"Not long ago it would have been hard to imagine a Republican President demanding government ownership in a private company, but here we are. And now the Trump Administration is toying with a tax on patents toomeaning, a tax on innovation, began the Journal. After summarizing the events that led to the federal government taking a 10% stake in Intel, the influential, center-right newspaper predicted that state involvement in the company would hamper Intel's ability to compete."
"The Administration says the deal won't include a seat on Intel's board or governance or information rights,' and it will mostly vote its shares with Intel's board. But government support will ease the imperative for Intel to become more competitive. That's one reason China's partially state-owned Semiconductor Manufacturing International Corporation has struggled. In the name of competing with China, the U.S. is imitating its model of state-run business. Washington is becoming Chinatown, it argued."
Federal government acquired a 10% stake in Intel, raising concerns that state involvement could hamper the company's competitiveness. The Administration asserts the investment will not include board seats, governance rights, or information rights and will largely vote with Intel's board. Government support could reduce incentives for Intel to improve performance, paralleling struggles of China's partially state-owned Semiconductor Manufacturing International Corporation. A proposed tax on the value of patents would effectively tax innovation and lower returns on invention. Congress provided full expensing for research and development in the recent tax bill to encourage investment and innovation.
Read at www.mediaite.com
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