> systemically putting short term gains ahead of long term research

That's more the stock market than the US government though. You could argue the US government tries to play a long game, and often the way the US plays that game is to let the free market decide (hands off, small government). It's definitely a valid strategy and has worked extremely well in a number of other industries, but for this specific niche, less so, and even then you could argue it's down to Intel's mismanagement than anything the government could or should have done.

It is clear that the government and wall street are generally of one mind on this. One recent specific way the government contributed to this is via the Tax Cuts and Jobs Act (TCJA) of 2017, which increased tax burden of R&D. They've also cut a lot of their own research funding (NIH, NSF).

I can't make the argument that the government is "hands off, small government" because I simply don't see the evidence of that. To the contrary, I have seen things like TARP, stimulus checks, oh, and the government buying 10% of Intel.

Taking 10% of Intel. Intel was already supposed to get this money and then retroactively were told to give up 10% for it

FWIW, in exchange for less restrictions on what they do with the money and less strict clawback terms.

I don’t believe that, I believe it was in exchange for not pressuring the CEO to step down any further.

This looks like an incredibly corrupt action.

Yes, Intel won’t have to build out their fabs as aggressively to get the money now.

The only people arguing against big government are republicans when democrats are in power, otherwise everyone is happy to expand spending.

Now that we have lawmakers openly declaring they would pick capitalism over democracy if forced to choose, I have little hope that the government will be receptive to changing anything structural.

I would argue that federal and state governments play even shorter games than investors in the stock market. They're constantly putting their thumbs on whichever scales are politically expedient to claim they did something every 2/4/6 years when it's time for reelection.

Just as an example, the calculus for "where should I build a factory" comes down to "which politicians give the biggest tax incentives" and not any market dynamics.

The strategy is fine, the problem is there aren’t enough domestic competing players in cutting edge semi nodes for it to work anymore. The US had many competing foundries before its semi industry was hollowed out by Japan and Korea. Now the only player in the US is Intel and, having been mismanaged for the last decade or more, it’s at risk.

I don’t think propping up Intel is going to work though, they’re a sinking ship and their management seems too risk averse and incompetent. It might be better for the US, long term, to let them collapse and sell off strategic parts to different domestic players (NVIDIA, AMD, micron, TI, etc) and use tariffs or other trade policy to force some amount of leading edge semi fabrication to use domestic manufacturing.