The chip-making industry is at the heart of America's rivalry with China. That may be why President Donald Trump last week called on Intel CEO Lip-Bu Tan to resign from his position.
Trump's decision to put Tan in the spotlight came after Sen. Tom Cotton (R-Ark.) raised concerns that the CEO's interests include firms "linked to the Chinese Communist Party and the People's Liberation Army," said The Associated Press. Tan is "highly CONFLICTED and must resign, immediately," Trump wrote on Truth Social. Tan responded that he has "always operated within the highest legal and ethical standards."
Intel is "beleaguered" after missing out on the "mobile and AI boom," said CNN. Tan became CEO in March with a mission to "revive" the company as a "faster-moving, flatter and more agile organization." But he also has "personally and through various venture funds invested in hundreds of Chinese companies," including those connected to the Chinese military. That led Cotton and other Republicans to question Intel's "impact on US national security."
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Intel "owes us answers about its CEO," said Dave Lee at Bloomberg. The company has a right to feel aggrieved to be under scrutiny at the same time Trump is "controversially loosening export controls on high-end" Nvidia Corp. chips being sold to China. At the same time, the "question of Tan's investments" should have been a "significant focus of the board's due diligence" when it decided to hire him. Intel received $8 billion from the federal government under President Joe Biden's CHIPS and Science Act, which makes it a "stakeholder deserving of transparency and reassurance."
The company "must not bow" to Trump's demands, said Michael Moritz at the Financial Times. The Malaysia-born Tan is a "much-admired figure in Silicon Valley" and a longtime American citizen. There is no one "better equipped to transform Intel's fortunes." The company is in need of revival, which makes this a difficult time for it to stand up to the "president's artless bullying" when so many other institutions have already capitulated. Intel needs to move forward. "The last thing Tan needs is to be distracted by a vindictive political sideshow."
What next?
Tan was already "at odds" with some members of the Intel board before Trump jumped into the scene, said The Wall Street Journal. The issue: Whether the company should "stay in the manufacturing business or exit it entirely." Intel's chip factories supply a third of its revenues but are also a "money loser" for the company. Why stay? Those factories are also "politically important" because they "secure the U.S.'s semiconductor supply chain."
Trump's attack on Tan "could compound" Intel's struggles to determine its future, said The New York Times. The company is behind schedule on a new Ohio factory that would help it shift chip production from Asia to the United States. However the controversy with Trump and Tan ends, "we need an American company to make American chips on American soil," said Sen. Jon Husted (R-Ohio).
