’s massive construction project in Boise and an article about what it might mean for Central New York.
Indiana: West Lafayette residents aren’t giving up. They organized a public action to call attention to the proximity of the planned SK hynix facility to homes, schools, churches, daycare centers, and a farmers market. “They held signs that counted down the distance – example: ‘1,000 feet from toxic industry”’– from the entrance of Cumberland Park to the northwest corner of Salisbury Street and Kalberer Road. There, Ellen and Seth Kresovsky, Arbor Chase residents, held a tarp painted with: ‘Toxic site. SK hynix doesn’t have to be here’.” Community members also filed lawsuits over environmental concerns to try to stop the rezoning approved in May by the city council.
Ohio: Intel’s financial upheavals have left New Albany in limbo. And in case it wasn’t clear, Intel’s stock sale to the US government has removed the deadline for building the company’s Ohio One facility. (The federal deadline, anyhow. There may be Ohio requirements.) But in response to a letter from Sen. Bernie Moreno, Intel said that it remained committed to building the Ohio fab, though the company did little to clarify the timeline for construction.
Corporate News
Amkor: An article on Amkor’s strategic position in the semiconductor industry: the firm is “a linchpin in the U.S. semiconductor ecosystem.”
Intel: From Fortune Magazine, How Intel ended up in the fight of its life. “Today seemingly no one at Intel denies the company is a rescue project.” Apparently, the company needs a cash infusion of $40 billion or so if it’s going to survive. (Though “Intel must also clear an extra hurdle: its own reputation for poor performance.”)
One source of that needed cash is the chip giant Nvidia. (Nvidia doesn’t make semiconductors; it designs them and then hires other companies to manufacture them.) Two weeks ago, the companies announced that Nvidia will buy a $5 billion stake in Intel. “News of the deal sent Intel’s shares soaring more than 25 percent to $31.79 on Thursday, while Nvidia’s stock rose about 3 percent. The value of the U.S. government’s stake in Intel, which it purchased for $20.47 a share late last month, also immediately increased.”
The company is also seeking help from Apple, TSMC, and others.
At CCU, we’ve been noting that Intel’s stock sale to the US government removed CHIPS Act guardrails like the requirement to create jobs in the US and report to the public on its energy and water use. (Intel calls these conditions handcuffs.) But there are still some limits as to what Intel can do: the company can’t sell off its foundry business. “The agreement requires Intel to maintain majority ownership for at least five years, effectively ruling out a true spinoff during that period.” This article also points out that Intel has already raised capital by selling partial ownership in some of its existing facilities. “In Arizona, Intel’s Fab 52 and Fab 62 are structured as 51 – 49 joint ventures with Brookfield Infrastructure…. Intel retains majority equity and full operational control, but profits and capital obligations are shared with its partners.”
Micron anticipates increased revenue in response to AI demand.
Environmental News
The Environmental Rights Foundation (ERF) in Taiwan has released a report on the impact of TSMC’s build-out in the US. Looking at TSMC’s cutting edge 2nm process, ERF concludes that, “Each single fab (4 factories) requires approximately:
- 100,000 tons of water per day,
- Up to 1GW of peak power demand, and
- After 90% reuse, 110 tons of general waste and 90 tons of toxic waste generated per day.
Such massive industrial projects inevitably strain the environmental carrying capacity of the regions where they are located, which further puts strain on local communities, their livelihoods and right to a clean, healthy, and sustainable environment.”
Labor and Workforce News
It’s a paradox. We’re in the midst of a reshoring revival, and yet the manufacturing sector is shedding jobs.
A new report from the Brookings Institute finds that the CHIPS Act created between 42,000 and 54,000 jobs in the US and increased wages in 149 counties with semiconductor manufacturing facilities,.
Another analysis calls for prioritizing workers in the age of AI. (The 73-page report only mentions the word “union” once.)
Texas Instruments is “facing scrutiny for continuing its reliance on H-1B visa workers while simultaneously laying off employees and benefiting from billions in federal subsidies.”
Economic News
The global semiconductor market is expected to hit one trillion dollars by 2030.
Global Politics
Polysilicon is the substrate for most semiconductors. Now China has ramped up production of the substance and is selling it at bargain prices, trying (it seems) to drive producers from other countries out of business.
Here’s a video exposing the harsh conditions behind Taiwan’s semiconductor production.
We’re Also Reading
AI will make the rich unimaginably richer. Is that what we really want, asks the Guardian? “Why are investors so bullish on the AI boom? Partly because this technology promises to lay off more workers, more rapidly, than any innovation in recent memory.”
Next they want to put chips in our brains.
Upcoming Events
At 12pm on Friday Oct. 10th, CCU member GreeningUSA is hosting a virtual green bag lunch on the topic of “The Cumulative Impacts of the Micron Project: PFAS and Environmental Justice.” You can register here.
That’s all for now. See you in Phoenix!
