National News
The president recently released an executive order on Accelerating Federal Permitting of Data Center Infrastructure. It applies to chip factories, because it defines semiconductors as part of the impacted infrastructure. The EO aims to speed up the construction of new data centers and chip factories by reducing environmental protection and limiting public accountability. It narrows environmental review (Congress already eliminated environmental review for most CHIPS Act recipients) and makes it easier to build on contaminated land. Here are some anxiety-provoking passages:
- The Secretary of Commerce, in consultation with the Director of the Office of Science and Technology Policy (OSTP) and other relevant executive departments and agencies (agencies), shall launch an initiative to provide financial support for Qualifying Projects, which could include loans and loan guarantees, grants, tax incentives, and offtake agreements.
- The Administrator of the Environmental Protection Agency shall assist in expediting permitting on Federal and non-Federal lands by developing or modifying regulations promulgated under the Clean Air Act; the Clean Water Act; the Comprehensive Environmental Response, Compensation, and Liability Act; the Toxic Substances Control Act; and other relevant applicable laws. (Emphasis added)
- The Administrator of the Environmental Protection Agency shall, consistent with the Environmental Protection Agency’s statutory authorities, expeditiously identify Brownfield Sites and Superfund Sites for use by Qualifying Projects.
- Within 180 days of the date of this order, the Secretary of the Army… shall review the nationwide permits issued under section 404 of the Clean Water Act of 1972 and section 10 of the Rivers and Harbors Appropriation Act of 1899 to determine whether an activity-specific nationwide permit is needed to facilitate the efficient permitting of activities related to Qualifying Projects.
CCU staff was quoted in an article explaining why this EO is a massive handout to gas, coal, and chemical companies.
The same day, the president announced an AI Plan, which includes a commitment to revitalize the semiconductor industry “without making bad deals for the American taxpayer or saddling companies with sweeping ideological agendas.” The plan includes the following policy actions:
- Led by Department of Commerce’s revamped CHIPS Program Office, continue focusing on delivering a strong return on investment for the American taxpayer and removing all extraneous policy requirements for CHIPS-funded semiconductor manufacturing projects. DOC and other relevant Federal agencies should also collaborate to streamline regulations that slow semiconductor manufacturing efforts.
- Led by Department of Commerce, review semiconductor grant and research programs to ensure that they accelerate the integration of advanced AI tools into semiconductor manufacturing.
CCU signed onto a response to the president’s plan, the People’s AI Action Plan, led by our friends at the AI Now Institute. You can learn more here.
There’s a new director at the CHIPS Program office. Bill Frauenhofer, an investment banker, previously served as global head of Semiconductor Investment Banking and head of West Coast Technology Investment Banking at Morgan Stanley.
A proposed 56% cut to the National Science Foundation budget “would undermine US leadership in science, eliminate funding for over 250,000 researchers and students, and break bipartisan commitments made under the CHIPS and Science Act,” warn NSF staff in an anonymous letter. As you will recall, the CHIPS and Science Act was never fully funded, with the Science part largely neglected in Congressional appropriations, so these new cuts are particularly devastating.
As we know, the new administration has paused its CHIPS Act implementation. Data shows that Commerce finalized most of its CHIPS Act awards after Trump won but before he took office.
News from Around the Country
Arizona: TSMC’s huge and expanding facility in Phoenix is prompting the growth of a new city in the desert. And another article on the company’s effect on the region.
Michigan: Some colorful commentary on the Michigan megasite which I can’t repeat here because it’s too colorful.
New York: It’s the public comment period for Micron’s draft Environmental Impact Statement. If you don’t want to read all 20,000 pages, you can still participate in the public comment. Please go to this website to demand that Micron protect wetlands and water resources, minimize air pollution, and create good jobs.
Nearly 90 people spoke at three sessions of a public hearing discussing the impact of Micron. You can watch excerpts from the public meeting here.
Micron moves from “talking” phase to “doing” phase. Two details in this booster-ish editorial:
- To provide housing to the new workforce, there are 16,000 units of housing in various stages of planning, with 2,000 new homes available later this year. Apparently private investors have been “waiting on the sidelines” to put money into projects like housing until they see Micron break ground.
- “Micron needs 34 permits from various government agencies to proceed.” CCU and our allies in New York, led by Jobs to Move America and Sustain CNY, will be present throughout the permitting process to make sure local regulators keep workers and the community safe.
Trump’s Big Bill boosts Micron’s tax break by about five billion dollars. It benefits other chipmakers similarly, but Micron is a great example of how the advanced manufacturing tax credits amount to a massive boondoggle. As you may recall, the “bill increases an existing investment tax credit from 25% to 35% for semiconductor manufacturers who build new plants in the United States. The credit can be claimed for the costs of building and equipping new plants. Micron disclosed in documents last year that the tax credit would be worth about $11.3 billion for the first phase of its project in the town of Clay. Under the change included in Trump’s bill, the tax credit could now be worth about $16 billion.” And that’s on top of the $4.6 billion in direct CHIPS Act subsidy that the government has promised Micron for its first two fabs, not to mention the $6 billion more from the state and county. Altogether, “the potential value of Micron’s government subsidies [will be] about $25 billion for the $48 billion first phase of construction.”
See below under We’re Also Reading for more on New York.
The Great State of Ohio: If you’re local, you’re invited to an in-person town hall meeting to discuss what’s happening with Intel in Licking County. The event will be held onWednesday, August 13, 5:30 – 7:30 pm at Licking County Library, Johnstown (Mary E. Babcock) Branch, 320 North Main Street, Johnstown, Ohio 43031. Register here. If you have any questions, reach out to Bailey Sandin at bsandin@policymattersohio.org.
Corporate News
Intel: Intel announced that the company lost $2.9 billion in their second quarter. Not only that, but according to a memo by CEO Lip-Bu Tan, the company said they’ll be laying off 15% of employees to cut costs. At this point, more than 5,000 workers in the US have been laid off this year alone, on top of a similar number in 2024.
- Intel says that if it can’t find some more customers, it will likely cancel the Ohio One facility in New Albany.
- If Intel stops making advanced chips, what will happen to its Oregon facilities? The Hillsboro campus is where the breakthroughs in design, materials, and manufacturing take place.
- Intel’s New Mexico facility hasn’t been spared either. The company reported 227 layoffs.
Has Intel abandoned Moore’s law? During the company’s Q2 earnings call, Tan emphasized a pragmatic approach to capital investment, stating, “I will only invest when I’m confident those returns exist.”
Samsung: If Intel is down, Samsung is up. The company signed a $16.5 billion deal to supply AI chips to Tesla over the next eight years. Both companies saw their stocks shoot up at the news. For Tesla, this means more vertical integration: Musk’s company will work closely with Samsung to design and manufacture the chips. (The paradox: the project was funded by Biden, but will be delivered to Musk.)
It’s also good news for Samsung, which had been delaying work on its Texas site because the firm lacked big customers. The company’s new deal with Tesla suggests it is best positioned as an alternative to TSMC.
TSMC: Here’s a deep dive into the company’s history.
Wolfspeed: will it bounce back after declaring bankruptcy?
Environmental News
Yes, we are returning to the dark ages. The EPA is dismantling its research unit.
Labor and Workforce News
A new report finds that the CHIPS Act (along with the IRA and the Infrastructure Investment and Jobs Act) offered historic opportunities for Black workers and others from under-resourced communities, opportunities that are now in jeopardy as the current administration pulls back funding for industrial policy. “In 2025, the Trump administration eliminated many of the diversity, equity, and inclusion initiatives in industrial policy legislation. Currently, significant funding is being slowly dispersed, paused, or clawed back, impacting the economic mobility of Black workers.”
Economic News
A two-day summit, Reindustrialize 2025, calls for a manufacturing renaissance. But the country is going in the wrong direction. In the first six months of 2025, the trade deficit grew and manufacturing jobs declined steeply. Apart from data centers, construction spending on manufacturing plants (for computers, electronics, and electrical products) has been declining for five months in response to economic uncertainty.
Tariffs on copper could snarl the semiconductor supply chain.
We’re Also Reading
The Brookings Institute argues that the CHIPS and Science Act has spurred a new and exciting form of local economic development. Using Micron and Syracuse as an example, they argue, “The central takeaway … is that the combination of federal policy experimentation and local civic innovation has yielded a new, more ambitious form of economy-building. Distinct from traditional economic development efforts, the ambition here is regional economic transformation, or the long-term process of shifting a region toward higher-value industries and better jobs, boosting productivity, and helping more people move up the economic ladder.”
This local work is particularly important in the current context, as the US shifts dramatically “from federal expansionism to austerity and protectionism. As a result, the responsibility for much economic leadership is shifting downward—suddenly and significantly—to local, regional, and state actors. These actors now face a clear mandate: stabilize their communities amid federal retrenchment while also laying the groundwork for long-term competitiveness, resilience, and shared prosperity. This mandate also requires regional leaders to confront the technological, demographic, and environmental forces that, over time, most profoundly shape a region’s economic future.”
The brilliant Isabel Estevez shares the lessons for industrial policy design from development economics.
Thanks for reading this far. I’ll be out next week, so look for another newsletter in the last two weeks of August.
