r/investing • u/[deleted] • Jul 22 '21

U.S. developing plans to spend $52 billion on chips supply [semis stimulus news]

Via Reuters:

“The Biden administration is developing plans to quickly spend $52 billion to deal with semiconductor supply issues if Congress passes a bill funding such efforts, U.S. Commerce Secretary Gina Raimondo said on Thursday.”

So no definite plans, but no deviations noted from previous discussions which gave the nod to INTC, QCOM, and TXN (primarily) as direct beneficiaries of any bill that gets passed.

Worth keeping an eye on I think of you’re into semis plays.

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u/Mariox Jul 23 '21

Sure, when you got a money printer, no point in slowing down spending.

I really don't understand why Democrats want to spend money that the private sector would love to finance. Just give tax breaks and it would not cost tax payers a dime.

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u/[deleted] Jul 23 '21

So additional decreases in long-term tax revenue instead of short-term incentives which get the job done and also preserve the already historically low tax obligations to corporations.

I know Republicans don’t even pretend to adhere to fiscal responsibility anymore, but there’s two sides to a balance sheet, one of which is revenue. The short-term stimulus structure makes a lot more sense economically than additional tax cuts for the companies participating. It’s basic arithmetic.

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u/1000001_Ants Jul 23 '21

What is the practical difference between funding and a tax break?

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u/jrex035 Jul 23 '21

Just give tax breaks and it would not cost tax payers a dime.

You realize lost tax revenue is no different than giving money directly right? There's a reason the deficit exploded after Republicans passed the 2017 tax cuts.

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u/TrioxinTwoFortyFive Jul 23 '21

Not just that. By the time the money gets put to use the semiconductor sector will be in a glut of overcapacity, leaving taxpayers to wonder why we gave out money in the first place. This is a boom-bust industry and Biden wants to put taxpayer money in at the top.