[seo-speedwagon]

These companies exist as capitalist organizations, they don’t build planes and chips out of patriotic noblesse, they do it to turn a profit. In such a system, failed companies go out of business. It really is that simple, anything else leads to bailouts that socialize losses for companies that privatize profits.

If they’re so important, then they should be nationalized.

[alephnerd]

Nationalization is not ideal because the operation of SOEs can be tainted by the whims of political incentives instead of operational incentives.

There is a reason why formally socialist China and India are trying to develop private sector players in these fields - a private corporation has the ability to be much more nimble around hiring and capital allocation unlike an SOE.

Also, your argument does not challenge my point how Taiwan, Japan, and South Korea leverage massive conglomerates instead of SOEs or small businesses to cement their lead in the Semiconductor Industry.

[maeil]

> There is a reason why formally socialist China and India are trying to develop private sector players in these fields - a private corporation has the ability to be much more nimble around hiring and capital allocation unlike an SOE.

Are they? After Chinese private tech companies got too big, they reigned them in and made them closer to the state than ever. I'd love to see actual proof that China is really lessening it's involvement in companies, because I haven't seen such a trend in a significant manner.

> Also, your argument does not challenge my point how Taiwan, Japan, and South Korea leverage massive conglomerates instead of SOEs or small businesses to cement their lead in the Semiconductor Industry.

I happen to be based in Korea and be familiar with the insides of the conglomerates.

None of the conglomerate subsidiaries have a monopoly in any sector or country like, for example, Google does in ads and search, or Intel did in CPUs for a decade or so, with >80% market shares.

Hyundai Auto is kind of getting there domestically, but that's it, and it's the exception plus the domestic market is only a small part of their revenue.

Similarly, the overwhelming majority of the subsidiaries are not "too big to fail". During the IMF crisis in the late 90s and in its aftermath, several conglomerates failed. As a result, to this day, the financials of the subsidiaries are not particularly intertwined with each other. Sure, they sometimes give each other contracts (why wouldn't you), but that's always just a small part. They're run very independently. And it still happens that they "fail", or at least do poorly enough that the conglomerate wants to get rid of them, in which case there's usually a buyer looking to snap it up and turn things around.