Paul Vernon/AP Photo
Intel CEO Patrick Gelsinger speaks during the announcement on January 21, 2022, in Newark, Ohio, that Intel would invest $20 billion to build two computer chip factories east of Columbus.
Earlier today, by a 2-to-1 margin, the Senate voted (64 to 32) to overcome what’s become its almost automatic cloture blockade and open debate on the CHIPS Act, which would throw more than $50 billion at some of America’s most profitable corporations (Intel heads the pack) to make more of the semiconductor chips they already make. Absent those chips, any number of software-reliant services and goods—most prominently, cars—don’t work anymore, as workers at GM, Ford, Nissan, et al. who’ve been idled by the chip shortage can attest. The bill also, commendably, boosts the government’s funding of basic research, which is one of the many things that governments should do.
As Bernie Sanders noted in his speech on the Senate floor today, some proponents of the Let’s-All-Help-Intel perspective have exposed a curious if unsurprising double standard. Bernie cited Mitt Romney’s argument that since other nations are subsidizing their own semiconductor manufacturers, we should, too. Why, Bernie wondered, did we model our corporate largesse on the corporate largesse of other nations, but fail to model our health care and economic rights policies on those nations’ universal health care, paid family leave, etc. etc. policies as well?
A good question. The answer, of course, is that the corporations and Wall Street banks that remain the big dogs in our political economy are relentlessly mercantilist—none of this free-market crap—when it benefits them. They loved China’s mercantilism, which enticed them to open hundreds of low-wage factories there, subsidized by the Chinese government, after they persuaded Congress to vote for permanent normal trade relations with China at the turn of the century. Now, they love U.S. mercantilism when it funds their return to the United States, providing the dollars to do more manufacturing at home once the elected representatives of our taxpayers cough up the bucks. They love it when states and cities offer them tax breaks and other subsidies to locate their facilities there, too.
Jack Welch, the late, former, and all-too-iconic CEO of General Electric, once opined that if he could, he’d relocate all GE factories to floating islands that could attach themselves to nations when (and only when) those nations guaranteed the company a pliable, low-wage labor force and sufficient governmental largesse. There’s actually existing capitalism for you.
Milton Friedman? Who he?
