US Calls Broadcom's Bid For Qualcomm a National Security Risk (nytimes.com)

An anonymous reader quotes a report from The New York Times (Warning: source may be paywalled; alternative source): The United States government said Broadcom's proposed acquisition of rival chipmaker Qualcomm could pose a national security risk and called for a full investigation into the hostile bid. The move complicates an already contentious deal and increases the likelihood that Broadcom, which is based in Singapore, will end its pursuit of Qualcomm. Such an investigation is often a death knell for a corporate acquisition. A government panel, the Committee on Foreign Investment in the United States, or Cfius, noted, in part, that the potential risk was related to Broadcom's relationships with foreign entities, according to a letter from a United States Treasury official. It also said that the deal could weaken "Qualcomm's technological leadership," giving an edge to Chinese companies like Huawei. "China would likely compete robustly to fill any void left by Qualcomm as a result of this hostile takeover," the official said in the letter. The letter and the public call for an investigation reflects a newly aggressive stance by Cfius. In most cases, the panel operates in secret and weighs in after a deal is announced. In this instance, Cfius, which is made up of representatives from multiple federal agencies, is taking a proactive role and investigating before an acquisition agreement has even been signed.

Comments

USA always using protectionist practices

[DanCruthfield]

Although I personally don't agree with this takeover attempt, I have to point the hypocrisy of the US.

Re:USA always using protectionist practices

[ShanghaiBill]

I have to point the hypocrisy of the US.

What hypocrisy? Under Trump, the US is openly protectionist in both actions and advocacy. That is stupid, but it is not hypocritical.

Re:USA always using protectionist practices

[RightwingNutjob]

It's not stupid, it's just different from what you're used to. Tariffs alone would be stupid. Quashing H1B's alone would be stupid. Extra scrutiny to foreign investment alone would be stupid*. All of the above plus a hefty corporate tax cut might actually lead to an improvement.

Or maybe not so stupid if we realize the existence of a whole wide universe not captured by the single number on the bottom line. Milton Friedman never understood this but you can't just stockpile steel or microchips; you have to be able to make your own or you risk inviting potshots from people who can.

Re: USA always using protectionist practices

[ShanghaiBill]

The hypocritical part is expecting the rest of the world not to retaliate in kind.

Trump is expecting retaliation. His claim is that American can "win" a trade war.

He is sort of right, in the sense that big economies lose less than small economies in a trade war. But still, everyone loses.

The last really big trade war was in the 1930s. It didn't end well.

Re:USA always using protectionist practices

[Gravis Zero]

It's not stupid, it's just different from what you're used to.

We've done a lot of bad shit and yet somehow this is proving to be one of the darker chapters of our nation's history.

Tariffs alone would be stupid.

Tariffs without cause (e.g. protectionism) are always stupid.

Quashing H1B's alone would be stupid.

H-1B visas have been abused to no end. Quashing them now is actually a fairly sane idea. The president has made no efforts to do so.

Extra scrutiny to foreign investment alone would be stupid*.

Actually, that's just called prudence. Why do you think there is a Committee on Foreign Investment in the first place?

All of the above plus a hefty corporate tax cut might actually lead to an improvement.

In a different economy, maybe. However, in our economy, it's going to hurt far more than it helps. FYI, there are no winners in trade wars.

Re:USA always using protectionist practices

[RightwingNutjob]

It isn't necessarily stupidity. The common opinion among economists and right-wingers that it's stupidity has historical baggage attached to it.

Back in Adam Smith's day, just about everyone was a subsistence farmer and free trade would make everyone wealthier in absolute terms. Even a century ago, there wasn't much difference in the standard of living among nations that would trade with each other. Sixty years ago, Europe and Japan were decimated by war and "free trade" could only mean that the French sold us cheese, the Germans sold us beer, and both bought our computers and jet engines. And it's still true that rich nations ought not throw up trade barriers against other similarly rich nations.

But...that's not what we've got right now and the free traders sound silly when they apply lessons learned under those circumstances to the situation of "free trade" with places where the prevailing wages are a tenth of what ours are here but the information and know-how flows freely. Maybe it's good for them, but it hollows us out.

Re:USA always using protectionist practices

[ShanghaiBill]

The countries with the lowest trade barriers are Singapore, Hong Kong, the Netherlands, Sweden, Switzerland and New Zealand. These are all countries with strong and growing economies. There are many examples of countries, such as Chile, South Korea, and Taiwan, that had closed economies, that then opened themselves to trade and prospered.

Can you name even a single counterexample of a country that put up trade barriers, and saw their rate of growth increase?

Re:USA always using protectionist practices

[ShanghaiBill]

Protectionism has been used by left and right. It's certainly not liberal, though.

"Liberal" means different things to different people.
In Europe, it has the original meaning of what Americans call libertarian (free trade, free enterprise, social tolerance).
In America, a "liberal" is a progressive, or what Europeans call "social democrats".
In Australia, a "liberal" is a right wing conservative.

Re:USA always using protectionist practices

[Goldsmith]

Your heart's in the right place, but this is a bad question. Many countries use and have used trade barriers to great success.

Right now, you can look at Canada (agriculture) and China (manufactured goods) as growth-with-trade-barrier successes.

Historically, the US became a manufacturing power by having very high trade barriers through most of the 19th century and the first half of the 20th. Japan rebuilt it's economy behind steep trade barriers after WWII. Alexander Hamilton and England's Henry VII (the "businessman" king) were protectionists.

But, you're right to point out that success often comes when you close (for a generation or two) and then re-open. What is the quality of life like behind trade barriers? It's not better. With trade barriers, you're effectively getting people to work harder for less money. This is something we're already doing very well in the US, and which we've found we can do with technological advancement faster and better than trade barriers. This is because developing new tech gives you access to new markets as you develop them, and during the highest profit stages of market development. Technology development is what we're good at, we should focus on that.

Re: USA always using protectionist practices

[drinkypoo]

WW2 was a good thing?

It was a good thing for the US economy. Everyone else got punched in the nuts and we came out ahead. All that prosperity where a bag boy could buy a house in the USA was based on WWII.

Re:USA always using protectionist practices

[Whibla]

Some examples include Switzerland, UK (the Princes (Harry and Andrew) had to do it as well - so royalty is no exception)...

You are mistaken.

Unlike Switzerland, the UK does not have mandatory military service, not even for royalty.

The reason, as I understand it, that the Princes did serve was out of a sense of obligation (literally the notion of noblesse oblige). If, as titular leaders of the country's military, they were to give orders sending soldiers into combat they'd better be in a position to understand what being a soldier is. There is also historical precedent to consider. When it comes to the nobility it has long been the case that the first (male) child was groomed to inherit, the second went to serve, while the third would often go into the church.

Anyway, when it comes to the modern age, to emphasise, while serving in the military might have been expected of them it was not required of them.

Re:USA always using protectionist practices

[Anonymous Coward]

Like the time Democrats fought for the right to own black people?

You mean the right-wing Southern Conservative "Democrats" who have been dead for over a century but that the "Republicans" of today laud as heroes for standing up for states's rights while vehemently insisting we hold sacred their monuments to racism and oppression?

Or are you talking about the time Democrats rounded up anybody who looked Japanese and shoved them in camps, whilst looting their property?

You mean the "Democrats" and "Republicans" of the 1940s who allied with Communism just to fight a war against the right-wing Fascists who engaged in industrial genocide the reality of which is happily denied by the "good people" in the White Nationalist movement of today?

Oh, yes, tax cuts are so dark.

You mean "tax largess" to the wealthy kleptocrats, and yes, that is some dark-ass corruption, as it was back in the 1830s and 1870s, and 1920s, and...

Well, the fact is, Trump might have just as well sold out the country, at least then we'd be renters, not debtors.

P. J. O'Rourke

[Tokolosh]

"When buying and selling are controlled by legislation, the first things to be bought and sold are legislators."

-- P. J. O'Rourke

(Warning: source may be paywalled; alternative sou

[Gojira Shipi-Taro]

Can we just dispense with linking paywalled sources in the first place?

It's definitely a poor idea to allow Huwei or however the fuck it's spelt to dominate this space.

broadcom will actually have to do R&D shock

[johnjones]

Instead of taking over companies and rinsing them of all their assets...

lets see broadcom actually produce some new products from LSI and Brocade maybe ?

they are headquartered in singapore to pay as little tax as possible...

The real security risks is Donald J. Trump

[Anonymous Coward]

We all remember the original Red Dawn, the movie where Russian troops invade the US and high school kids carry out guerilla warfare against the invading Russians.

Red Dawn 2064 opens with Evgeny Shamalov, the first candidate of the new UltraCon-Republican party, being sworn is as President of the United States. Sharmalov, it is revealed, lost the popular vote, but won the electoral college in an election widely regarded as having been rigged.

Flash back to 2013. We see a small jet land at a private airport outside Miami. A very pregnant Yekaterina Vladimirovna Tikhonova Sharmalov (nee Putin) is helped down the steps and into a waiting limo which whisks her away to a hotel reminiscent of Mar-A-Lago. A few days later she goes into labor and delivers a baby boy. A baby boy she names Evgeny.. Days later they fly home to Russia in possession of an American birth certificate.

Flash forward to 2064 again. Smarmolov quickly moves to cement his power, taking control with an iron fist. Russian billionaires move to the US in record numbers. Just like the Norman invasion of England in 1066 where the Norman nobility take over, except now it's the new Russian nobility and Americans are the new serfs.

High school kids that try to rise up are quickly eliminated by US Air Force Predator drones strikes, flown by our own US military. The kids have AR-15s – America never passed reasonable gun control – but they didn't stand a chance against Predators and guided missile strikes.

-- Americanus

Re:The real security risks is Donald J. Trump

[PolygamousRanchKid]

High school kids that try to rise up are quickly eliminated by US Air Force Predator drones strikes, flown by our own US military. The kids have AR-15s – America never passed reasonable gun control – but they didn't stand a chance against Predators and guided missile strikes.

-- Americanus

This is a common military strategic thinking mistake made by top US military brass and armchair computer war games players.

The Afghan and Iraqi insurgents only have homemade Kalashnikovs, RPGs and IEDs! We will easily crush them with our M1 Abram tanks, Predator and guided missile strikes! We will defeat them in a few weeks!

Well, after 15 years, the US military still hasn't defeated them. The US military met the same fate in Vietnam. I remember in the 70s, everyone in the US said that we would never repeat the same mistakes made there.

Oops! We forgot, and thought we could defeat guerilla insurgents with a conventional army. And we repeated the same mistakes in Afghanistan and Iraq.

How did the UK do in trying to defeat the IRA?

They didn't, and were forced into a peace process with known terrorist murderers. Or freedom fighters, depending on your personal political beliefs.

A high school kid with an assault weapon hidden under his bed will not defeat the US military. But he can indefinitely harass and annoy them causing casualties that will eventually force them to give up.

Oh, where will these high school kids get their weapons . . . ? The same place they get their drugs today. All the US military might cannot prevent drugs from being smuggled into the country . . . weapons will be no problem either.

And IEDs, just how will the high school kids make them . . . ? The same way I did in high school. Take a bottle of iodine crystals and mix it into household ammonia cleaning fluid. Strain the resulting precipitate through a coffee filter, and let it dry . . . somewhere in the shade, not in sunlight! When it is dry, poke at it with a pencil.

Fun, fun, fun.

The Palestinian terrorists even produce deadly souped up bottle rockets called Qassams, which use aluminum powder and sulfur for fuel. Oh, and "Carlo" machine guns.

So, "Red Dawn" was a seriously silly movie . . . but the effectiveness of a guerilla fighters against a conventional military force should not be underestimated.

Re:The real security risks is Donald J. Trump

[drinkypoo]

The issue though is that it tends to require a level of brutality that is currently politically untenable in the United States.

And not just politically. American soldiers committed suicide in record numbers in Iraq. What do you think those numbers would be like if they were massacring their neighbors at home?

Re:Broadcom = buggy hardware

[BlueStrat]

I get better news on reddit.

I can get better news by face-rolling the keyboard in the search bar. It's not like the goalposts are particularly high, here.

Seriously, I come here for the comments and discussions when it's not just screaming obscenities like monkeys flinging poo...yeah, I know...unicorns and hen's teeth these days.

Point being, if you're coming to Slashdot for *news* then you're doing it wrong. It may have the word "news" in the motto, but this is not a current-news site by any stretch of the imagination.

Strat

Look more closely

[Anonymous Coward]

I'm from New Zealand, and I think this a quite an oversimplification. Australia has much higher trade barriers than NZ, and has much higher growth (they have had something like 28 years now without a recession). This is because they have a big enough population to sustain their own heavy industries, and abundant natural resources that are in high demand.

The countries you list are all very small either population and/or resource wise. They have to trade, or their people go without. It doesn't really prove anything as to whether protectionist policies are useful or not.

I generally agree that trade barriers are stupid, but there is also the valid counter point that other countries do not necessarily play the game fairly. There is no easy solution to this, because if a country reacts by putting up its own barriers (tariff or non-tariff) then you just start a tit-for-tat trade war which most certainly is very damaging to all involved. But doing nothing can invite further abuses from your trade partners.

Personally I think a lot of people want to find 'the one rule to rule them all' around trade and economics because it is intellectually satisfying. But I do not believe that exists in many areas of economics. Indeed, I think the greatest failing of neo-liberalism, is that it allowed intellectually incompetent people to sweep into power by proclaiming that the solution to every problem was simply 'leaving it to the market'. How else do you explain the bunch of idiot showmen/women who now dominate western politics.

Endangered back doors, call 911!

[xxxLCxxx]

Everybody who ever grappled with driver BLOBs knows that Qualcomm* 'has an open heart' for people coming in via radio. This allows agencies to take over your phone easily via GPRS/LTE using an IMSI-catcher or simply by getting hooked in-between "by law" (after all, your're a potential terrorist).
Now if Broadcom takes over Qualcomm this could jeopardize their neat back doors. Makes you want to cry, doesn't it? :-P

---
*"Qual": noun, female; German for 'ordeal'.

Re:(Warning: source may be paywalled; alternative

[Crypto Gnome]

Can we just dispense with linking paywalled sources in the first place?

It's definitely a poor idea to allow Huwei or however the fuck it's spelt to dominate this space.

Yes, but the solution is for American Companies to stop royally sucking, not putting up government acts of business obstruction.

Recently America started crybabying about Chinese dominating the solar panel industry. BUT the reason that China dominates is THEY invested heavily in Solar power R&D at a time when The US of A made a decision to double-down on "fossil fuels".

Choices have consequences, deal with it.