The Chips Act Becomes Industrial Social Policy

Gina Raimondo uses semiconductor subsidies to impose progressive priorities via corporations 

WSJ editorial. Excerpts:

"Start with child care, which chip makers applying for more than $150 million in federal aid will be required to provide to their employees and construction workers. Finding workers to run child-care facilities, especially in rural areas, may prove even more challenging than finding workers to build and operate the plants. The U.S. child-care workforce is still 58,000 smaller than before the pandemic. By boosting demand for child care, Commerce’s mandate will increase costs for all parents living near a chip plant.

But not any child care will do. Chip makers will have to craft their “child care plans in tandem with community stakeholders, including state and local governments and local groups with expertise administering child care”—i.e., labor unions and progressive outfits. Start the woke indoctrination early.

Chip makers will also have to pay construction workers prevailing wages set by unions and will be “strongly encouraged”—i.e., required—to use project labor agreements (PLAs), which let unions dictate pay, benefits and work rules for all workers. States restricting PLAs may have to change their laws if they want to benefit from the federal largesse.

Companies will have to comply with the Administration’s “Good Jobs Principles” that guarantee “full-time and part-time workers are provided family-sustaining benefits that promote economic security and mobility,” including “paid leave and caregiving supports.”

In their applications, chip makers will have to describe their “wraparound services to support individuals from underserved and economically disadvantaged communities,” such “as adult care, transportation assistance, or housing assistance.” The Administration is imposing a cradle-to-grave welfare system via corporate subsidies."

"Producing chips in the U.S. is 40% more expensive than overseas. One reason is the U.S. permitting thicket. But chip makers that receive federal largesse will still have to comply with more regulation under the National Environmental Policy Act."

"Commerce is also demanding that companies receiving more than $150 million share “with the U.S. government a portion of any cash flows or returns that exceed the applicant’s projections above an established threshold.” No buying back stock for five years either."

"Goldman Sachs last autumn estimated the subsidies might increase the U.S. market share of global chip capacity by less than 1%."