471–480 of 593 posts
Honestly, this is good policy. We can't have our complete global supply chain held over our heads when China goes and does something crazy inevitably.
This is a very bad policy. We should instead invest in local companies, not a American monopoly like Intel.
but they'll bring CPU/Semico talent to germany and other eu countries
then with talent you can start building your own start ups, dont ya?
Investing in local chip fabs is long overdue. These are incredibly important for geopolitical stability and should be distributed world-wide. We've centralized too many fabs in too few places in the search for low cost.
It is very important for national stability. A highly-interconnected global economy is arguably better at securing international stability.
In March 2020, I made the following predictions:
1) National governments will do what it takes short to provide for their citizens, even if they have to print money to do so, and risk inflation. Check.
2) Supply chains will be shaken up, costs for most goods will go up. Check
3) National governments in Western countries will seek to have strategic industries moved back to domestic or friendly territories. Check.
4) International trust will detoriate, and international conflict will become more likely. Check.
5) As inflation goes up, central banks will try to raise interest rates, but too slowly and too little. Check.
6) At some point, interest rates will rise to a level that causes a severe recession, with rising unemployment, even though inflation still remains higher than the interest rate. As people take to the street, central banks are forced to lower the interest rate, and possibly resume QE. Still open.
7. As interest rates go down, inflation goes even higher than before step 5. It will remain like this for the best part of 10 years (with high volatility), before some countries are willing to take the Volcker medicine for real.
8. As the economic forest fire ends, debts are erased, retirees have lost their savings and the next super-cycle begins.
Once again EU taxpayer money bankrolling US tech dominance. When will we ever learn to build up our domestic tech industry? And before the chip hipsters crawl all over my back to prove we ackshually have a powerful domestic semi industry, please name me another EU company, other than ASML (a company 90% of people here never heard of before the chip shortage), that has the same margins, dominance and ability to shape…
with them you'll be able to build start ups, etc.
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>Serious question - How do you propose governments encourage companies In some countries capitalism simply works the opposite way.
Companies pay governments to do business there? I mean this sounds great, I would love my grocery store to pay me to shop there. How do we make this happen? It seems to me sometimes like waiting for these kind of things to happen is cutting off your nose to spite your face.
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Why the false dichotomy? Does political freedom automatically contradict with economic prosperity for some reason now? Born and raised in China, I fail to see how the last 10 years of erosion in freedom has yielded any better results economically. Please don’t buy the government propaganda that legitimizes everything from stupid to evil as a price that has to be paid to raise people out of poverty.
Nowhere did I say that economic freedom and political freedom are mutually exclusive. What I do protest however is the idea that only political freedom can be considered a legitimate form of freedom. I am making the case that: - economic freedom is an equally valid form of freedom. - societies can make up their own minds on what sort of freedoms they value most. As for "erosion of freedom in the last 10 years in Chin…
Really? My girlfriend and her friends would strongly disagree with that statement. From my understanding they grew up in a time when internet in China was a lot younger and they actually had an ability to discuss political discussions, or items that highlight the government in a negative manner.
Now everything that isn't the government's view is incredibly censored/filtered online. It might hard to not see the erosion of freedom when it's being prevented from being communicated online.
Fwiw I'm not disagreeing with your statement on economic freedom and I find the amount of people lifted out of poverty and the growth China has gone through in the last few decades to be incredible but it seems a bit disingenuous to say certain "freedoms" haven't been eroded in the last 10 years comparatively.
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It is very important for national stability. A highly-interconnected global economy is arguably better at securing international stability.
I think the parent makes a better point in concrete terms. Geopolitically interconnected trade is all well and good in theory, but putting two superpowers at odds over the consolidation of oxygen right off the coast of one of them, with a long-standing grudge between them into the bargain has obvious implications for stability. All of economics looks great on paper until basically any little happenstance quirk utterl…
> Geopolitically interconnected trade is all well and good in theory, but putting two superpowers at odds
obviously, as we have seen in the past 40 years, both within and without there has been alot of economic turmoil (economic crisis) instead of pure prosperity and it turns out politicians couldn't outsource their jobs to the market
countries and regions need to politically strive for peace, cooperation and friendship, the market and trade isn't enough imo
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Selling off allies in eastern europe to Russia is a good strategy? That's a good way to start WW3, on Russian side...
Increasing trade with Russia is the most effective way to avoid a war. When goods and services don't cross borders, armies will.
Not to mention in the case of Germany, Russia's army would be obliterated by NATO if the warfare was purely conventional.
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That was the main argument for global trade already in 1914. France was Germany's most important commercial partner, and vice-versa. All German rifles had stocks made from French walnut wood! All French locomotives had German-made tubing! This stupid mantra was repeated ad nauseam after 1991, too, with silly op-eds from Friedman and friends about how two countries with McDonald joints in both can't be at war and simi…
This is the same logic that because some vaccinated people get Covid, vaccines are stupid and don't work.
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I don’t get your point. What you describes sounds exactly like the goal of such a subsidy. With new Intel factories in Europe that means more demand for ASML and other European companies, given that they already collaborate. With the addition that you can now train Europeans and develop the industry locally.
My point is that as a taxpayer in Germany, I don't want to subsize an American company. Better to invest in local companies like Infineon or Bosch.
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Yes it doesn't revolve around America vs Russia You have to consider the EU vs Russia. It's not in EU's or Germany's intrest to keep trading with Russia
It is though, they get something like 40% of their gas from Russia, and 30% of oil imports. It is immensely in the interest of Germany to have good relations and continued trade with Russia.
The problem comes from what they've decided to use their exports as leverage for.
Economic interests don't have to perfectly align for one nation's relationship and favor to be preferable over another.
Economic interests don't exist in a space devoid of cultural, ideological, or emotional ones.
Reaching the conclusion that relationships should be normalized is only truly ideal if you're viewing it: A) in an economic only vacuum and B) from a lens of maximizing Russia's resource based leverage, because that's all they have.