For want of a nail…
One of the blogs at ZDNet.com points out something I have been aware of for quite some time, but haven’t posted upon. Perhaps I should start making some noise. From Tom Foremski: IMHO, “US chip leadership is in trouble – but business is good“:
The bad news is that US is likely to lose its lead in chip manufacturing expertise and that could be catastrophic to the US economy. The SIA and the chipmakers and other groups are lobbying hard in Washington D.C. to make sure that the US funds more basic research, invests in education so it has a highly skilled workforce, and can provide new ways to finance multi-billion dollar fabs.
“There is no other industry like the chip industry that has created so many jobs, and has contributed so much to the GDP of this country,” said Mr Scalise. So far so good, I said. Why should we be so concerned about the future when the US chip industry is doing so well?
Mr Scalise and the others, pointed out that it is becoming more difficult to manufacture in the US because of fewer science and math students, and the economic incentives are much less than those offered in other countries. Yet each chip fab provides significant economic value to the host country because of the infrastructure that grows around it. Many other countries recognize that benefit and are offering significant incentives for chipmakers.
One worrying trend is China. Mr Scalise and his team recently returned from a fact finding trip to China. He said that SMIC, the country’s largest chip maker, is able to take advantage of sweetheart financing deals. The government of a large province in China is building billion dollar fabs and it will lease them to SMIC. This means SMIC doesn’t have to raise billions in capital markets to finance its expansion. This is a significant competitive advantage for SMIC.
The reason I had an expatriate assignment in France was because the newest fab (aka “wafer fabrication factory”) for my company (Freescale Semiconductor) is there, in large part because of tons of subsidies from the French government. Many fabs are being built in China, as Foremski notes in his post. Aside from jobs lost in the US, do we really want to be exporting the basic technology that powers our smart-bombs, guidance systems in our tanks, fly-by-wire systems in our jets, essentially all the technology that gives our military a huge advantage on the battlefield to a power that arguably will be our greatest rival in the 21st century?
My vote would be no, even if my future employment prospects were not affected.
What do you think?
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Cross-posted to Random Fate.
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10 Responses to “For want of a nail…”
Uhmm, like hell no.
This bodes very, veeeeerrryyy badly for us, and I am with you on this Jack.
Lou Dobbs reported tonight that there has been an increasing number of high school drop-outs every year for the last forty years. Fully one third of High School students drop out.
This is absolutely amazing to me. Our future is lost.
There is a college graduate and a high school senior in my houshold who will be pounding the pavement in search of employment very soon.
One problem locally is, that the dominant company in my home town makes computers with an imported labor force because “we can’t get local talent with skills that are advanced enough to perform for us”. Then the company holds my local government hostage to a demand for property tax relief when it locates its factories in my town. Schools are financed by local propery taxes and lo and behold these are the same schools that are going to an eight month school year because they can’t finance nine months for above-mentioned high school student. Bummer
Taking not just this issue into consideration, I’m beginning to wonder why anyone wants to spend or go into debt for 50 to 100 thousand bucks on a good high quality education to take jobs offers under 30,000 a year when they can make in short order 60,000 or more in the trades and industry occupations training on the job and get paid for their training.
There are five occupations in the U S A I guarantee are over saturated, MBA’s. computer science/technology, doctors, lawyers, and politicians in this dog eat dog U S A world we live in scrambling and snarling, biting at each other in order to climb the ladder to success like starving dogs over a dried up bone.
Chip…
Because when you hit your fifties, they don’t want you anymore. They keep a few knowledgeable older people around to lead younger people able to work harder and longer. All the while quietly integrating illegal alien labor pushing out Americans from the job sites. If I were you, I would investigate suicide rates in the United States over the past fifty years. As you start seeing a change in rates over the years, the data gets more and more suspicious and more difficult for a social scientist to verify.
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