WEBVTT - How to Make the U.S. Semiconductor Industry Boom Again 0:00:10.560 --> 0:00:14.320 Hello, and welcome to another episode of the Odd Lots Podcast. 0:00:14.360 --> 0:00:18.439 I'm Joe Wisenthal and I'm Tracy Halloway. Tracy, we're doing 0:00:18.680 --> 0:00:22.400 We're doing another semi Conductor's episode today. There's no escape. 0:00:23.200 --> 0:00:25.279 Once you're in, you can't get out, right, We're gonna 0:00:25.320 --> 0:00:29.800 be doing semi conductors episodes, um for for the rest 0:00:29.840 --> 0:00:32.200 of our career, I'm sure. But you know, I think 0:00:32.200 --> 0:00:35.800 there's actually like two reasons we maybe three, or maybe 0:00:36.159 --> 0:00:38.120 why we keep going back to this. Well. I mean, 0:00:38.360 --> 0:00:40.599 for one, there's just a lot of news, like so 0:00:40.640 --> 0:00:44.320 many things have happened, whether it's a sort of new 0:00:44.400 --> 0:00:47.920 ventures from say Intel, or new spending plans from Tawan Semi, 0:00:48.000 --> 0:00:50.640 or new legislation being proposed, So there's all kinds of 0:00:50.680 --> 0:00:53.840 new news. But I also think, um, it's just a 0:00:53.960 --> 0:00:57.880 really good it's a good topic for us. Yeah. I 0:00:57.880 --> 0:01:01.520 think it's an interesting mix of technology and sort of 0:01:01.560 --> 0:01:06.840 business competition and also government policy. And we've spoken a 0:01:06.840 --> 0:01:10.600 lot about this, but government policy plays such a big 0:01:10.720 --> 0:01:16.160 role in sort of um incubating semiconductor industry, and I 0:01:16.160 --> 0:01:19.080 think we spoke about this probably the most with Taiwan 0:01:19.280 --> 0:01:22.520 and t SMC, But even in the US, you have 0:01:22.640 --> 0:01:26.280 that history of government support nurturing the early stages of 0:01:26.280 --> 0:01:30.399 the semiconductor industry as well. Yeah, that's exactly right, Like 0:01:30.440 --> 0:01:36.280 it touches on all these things technology, competition, market, stock market. 0:01:36.560 --> 0:01:38.360 But as you say, you know, there is a long 0:01:38.560 --> 0:01:43.600 history in China now currently Taiwan, Japan, the US of 0:01:43.720 --> 0:01:46.080 governments playing a role. And I think there's like this 0:01:46.200 --> 0:01:48.360 sort of broader macro thing which we talked about all 0:01:48.360 --> 0:01:53.520 the time, of sort of more activist role for government, 0:01:53.560 --> 0:01:57.320 for democratically elected or elected leaders, like thinking taking a 0:01:57.400 --> 0:02:01.880 more active role in shaping economy and managing the economy 0:02:02.240 --> 0:02:05.040 and so like. Because of that and because of the 0:02:05.120 --> 0:02:09.320 history of chips. Uh, semiconductors fit right into our fit 0:02:09.440 --> 0:02:12.280 right into our wheelhouse. Yeah, it's sort of a nice 0:02:12.280 --> 0:02:16.000 petree dish, I guess for a greater fiscal role for 0:02:16.040 --> 0:02:19.960 government's Yeah, exactly exactly right. And uh, every time we 0:02:20.000 --> 0:02:22.160 do semi conductor episodes, people listen to them and they 0:02:22.200 --> 0:02:24.919 want more, so we are going to deliver. So here 0:02:24.919 --> 0:02:26.799 we are again. Yeah, so here we are. Here we 0:02:26.840 --> 0:02:29.120 are gonna so you know, like I've forgotten all the 0:02:29.120 --> 0:02:31.400 ones we've done, We've done the fall of Intel, the 0:02:31.520 --> 0:02:36.200 rise of Taiwan, semi China's own ambitions, the stumbles of 0:02:36.240 --> 0:02:38.880 the US. I don't know if we've like really done 0:02:38.880 --> 0:02:42.639 one yet on what it would take for the US 0:02:42.720 --> 0:02:49.399 to really have a sustained recovery in its semiconductor manufacturing prowess. 0:02:49.440 --> 0:02:51.800 And of course we know that that's important because we 0:02:51.880 --> 0:02:56.800 have this acute semiconductor shortage, particularly affecting autos, but also 0:02:56.919 --> 0:02:59.280 there is this sort of long term maybe it's a 0:02:59.360 --> 0:03:02.919 defense of it's a geopolitical concern beyond this acute moment 0:03:03.240 --> 0:03:06.640 that it is problematic, that's such an important piece of 0:03:06.680 --> 0:03:11.400 basically everything that gets built is almost entirely important. I'm 0:03:11.400 --> 0:03:14.160 pretty sure we've touched on it in various episodes, but 0:03:14.200 --> 0:03:17.120 you're right, we haven't done a whole episode dedicated to 0:03:17.800 --> 0:03:20.120 US policy in the same way that we've done it 0:03:20.160 --> 0:03:24.200 for Taiwan or China. Yeah, exactly right. So today I'm 0:03:24.280 --> 0:03:26.679 very excited because we're going to finally talk about some 0:03:26.760 --> 0:03:31.639 of the history of semiconductor policy in the United States 0:03:32.080 --> 0:03:38.200 and also perhaps what policies could could revive the domestic industry. 0:03:38.480 --> 0:03:40.480 All right, let's do it, all right, So I'm very 0:03:40.480 --> 0:03:43.360 excited to speak to our guests. It's sort of actually 0:03:43.360 --> 0:03:46.360 the perfect combo because we actually have two guests today. 0:03:46.560 --> 0:03:48.520 One of them is an economist and one of them 0:03:48.560 --> 0:03:52.560 is a technologist. Alex Williams and huss And Kohn wrote 0:03:52.560 --> 0:03:56.440 a piece for Employee America back in March total titled 0:03:56.480 --> 0:03:59.880 a Brief History of Semiconductors, How the US cut cost 0:04:00.200 --> 0:04:03.800 and lost the leading edge and m Alex is an 0:04:03.800 --> 0:04:07.680 economist and research analyst and Employe America. Husson he's a 0:04:07.680 --> 0:04:12.520 PhD from Carnegie Mellon on semiconductor policy specifically, and he 0:04:12.560 --> 0:04:16.120 now works in tech in both operations and procurement. So 0:04:16.240 --> 0:04:18.679 between the two of them, kind of the perfect way 0:04:18.720 --> 0:04:21.640 to talk about the macro and the micro at once. Uh, 0:04:21.920 --> 0:04:24.160 Alex and Husson, thank you so much for joining us. 0:04:24.279 --> 0:04:26.840 Really excited to hear. Yeah, glad to be here. So 0:04:26.880 --> 0:04:29.240 what is it from your perspective? I mean, as I said, 0:04:29.279 --> 0:04:32.120 you guys wrote this piece on Employee America, which normally 0:04:32.160 --> 0:04:35.400 is sort of very focused on bigger picture macro stuff, 0:04:35.640 --> 0:04:39.760 labor market stuff in general. Why from your perspectives is 0:04:39.800 --> 0:04:42.920 semi conductors as sort of a thing that fits into 0:04:42.960 --> 0:04:48.000 that rubric. So I think the big overriding theme behind this, uh, 0:04:48.040 --> 0:04:50.080 this series that we've been doing on semi conductors. We 0:04:50.120 --> 0:04:52.279 have two pieces out so far. We have a third 0:04:52.279 --> 0:04:55.520 one that should be ideally coming out right around when 0:04:55.560 --> 0:04:58.719 this episode goes public, and then a fourth one after that. 0:04:59.320 --> 0:05:01.839 But the I you just like us, once you start 0:05:01.880 --> 0:05:04.679 the semi conductor series, you can't stop. It's so true. 0:05:04.720 --> 0:05:07.160 We originally were going to write one piece and then 0:05:07.200 --> 0:05:09.640 it was so big, and then it kept going. It 0:05:09.839 --> 0:05:12.880 just yeah, there's something about this industry that every every 0:05:12.880 --> 0:05:15.159 time you look a little bit closer, there's an entire 0:05:15.320 --> 0:05:17.920 other world that opens up. All right, Sorry, keep going. 0:05:17.960 --> 0:05:20.680 I didn't mean to interrupt you. Oh, no, worries. So 0:05:21.000 --> 0:05:25.680 really what we wanted to talk about was was semiconductors 0:05:25.720 --> 0:05:29.240 is a lens for thinking about sort of the intersection 0:05:29.520 --> 0:05:34.800 of you know, industrial policy, trade policy, stagnant demand over 0:05:34.880 --> 0:05:39.040 the period since the two thousand crash and dot coms 0:05:39.040 --> 0:05:42.320 and things like that. And the idea was that we're 0:05:42.360 --> 0:05:46.080 a labor market focused institution, but industrial policy, you know, 0:05:46.279 --> 0:05:49.599 of its nature, has a strong you know, labor market focus, 0:05:49.600 --> 0:05:52.159 and that the idea is that you're directing the economy 0:05:52.200 --> 0:05:55.240 to make best use of its resources, even if sort 0:05:55.240 --> 0:06:00.000 of short run profit considerations or efficiency considerations don't necessar 0:06:00.040 --> 0:06:03.880 sarely support that. So it seems, you know, a little strange. 0:06:03.880 --> 0:06:05.440 We write about the FED a lot, we write about 0:06:05.480 --> 0:06:07.480 labor markets a lot, But the idea is that we 0:06:07.520 --> 0:06:10.279 wanted to bite off something a little bit bigger to say, okay, cool, 0:06:11.360 --> 0:06:13.760 we do care a lot about labor markets. But part 0:06:13.760 --> 0:06:16.279 of that is up skilling, and part of that is 0:06:16.560 --> 0:06:21.719 focusing economic policy around specific industrial objectives. And when you 0:06:21.839 --> 0:06:25.720 do that, you naturally you can't help but intervene in 0:06:25.800 --> 0:06:28.479 the labor market to do so. On the one hand, 0:06:28.920 --> 0:06:32.240 and on the other hand, you know, there's been real 0:06:32.320 --> 0:06:37.040 sort of bipartisan support for sort of doing something about semiconductors. 0:06:37.080 --> 0:06:39.919 Like there's really regardless of what political party you look to, 0:06:40.040 --> 0:06:44.839 there's you know, energy behind doing something about this situation. 0:06:44.880 --> 0:06:47.080 And we wanted to kind of spell out, you know, 0:06:47.279 --> 0:06:51.640 from a perspective that sees these labor market outcomes as 0:06:52.560 --> 0:06:55.320 critical and not just accidental. We wanted to spell out 0:06:55.400 --> 0:06:59.840 what that kind of policy intervention should look like. If 0:06:59.880 --> 0:07:02.400 I can had one thing on just the industrial policy lens. 0:07:02.760 --> 0:07:07.000 It's really interesting because the semiconductor industry has has been 0:07:07.040 --> 0:07:09.000 at the forefront of a lot of these debates in 0:07:09.040 --> 0:07:12.360 the past. And if you revisit the industrial policy debates 0:07:12.360 --> 0:07:14.800 of the nineteen eighties UM when they were talking about 0:07:14.800 --> 0:07:18.680 saving steel and auto, they weren't focused on the semiconductor 0:07:18.680 --> 0:07:23.160 industry as a place that needed intervention. And so I 0:07:23.480 --> 0:07:25.760 do think given this moment in time and the focus 0:07:25.880 --> 0:07:28.560 on the industry, is a good chance for us to 0:07:28.560 --> 0:07:30.640 reflect on you know, we had a chance to do 0:07:30.720 --> 0:07:32.880 i P in the past, and we chose not to 0:07:33.720 --> 0:07:36.320 because we we thought, hey, the booming industries will save us. 0:07:36.560 --> 0:07:38.400 And we're kind of back at that same debate with 0:07:38.400 --> 0:07:41.360 an industry that that was ignored in those previous debates. 0:07:41.360 --> 0:07:43.160 So it is a good chance for us to kind 0:07:43.160 --> 0:07:45.920 of revisit the history too and say what can we 0:07:46.000 --> 0:07:49.880 learn from the past debates that we had. So Alex 0:07:49.920 --> 0:07:54.160 mentioned this idea of industrial policy being tied to labor 0:07:54.200 --> 0:07:58.480 markets and also allowing um an industry to sort of 0:07:58.920 --> 0:08:02.640 look past short term inefficiencies for the sake of like 0:08:02.760 --> 0:08:07.000 longer term competitive gains. Can you talk a bit about 0:08:07.000 --> 0:08:11.320 how that relates to semiconductors specifically, like why is that 0:08:11.440 --> 0:08:15.960 important for the semiconductor business? Model. One of the lessons 0:08:16.000 --> 0:08:20.320 that gets lost when we talk about off shoring of 0:08:20.360 --> 0:08:23.840 production is that it's not just moving a facility offshore, 0:08:24.080 --> 0:08:28.440 you actually move that expertise offshore. So a factory is 0:08:28.520 --> 0:08:31.200 not just a box with a bunch of machines in 0:08:31.240 --> 0:08:34.680 it that are outputting widgets. It is that capex, but 0:08:34.760 --> 0:08:37.640 it's also the people who come together to produce out 0:08:37.640 --> 0:08:41.280 of that factory. And so one of the major consequences 0:08:41.640 --> 0:08:44.360 of sort of the last thirty years of the like 0:08:44.520 --> 0:08:50.200 offshoring revolution in manufacturing from the United States perspective is 0:08:50.200 --> 0:08:53.400 that we also lost a lot of latent expertise within 0:08:53.440 --> 0:08:56.480 the economy. So actually, my advisor has worked with other 0:08:56.559 --> 0:09:00.680 researchers and students that showed that when plans shut down, 0:09:00.720 --> 0:09:03.079 a lot of the folks who are in the scientific 0:09:03.120 --> 0:09:06.320 research department leave the industry. They don't patent in the 0:09:06.360 --> 0:09:09.680 industry anymore. So now you have scientific expertise exiting the 0:09:09.679 --> 0:09:13.240 industry entirely. And similarly, think of like blue collar workers 0:09:13.360 --> 0:09:15.920 who you know, they might be doing servicing of machinery 0:09:16.080 --> 0:09:18.800 or they might be floor operators. They have to go 0:09:18.880 --> 0:09:20.880 find work elsewhere, and they have a lot of latent 0:09:20.920 --> 0:09:24.520 knowledge about processes and how to actually build things that 0:09:24.559 --> 0:09:27.319 gets lost when they go work in a different industry. Altogether. 0:09:27.720 --> 0:09:32.080 The upshot is that um, that human capital is not 0:09:32.240 --> 0:09:35.480 just like jobs, but they're actually the people who figure 0:09:35.480 --> 0:09:39.640 out solutions on how to make how to push technology forward, right, 0:09:39.800 --> 0:09:42.960 and not just from a academic perspective, pushing technology forward 0:09:43.000 --> 0:09:45.840 with invention, but actually with you know, tweaking on the 0:09:45.840 --> 0:09:50.720 shop floor and translating uh research and development ideas into 0:09:51.040 --> 0:09:54.480 production capabilities. And the role that policy can play in 0:09:54.520 --> 0:09:58.160 this is you know, after say the two thousand you 0:09:58.200 --> 0:10:01.000 know dot com bubble bursting, you had to situation where 0:10:01.640 --> 0:10:04.360 you know, in a lot of sort of economic models, 0:10:04.360 --> 0:10:06.959 you think, oh, there's a crash, it's going to force 0:10:07.040 --> 0:10:10.400 out the less competitive companies so that the more competitive 0:10:10.440 --> 0:10:14.200 ones can restructure themselves and win the day. But the 0:10:14.280 --> 0:10:17.120 issue is is that you had substantial labor market attrition. 0:10:17.240 --> 0:10:19.840 So this sort of you know, sort of squeezing effect 0:10:19.920 --> 0:10:22.040 like an accordion where people get pushed in and out 0:10:22.040 --> 0:10:26.360 of the labor market creates just an incredible excess waste 0:10:26.520 --> 0:10:32.199 of capacity when under a policy supported softer budget constraint regime, 0:10:32.720 --> 0:10:36.160 you could actually preserve and inculcate that you know that 0:10:36.280 --> 0:10:39.280 human capital, as it were, one of the things that 0:10:39.640 --> 0:10:42.040 you guys talk about in this piece as sorry, And 0:10:42.120 --> 0:10:44.199 as you mentioned, there's two pieces by now, but I'm 0:10:44.200 --> 0:10:46.840 looking at the one that you wrote in margin, and 0:10:46.920 --> 0:10:51.760 you draw this distinction between industrial policy, and I hadn't 0:10:51.800 --> 0:10:55.280 heard the term before, but it's very useful science policy. 0:10:55.960 --> 0:10:58.320 And I think you know, when people think, oh, let's 0:10:58.320 --> 0:11:01.000 you get to take to revive of US industry or 0:11:01.160 --> 0:11:03.720 revive tech expertise, like oh what about R and D 0:11:03.840 --> 0:11:06.000 and spending, and you sort of put that in this 0:11:06.080 --> 0:11:09.360 category of science policy. But can you talk about the 0:11:09.440 --> 0:11:13.240 sort of the distinction between these two things and the 0:11:13.520 --> 0:11:16.120 some of the approaches that have been taken in the past, 0:11:16.200 --> 0:11:18.719 Because this isn't the first time that there has been 0:11:18.800 --> 0:11:23.200 anxiety about chips elsewhere sort of pulling away from US. 0:11:23.880 --> 0:11:26.640 So I'm gonna say one quick thing before leaving it 0:11:26.640 --> 0:11:29.120 to Hussan to talk about the history of this split. 0:11:29.440 --> 0:11:32.000 But I think that the core thing to remember here 0:11:32.120 --> 0:11:36.400 is there's this idea that technology is just some overlay 0:11:36.480 --> 0:11:40.240 that sits on top of existing productive processes, whether you're 0:11:40.280 --> 0:11:43.559 thinking of like you know, sort of total factor productivity 0:11:44.160 --> 0:11:47.320 or other ideas of technology that it just sort of 0:11:47.440 --> 0:11:51.520 is this faery dust sprinkled over existing production. The issue 0:11:51.640 --> 0:11:54.640 is is that for technology to really be incorporated in 0:11:54.679 --> 0:11:58.480 the capital stock, it has to feed out through and 0:11:58.559 --> 0:12:02.600 become incorporated in the actual physical products used in production. 0:12:03.200 --> 0:12:06.680 And so if you don't have an industry that is booming, 0:12:06.720 --> 0:12:11.400 that is getting turnover in CAPEX where older technology production 0:12:11.440 --> 0:12:15.320 equipment is being replaced with newer technology production equipment. The 0:12:15.440 --> 0:12:17.360 things that you know how to do with the frontier 0:12:17.440 --> 0:12:22.240 don't necessarily translate into production outcomes. But I will leave 0:12:22.679 --> 0:12:25.720 the history of of you know this this situation to Hassan. 0:12:27.400 --> 0:12:30.400 What Alex said is is very apt. I think where 0:12:30.440 --> 0:12:34.760 the policy mistake happened in the past was this framing 0:12:34.800 --> 0:12:37.800 of America needs to maintain its lead. In order to 0:12:37.840 --> 0:12:40.120 maintain our lead, we're going to fund R and D. 0:12:40.720 --> 0:12:45.600 The production and competition aspect of technology will be left 0:12:45.679 --> 0:12:48.439 up to firms in the market. And so there was 0:12:48.440 --> 0:12:51.600 a broad policy consensus to say, will fund R and D, 0:12:51.760 --> 0:12:54.240 whether that's through the military or through institutions like the 0:12:54.320 --> 0:12:57.960 NSF for national labs. The problem becomes that there is 0:12:58.000 --> 0:13:02.040 this translation that has to happen ween a researcher, who is, 0:13:02.480 --> 0:13:06.360 you know, doing cutting edge research and what is commercializable. So, 0:13:06.440 --> 0:13:09.040 just as one small anecdote, as part of my work 0:13:09.160 --> 0:13:13.960 on alternative Secilican SEAMOSS and graduate school UM, the industry 0:13:14.040 --> 0:13:18.559 was evaluating proposals by different academic researchers, and a researcher 0:13:18.600 --> 0:13:21.840 got up in front of an audience of industry researchers 0:13:21.840 --> 0:13:23.840 and was very confident that I solved your problem. I 0:13:23.880 --> 0:13:26.120 have your next transistor and went through and presented all 0:13:26.160 --> 0:13:29.360 sorts of data on its ability to operate and and 0:13:29.400 --> 0:13:31.680 showed that it was better in some cases. And the 0:13:31.720 --> 0:13:35.719 first question was what temperature does your transistor operate at? 0:13:35.880 --> 0:13:40.440 And very confidently the researcher said, oh, uh, seventy seven kelvin. 0:13:40.440 --> 0:13:44.320 It's cool that by liquid nitrogen. So just very spent 0:13:44.360 --> 0:13:46.240 two seconds thinking about it. That's not something you or 0:13:46.280 --> 0:13:48.360 I could put in our laptop or cell phone, and 0:13:48.400 --> 0:13:50.400 that's sort of you know, that's but that's kind of 0:13:50.400 --> 0:13:52.560 the where the disconnect is. We fund a lot of 0:13:52.600 --> 0:13:54.920 researchers who have leeway to go do all sorts of 0:13:54.920 --> 0:13:58.440 crazy things, and they do invent very interesting ideas, but 0:13:58.480 --> 0:14:00.520 at the end of the day. To take that, UM, 0:14:00.920 --> 0:14:03.719 the realm of science to the realm of technology requires 0:14:03.760 --> 0:14:07.480 a lot of translation and attention to you know, different 0:14:07.480 --> 0:14:09.800 types of variables like can I make a million of these? 0:14:09.880 --> 0:14:12.600 Can I put them in people's homes? Um? And something 0:14:12.640 --> 0:14:15.199 like a transistor at you know, this liquid nitrogen cooled 0:14:15.559 --> 0:14:18.439 fails that test for a technologist, but maybe not a scientist. 0:14:33.840 --> 0:14:37.840 Can we get into, like, um, the actual historical aspects 0:14:38.120 --> 0:14:40.720 of some of this, So just in terms of the 0:14:40.800 --> 0:14:45.200 industrial versus science policy split, you talk a lot about 0:14:45.200 --> 0:14:48.720 it in relation to what happened to the semiconductor industry 0:14:48.840 --> 0:14:52.680 in the nineties. Could you describe that period and exactly 0:14:52.800 --> 0:14:55.640 what happened and how it sort of set the US 0:14:55.760 --> 0:15:01.120 up for being less competitive in the tooth puss To 0:15:01.200 --> 0:15:03.120 come to where we were the decisions that were made 0:15:03.120 --> 0:15:05.280 in the nineties, it helps to take a step back. 0:15:05.400 --> 0:15:08.480 So at the founding of the semiconductor industry, you have 0:15:08.600 --> 0:15:13.080 this breakthrough at Bell Labs, and the military is extremely 0:15:13.160 --> 0:15:16.000 interested in this and it plays a very heavy handed 0:15:16.120 --> 0:15:21.600 role in shaping the diffusion of transistor technology across basically 0:15:21.600 --> 0:15:25.160 the entire economy. UM. It requires Bell Labs to openly 0:15:25.240 --> 0:15:28.040 license it um and it requires second source and contracts 0:15:28.040 --> 0:15:31.600 for any firms that are manufacturing transistors. The end result 0:15:31.760 --> 0:15:35.400 is that because of the military implications of this technology, 0:15:35.440 --> 0:15:38.240 we had this de facto industrial policy saying we need 0:15:38.280 --> 0:15:42.320 to diffuse semiconductor expertise throughout the economy. So that kind 0:15:42.360 --> 0:15:44.720 of lays the foundation for the U s having a 0:15:44.800 --> 0:15:47.560 durable lead for a couple of decades. Beginning in the 0:15:47.600 --> 0:15:51.840 late nineties seventies, Japanese firms begin to catch up, beginning 0:15:51.880 --> 0:15:54.640 with their their targeting of d RAM markets UM and 0:15:54.680 --> 0:15:58.280 they take the process lead from US firms. And this 0:15:58.320 --> 0:16:00.720 is sort of a major major watershed moment in the 0:16:00.760 --> 0:16:03.960 industry because the industry does actually ask for help, but 0:16:04.120 --> 0:16:06.400 it's first ask for help is on trade grounds, and 0:16:06.440 --> 0:16:09.720 it basically gets uh it asked for, like anti dumping 0:16:09.720 --> 0:16:14.360 measures against Japanese UM suppliers. There's all sorts of debates 0:16:14.400 --> 0:16:17.640 that happened. The big electronics manufacturers think firms like HP 0:16:17.960 --> 0:16:19.960 or IBM kind of sit out these debates because they 0:16:20.000 --> 0:16:23.320 actually like having cheap chips from Japan and there isn't 0:16:23.360 --> 0:16:27.880 a major push towards more heavy handed government involvement. The 0:16:27.920 --> 0:16:31.160 industry does get some wins in the nineteen eighties where 0:16:31.160 --> 0:16:35.240 the government allows them to do collaborative research, but even 0:16:35.280 --> 0:16:38.800 there it's pretty hands off. The government basically says, all 0:16:38.880 --> 0:16:42.680 we're going to do is fund advanced lithography and help 0:16:42.720 --> 0:16:47.280 you coordinate some of your investments across firms, but we're 0:16:47.280 --> 0:16:50.080 not going to take an active hand in shaping where 0:16:50.080 --> 0:16:52.200 the industry needs to go. We're going to look to 0:16:52.280 --> 0:16:55.080 the industry to kind of define where we need to go. 0:16:55.760 --> 0:16:58.960 And that kind of gets institutionalized in a few different institutions, 0:16:59.000 --> 0:17:01.960 the first being the SRC, which is a semi conductor 0:17:02.000 --> 0:17:07.359 Research Corporation which funds university research. Then SEMITECH, which is 0:17:07.400 --> 0:17:10.879 the most talked about industrial consortia UM which was jointly 0:17:10.920 --> 0:17:13.960 funded between U s sm E conductor firms and the 0:17:14.040 --> 0:17:15.840 do O D. And then the lastly is the National 0:17:15.840 --> 0:17:19.840 Technology road Map for Semiconductors, which is basically the industry 0:17:19.880 --> 0:17:22.359 saying here's where we think semiconductors are going to be 0:17:22.400 --> 0:17:25.520 in fifteen years and here the technical capabilities will need. 0:17:26.000 --> 0:17:28.480 And hey, government would be great if you helped to 0:17:28.520 --> 0:17:31.760 coordinate some of the early stage research research that we're 0:17:31.800 --> 0:17:34.199 going to need, you know, fifteen years from now. For 0:17:34.359 --> 0:17:38.200 future products. So how did that work out? The good 0:17:38.240 --> 0:17:40.840 side is that in the early nine nineties you actually 0:17:40.840 --> 0:17:43.480 have a resurgence for U S SMI conductor firms. They 0:17:43.480 --> 0:17:45.919 begin to recapture market share, and it is kind of 0:17:46.000 --> 0:17:50.119 like a everyone celebrates. Hey, this policy regime that we 0:17:50.119 --> 0:17:53.560 we established seems to be working. But the US takes 0:17:53.600 --> 0:17:56.119 its foot off the pedal and actually begins to wind 0:17:56.119 --> 0:17:58.440 down a lot of these institutions. One they no longer 0:17:58.480 --> 0:18:02.120 have a national focus. They begin Internet nationalized, so SEMITECH 0:18:02.200 --> 0:18:05.240 begins to introduce international members beginning the late nineties. The 0:18:05.280 --> 0:18:08.800 Technology Roadmap begins to introduce international members also in the 0:18:08.840 --> 0:18:11.719 late nineties, so it's no longer national technology roadmap, it's 0:18:11.720 --> 0:18:14.679 an international technology roadmap. UM. The end result is that 0:18:15.000 --> 0:18:18.399 a lot of entrepreneurs outside of the US kind of 0:18:18.400 --> 0:18:20.159 have a blueprint for what it's going to take to 0:18:20.240 --> 0:18:24.320 compete with US firms, and they they begin to catch 0:18:24.440 --> 0:18:27.760 up in key UH industry processes. So you see it 0:18:27.800 --> 0:18:30.600 in things like d RAM where Korean firms have have 0:18:30.800 --> 0:18:33.600 majorly caught up to even Japanese firms, and most Japanese 0:18:33.640 --> 0:18:36.239 firms have left the market. UM. And you see it 0:18:36.240 --> 0:18:39.520 now with the rise of foundries, where foundry firms were 0:18:39.560 --> 0:18:42.920 able to catch up to integrated device manufacturers and overtake 0:18:43.040 --> 0:18:46.040 you know, most recently with t SMC and Samsung overtaking 0:18:46.080 --> 0:18:49.320 Intel in terms of their process capabilities. And then the 0:18:49.720 --> 0:18:52.280 third sort of a trend that kind of makes this 0:18:52.560 --> 0:18:56.119 more exacerbated is you have a major technology revolution in 0:18:56.160 --> 0:19:00.720 the late two thousands where traditional manufacturing also sees get 0:19:00.760 --> 0:19:05.440 more expensive and US firms, which we're funding heavily in 0:19:05.600 --> 0:19:09.080 R and D and were previously integrated device manufacturers so 0:19:09.080 --> 0:19:11.640 they were vertically integrated, they begin to pull out most 0:19:11.640 --> 0:19:15.240 of their manufacturing and rely more and more on foundries, right, 0:19:15.320 --> 0:19:18.719 and so that helps those founderies also increase their overall 0:19:18.880 --> 0:19:22.160 CAPEX bend because they now have more customers kind of 0:19:22.240 --> 0:19:24.560 they have a stronger customer base to drive their R 0:19:24.640 --> 0:19:26.680 and D in capex and and help them further push 0:19:26.920 --> 0:19:31.240 the frontier of manufacturing. So ultimately, it worked out well 0:19:31.240 --> 0:19:33.400 in the near term in that a lot of these 0:19:33.440 --> 0:19:37.480 companies became more profitable because they were able to coordinate 0:19:37.480 --> 0:19:40.600 their research and development more tightly with one another, and 0:19:40.640 --> 0:19:43.280 they were able to sort of hone in on a 0:19:43.359 --> 0:19:47.399 particular vision of industry organization. But the problem is is 0:19:47.440 --> 0:19:52.959 that by distributing who is working on what in that manner, 0:19:53.200 --> 0:19:57.440 you don't build out redundancies in the system. If every 0:19:57.480 --> 0:20:01.600 individual firm is competing on every individ dual product line 0:20:01.840 --> 0:20:04.840 or if not product line approach to production, so like 0:20:04.920 --> 0:20:08.000 sort of production methodology or what have you, you just 0:20:08.200 --> 0:20:12.000 from an evolutionary perspective, have more people working on the 0:20:12.040 --> 0:20:15.120 same thing, so more sort of opportunities for kinds of 0:20:15.600 --> 0:20:18.600 you know, mutations in the method of production that may 0:20:18.680 --> 0:20:21.480 or may not be worthwhile. If you cut out that 0:20:21.760 --> 0:20:26.920 entire you know, base, once what you're working on starts 0:20:27.040 --> 0:20:30.240 to not quite work as well, you don't have a 0:20:30.359 --> 0:20:34.760 rolodex of strange ideas or mutations or slight differences that 0:20:34.800 --> 0:20:37.280 you can point to. On the one hand, and on 0:20:37.320 --> 0:20:41.040 the other hand, you self consciously shrunk the market for 0:20:41.240 --> 0:20:46.320 semicap for productive for producing machinery to produce semiconductors for 0:20:46.480 --> 0:20:50.960 domestic firms. And so these two together lead to this 0:20:51.080 --> 0:20:55.040 kind of self reinforcing situation where you're running really quickly, 0:20:55.400 --> 0:20:59.399 but the moment you trip, you're on the ground. Just 0:20:59.440 --> 0:21:02.240 one more has oracle question Before we move on to 0:21:02.800 --> 0:21:08.360 modern day efforts to boost U S semiconductor expertise and capacity. 0:21:08.400 --> 0:21:11.600 Can you talk a little bit more about Japan in 0:21:11.640 --> 0:21:13.800 the nineteen eighties, because this was such a big deal 0:21:13.960 --> 0:21:17.200 in terms of competition with the US, and they kind 0:21:17.240 --> 0:21:20.200 of on the one hand they went down a similar 0:21:20.280 --> 0:21:25.480 path in that the government was promoting their own domestic industry. 0:21:25.520 --> 0:21:28.080 But on the other hand, they didn't have nearly as 0:21:28.160 --> 0:21:32.600 much involvement um from the military because Japan's military it 0:21:32.720 --> 0:21:35.760 kind of exists, but it's nowhere near the size um 0:21:35.920 --> 0:21:40.800 or scale of the U S. Did you describe that contrast. So, 0:21:41.040 --> 0:21:44.800 the major institution in Japan that drove industrial policy for 0:21:44.880 --> 0:21:49.520 semi conductors and also computing is MITTY, which is and 0:21:49.520 --> 0:21:51.640 I always forget the exact name, but it's the Ministry 0:21:51.680 --> 0:21:55.560 for International Trade. They actually played a very heavy handed 0:21:55.640 --> 0:22:01.720 role in reshaping both the semiconductor and computing industries during 0:22:01.760 --> 0:22:05.960 the nineteen eighties. They set targets for what their technology, 0:22:05.960 --> 0:22:09.280 what their internal firms needed to be capable of UM 0:22:09.320 --> 0:22:12.280 at a technology level, so they said, by four we 0:22:12.320 --> 0:22:15.640 need to have x y z process and product capabilities, 0:22:15.840 --> 0:22:19.880 and they would actually reshape firms by force forcing UM 0:22:20.080 --> 0:22:25.600 collaborations between competitors on specific technology approaches. The end result 0:22:25.680 --> 0:22:29.160 was that it allowed them to leap frog American firms 0:22:29.359 --> 0:22:31.679 in product categories like d RAM, where they took a 0:22:31.680 --> 0:22:34.919 more conservative path um to reaching sort of the targets 0:22:34.920 --> 0:22:37.560 that have been laid out by Mitti and capturing huge 0:22:37.560 --> 0:22:41.439 portions of market share. The apex of fears over Japanese 0:22:41.560 --> 0:22:45.560 domination of the industry came with the announcement of Japan's 0:22:45.960 --> 0:22:49.880 fifth Generation Supercomputing project, which I believe was in four 0:22:50.200 --> 0:22:52.920 sort of based on the heels of their success with 0:22:53.400 --> 0:22:56.200 their v l s I program UM, where they basically said, 0:22:56.359 --> 0:22:58.760 we're going to now that we've caught up to the 0:22:58.760 --> 0:23:01.320 frontier in some econo pers and computing, we're going to 0:23:01.440 --> 0:23:04.359 define the next generation of computing with advances and semic 0:23:04.359 --> 0:23:09.959 connectors and computing technology. However, that program mostly was a 0:23:09.960 --> 0:23:13.840 failure UM. It petered out and sadly going into the 0:23:14.480 --> 0:23:18.280 ES from Japan's perspective, the the economy more broadly UM 0:23:18.280 --> 0:23:22.680 stagnated UM and you know today Japanese computer and semic 0:23:22.680 --> 0:23:25.240 connector firms are nowhere near the leadership they were in 0:23:25.280 --> 0:23:28.040 the eighties and nineties. So they did take a very 0:23:28.080 --> 0:23:30.960 different tact to sort of play catch up to U 0:23:31.040 --> 0:23:34.040 S firms, but they were also unable to to sort 0:23:34.080 --> 0:23:37.800 of build on that catch up phase to establish long 0:23:37.880 --> 0:23:40.480 term dominance the way the U S industry was able 0:23:40.480 --> 0:23:43.040 to do in the decades prior. If I can just 0:23:43.200 --> 0:23:45.760 offer a short summary of that in a in a 0:23:45.800 --> 0:23:51.200 certain way. So much of industrial policy for ketchup is effective, 0:23:51.400 --> 0:23:54.160 especially in East Asia, because the rest of the world 0:23:54.240 --> 0:23:57.040 presents a target and the goal of policy is to 0:23:57.119 --> 0:24:00.960 hit that target. When you're at the technical logical frontier 0:24:01.080 --> 0:24:04.520 or when you're attempting to gain the technological frontier, you 0:24:04.560 --> 0:24:07.240 need to not only be good at hitting targets, but 0:24:07.280 --> 0:24:11.160 you need to become good at specifying or imagining targets 0:24:11.200 --> 0:24:14.760 that no one sees yet, which is a different necessity 0:24:14.800 --> 0:24:17.480 and sort of speaks to the fact that there is 0:24:17.480 --> 0:24:20.560 a role for industrial policy. But the fact that there 0:24:20.600 --> 0:24:22.960 is a role for industrial policy doesn't mean that there's 0:24:23.000 --> 0:24:27.639 no role for science policy, which sort of funds people 0:24:27.760 --> 0:24:31.000 thinking about where targets might be or where targets ought 0:24:31.080 --> 0:24:34.080 to be. That that's super that's super interesting. So you 0:24:34.119 --> 0:24:36.040 still have to have that R and D. You have 0:24:36.080 --> 0:24:38.760 to have the crazies that think about can we have 0:24:39.480 --> 0:24:42.720 a chip that's a negative seventies seven kelvin And Okay, 0:24:42.760 --> 0:24:44.359 maybe that's never gonna be in a phone, but there 0:24:44.400 --> 0:24:48.320 have to be people out there and investment in figuring 0:24:48.320 --> 0:24:51.600 out what that that true? Like pure science tech frontier is, 0:24:52.080 --> 0:24:53.600 you know, I know where we gotta get to, like 0:24:53.640 --> 0:24:55.520 the sort of present tense like what's to be done? 0:24:55.520 --> 0:24:58.080 But you know, one of the questions I'm still like 0:24:58.160 --> 0:24:59.680 curious about her that I feel like we need to 0:24:59.680 --> 0:25:02.600 talk abo out of. We we have. Part of the 0:25:02.640 --> 0:25:04.920 consternation right now is the sort of model that you 0:25:05.040 --> 0:25:07.639 talked about where we have design in the US and 0:25:07.760 --> 0:25:09.919 a lot of companies that are still extremely good at it, 0:25:10.200 --> 0:25:15.719 but manufacturing overseas. The separation of design and production the foundries, 0:25:15.760 --> 0:25:17.800 and that's what left has left us sort of like 0:25:18.000 --> 0:25:22.720 I guess GEO politically vulnerable. Perhaps how much is the 0:25:22.960 --> 0:25:26.760 role of Wall Street specifically in the history a contributor 0:25:27.040 --> 0:25:31.880 to companies opting for this business model. So I think 0:25:31.920 --> 0:25:34.959 that is a good question, and I think we're you again. 0:25:35.040 --> 0:25:38.000 I don't have like a deep study on it, but 0:25:38.080 --> 0:25:40.400 I do think you saw a change in the industry 0:25:40.960 --> 0:25:45.680 when you saw generational change in its leadership. So UM 0:25:45.720 --> 0:25:48.320 in the late eighties and early nineties, many of the 0:25:48.480 --> 0:25:52.800 leaders of US semi connector firms like Intel or fair 0:25:52.920 --> 0:25:56.320 Child or am D, we're still their founders. And there 0:25:56.400 --> 0:25:59.080 was actually, when you talk about this split between design 0:25:59.080 --> 0:26:03.840 and manufacturing, a model from integrated vertically integrated manufacturers that 0:26:03.960 --> 0:26:07.959 quote real men have fabs UM. It was meant as 0:26:07.960 --> 0:26:11.560 an insult towards foulist firms who, you know, we're relying 0:26:11.600 --> 0:26:15.320 on foundries to build their chips. And there was a 0:26:15.359 --> 0:26:19.000 generational change in that leadership that also sort of saw, 0:26:20.080 --> 0:26:23.480 I think the financialized approach of hey, you know, we 0:26:23.560 --> 0:26:26.000 can shed some of our assets and reduce our overall 0:26:26.040 --> 0:26:30.040 costs and increase our margins if we rely on foundries UM. 0:26:30.119 --> 0:26:32.480 SO I think it was a mix of both Wall 0:26:32.480 --> 0:26:36.199 Street's influence, but also when that first generation of leaders 0:26:36.280 --> 0:26:39.239 left the industry, new managers came in and took a 0:26:39.280 --> 0:26:44.160 different approach to UM technology development and influence in terms 0:26:44.200 --> 0:26:47.040 of mood and approach rather than profit pressures, you know 0:26:47.119 --> 0:26:50.760 necessarily or a priori So maybe just to set the 0:26:50.800 --> 0:26:52.399 scene for the present day, when you look at the 0:26:52.480 --> 0:26:57.440 U S semiconductor industries competitiveness its place in the world, 0:26:58.320 --> 0:27:01.639 What do you see as lacking and where are the 0:27:01.640 --> 0:27:04.640 biggest areas for potential improvement, and then we can talk 0:27:04.640 --> 0:27:08.280 a little bit about how we might get there. So 0:27:08.320 --> 0:27:10.040 I think if you were to look at the U S. 0:27:10.040 --> 0:27:13.440 Smiconductor industry today, there are certainly pockets of excellence. We 0:27:13.720 --> 0:27:17.560 have world leading firms and electronic design automation like Synopsis 0:27:17.560 --> 0:27:20.360 and Cadence. We have world leading firms and equipment manufacturing 0:27:20.600 --> 0:27:23.320 like Applied Materials and k l A. Ten Core, And 0:27:23.359 --> 0:27:27.320 we have world leading fabulous design firms like Qualcom and 0:27:27.359 --> 0:27:30.920 in Video, and increasingly a new crop of tech giants 0:27:30.920 --> 0:27:34.080 like Google, Apple and Facebook who have realized they can 0:27:34.119 --> 0:27:38.159 get into chip design for their specific workloads. Where the 0:27:38.280 --> 0:27:42.960 U S industry has gotten weakest is it's specifically in 0:27:43.000 --> 0:27:47.520 its semiconducting manufacturing ecosystem. Although we do have quite a 0:27:47.520 --> 0:27:49.840 few fabs still in the US, both at the leading 0:27:49.920 --> 0:27:53.160 edge and at the trailing edge, we don't have sort 0:27:53.200 --> 0:27:58.520 of a thick ecosystem of equipment suppliers and manufacturers on 0:27:58.560 --> 0:28:02.560 the ground working together to push the edge on what's possible. 0:28:03.000 --> 0:28:06.080 And that's one place where, for example, a weakness is 0:28:06.200 --> 0:28:10.480 we don't have any EUV lithography machines in the US 0:28:10.480 --> 0:28:13.760 producing commercially outside of Intel, right, we have just one 0:28:13.840 --> 0:28:16.600 company in the U S who is using that technology. 0:28:16.680 --> 0:28:20.720 And we don't have that learning environment between multiple manufacturers 0:28:20.840 --> 0:28:23.280 and suppliers who are visiting multiple sites, who are kind 0:28:23.320 --> 0:28:26.720 of learning best in class techniques from different firms to 0:28:26.800 --> 0:28:29.520 continue to push the envelope. And and that kind of 0:28:29.600 --> 0:28:32.480 hinders our ability to innovate because you don't get innovation 0:28:32.520 --> 0:28:35.000 across the entire stack. You kind of focus your innovation 0:28:35.040 --> 0:28:37.160 on the places where we do lead, So you don't 0:28:37.240 --> 0:28:39.840 you don't kind of bring that full package together where 0:28:39.840 --> 0:28:43.400 you're where you're developing new technologies in the fab and 0:28:43.640 --> 0:28:48.480 helping that helping leverage those findings with suppliers and equipment 0:28:48.520 --> 0:28:53.400 manufacturers and design firms. And this is exactly the role 0:28:53.400 --> 0:28:55.800 of industrial policy and speaks to the sort of target 0:28:55.880 --> 0:28:59.120 metaphor that you know I used earlier, which is that 0:28:59.200 --> 0:29:01.680 if you have these cutting edge firms at the absolute 0:29:01.760 --> 0:29:05.680 peak of your industry, while you are at the technological frontier, 0:29:06.160 --> 0:29:08.240 it's clear that you have people who know how to 0:29:08.280 --> 0:29:14.160 set targets. The issue becomes translating that into a you know, 0:29:14.240 --> 0:29:17.880 industrial organization, you know, sort of like an ecosystem is 0:29:17.920 --> 0:29:21.440 a very good word for it, where you know, sort 0:29:21.440 --> 0:29:25.640 of there are a variety of firms engaged in and 0:29:25.840 --> 0:29:30.160 you know who in principle can help hit that target 0:29:30.240 --> 0:29:33.560 that is being specified by those sort of absolute front 0:29:33.600 --> 0:29:36.000 of the line firms. So the idea is that an 0:29:36.040 --> 0:29:41.040 introduction of industrial policy into the existing industry like will 0:29:41.080 --> 0:29:44.400 sort of allow it to do what it does well 0:29:44.600 --> 0:29:58.160 even better by virtue of adding support and supply line. 0:30:04.200 --> 0:30:07.160 So I realized, there's one more question I want to 0:30:07.200 --> 0:30:10.120 get to, uh, and it's related to this before we 0:30:10.160 --> 0:30:11.959 get to the sort of pure question of like, all right, 0:30:12.000 --> 0:30:14.120 what is the best policy it looks like and uh 0:30:14.520 --> 0:30:16.000 huss and you sort of hinted at it when you 0:30:16.040 --> 0:30:19.680 were talking about Japan's rise and fall, and it's something 0:30:19.760 --> 0:30:23.719 Alex that your colleague Scanda m. Nath has talked a 0:30:23.720 --> 0:30:27.240 little bit about. But what is also the role of 0:30:27.440 --> 0:30:30.080 just the sort of sluggish economy and all this the 0:30:30.160 --> 0:30:33.200 lack of capital deepening, the lack of capital investment of course, 0:30:33.480 --> 0:30:37.000 from the Great Financial Crisis to you know, the virus, 0:30:37.240 --> 0:30:41.120 the pandemic economic growth was weak. Tech really never really 0:30:41.280 --> 0:30:44.560 tech spending never really recovered in the same way after 0:30:44.600 --> 0:30:47.240 the dot com bubble. What is the role that just 0:30:47.280 --> 0:30:51.840 like our our our acceptance of poor growth contributed to 0:30:52.040 --> 0:30:57.040 this sort of hollowing out of techno. How so, our 0:30:57.120 --> 0:30:59.880 first piece in the series, actually, which is called supp 0:31:00.040 --> 0:31:04.280 lying demand the chip shortage in macro context, delves into 0:31:04.280 --> 0:31:08.440 this question, you know, pretty pretty intensively, and the simplest 0:31:08.480 --> 0:31:10.880 answer is a basic, you know, sort of Canzian answer. 0:31:11.000 --> 0:31:15.120 If you don't have strong demand, manufacturers are going to 0:31:15.200 --> 0:31:18.560 see that and say, Okay, our present capacity, in whatever 0:31:18.640 --> 0:31:21.920 technological quality it's in is sufficient to meet what we 0:31:21.960 --> 0:31:24.120 think is going to happen. So there's no need for 0:31:24.200 --> 0:31:27.640 us to invest in new capacity here because at that 0:31:27.720 --> 0:31:29.640 point we'll just flood the market and we'll begin to 0:31:29.640 --> 0:31:32.480 eat into our own margins. So if you can durably 0:31:32.560 --> 0:31:34.680 predict that there's going to be low demand for a 0:31:34.720 --> 0:31:37.920 long period of time, you can cut capex and not 0:31:38.080 --> 0:31:40.640 have it, you know, negatively impact you because there's no 0:31:40.720 --> 0:31:44.080 demand for you know, anyone in in that market space. 0:31:44.120 --> 0:31:47.160 But the problem is is that if you have say 0:31:47.560 --> 0:31:51.200 technology advancing at a constant rate, and like I said before, 0:31:51.360 --> 0:31:54.600 for that technology to enter into the production process. It 0:31:54.680 --> 0:31:57.520 has to come through, it has to become embodied in 0:31:57.960 --> 0:32:01.600 new capital goods for production. If you don't have a 0:32:01.600 --> 0:32:05.720 macroeconomic environment that has enough you know, effective demand to 0:32:06.200 --> 0:32:10.760 persuade producers to invest in new capital goods and to 0:32:10.840 --> 0:32:13.800 add capacity, you're not going to see that technology be 0:32:13.840 --> 0:32:16.080 taken up because you're not going to see the capex happen. 0:32:16.520 --> 0:32:19.360 An environment of low effective demand is going to redound 0:32:19.440 --> 0:32:23.440 not only on poor employment, which you know, creates a 0:32:23.520 --> 0:32:26.840 less skilled labor force, you know, and even without even 0:32:26.880 --> 0:32:31.200 speaking to layoffs caused by you know, sort of market slowdowns, 0:32:31.200 --> 0:32:34.760 but it's just going to not have technological advances that 0:32:34.840 --> 0:32:37.800 do happen be incorporated into the economy as a whole 0:32:37.840 --> 0:32:39.480 as quickly as it could be, and so you'll see 0:32:39.520 --> 0:32:44.360 a productivity slowdown as well. So does that suggest that 0:32:44.640 --> 0:32:47.480 one of the fixes for the market right now could 0:32:47.480 --> 0:32:51.240 be setting some sort of demand floor, like just ensuring 0:32:51.280 --> 0:32:55.200 that the government is there to buy up excess capacity 0:32:55.240 --> 0:33:00.880 of semiconductors. So I think that that's a a necessary 0:33:01.000 --> 0:33:05.760 part of the fiscal spending, part of an industrial policy plan. However, 0:33:06.600 --> 0:33:11.320 it's very difficult to specify beforehand where that should be done. 0:33:11.440 --> 0:33:15.040 As I'm sure Huston can speak to, semiconductors are an 0:33:15.080 --> 0:33:20.200 astoundingly differentiated market where you know, the there's there's very 0:33:20.280 --> 0:33:22.959 little that is you know, you could think of as 0:33:23.000 --> 0:33:25.120 a simple baseline. You know, in the same way that 0:33:25.480 --> 0:33:28.280 price supports for commodities like milk, you can define a 0:33:28.320 --> 0:33:31.040 basic this is milk everywhere you go, this is what 0:33:31.160 --> 0:33:34.959 milk is. So before we can do that, really what 0:33:35.040 --> 0:33:39.160 needs to be done is the US government would need 0:33:39.200 --> 0:33:41.960 to build out a data gathering apparatus to get a 0:33:42.000 --> 0:33:45.560 full picture of what supply chains look like now, because 0:33:45.680 --> 0:33:51.680 with the level of differentiation, it's difficult to say what 0:33:51.880 --> 0:33:54.320 that would look at before that data is gathered. They'll 0:33:54.320 --> 0:33:56.640 I'll let us and speak on that if he wants to. 0:33:57.320 --> 0:34:00.000 And actually this is a place where the Biden administer 0:34:00.000 --> 0:34:02.160 it should sort of started on the right foot. Um. 0:34:02.200 --> 0:34:04.479 It was one of the first executive orders that they 0:34:04.480 --> 0:34:07.960 announced was a supply chain review of semi conductors, and 0:34:08.320 --> 0:34:10.480 it's sort of as as Alex hinted at earlier, I 0:34:10.480 --> 0:34:13.920 think it's really important because there is a major bipartisan 0:34:13.960 --> 0:34:18.360 consensus on doing something. But to cut through the noise 0:34:18.640 --> 0:34:21.800 and get to the what is this something we should do. 0:34:22.040 --> 0:34:24.640 I do think the government has to take time to 0:34:24.719 --> 0:34:29.040 take stock of where are our biggest vulnerabilities in the 0:34:29.080 --> 0:34:32.080 supply chain today? UM. We've had some a lot of 0:34:32.120 --> 0:34:36.160 noise related to the shortage, especially with say automakers, But 0:34:36.239 --> 0:34:38.680 I don't think there's anyone who's saying we need to 0:34:38.960 --> 0:34:43.759 completely reshore the automobile I see supply chain. UM. I 0:34:43.800 --> 0:34:47.040 think instead, you know, the conversation we should be having 0:34:47.080 --> 0:34:50.440 at at an industrial policy level is what are the 0:34:50.480 --> 0:34:54.000 internal capabilities that we need to maintain in order to 0:34:54.040 --> 0:34:58.680 maintain a resilient UM semi conductor ecosystem in the United States, 0:34:59.120 --> 0:35:01.279 and how can we support that? So there may be 0:35:01.440 --> 0:35:06.000 areas of that ecosystem that are best supported with purchase guarantees, um, 0:35:06.040 --> 0:35:09.560 you know, for specific markets to make them competitive. UM, 0:35:09.600 --> 0:35:12.400 But I do think other areas would have other support 0:35:12.400 --> 0:35:15.960 mechanisms as well. Right So, with autos, although it's a 0:35:16.000 --> 0:35:19.480 problem right now, my understanding is that the actual technology 0:35:19.520 --> 0:35:22.440 that's missing is they're cheap, they're low end. It's not 0:35:22.560 --> 0:35:26.319 like necessarily the most urgent thing. Ultimately, it's just sort 0:35:26.320 --> 0:35:28.480 of a weird thing going on right now. So in 0:35:28.520 --> 0:35:31.160 your view, like, where should we be looking like, where 0:35:31.160 --> 0:35:33.680 do you think we're going to find the supply chain 0:35:33.880 --> 0:35:38.520 vulnerabilities and what are some of the perhaps best policies 0:35:38.880 --> 0:35:41.000 that we could be putting forth in terms of like 0:35:41.160 --> 0:35:45.920 legislation and dollars that that might go towards addressing it 0:35:46.040 --> 0:35:49.600 or maybe building a system that can resiliently address issues 0:35:49.640 --> 0:35:52.719 as they come up. I think I'll talk a little 0:35:52.719 --> 0:35:55.480 bit about the specific deficiencies that I see, and then 0:35:55.520 --> 0:35:58.600 Alex can maybe talk more about some of the proposals 0:35:58.600 --> 0:36:02.879 that we've seen and where those are most promising. So 0:36:02.960 --> 0:36:05.000 I think we're where where the U S has a 0:36:05.120 --> 0:36:09.840 deficiency is we've weakened sort of our overall ecosystem for 0:36:10.320 --> 0:36:13.640 manufacturing innovation, and I think I would give to give 0:36:13.680 --> 0:36:15.840 a good counterexample of what that might look like. Is 0:36:16.000 --> 0:36:18.800 You've had Dan Wang on this podcast to talk previously 0:36:18.840 --> 0:36:21.640 about how magical of a place Shenzen is for its 0:36:21.680 --> 0:36:25.600 electronics ecosystem where you have engineers from across the world 0:36:25.680 --> 0:36:28.760 kind of coming together and tunkuring to build new things. 0:36:29.200 --> 0:36:31.440 And if you go back to Silicon Valley in the nineties, 0:36:31.520 --> 0:36:33.719 that's what you had. You had, you know, engineers from 0:36:33.760 --> 0:36:37.279 different firms coming together, meeting up at local bars and 0:36:37.360 --> 0:36:39.360 kind of learning from each other and learning from local 0:36:39.360 --> 0:36:43.480 suppliers on what best and class capabilities were. Because today 0:36:43.640 --> 0:36:46.960 that our domestic ecosystem has been so thinned out, you 0:36:47.040 --> 0:36:50.480 really only have you know, a few company towns where 0:36:50.520 --> 0:36:54.040 you don't get that same sharing of information. That's one weakness. 0:36:54.200 --> 0:36:56.960 I think the other weakness that we have is we 0:36:56.960 --> 0:37:02.200 we have reliance on individual rule suppliers for key key 0:37:02.239 --> 0:37:04.279 links in the supply chain. So the one that's gotten 0:37:04.280 --> 0:37:07.040 talked a lot about is t SMC at the leading edge, 0:37:07.120 --> 0:37:09.479 where you can't manufacture a trip at five or seven 0:37:09.480 --> 0:37:12.480 animeters without relying on t SMC. But we're also seeing 0:37:12.480 --> 0:37:16.520 it in trailing edge nodes where a lot of materials 0:37:16.560 --> 0:37:20.319 and components are single source, sometimes out of Taiwan or 0:37:20.360 --> 0:37:22.879 sometimes out of other countries like China, and those create 0:37:22.920 --> 0:37:27.440 vulnerabilities for our entire industrial ecosystem because hey, guess what 0:37:27.520 --> 0:37:30.840 that two dollar integrated circuit that's nothing to write home about. 0:37:31.040 --> 0:37:33.560 You can only get from one plant. And so I 0:37:33.600 --> 0:37:36.720 think you know that leads you to the first policy 0:37:36.719 --> 0:37:39.440 point that that Alex introduced, which is we need to 0:37:39.480 --> 0:37:41.879 do a review of our supply chains to understand where 0:37:41.880 --> 0:37:46.520 those gaps really are and then think about remedies. And 0:37:46.560 --> 0:37:50.040 I would say, in terms of taking seriously that the 0:37:50.120 --> 0:37:54.239 first step towards coming up with a truly efficacious industrial 0:37:54.280 --> 0:37:58.000 policy program. In terms of proposals on the table to 0:37:58.080 --> 0:38:02.319 do this, the Endless Frontiers Act doesn't really address this 0:38:02.400 --> 0:38:04.600 too much. A lot of its funding is still focused 0:38:04.600 --> 0:38:08.640 through academia, even though it does engage with the Manufacturing 0:38:08.760 --> 0:38:13.160 USA program. The Chips Act does provide for a survey 0:38:13.160 --> 0:38:17.280 of manufacturers, you know, about national security concerns, particularly across 0:38:17.320 --> 0:38:20.719 the supply chain UH, and it does the uh, you know, 0:38:20.760 --> 0:38:22.719 sort of in my opinion, good move of anchoring that 0:38:22.760 --> 0:38:26.080 in the Department of Commerce rather than the you know, 0:38:26.120 --> 0:38:29.640 the n c s C, the National uh Counterintelligence and 0:38:29.640 --> 0:38:32.840 Security Council or something like that has a similar you know, 0:38:32.960 --> 0:38:36.840 national security in the semiconductor supply chain a project that 0:38:36.880 --> 0:38:41.239 it's working on. UM. But really the the ideal is 0:38:41.600 --> 0:38:45.600 the sort of spec infrastructure plan that the Biden administration 0:38:45.640 --> 0:38:49.600 put forward, which includes fifty billion dollars for the establishment 0:38:49.600 --> 0:38:51.640 of an Office of the Department of Commerce to monitor 0:38:51.719 --> 0:38:55.880 domestic industrial capacity just across the board, which you know, 0:38:56.080 --> 0:39:02.640 insofar as the problems in semiconductors are you know, significant 0:39:02.840 --> 0:39:07.680 and melorable through industrial policy. But there's also a critical 0:39:08.360 --> 0:39:11.960 sense that this industrial policy tool kit is something that 0:39:12.000 --> 0:39:13.959 we are going to have to get better at as 0:39:14.000 --> 0:39:18.040 we sort of confront the absolute necessity of adapting the 0:39:18.040 --> 0:39:21.839 economy to climate change in ways other than just reducing 0:39:22.840 --> 0:39:26.279 fossil fuel usage in order to adapt to a significantly 0:39:26.360 --> 0:39:32.200 changing landscape, having active monitoring of domestic industrial capacity and 0:39:32.320 --> 0:39:34.920 factors impacting it from a variety of sources is going 0:39:34.960 --> 0:39:36.120 to be something that we're going to have to get 0:39:36.200 --> 0:39:40.040 much better at. And semiconductors provide, through their complexity and 0:39:40.120 --> 0:39:44.320 through their product differentiation, just an incredible sandbox for testing 0:39:44.320 --> 0:39:48.440 out methods for doing this. I have a devil's advocate question, 0:39:48.560 --> 0:39:51.719 which is, what do you say to people who are 0:39:51.760 --> 0:39:55.560 sort of um markets fundamentalists, let's call them, who would 0:39:55.600 --> 0:39:59.080 say that, well, the US has squandered its edge in 0:39:59.160 --> 0:40:03.920 semiconductor is Intel has made a ton of missteps in 0:40:03.960 --> 0:40:07.160 its own business. It doesn't deserve to have help from 0:40:07.200 --> 0:40:09.359 the government in any way because it's just not going 0:40:09.400 --> 0:40:11.400 to be efficient or it's not going to be competitive 0:40:11.920 --> 0:40:17.399 with Taiwan or China and other manufacturers. What's the response there. 0:40:18.760 --> 0:40:21.640 I agree that any industrial policy should not be viewed 0:40:21.680 --> 0:40:24.560 as a giveaway to national firms, and I think the 0:40:24.680 --> 0:40:29.000 any administration looking to implement industrial policies should be also 0:40:29.120 --> 0:40:32.279 looking to make sure that they're either getting concessions from 0:40:32.520 --> 0:40:36.040 firms that they're providing help to, or using it to 0:40:36.200 --> 0:40:40.200 seed not just existing firms, but also helping um you know, 0:40:40.280 --> 0:40:43.080 new firms take advantage of those. But the other comment 0:40:43.120 --> 0:40:45.560 I'd make is we should be kind of blunt that 0:40:45.880 --> 0:40:49.360 there is no free market operation in the global semiconductor 0:40:49.440 --> 0:40:53.880 industry when Taiwan is subsidizing the production of fads. China 0:40:53.960 --> 0:40:58.080 has openly stated its ambitions for the for its domestic 0:40:58.120 --> 0:41:01.200 semiconductory industry, and Korean Japan, of course, have a long 0:41:01.239 --> 0:41:03.759 history of supporting their domestic industries as well, and there's 0:41:03.800 --> 0:41:06.919 also talk now of Europe funding leading edge fat. So 0:41:07.360 --> 0:41:11.320 the question kind of comes given that, you know, national 0:41:11.320 --> 0:41:14.239 governments across the world are going to be subsidizing and 0:41:14.239 --> 0:41:16.960 protecting their industries, what do we need to do in 0:41:17.080 --> 0:41:20.000 order to make sure that we have a sufficiently capable 0:41:20.040 --> 0:41:24.799 and resilient ecosystem to service our economy. Because as Alex 0:41:24.880 --> 0:41:28.640 kind of hinted at semi characters are so pervasive they 0:41:28.680 --> 0:41:31.960 they touch every part of a modern twenty century economy. 0:41:32.080 --> 0:41:35.000 And to find ourselves at the mercy of far flung 0:41:35.080 --> 0:41:39.160 suppliers because that's what the market requires, I think, is 0:41:39.200 --> 0:41:41.760 a risk that a government doesn't actually want to take, 0:41:42.080 --> 0:41:46.120 regardless of its adherence to free market principles. And worse 0:41:46.200 --> 0:41:49.560 than that, it's bad economics. The idea that you know, 0:41:49.719 --> 0:41:52.239 free market principles would say that you should, you know, 0:41:52.360 --> 0:41:55.480 pursue comparative advantage and let these other countries with their 0:41:55.520 --> 0:41:59.400 cheaper labor do these lower value add processes, and you 0:41:59.400 --> 0:42:03.640 know sort of and the torpedoes to the domestic economy, 0:42:03.840 --> 0:42:06.040 you know, relies on this notion that you know, we 0:42:06.120 --> 0:42:09.160 are specializing in high value add and they're specializing in 0:42:09.200 --> 0:42:12.640 low value add and then we sell our high value 0:42:12.680 --> 0:42:15.040 add and buy their low value add and then it's 0:42:15.080 --> 0:42:17.839 better for everyone. This is sort of the you know, 0:42:17.960 --> 0:42:21.120 happy family of the Riccardian models you know, from you know, 0:42:21.120 --> 0:42:24.319 a thousand years ago. The problem is is that in 0:42:24.760 --> 0:42:29.960 an actual dynamic economy, everyone firms and nations alike are 0:42:30.040 --> 0:42:33.239 trying actively to move up the value chain. So if 0:42:33.280 --> 0:42:36.520 you sort of say, hey, sure you can have all 0:42:36.560 --> 0:42:38.600 of this, you know, sort of low value add work, 0:42:38.680 --> 0:42:40.920 like have fun. We're going to be, you know, just 0:42:41.120 --> 0:42:43.719 doing the ultra high tech. You know, we're just going 0:42:43.760 --> 0:42:46.040 to design the chips and you'll never catch us up 0:42:46.080 --> 0:42:50.400 at that. And then you know, five years, ten years, fifteen, 0:42:50.400 --> 0:42:54.120 twenty years later, these firms that we're doing what used 0:42:54.160 --> 0:42:56.839 to be low value add work have stacked up enough 0:42:56.880 --> 0:43:00.040 process improvements that all of a sudden, hey, if you 0:43:00.040 --> 0:43:03.160 want to produce something at five nanometers or seven nimeters, 0:43:03.239 --> 0:43:05.040 you have to go through them. Because at the time 0:43:05.120 --> 0:43:08.120 we decided, oh, you know, this is sort of schlap 0:43:08.200 --> 0:43:11.239 work and you know, sort of Ricardian comparative advantage will 0:43:11.239 --> 0:43:15.560 take care of us forever. Markets don't work that way. 0:43:15.760 --> 0:43:18.239 Was anyone ever like warning about this back then? Where 0:43:18.239 --> 0:43:20.279 there people are like, oh, maybe it's not a good 0:43:20.320 --> 0:43:24.920 idea that all these companies for all these products are 0:43:24.960 --> 0:43:27.000 just sort of assuming, you know, just sort of thinking 0:43:27.000 --> 0:43:30.560 of Taiwan is their factory and you know, let's just 0:43:30.600 --> 0:43:34.799 do the high tech stuff here. Chalmers Johnson famously I 0:43:34.800 --> 0:43:37.560 think Hussin can speak to more. I mean, there was 0:43:37.600 --> 0:43:40.360 an enormous freak out in the nine eighties when Japan 0:43:40.440 --> 0:43:43.319 became ascendant. Uh, and that's where the d D really 0:43:43.360 --> 0:43:46.160 did get involved. But but I don't I don't think 0:43:46.200 --> 0:43:49.120 anyone in the eighties and nineties sort of as we were, 0:43:49.160 --> 0:43:51.239 you know, crafting the path that we ended up now 0:43:52.080 --> 0:43:55.640 foresaw a future where you know, the U. S. Economy 0:43:55.680 --> 0:44:00.879 could be ground to a halt by foreign ship supplier availability. Right. 0:44:01.040 --> 0:44:03.800 I think it's kind of gotten to a point where, 0:44:04.200 --> 0:44:08.040 well beyond what the architects of our current policy regime 0:44:08.520 --> 0:44:11.720 sort of imagined. Do you want do you like? How 0:44:11.760 --> 0:44:14.920 optimistic do either of you feel based on you know, 0:44:14.960 --> 0:44:18.279 we have this sort of emerging bipartisan consensus. It might 0:44:18.360 --> 0:44:21.640 be like one of the only bipartisan issues that there is. Like, 0:44:21.680 --> 0:44:25.160 it really does seem like both Republicans and Democrats are 0:44:25.280 --> 0:44:28.720 kind of on similar pages on this, and there's willingness 0:44:28.760 --> 0:44:31.360 to spend money and identification of some of the issues. 0:44:31.400 --> 0:44:34.759 So how optimistic are you that this sort of like 0:44:34.880 --> 0:44:39.000 long decay of our production no how can start to 0:44:39.000 --> 0:44:43.160 be reversed? Just speaking from a policy perspective, I think 0:44:43.160 --> 0:44:45.920 it really all comes down to the correct choice. And 0:44:45.960 --> 0:44:48.759 I'll let Husson speak a little bit more to what 0:44:48.920 --> 0:44:52.640 that correct choice of policy program is. I was gonna 0:44:52.640 --> 0:44:56.239 say two things on how optimistic I am one is. 0:44:56.600 --> 0:44:59.680 I think in the short term I'm very optimistic that 0:44:59.719 --> 0:45:03.840 we will pass policy. Whether it's the right policy depends 0:45:03.840 --> 0:45:07.560 on making sure we get policymakers to listen on what 0:45:07.600 --> 0:45:10.359 approaches we have. I think in the long term, on 0:45:10.440 --> 0:45:14.759 whether or not this episode helps the United States adopt 0:45:14.960 --> 0:45:19.520 afford looking industrial policy strategy that can be leveraged for say, 0:45:19.640 --> 0:45:23.600 climate change is still is a much bigger question, and 0:45:23.640 --> 0:45:26.000 that's the level that I would like to see US 0:45:26.000 --> 0:45:30.520 get to UM for for success. I think what Alex 0:45:30.560 --> 0:45:32.880 has done and and has seen in proposals that are 0:45:32.880 --> 0:45:35.480 out there today is that the right pieces are in 0:45:35.560 --> 0:45:39.720 proposals UM. Whether that's the Endless Frontiers Act, the Biden 0:45:39.760 --> 0:45:44.200 Infrastructure Bill, or work from some senators like Senator Coon's, 0:45:44.360 --> 0:45:47.520 the pieces are there, I think to be really successful 0:45:47.520 --> 0:45:49.879 in the short term, it's about pulling out the right 0:45:50.200 --> 0:45:54.160 specific proposals and and merging them together into the right 0:45:54.200 --> 0:45:58.439 approach with a focus on supply chain analysis, setting clear 0:45:58.480 --> 0:46:02.239 goals for what the US semiconductor ecosystem should be capable of, 0:46:02.760 --> 0:46:06.040 and then building up that supply chain, a supply chain 0:46:06.120 --> 0:46:09.560 monitoring muscle to sort of look forward and beyond the 0:46:09.680 --> 0:46:14.719 semiconductor industry to where else will want to manage our 0:46:15.280 --> 0:46:19.640 industrial capabilities to tackle, you know, future challenges with climate change, 0:46:21.160 --> 0:46:24.399 anything else, Alex and husting any sort of last things 0:46:24.440 --> 0:46:26.200 we didn't ask about. Our key ideas you want to 0:46:26.360 --> 0:46:29.120 keep something you want to get across. I guess just 0:46:29.320 --> 0:46:31.760 to look out for sort of the next two pieces 0:46:31.920 --> 0:46:34.600 in this series, which the next one will be a 0:46:35.680 --> 0:46:39.440 sort of thorough account of what the Industrial Policy tool 0:46:39.520 --> 0:46:43.200 Kit ought to be UH for for our government's looking 0:46:43.239 --> 0:46:46.160 to implement this UH and the one after that being 0:46:46.280 --> 0:46:50.040 sort of a longer theory based, you know, sort of 0:46:50.160 --> 0:46:54.600 argument against this this Ricardian comparative advantage approach to trade policy, 0:46:55.360 --> 0:46:59.200 which the semiconductor industry illustrates particularly well, but which holds 0:47:00.239 --> 0:47:03.600 across sectors. I can't wait to read them all right, 0:47:03.680 --> 0:47:07.040 Husson and Alex, thank you both so much for coming up. 0:47:07.840 --> 0:47:12.319 Thanks so much for having us. This is wonderful. Thanks guys, 0:47:12.400 --> 0:47:28.440 that was great. I found that to be a very 0:47:28.520 --> 0:47:32.480 helpful UH conversation to sort of like frame where we 0:47:32.560 --> 0:47:35.359 are right now. I really like I like this idea. 0:47:35.360 --> 0:47:37.360 I mean, it's we've we've talked about this, you know, 0:47:38.080 --> 0:47:40.200 Dan Long and a few others. You know, obviously this 0:47:40.360 --> 0:47:43.960 idea of like learning by doing the importance of actual 0:47:44.080 --> 0:47:46.600 like getting your hands already know how. But I felt like, 0:47:46.880 --> 0:47:50.640 you know, is Alex put it that, you know, technology 0:47:50.800 --> 0:47:54.920 isn't just something that's like is handed down to producers 0:47:55.000 --> 0:47:57.880 and then they like upgrade the thing like production is 0:47:58.040 --> 0:48:01.239 like what technology is. It's just like a very like 0:48:01.320 --> 0:48:04.879 sort of like useful way to think about the challenge. Yeah. 0:48:04.960 --> 0:48:08.239 And I also like this idea that you know, people 0:48:08.320 --> 0:48:13.440 tend to think about industrial policy and government involvement in 0:48:13.640 --> 0:48:17.040 industry as a sort of um like a really boring, 0:48:17.760 --> 0:48:22.560 very controlling, like stifle stifling of innovation, I think, but 0:48:23.560 --> 0:48:26.800 the way um Alex and Husson kind of described it, 0:48:27.800 --> 0:48:32.239 it can be a backstop for getting really creative innovation 0:48:32.640 --> 0:48:34.640 in different products. And I think a lot of people 0:48:34.680 --> 0:48:38.520 don't necessarily think of it that way totally, right, And 0:48:38.640 --> 0:48:40.520 I just think, you know, I really appreciate this sort 0:48:40.520 --> 0:48:45.360 of like more granular discussion about the different periods of 0:48:46.080 --> 0:48:48.719 our different policy regimes and thinking like, oh, we can 0:48:48.800 --> 0:48:51.080 do this just by funding a lot of R and D, 0:48:51.280 --> 0:48:53.200 and of course I don't think anyone is going to 0:48:53.280 --> 0:48:56.560 deny that R and D is extremely important. But then 0:48:56.640 --> 0:48:58.920 also the demand side of element. But you can't just 0:48:59.080 --> 0:49:01.360 get the demand because there's no such thing as just 0:49:01.880 --> 0:49:04.040 a chip or saying you know, I can't say we're 0:49:04.040 --> 0:49:06.600 gonna bull the chips, having to identify them. It's a 0:49:06.719 --> 0:49:09.839 difficult problem. And I think you know that that point 0:49:09.920 --> 0:49:12.400 that Husted made at the end, like what matters is 0:49:12.440 --> 0:49:14.759 getting the policy right, Like there isn't going to be 0:49:15.080 --> 0:49:19.800 a sort of nice, a nice clean up, one shot solution. 0:49:20.080 --> 0:49:23.920 It's got to be a sort of a multi pronged focus. Yeah. Absolutely, 0:49:24.480 --> 0:49:27.040 I'm sure. I have this terrible feeling that in like 0:49:27.640 --> 0:49:30.000 two decades, we're going to be having a conversation about 0:49:30.080 --> 0:49:32.520 this moment in time, talking about whether or not the 0:49:32.640 --> 0:49:36.279 US's attempts to revive its semiconductor industry We're successful or not. 0:49:36.920 --> 0:49:39.239 It's going to be a never ending semi series. We 0:49:39.320 --> 0:49:41.560 will we will definitely talk about it in two decades, 0:49:41.640 --> 0:49:44.640 but maybe it'll maybe we'll be looking back at how 0:49:44.680 --> 0:49:48.720 it was, how the US turned it around. Absolutely, Okay, 0:49:49.080 --> 0:49:52.399 shall we leave it there, Yeah, let's leave it there. Yeah, 0:49:53.000 --> 0:49:55.800 this has been another episode of the All Thoughts Podcast. 0:49:55.920 --> 0:49:58.600 I'm Tracy Alloway. You can follow me on Twitter at 0:49:58.640 --> 0:50:01.800 Tracy Alloway and I'm Joey Wasn't Though. You can follow 0:50:01.880 --> 0:50:05.160 me on Twitter at the Stalwart. Follow our guests on 0:50:05.239 --> 0:50:10.120 Twitter Alex Williams, He's at Tragic Bios. Follow Hussan con 0:50:10.280 --> 0:50:13.359 on Twitter. He's at Hussan Cohn and check out all 0:50:13.440 --> 0:50:15.640 of their writing. And you know there's ones coming up 0:50:15.680 --> 0:50:18.880 at the Employee America Medium page or at the Employee 0:50:18.920 --> 0:50:23.879 America website. Lots of super deep stuff there. Be sure 0:50:23.920 --> 0:50:27.720 to follow our producer Laura Carlson. She's at Laura M. Carlson. 0:50:28.080 --> 0:50:31.960 Follow the Bloomberg head of podcast Francesca Levi at Francesca Today, 0:50:32.400 --> 0:50:35.399 and check out all of our podcasts at Bloomberg onto 0:50:35.440 --> 0:50:38.160 the handle at podcasts. Thanks for listening.