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CANADA MODERN CHIP TECHNOLOGY ... ReichAnalytics Intel Dying While Montreal Makes World's Most Advanced Chips — Trump's $40B Mistake \| Robert Reich PLAY YOUTUBE VIDEO Original article: https://www.youtube.com/watch?v=POGn5Q2GQJQ
Intel Dying While Montreal Makes World's Most Advanced Chips — Trump's $40B Mistake \| Robert Reich ReichAnalytics 6.32K subscribers Jan 3, 2026 What happens when an 80% CHIPS Act cut and engineer visa restrictions accidentally destroy American semiconductor leadership and create a chip manufacturing powerhouse in Canada? In this analysis, Robert Reich uncovers the devastating story behind the semiconductor industry's exodus from Arizona and Ohio to Montreal — a story the media isn't telling you. While headlines focus on Trump's budget cuts and security clearances designed to protect American chip technology, the real shift is the systematic collapse of the conditions that made domestic semiconductor production possible. This isn't just about Intel layoffs; it's about how shortsighted policy destroys the most strategic industry of the 21st century. For workers like David at Intel's canceled Ohio fab and Tom on the construction site that never opened, this means losing careers in the field that powers modern civilization. Meanwhile, Montreal is manufacturing three-nanometer chips as Canada invests $40 billion with guaranteed energy prices and 72-hour engineer visas. Because when politicians starve strategic industries and expel the world's best talent, those industries don't disappear — they just fabricate from a different country. How this was made Altered or synthetic content Sound or visuals were significantly edited or digitally generated. Learn more Peter Burgess COMMENTARY Peter Burgess Transcript 0:00 I want to start with something that might sound impossible at first. Montreal, a city known for bagels and hockey, is now manufacturing the most advanced semiconductor chips in the world. Three nanometer processors, the kind that power the latest smartphones and AI systems, the kind that until very recently only Taiwan and South Korea could produce, are rolling off production lines in facilities built in the last 18 months across Quebec. If you told anyone five years ago that Canada would be competing with TSMC and Samsung in chip manufacturing while Intel was shuttering factories and laying off thousands of American workers, they would have called you delusional. Semiconductors were America's crown jewel. Silicon Valley was not just a place. It was a promise. The idea that the United States would lead the world in the technology that powers everything from cars to medical devices to military systems. But that promise is breaking right now. And the reason is not foreign competition or lack of innovation. It is policy. Specifically, Trump's decision 1:02 to gut the chips act by 80% making it nearly impossible for the very engineers who understand chip manufacturing to work in the United States and allowing energy costs to spiral out of control just as fabrication plants require stable, cheap power to operate. Those decisions framed as protecting American industry and national security have had the opposite effect. They have destroyed the conditions necessary for domestic chip production to succeed. And Canada, seeing an opening, moved with extraordinary speed to build what America abandoned. They are not just attracting chip companies. They are becoming the semiconductor capital of the Western world. And the workers, the engineers who spent careers mastering one of the most complex manufacturing processes humans have ever created are learning that even the most strategic industries can relocate when governments make them unviable. And when they do, entire economic futures shift with them. 2:00 What officially happened looks straightforward on paper, but the consequences were seismic. In 2022, under Biden, the United States passed the Chips and Science Act, a landmark piece of legislation designed to bring semiconductor manufacturing back to America. The bill allocated 52 billion in subsidies and tax incentives for companies willing to build fabrication plants or fabs on US soil. The logic was clear. The world had become dangerously dependent on Taiwan for advanced chips, and geopolitical tensions with China made that dependence a national security risk. If Taiwan were ever blockaded or invaded, the global economy would collapse overnight. Every car, every phone, every computer, every piece of modern infrastructure depends on chips. And most of those chips come from a single island that China considers part of its territory. The Chips Act was supposed to fix that. Intel announced plans to build massive new fabs in Ohio and Arizona. TSMC, the Taiwanese giant, 3:03 committed to a facility in Arizona. Samsung explored options in Texas. Tens of thousands of jobs were promised. Communities that had watched manufacturing disappear for decades were told this was their chance to rebuild. Then Trump took office again in 2025, and one of his first moves was to target the Chips Act. He called it corporate welfare, a handout to companies that should be investing on their own. He slashed the funding from $52 billion to 10 billion. Most of the approved grants were frozen. Tax incentives were delayed indefinitely and the signals sent to the industry was unmistakable. The United States government was not serious about supporting domestic chip production. Companies that had been planning multi-year, multi-billion dollar projects suddenly faced uncertainty. Would the subsidies come through? Would the tax benefits materialize? Could they count on the dungert stability necessary to justify investments that take 5 to 10 4:00 years to pay off? The answer increasingly was no. But Trump's semiconductor policy did not stop at funding cuts. He also tightened visa restrictions for foreign engineers. And this is where the policy became catastrophic. Chip manufacturing is not like other industries. It is extraordinarily specialized. There are maybe a few thousand people in the world who truly understand advanced semiconductor fabrication. The processes involved photothography, etching, doping, chemical vapor deposition require not just theoretical knowledge but years of hands-on experience. And the vast majority of those experts are not American. They are from Taiwan, South Korea, Japan, India, China. They studied in those countries, worked at TSMC or Samsung or SKHEX, and then some of them came to the United States for graduate school or jobs at Intel or other companies. Trump's new rules made it nearly impossible for them to work in the US semiconductor sector. The 5:01 justification was national security. Ships are dualuse technology critical for both commercial and military applications. But the effect was that the people who actually know how to build advanced fabs could not get visas could not renew existing visas or had their clearances revoked. And without them, the factories being built in Arizona and Ohio became expensive monuments to policy failure. The third part of Trump's unintentional destruction of American chip manufacturing was energy policy. Semiconductor fabs are energyintensive. A single advanced fab can use as much electricity as a small city. They require stable, reliable power 24 hours a day, 7 days a week. Any interruption, even for seconds, can destroy millions of dollars worth of wafers in production. Trump's administration deregulated energy markets, removed incentives for renewable energy, and allowed utilities to raise prices aggressively. In Arizona, where Intel 6:01 and TSMC were building, electricity costs spiked. In Ohio, the grid became less reliable as coal plants closed without adequate replacement capacity. Companies trying to justify billiondoll investments suddenly faced not just funding uncertainty and talent shortages. But the prospect of operating in an environment where energy costs and reliability could not be predicted. The result was predictable. Intel paused construction on its Ohio FAB indefinitely. They announced 5,000 layoffs, including engineers who had been hired specifically for the project. TSMC delayed its Arizona facility and quietly began exploring alternatives. Samsung shelved its Texas plans and workers who had been promised a renaissance in American manufacturing, who had moved to these states, who had bought houses and enrolled their kids in schools, found themselves stranded. While American semiconductor policy was collapsing, Canada was building. Mark 7:00 Carney, always strategic, recognized that chips are the most critical technology of the 21st century. Whoever controls semiconductor production controls artificial intelligence, controls telecommunications, controls the infrastructure of modern life. If the United States was going to abandon that leadership, Canada would seize it. Carney announced a $40 billion investment in semiconductor manufacturing over 10 years. He designated Montreal as the hub, taking advantage of Quebec's massive hydroelectric capacity, which provides some of the cheapest and cleanest electricity in the world. He created a streamlined visa process for chip engineers. If you had experience at TSMC, Samsung, Intel, or any major semiconductor company, you could get a Canadian work permit in 72 hours. No security clearances, no nationality restrictions. If you knew how to make chips, Canada wanted you. He offered companies building fabs in Canada a 60% 8:00 rebate on construction costs and guaranteed electricity prices for 20 years. No surprises, no political interference, just stable, predictable support. The response was swift. Engineers who had been planning to move to Arizona or Ohio for intel or TSMC jobs started looking north. Taiwanese engineers who had been preparing to help TSMC set up its American operation pivoted to Canada. South Korean process experts, Indian material scientists, Japanese equipment specialists all began moving to Montreal and companies followed. Not just startups, but established players. A consortium of Taiwanese firms announced a joint venture to build a 3 nanometer fab in Montreal. Samsung opened a research center. Even Chinese companies locked out of the US market by sanctions started exploring partnerships with Canadian firms, seeing Canada as a neutral ground where they could participate in the global supply chain without triggering American retaliation. 9:00 Let me show you what this looks like for the people living through it. Meet David. He is 36 years old, worked at Intel for 11 years. He started as a process engineer right out of his master's program at UC Berkeley, working on 14 nanometer chip production at Intel's Oregon facilities. Over the years, he specialized in extreme ultraviolet lithography, the cuttingedge technology that allows chips to be made smaller and more powerful. He became one of Intel's top experts in EUV, managing a team of eight working on next generation nodes. He loved the work. It was intellectually demanding, constantly evolving, at the absolute frontier of what humans can manufacture. He made $145,000 a year, owned a small house in Hillsboro near Intel's main campus, and was building a career he expected to last decades. In 2024, Intel announced it was building a new fab in Ohio, a state-of-the-art facility that would 10:00 produce the company's most advanced chips. David was recruited to join the team. They offered him a promotion, a raise to $170,000 and the chance to be part of something historic, bringing cuttingedge chip manufacturing back to the American heartland. David and his wife talked about it. Moving to Ohio was not ideal. They liked Oregon, but the opportunity was significant. They decided to go for it. They sold their house, bought a new one in a suburb outside Columbus, enrolled their daughter in a new school, and David started his new job in early 2025. For the first 6 months, everything seemed to be moving forward. The Fab Construction was underway. David's team was planning the production lines, ordering equipment, hiring staff. But then the political environment shifted. Trump cut the Chips Act funding. Intel's subsidies, which had been approved, were frozen. The company put the Ohio project under review. Weeks passed, then months. David's team was told to pause hiring, 11:00 then to stop ordering equipment. Then in August, Intel announced that construction on the Ohio FAB was being suspended indefinitely. They needed to reassess the financial viability of the project given the lack of government support. 2 weeks later, David got the call. His position was being eliminated. Intel was laying off 5,000 people across the company and most of them were tied to the Ohio project. David was stunned. He had moved his family across the country for this job. He had sold his house in Oregon, bought a house in Ohio, uprooted his life, and now barely a year later, it was over. Intel offered him 6 months of severance and the option to apply for other positions within the company, but there were no openings in his specialty. EUV lithography is not something you can do just anywhere. It requires facilities that cost billions of dollars and teams of specialists and intel was not building new facilities. It was shutting them down. David started looking for alternatives. He reached out 12:01 to TSMC, but their Arizona project was delayed and they were not hiring. He contacted Samsung, but their Texas plans were sheld. He looked at startups, but none of them were working on advanced nodes. For two months, David applied to jobs, sent out resumes, with former colleagues. Nothing came through and the severance clock was ticking. That is when David got a message from a recruiter in Montreal, a new company, Northchip Technologies, a joint venture between Canadian investors and Taiwanese engineers, was building a three nanometer fab in Montreal. They were hiring aggressively, looking for people with EUV experience. They offered David a job as a senior process engineer leading a team of 12 working on some of the most advanced chip manufacturing in the world. The salary was 165,000 Canadian, about 123,000 US less than what he had been making at Intel, but the cost of living in Montreal was significantly lower than Columbus. And 13:01 the job was real, not a promise. And they offered equity. If the company succeeded, David could make far more than he ever would have at Intel. David was conflicted. Moving again felt overwhelming. His wife was tired of relocating. Their daughter was struggling to adjust to Ohio. And now they were talking about moving to another country, to a city where the primary language was French. But David also knew he did not have better options. The American semiconductor industry was contracting. If he wanted to keep working at the cutting edge of his field, he had to go where the work was. And right now, that was Canada. David and his family moved to Montreal in November. The transition was hard. The city was colder than Ohio, the culture different, the language barrier real, but the work was extraordinary. Northchip was not just replicating what TSMC or Samsung were doing. They were innovating, developing new processes, collaborating with researchers at McGill and the University of Montreal, building 14:01 something genuinely new. And David's team was exceptional. Engineers from TSMC, Samsung, Intel, all of them had come to Montreal for the same reason. They wanted to work on the most advanced technology, and Canada was the only place in the Western world where that was possible. Within 6 months, David felt more optimistic about his career than he had in years. Northchip completed its first production run, a small batch of three nanometer chips for a Canadian AI company. The yield was higher than expected. The performance exceeded targets. The company secured additional funding, a partnership with a European electronics firm, and government support for expansion. David's equity, which had seemed speculative, started to look valuable, and his family slowly began to settle. They found a neighborhood they liked, enrolled their daughter in a bilingual school, made friends. Montreal was not Oregon, but it was home. Now, let me show you the other side of this shift. Because for every engineer like David, 15:01 who found opportunity in Canada, there are workers in the United States who were promised jobs that never materialized. Meet Tom. He is 42 years old, lives in a small town outside Columbus, Ohio. Tom is not an engineer. He is a construction worker been in the trades for 20 years, specializing in industrial projects, factories, power plants, large-scale facilities that require precision and experience. When Intel announced it was building a fab in Ohio, Tom saw it as the opportunity of a lifetime. The project was supposed to employ thousands of construction workers over 5 years, followed by permanent manufacturing jobs. Tom got hired by one of the contractors working on the site. The pay was excellent, $90 an hour with overtime, full benefits, steady work for the foreseeable future. Tom bought a new truck, took out a small loan to renovate his house, started planning for his kids' college funds. For the first time in years, he felt financially secure. 16:00 For 6 months, the work was steady. Tom was part of the team building the clean rooms, the specialized environments where chips are manufactured. The work was demanding, required extreme precision, but Tom was good at it. Then the slowdown started. Orders for equipment were delayed. Construction schedules were pushed back. Contractors were told to reduce crews. Tom's hours were cut from 60 a week to 40, then to 30. Then in August, the site shut down entirely. Intel suspended the project. The contractors laid off their workers. Tom got two weeks notice and four weeks of severance. Tom is 42 years old. He spent 6 months working on a project that was supposed to be his career for the next decade. And now it is over. He is competing with thousands of other construction workers for jobs that do not exist. Ohio's economy, which had been promised a semiconductor renaissance, is back where it started, struggling to replace the manufacturing jobs lost over decades. Tom's truck 17:01 payment is $400 a month. His mortgage is 1,200. His wife works part-time at a grocery store, which helps, but it is not enough. Tom does not know what comes next. And Tom is not alone. Across Ohio, Arizona, Texas, the states that were promised chip manufacturing jobs, thousands of workers are in the same position. The factories were never built. The jobs never materialized. The investments never came through. And the communities that have been told this was their chance to rebuild are watching that promise evaporate. Meanwhile, Montreal is booming. Construction is everywhere. New fabs are going up. Housing developments are expanding to accommodate the influx of workers, restaurants, schools, services, all growing to support a population that suddenly includes thousands of highly paid engineers and their families. The Quebec government is investing in infrastructure, expanding transit, building schools. The entire region has a sense of momentum, of possibility that 18:02 feels like the early days of Silicon Valley. The contrast between David and Tom reveals something essential about this moment. David with specialized skills and credentials had options. He could move. He could find work in Canada. He could rebuild his career. But Tom, with skills that are valuable but tied to local economies, with a life rooted in Ohio, with financial obligations and family ties, does not have the same mobility. He is stuck watching an industry that was supposed to revitalize his community disappear before it even arrived. And that inequality, that gap between who can adapt and who cannot, is one of the most painful aspects of this shift. Now, let's zoom out and look at the structural forces reshaping the semiconductor industry. Because understanding how chips are made is essential to understanding why Trump's policies were so destructive. Semiconductors are the most complex manufactured products in human history. A modern chip contains billions of 19:00 transistors, each smaller than a virus, arranged in patterns so intricate they can only be created using light at wavelengths shorter than visible spectrum. The factories that make them, fabs, cost anywhere from 5 to 20 billion to build. They require ultra pure water, air filtration systems that remove particles a thousand times smaller than a human hair, and precision equipment that can position materials at the atomic level. And the manufacturing process takes months. A single wafer of silicon, a disc about 12 in across, goes through hundreds of steps, each requiring different chemicals, temperatures, pressures. If anything goes wrong at any point, the entire wafer is ruined. yields. The percentage of chips that actually work are closely guarded secrets. But even at the best fabs, a significant portion of production is defective. This complexity means that chip manufacturing requires not just capital, but expertise. You 20:00 cannot simply read a manual and start making chips. You need engineers who have spent years learning the process, troubleshooting problems, optimizing yields, and those engineers are rare. TSMC, the world leader, employs tens of thousands of them. Samsung has thousands more. Intel, which used to be the leader, has been losing ground for years because it lost talent, because it fell behind on process technology because it made strategic mistakes that compounded over time. When Trump cut funding for domestic fabs, he did not just reduce the amount of money available. He signaled to the industry that the United States was not a reliable partner. Companies planning billion-dollar investments need to know that the political environment will remain stable for at least a decade. When Trump cut the chips act by 80% within months of taking office, he destroyed that confidence. The visa restrictions made the problem exponentially worse. The people who know how to build advanced fabs are overwhelmingly foreignborn. 21:00 They trained at universities in Taiwan, South Korea, Japan. They worked at TSMC or Samsung for years learning the craft. Some of them came to the United States for graduate school and stayed working at Intel or smaller companies, but many of them did not. And when the United States started building fabs under the chips act, those people were supposed to come to America to train local workers to transfer knowledge to make domestic production viable. Trump's visa policies made that impossible. You cannot build a cuttingedge fab without cutting edge expertise. And you cannot get that expertise if the experts cannot enter the country. The energy issue, often overlooked, is just as critical. A modern fab uses enormous amounts of electricity, not just to run the equipment, but to maintain the environmental controls that keep the clean room sterile. And the power has to be consistent. A voltage spike, a momentary outage, anything that disrupts the process can destroy millions of 22:00 dollars worth of production. That is why TSMC built in Taiwan, an island with stable, cheap electricity from a mix of nuclear, natural gas, and renewables. That is why Samsung operates in South Korea, which has invested heavily in grid reliability. When Trump deregulated energy markets and allowed utilities to raise prices, he made the United States less competitive. And when the grid became less reliable, as happened in Texas during winter storms and in California during summer heat waves, he made domestic chip production riskier. Canada understood all of this. Carney's semiconductor strategy was built on three pillars. First, abundant, cheap, clean energy. Quebec's hydroelectric system is one of the largest in the world, and it produces electricity at some of the lowest costs on the planet. Second, open immigration for talent. No restrictions. No security clearances based on nationality. If you can make chips, come. Third, stable, long-term 23:01 government support. No political interference. No budget cuts. $40 billion committed over 10 years guaranteed. And the results speak for themselves. In less than 2 years, Montreal has gone from having no semiconductor manufacturing to producing some of the most advanced chips in the world. Northchip, the company David works for, completed its first 3 nanometer production run. A Taiwanese Canadian joint venture is building a 2 ninometer fab, which would put them ahead of everyone except TSMC. And the ecosystem is expanding. Equipment suppliers are opening offices in Montreal. Chemical companies are building facilities. Universities are launching new semiconductor research programs. The entire supply chain is replicating itself. And it is not just Montreal. Vancouver is becoming a hub for chip design, the software side of semiconductors. Calgary is attracting companies focused on power management and advanced materials. Canada is 24:01 building a distributed semiconductor industry, not concentrated in one vulnerable location, but spread across multiple cities, each specializing in different parts of the value chain. Meanwhile, American chip manufacturing is stagnant. Intel is struggling. Its market share is shrinking. Its technology lags behind TSMC and Samsung. The Ohio FAB may never be built. The Arizona fabs are delayed indefinitely. And the workers who were promised jobs, who moved to these states, who believed in the promise of a semiconductor renaissance are discovering that promises without follow-through are just words. You deserve better than this. You deserve leaders who understand that strategic industries require long-term commitment, that cuttingedge technology requires global talent, that complex manufacturing needs stable, predictable support. David deserves better. Tom deserves better. The thousands of workers who were promised a future in 25:00 semiconductors and instead got layoffs and broken commitments. They all deserve better. Canada did not steal the American semiconductor industry. Canada built an alternative because American policy made domestic chip production unviable. And until American leaders understand that you cannot lead in advanced manufacturing by cutting funding, restricting talent, and destabilizing energy markets, this trend will continue. American chip manufacturing is not dead, but it is no longer leading. And in an industry that defines technological sovereignty, that might be enough to finish it. The fabs in Ohio and Arizona sit halfbuilt, monuments to policy failure. The fabs in Montreal are running at full capacity, producing chips that power the future. And the workers who spent their lives mastering the most complex manufacturing process in history are learning that even the most strategic industries can relocate when governments make them impossible. That is the lesson of 26:00 America's chip collapse. And it is a lesson written in silicon for everyone to

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