In the last few weeks, Intel’s stock charged ahead by more than 20% as investors hoped for a breakup of Intel, the United States’ top manufacturer of leading-edge semiconductors. The Biden administration, with the support of Congress, tried to save American chip manufacturing with the CHIPS Act. $52 billion was approved in part to establish at least one American headquartered cutting-edge chip manufacturer. Some progress was made, including inducing Taiwan Semiconductor Manufacturing Company (TSMC), the world leader in chip manufacturing today, to invest in the United States. But the Commerce Department spent two years slow walking the implementation of the legislation, limiting the availability of funds, demanding social goals, and restricting ownership options. In a word, the Biden administration failed.
In the meantime, given the right conditions, the only player that can accomplish the goal of making America a leader in advanced chip manufacturing is Intel, which has continued to flounder. The CEO was fired in November, the board had no succession plan, and the company has become dependent on financial engineering to give shareholders a short-term boost.
