CCU in the News
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CCU’s very own Rand Wilson wrote about Intel’s layoffs for Labor Day. “As Intel works through its technical and marketing challenges, we must not lose sight of the human costs of its crisis and the company’s obligations to workers and their communities.”
CCU published an Intel layoff tracker to compare Intel’s job creation promises with its job destruction reality.
National News
We got more detail about the Intel deal that President Trump announced in August, converting CHIPS Act funding into an equity stake in the company. The government will give Intel $5.7 billion in cash sooner than planned: whereas CHIPS Act grants required the company to meet a series of milestones to get the money, the new deal hands over the pork immediately. The company will later receive $3.2 billion from the Secure Enclave program, originally awarded to Intel to make chips for the military. (Intel has already received $2.2 billion from the US government as part of the original incentive grant.) We also learned that the new deal frees Intel from obligations about job creation and environmental protection included in the previous agreement. But it will penalize Intel if the company spins off its foundry business within the next five years.
The chattering class has been chattering about the government’s equity stake in Intel. Here is a sample:
- The founder of Palantir, a venture capital firm, says it is “very weird” and looks like “cronyism.”
- The chief economics commentator at the Wall Street Journal calls it “state capitalism” and warns that “there is no statutory basis for any of what Trump is doing.” Elsewhere, he says the US now “has a stake without a strategy.”
- Another commentator calls Trump’s intervention in Intel “the visible hand.” (Get it?)
- A fellow at the Manhattan Institute says it’s “a big government blunder” that takes us closer to socialism.
- The Washington Examiner asks, “If you wouldn’t buy Intel stock with your own savings, why should Washington force you to do it with your tax dollars?”
- “Donald Trump is a socialist, apparently.” The same article attributes Trump’s “Intel shakedown” to the president’s desire to “control the means of production, and everything else.”
- California Gov. Gavin Newsom, who is teaching a master class in trolling the president, took to X to publish a Socialist Realist style portrait of Trump with a hammer and sickle flag and the text, “ALL HAIL CHAIRMAN TRUMP! WITH HIS GLORIOUS 10% PURCHASE OF INTEL, THE SOCIALIST REPUBLIC OF AMERICA ENTERS A BOLD NEW ERA OF GOVERNMENT-RUN BUSINESS.”
- Arizona Senator Mark Kelly says it’s a “bad precedent.”
- Foreign Policy says that Trump is treating America like an emerging market. “Trump’s economic program has damaged many weaker economies and makes even less sense for the United States.”
- Labor ally Les Leopold says, yeah, no, Trump has not gone socialist. “What Trump is laying bare are decades of corporate socialism—the use of taxpayer money to support and enrich private corporations and their stockholders… This is the real swamp that is siphoning wealth and stable jobs away from working people.”
- In a letter to Commerce Secretary Howard Lutnick, Elizabeth Warren points out that Trump’s deal would allow Intel to move factories overseas because it voids all of the terms of the original CHIPS Act contracts. “Intel is a failing company,” Warren wrote to Lutnick. “After spending years focused on chasing short-term profits at the expense of long-term investments in its competitiveness, the company’s share price fell 60 percent last year. Yet the President has handed billions of dollars to Intel, with no meaningful strings attached.” In an interview for a forthcoming podcast, Warren discusses the limitations the CHIPS Act placed on companies. “What were the strings there for? They were there to say, if you’re going to take taxpayer money, you’ve got to make sure that the thing you are producing is our best effort to make it benefit American taxpayers, good jobs, revitalizing the economy, creating a meaningful supply chain that’s onshore.”
- California Rep. Ro Khanna says the Intel stake should be structured to help workers. “We should make sure that if we are going to be a shareholder, we have labor neutrality and help workers,” he told Meet the Press.
- The New Republic says that if the left “seizes” Trump’s initiative, the Intel stake could usher in “a more democratic vision of public ownership and global competitiveness. … Even if it takes Trump, like a broken clock, to stumble into the point, the underlying principle is sound: The government should hold equity in more of corporate America, not less.”
- TSMC, GlobalFoundries, and other CHIPS Act funding recipients say they are not interested in giving the government an equity stake in their companies.
Trump warns that he will place “fairly substantial” tariffs on chips imports “very shortly,” but says he will exempt companies that are manufacturing in the US. In the last few days he has said he will impose a 100% tariff on chips.
As part of the trade war against China, the US has made it harder for Samsung, Intel, and SK hynix to make chips there, by removing special permissions that previously allowed these companies to export American chipmaking tools to their factories in China. TSMC too, in a separate action.
News from Around the Country
Arizona: Residents of the Vistancia neighborhood of Peoria celebrated a victory when the city announced that Amkor would be building its advanced packaging plant at a business park outside of town, instead of adjacent to schools and homes. (Here’s further analysis and a little more detail from a mayoral candidate who smells blood in the water.) Congratulations to the community members who protested, canvassed their neighborhood, packed city council meetings, formed a non-profit, and threatened a lawsuit. Now they’re planning to keep fighting – to make sure Amkor doesn’t poison their air and water.
Adding to the previous layoffs, 97 more workers at Intel in Chandler will soon lose their jobs.
Indiana: Angry residents of West Lafayette wrote an open letter to the city council and Purdue University, denouncing the May decision to allow SK hynix to locate a factory in the middle of a residential neighborhood. “They prioritized protecting institutional narratives and pursuing financial gains from research funding, real estate ventures, and CHIPS Act recognition — at the direct expense of public trust, community safety, and environmental protection.” Vocal community members are calling for the city to reverse its zoning decision.
Michigan: Officials may be disappointed, but Michigan residents might be relieved that Sandisk is no longer planning to build a chip factory in Mundy Township near Flint. The local economic development agency has revealed that the total price tag of incentives and tax breaks for the company would have been $40 billion. That’s money the community would otherwise be able to spend on schools, roads, firefighters, and other public services. Apparently local officials are still trying to market their “megasite” to another customer.
Ohio: Three years after groundbreaking, Intel’s Ohio factories are still unfinished.
Corporate News
Here are the world’s largest semiconductor foundries, ranked. (Foundries are companies that manufacture chips for other businesses.) TSMC comes in number one, with 68% of global market share. Samsung comes in second with 8%, GlobalFoundries third with 4%. Intel doesn’t even appear on the pie chart. In the fourth quarter of 2024, TSMC had $25.5 billion in revenue, while Intel’s foundry business brought in $31 million, worth 0.1% of global revenue.
Intel: Qualcomm’s CEO says he’d like to use Intel chips but they’re “not an option” today.
Here’s an article tracing the history of Intel’s rise and fall. Did you know Intel invented USB? I didn’t.
TSMC: A great article in The Economist on the company’s history, current stature, and future.
Environmental News
Wondering how semiconductor fabs use water? Wonder no more.
Here’s another water-related article on the danger of PFAS pollution from chip fabs. “As chipmaking capacity grows in the U.S., the challenge is not only about water quantity but also about water quality. The same water that rinses a silicon wafer might also flow back into rivers used for drinking, farming, or recreation. Without vigilant oversight and investment in new treatment technologies, the semiconductor boom risks creating environmental costs that outlast its economic benefits.”
This isn’t news, but I thought you might appreciate it: a European analysis of the ecological footprint of chip production.
See below under Upcoming Events for an event on community air monitors.
Labor and Workforce News
Are there enough skilled workers to sustain America’s chips push? How many times will we read the same article? Maybe if it’s really a problem, they could pay workers more?
A day in the life of a wafer fab operator, as described on the employer’s website. “I absolutely love my job. I love being around this sort of science fiction world. It’s very unique. I love coming in every day.” I’m rolling my eyes.
Economic News
The manufacturing sector contracted for the sixth consecutive month.
Upcoming Event
Interested in community air monitoring? On September 9th at 1pm ET (tomorrow!), the Environmental Protection Network will be hosting a network call focusing on new approaches to measuring hazardous air pollutants to improve understanding of community health risks, featuring Johns Hopkins Professor Peter De Carlo. (Here is a short video about his cutting-edge work in cancer alley in Louisiana.) Register here for the call.
