European Commission Launches $12 Billion Chip Support Campaign 111
An anonymous reader writes "Neelie Kroes, European Commission vice president responsible for the digital economy, wants to use 5 billion euros of European Union tax payers' money, together with matching funds from the chip industry, to recreate European success in semiconductors similar to that of Airbus. Because of its strategic importance to wealth creation Kroes wants Europe to reverse its decline in chip manufacturing and move back up from 10 percent to 20 percent of global production."
I am willing to go along ... (Score:5, Insightful)
Assuming that what comes out of it is able to be used by ANY EU based (i.e. PAYING taxes here) firm. I think another stipulation to using any of the research money or outcome of said research should be that the firm which is also based on EU, must also produce the resulting products inside the EU. Not spending my money to gain a competitive advantage and then turn around and outsource all production to China or Brazil.
Basically, if we are paying, we better get real benefits.
Re:I am willing to go along ... (Score:4, Insightful)
There might and will be benefits for society at large, people get jobs, knowledge is gained and other new ventures can develop.
Those benefits don't show up in the books of investment bankers but are still very real.
Re:I am willing to go along ... (Score:5, Insightful)
It's not as simple as that.
Improved infrastructure provides a moderate benefit to a great many individuals and businesses which can add up to a net profit for the country. This doesn't mean that it would have been a good investment for a private company to build the infrastructure, because it is not possible to capture all the value that the infrastructure creates. For example, a toll road operator doesn't get paid for the reduced pressure on surrounding roads, but the users of those roads still benefit.
Similarly, this EU investment may make a net profit for the EU but that doesn't mean a corporation would make a profit doing the same thing.
Or it may be a giant waste of money. But the fact it wouldn't work as a corporation tells us nothing either way.
Re:I am willing to go along ... (Score:5, Insightful)
This is a really dumb way of thinking about how the government spends money. A corporation does not need to make a profit: it needs to make a profit now. And not just now, but also high enough.
Governments are special in that they can finance things which bring in enormous profit in the very long run (fundamental research, very large infrastructure projects) or which have very large positive externalities (free roads). Without governments, you could not build dams: large ones become profitable after 50 years. No bank, no insurance company will accept such long-term risks: they may well not exist that long. Only countries can be reasonably certain of existing within such stretches of time.
TL;DR; it is an essential function of governments to fund long-term, high-risk projects.
Re:I am willing to go along ... (Score:4, Insightful)
Private corporations are concerned with immediate success. They need to show something in their next quarter report or their stocks will fall. Things like investment in future endeavors is rare, and only risked if there's a chance to gain some sort of perpetual patent. But why bother with high investments in basic research when it's far more profitable to whip up some trivial patent of something even a dumb fuck in middle management could come up with?
No, basic research, the research that actually does lead to groundbreaking results and exciting new technology is NEVER conducted by companies. Never. Remember the laser? You know, the thing that drives your DVD and BluRay drives? Think that was what the idea of Einstein when he whipped up the theoretic basis for it in 1917? Hell, even current patent laws don't allow you to milk it for a century. And no, this is NOT the suggestion that we should extend patents beyond the insanity copyright has already reached. But I ramble.
A lot, and I really mean a LOT, of theoretic and practical research was necessary, from great minds like Ladenburg, Kastler, Basov and Maiman, and still it took the last one 'til the 1960s to produce a working laser, more than four decades after the theoretic foundation.
You think any company on this planet would think in terms like this?
You think any investor would invest in something that could take half a century to produce results you can market?
Hell, it took 'til the 1980s to produce consumer grade lasers. And 'til the 1990s and even 2000s to make them cheap. Today, though, they're everywhere, from consumer electronics to cutting edge science, from micrometer distance measuring to touch-less cutting. And of course playing DVDs and BluRays.
Think we'd have any of those things if we left innovation to the market?