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Sale of IBM's Chip-Making Business To GlobalFoundries To Get US Security Review

Posted by timothy on from the asking-permission-is-the-new-liberty dept.

dcblogs writes IBM is an officially sanctioned trusted supplier to the U.S. Defense Dept., and the transfer of its semiconductor manufacturing to GlobalFoundries, a U.S.-based firm owned by investors in Abu Dhabi, will get U.S. scrutiny. Retired U.S. Army Brig. Gen. John Adams, who authored a report last year for an industry group about U.S. supply chain vulnerabilities and national security, said regulators will have to look closely. "I don't want cast aspersions unnecessarily on Abu Dubai — but they're not Canada," said Adams "I think that the news that we may be selling part of our supply chain for semiconductors to a foreign investor is actually bad news."

13 of 95 comments (clear)

  1. Abu Dubai???? by Anonymous Coward · · Score: 3, Informative

    You mean Abu Dhabi? Dice, fire Timothy at once!

    1. Re:Abu Dubai???? by ultranova · · Score: 3, Insightful

      And we all know neither Abu Dhabi nor Dubai are in Canada. I don't know why it was necessary to point that out.

      He didn't say they aren't in Canada, he said they aren't Canada. Basically, he thinks Canada is unlikely to sabotage or spy on the US but someone in Middle-East might get ideas. Which is a valid concern and deserves consideration.

      --

      Forget magic. Any technology distinguishable from divine power is insufficiently advanced.

  2. Wake up America ... by Anonymous Coward · · Score: 4, Insightful

    How long are you going to keep pretending that you are doing anything other than sinking into irrelevance?

    If you don't make anything, and you have to buy it from the global market ... do you really still think you're innovating and pioneering?

    Or will you finally realize your corporations are destroying your economy, and leaving you as a bunch of whiny bitches sitting on the sidelines still thinking you're awesome?

    1. Re:Wake up America ... by glrotate · · Score: 4, Funny

      This is just evidence that the US has progressed beyond high tech manufacturing - a 20th century legacy industry.

      The US is now fully connected and chooses to specialize in bleeding edge products like selfies.

    2. Re:Wake up America ... by Glasswire · · Score: 4, Informative

      Nonsense, the biggest fabs of the biggest semiconductor company in the world, making the most advanced microprocessors are located in the US at Oregon and Arizona sites. It's a little company called Intel.

    3. Re:Wake up America ... by ShanghaiBill · · Score: 4, Insightful

      If you don't make anything, and you have to buy it from the global market ... do you really still think you're innovating and pioneering?

      Yes. Innovation occurs during conception and design, not manufacturing. Apple makes hundreds of dollars for every iPhone sold, because they own the design. Foxconn makes ten bucks for manufacturing it.

      But this is a silly discussion, since manufacturing is NOT declining in America. America is the world's second biggest manufacturer, with nearly $2 trillion in annual output. What has declined, is not manufacturing, but manufacturing employment, due to automation, and offshoring of the most labor intensive sectors. Since 1975, manufacturing employment in America has declined by 30%, while manufacturing output has doubled.

    4. Re:Wake up America ... by ErichTheRed · · Score: 4, Insightful

      " What has declined, is not manufacturing, but manufacturing employment, due to automation, and offshoring of the most labor intensive sectors."

      And that's good?

      I know that the bright rosy future prediction is that everyone is going to jump on board the knowledge worker train and deliver high quality services and creative goods. I don't mean to sound like a jerk, but have you taken a look around at the _average_ person lately? That average person used to be employed in a factory making a living wage doing a repetitive task suitable for their ability level. The reality is that you can't just plug someone like that into, say, an IT or project management job. There is a continuum of IQ and skills, and a healthy economy needs to account for the low end and the high end. You can't just shunt off the low end to fast food, Walmart and unemployment without fixing some of the imbalance, or you will have French Revolution 2.0 on your hands.

      I think the future is a lot more bleak -- you're going to have over half the population running around with no income and no way to make a decent living, and the rich who don't want to do anything about it because they've earned their money in their mind.

    5. Re:Wake up America ... by ShanghaiBill · · Score: 3, Insightful

      And that's good?

      Yes. Wealth is created by the production of goods and services, not by "keeping people busy". So if we can produce more, with less labor, that is a good thing.

      You can't just shunt off the low end to fast food, Walmart and unemployment without fixing some of the imbalance

      Then you fix the imbalance. In America, the bottom quintile already get 40% of their income from redistribution. Providing something like an earned income tax credit to top up the income of people in service jobs makes a lot more sense than keeping people in make-work manufacturing jobs, doing things that a machine can do better.

    6. Re:Wake up America ... by ultranova · · Score: 3, Insightful

      Wealth is created by the production of goods and services, not by "keeping people busy". So if we can produce more, with less labor, that is a good thing.

      It's good for those who get to fire workers and pocket their wages as profit, yes. It's bad for those workers who now have to make do with miserly unemployment benefits, and demonized for it by both their former employers and peers. It's bad for the remaining employees, who get worse pay and more crap due to fiercer competition for the remaining available jobs. And it's bad for everyone once there's enough people getting the short end of the stick that they'll just grab it and beat their masters to death with it.

      Then you fix the imbalance.

      You can't, because the culture won't allow that. Any attempt to either narrow the income gap or make it possible for the unemployed to live an independent middle-class life will be instantly declared "socialist", and rightly so. Automation is fundamentally incompatible with capitalism, or at least a version of capitalism where people are expected to "earn" their income by working. Just look at how much hate "welfare queens" get, despite that being the only alternative to busywork that doesn't result in social collapse.

      Basically, a post-industrial society will either unconditionally pay its citizens their upkeep with no strings attached, be a more or less horrible dystopia where that upkeep comes with submitting to arbitrary rules like taking drug tests or doing pointless busywork, or collapse in a violent uprising. And I think we all know which one Americans will never, ever, under any circumstances allow their neighbours, even if that means denying it to themselves.

      It's a pity, really. Once upon the time American Dream was a plot of land, since that's what it took to be independent. Then it became a pot of gold, because again that's what it takes to be free from having to bow to your local Count von Bastardessen to get food. And now, with everything getting automated, everyone could have their virtual plot of land - their share of the automated manufacturing resources, granted in the form of citizen pay - but that's not going to happen. But perhaps the developing countries will take note, and avoid the collapse ahead of us.

      --

      Forget magic. Any technology distinguishable from divine power is insufficiently advanced.

    7. Re:Wake up America ... by Matheus · · Score: 3, Interesting

      This.

      Honestly I'm a big fan of the Star Trek future however possible that may be. If through automation / etc the needs of *all can be produced by an extreme few why do we need to continue the philosophy that everyone must earn money to survive. I'm not for pure socialism but I have no problem with the safety net being high enough that everyone can do "good" on "nothing" not just eek by. Choosing to live on that minimum is a choice that is perfectly valid for all and not even to be shunned. That leaves those who want to follow their interests the freedom to do so without having to worry about where the shelter over their head or the food on their next plate is coming from.

      There are all sorts of logistical issues to work out for that dream to be a reality (not the least of which is making sure enough people work for their own benefit to keep the engine running) and our level of automation isn't quite there yet to support it but that's the future I want to live in.

  3. Re:For better or for worse by tomhath · · Score: 4, Insightful

    no private company would want to work with government, because the government would want to get the maximum benefit for the least price

    That is no different from selling to any other customer

  4. Government again sells security to highest bidder by gestalt_n_pepper · · Score: 4, Interesting

    That started with Reagan, who was happy to buy Saudi Oil rather than try and change the USA's energy picture. Sure. No security issue there.

    So now we're selling our chip-making infrastructure. But what's one more attack vector? We're already dependent on chips made in China and software coded in India. I guess having our supplies cut off by Abu Dhabi couldn't be much worse.

    It's all about moneyed interests. Countries are an illusion designed to keep the little people from revolting, which will continue to work until there's not enough affordable oil to keep cheap food, entertainment and drugs coming down the pipeline. After that, all bets are off.

    --
    Please do not read this sig. Thank you.
  5. Wrong criterion by Tenebrousedge · · Score: 4, Insightful

    No, the government's job is infrastructure, and other things that can be described as natural monopolies. If the start-up costs for a business are in the tens- to hundreds-of-billions, there isn't going to be much in the way of competition no matter what the industry is. If it's actually vital that said industry exists, it makes sense to nationalize it.

    However, if competition is possible, it should be encouraged. There's no reason to nationalize SecureWidgetCo if a dozen people could take their place tomorrow, even if they only sell to the government.

    It's clear that if the US Government wants to be sure of its chip supply, it needs to be in business for itself. The ultimate reason is not however that it's inherently inefficient for the government to enter into contracts with private companies, but that large scale microchip fabrication is so expensive that no (private, US) company is willing to do it.

    P.S. With respect, if your response to this is that natural monopolies do not exist, please save yourself the trouble of responding.

    --
    Those who advocate genocide deserve every protection afforded by law, and none afforded by common human decency.