Friday, February 10th 2017
On Intel and Their $7B White House Affair
By now, we've all seen, or at least heard, about Intel CEO's Brian Kraznich Fab 42 announcement (done from the Oval Office, no less). It was to be a joint press conference to announce a highly impactful investment on U.S. soil, which also turned into some welcome PR for Intel, and got the CEO some face time with the President.
It has to be said though, that hailing this as a Trump administration win is simply politics doing its best: spinning the truth for its own benefit. I say this because the original announcement for the construction of this Arizona fab was done way back in 2011, with then Intel CEO Paul Otellini breaking the news that they would spend $5 billion on the plant during the Obama Administration. Construction started that year, with overall expectation for its completion being somewhere around 2013. Cue the usual delays, and enter 2013's 10% decline of the PC market, and Intel did what any sensible company would do in the wake of lower expected volume of shipments (and respectively lower production needs) - they postponed the opening of the factory, indefinitely, instead choosing to improve manufacturing capability of its then already-operational fabs. So, the factory wasn't announced because of President Trump's policies and overall government acumen, nor is it probably going to be finished by the time his first term ends.
Krzanich didn't make this announcement because the "tax and regulatory policies" of the Trump administration are "advantageous". Kraznich did it in a show of force and open support for President Trump (as Kraznich has a past of doing), and if there's one thing we know of Intel (and every other major corporation focused on profit) is that everything happens for the bottom-line. The question of "why now" isn't answered with "because of President Trump's policies". It's answered by Krzanich's internal memo to Intel employees: because growing demand means Intel must increase production capacity. A sign of the times is the fact that the Arizona fab was originally projected to push Intel's 14 nm manufacturing capability, but has now been re-purposed as an accelerator towards Intel's 7 nm aspirations.
Although it has to be said, as President Trump himself would, that Arizona workers will be very happy: 10,000 jobs is a whole big number - full of zeroes. Arizona is second only to Nevada in overall population growth rate, and job creation is one of the most important economic growth factors. Though that's not the real number of workers: that's the best-case scenario. The real number of direct jobs to be created by this investment is around 3,000, with up to 10,000 jobs being created "in support" of the factory, as Kraznich himself put it (such as new businesses opening to support the infrastructure and the increased number of employed workers).
In fact, President Trump's administration hasn't even made a concrete, thought-out move towards tax breaks on American companies, though he did promise a 15% reduction in taxes while campaigning. So far, the only thing they've done on that camp is freezing new and outstanding regulations to fall into place, as well as adopting a purely "less is better" approach to tax regulation: for every new tax regulation, cut two previously existing ones".
Now personally, I find it to be extremely disconcerting that President Trump's administration has the most clearly-defined trend of donations having bought top spots in the Trump administration, in what can be called influence peddling, even avoiding such boresome proceedings as ethic reviews for conflicts of interest.
All in all, I just think these are way too many coincidences to be just that. It seems simply as just yet another pivot, another case of one hand washes the other in the cutthroat world of corporate interests and political favor, of chess played (and paid) with billions. Let's face the proverbial elephant in the oval office: Intel's announcement is a complete farce, being indicative of an unhealthy balance of powers between those that be at the White House and corporate interests.
I understand how negative all of this sounds. But every case must be considered as-is, and this one simply isn't. There are healthy, transparent, strengthening bonds that a government can have with the corporations that are the lifeblood of its economic development, which positively impact the every-man's life. Tax cuts may be one of them, by increasing the amount of leeway a company can have on its own internal investment, R&D, increased employment and better conditions for its workforce. Government subsidies, which propel promising startups which then grow on to provide new, competitive businesses and thus reinforce the economy - of which Intel has received at least $5.9 billion dollars itself, from tax rebates to federal grants, including almost $100 million in property tax immunities (while AMD itself has received only about $11 million). Another good example is how governments supported what were, at their infancy, extremely low-margin business (like the solar panel and renewable energies companies), eventually ushering us all into developments that will only improve the quality of life for us and our children.
There are ways of doing things; both President Trump and Kraznich may even know how to do them, and have certainly done some of them before.
But then, then there are ways of how not to do things.
It has to be said though, that hailing this as a Trump administration win is simply politics doing its best: spinning the truth for its own benefit. I say this because the original announcement for the construction of this Arizona fab was done way back in 2011, with then Intel CEO Paul Otellini breaking the news that they would spend $5 billion on the plant during the Obama Administration. Construction started that year, with overall expectation for its completion being somewhere around 2013. Cue the usual delays, and enter 2013's 10% decline of the PC market, and Intel did what any sensible company would do in the wake of lower expected volume of shipments (and respectively lower production needs) - they postponed the opening of the factory, indefinitely, instead choosing to improve manufacturing capability of its then already-operational fabs. So, the factory wasn't announced because of President Trump's policies and overall government acumen, nor is it probably going to be finished by the time his first term ends.
Although it has to be said, as President Trump himself would, that Arizona workers will be very happy: 10,000 jobs is a whole big number - full of zeroes. Arizona is second only to Nevada in overall population growth rate, and job creation is one of the most important economic growth factors. Though that's not the real number of workers: that's the best-case scenario. The real number of direct jobs to be created by this investment is around 3,000, with up to 10,000 jobs being created "in support" of the factory, as Kraznich himself put it (such as new businesses opening to support the infrastructure and the increased number of employed workers).
In fact, President Trump's administration hasn't even made a concrete, thought-out move towards tax breaks on American companies, though he did promise a 15% reduction in taxes while campaigning. So far, the only thing they've done on that camp is freezing new and outstanding regulations to fall into place, as well as adopting a purely "less is better" approach to tax regulation: for every new tax regulation, cut two previously existing ones".
Now personally, I find it to be extremely disconcerting that President Trump's administration has the most clearly-defined trend of donations having bought top spots in the Trump administration, in what can be called influence peddling, even avoiding such boresome proceedings as ethic reviews for conflicts of interest.
All in all, I just think these are way too many coincidences to be just that. It seems simply as just yet another pivot, another case of one hand washes the other in the cutthroat world of corporate interests and political favor, of chess played (and paid) with billions. Let's face the proverbial elephant in the oval office: Intel's announcement is a complete farce, being indicative of an unhealthy balance of powers between those that be at the White House and corporate interests.
I understand how negative all of this sounds. But every case must be considered as-is, and this one simply isn't. There are healthy, transparent, strengthening bonds that a government can have with the corporations that are the lifeblood of its economic development, which positively impact the every-man's life. Tax cuts may be one of them, by increasing the amount of leeway a company can have on its own internal investment, R&D, increased employment and better conditions for its workforce. Government subsidies, which propel promising startups which then grow on to provide new, competitive businesses and thus reinforce the economy - of which Intel has received at least $5.9 billion dollars itself, from tax rebates to federal grants, including almost $100 million in property tax immunities (while AMD itself has received only about $11 million). Another good example is how governments supported what were, at their infancy, extremely low-margin business (like the solar panel and renewable energies companies), eventually ushering us all into developments that will only improve the quality of life for us and our children.
There are ways of doing things; both President Trump and Kraznich may even know how to do them, and have certainly done some of them before.
But then, then there are ways of how not to do things.
199 Comments on On Intel and Their $7B White House Affair
This article is leftist propaganda, has no place in a tech site, it's shameful and biased and you should withdraw it with an apology.
Why not write that Trump was the reason Intel decided to put the "indefinitely" cancelled project off ice? You could have still conveyed the message that Intel was planning this longer, although everybody knows planning and actually doing are two completely separate things.
Instead of viewing this just as optimistic news from Intel and Trump that the plant
in fact is going to be built, when it wasn't sure before... you put it in a bad light by prognosticating that it "probably won't be built in Trump's first term". You don't mention that these thing usually take a while to plan and build, and that they are now trying to work with a totally different administration and new laws...
This shouldn't be on TPU and should be taken down with an apology, if you don't want an exodus of many of your readers who voted for Trump, I have to assume you just see as "deplorable, sexist and racist" like someone who you most likely voted for, if you did.
Though what you say is true that there wasn't a TPU article about the bailout, I wasn't here when that happened. Because I guarantee you, I would definitely have written something about that.Those things you mention are all in the piece. I even explain how it wasn't Trump who took the project off ice. It was an Intel decision, taking advantage of the timing to approach the administration.
I actually don't understand how some of the facts that I use to back up my opinion aren't even considered, and are just glossed over. Maybe they're not that convenient. But I stand by what I wrote, and always will.
Even though the whole timing and public presentation of the announcement with Trump seems to scream otherwise, you still want to interpret it your way. Fine. But don't say it's a fact, and not just liberal scraping to pull anything remotely negative about Trump out of thin air.
As I said, what companies plan internally and what they actually do in the end are completely different things. If you don't know this, I assume you never worked at any real company in your life, on any big projects. Your investigation on the inner communications at Intel doesn't prove an ounce what they might have done or not done with or without Trump. It's simply your assumption of having all the facts when you don't, and your arrogance to still push a negative story without having those facts, which is more than just unethical. It's another journalist who thinks he's "fighting the power" by just slandering the president.
This is exactly why Trump won, by the way, because facts are 'too hard' nowadays for some journalists. Every intuition is called a fact now, no matter how delusional or how many actual facts it ignores.
I'm really taking a break from this place.
Also throwing the word "universal" around is a red herring, it's a way to legitimize anything you say while insulating yourself from any criticism because it makes it sound like any scrutiny of your opinions are invalid.
To TPU writers: use your safe spaces to recharge your emotional batteries and leave this site unpolluted.
Otherwise, if Le Pen and/or Geert Wilders win what will you do ? Cut your veins and splash red all over these pages ? Get a grip.
racist
sexist
bigoted
misogynist
xenophobic
homophobic
islamophobic
it usually translates: white, male, middle class, heterosexual ..... wait, that's me :eek: I'm a criminal !!!