The Trump administration has launched their own ‘Manhattan Project’ amid reports one of America’s largest companies is set to be nationalized.
Intel, the largest chip fabricator in the US, has been in talks with Donald Trump over a potential government stake in the company.
While the percentage stake the government is asking for has not been made public, nationalizing a company is typically reserved for emergencies.
The government nationalized a number of banks after the 2008 financial crisis and key logistics companies during World War II.
It comes amid concerns that America relies too heavily on TSCM, a chip manufacturer in Taiwan. China has repeatedly threatened to invade the island nation.
If China were to invade, it would throttle America’s ability to compete in the booming chipmaking industry that is being driven by artificial intelligence.
While Intel’s AI chips are considered inferior to those designed by Nvidia and AMD, the company is unique in that it not only designs its chips but it manufactures them. Trump wants to protect America by onshoring chip manufacturing.
‘This feels like the Manhattan Project – or the run-up to World War II,’ MIT AI computer scientist Dave Blundin said. ‘It’s every bit as important as the space race was, as the nuclear arms race was. Actually, it’s more important.’
Intel. Corp, one of the most capable semiconductor manufacturers in the US, has been in talks with the Trump administration as the US government is seeking a stake in the company. Pictured: Intel’s CEO Lip-Bu Tan at the company’s Annual Manufacturing Technology Conference earlier this year
Intel’s advanced abilities to manufacture semiconductors would allow the US to give up its reliance on foreign fabs in order to power artificial intelligence, defense and the economy
The consideration to nationalize the company, a move typically done in times of national urgency, comes as the US is looking to get ahead of China in the AI and tech arms race
Intel’s advanced abilities to manufacture semiconductors would allow the US to give up its reliance on foreign fabrication plants (fabs), especially in Taiwan which controls more than 60 percent of the market, in order to power artificial intelligence, defense and the economy.
The talks remain ongoing and finer details continue to be made clear, but the idea would be that the US government would pay for the stake in the company, one person close to the matter told Bloomberg.
Another stressed that the talks do not ensure that the deal is definitive, and the discussion could end without a deal being made.
The move, according to AI and tech experts on Diamandis’ podcast Moonshots, echoes the ‘Manhattan Project’ as a sort of a ‘national survival strategy.’
‘The reason the US needs to protect Taiwan fundamentally… is because the fabs are there. If the fabs all move to the US, then why would the US defend Taiwan?’ Blundin said.
Concerns have been raised about the decision to nationalize the company, as he added: ‘They’re putting the whole industry on a kind of war footing, like mobilization for conflict, except the battleground is supply chains and chip fabs.’
Intel told Bloomberg, while declining to comment on the discussion with the Trump administration, that the company is ‘deeply committed to supporting President Trump’s efforts to strengthen US technology and manufacturing leadership.’
‘We look forward to continuing our work with the Trump administration to advance these shared priorities, but we are not going to comment on rumors or speculation,’ the company added.
White House spokesman Kush Desai told the outlet: ‘Discussion about hypothetical deals should be regarded as speculation unless officially announced by the administration.’
The move comes after two AI companies agreed last week to hand over 15 percent of their chip sales revenue in China to the US government in exchange for export licenses.
Nvidia and Advanced Micro Devices (AMD) entered an unprecedented arrangement with the White House to promote and sell their semiconductors in China last week, three people familiar with the situation told the Financial Times.
‘This feels like the Manhattan Project — or the run-up to World War II,’ MIT AI computer scientist Dave Blundin (pictured) said on a podcast with MIT engineer Peter Diamandis
The CEO of Nvidia, Jensen Huang (right), met with Donald Trump (left) last week to review the bizarre deal, according to sources, including a US government official
US security experts said Nvidia’s H20 in particular will aid the Chinese military efforts and boast China in its AI development race against the US
‘In the short term, this is fantastic. In the long term, wow, could this turn bad in a hurry,’ Blundin said. ‘It’s good for the US economy, but we’re going to use that to fund [the] US catching up in the chip wars.’
‘Very, very good business deal and incredibly slippery slope precedent.’
The deal could pour more than $2 billion into the US government, the New York Times reported, although Trump did not reveal what the money may be used for.
Just as sources say Trump and the AI companies entered the agreement, the president declared he would impose a 100 percent tariff on the imports of semiconductors and chips unless the company is ‘building in the United States.’
News of Trump’s discreetly entered agreement with Nvidia and AMD has been slammed by experts who say the move could have detrimental repercussions when it comes to US-China relations.
‘This is an own goal and will incentivize the Chinese to up their game and pressure the administration for more concessions,’ Liza Tobin, who previously served as China director at the National Security Council, told The New York Times.
The move to sell microchips to China has been heavily criticized, as many see it as a threat to national security and a move against America’s best interests.
