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Comment by Invictus0 | Hacker News Reader

Can someone explain to me why Foxconn didn't build the plant? Why would they go through the trouble of negotiating this deal, which ended up phenomenally in their favor, just to throw their hands in the air and walk away?

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From what I can tell, Foxconn never actually intended to build the plant. (I'm getting a lot of this from an interesting long-form article on the history of this deal; unfortunately, I don't remember where I found this article, sorry).

Essentially, Foxconn thought that the Wisconsin deal would work more typically as its deals in China went. Glad-hand the government officials, get sweetheart deals on land and investment, and as long as you're not totally incompetent in making use of it, they won't care what you do with it, even if you fail to live up to the original promises. It's not clear to me that Foxconn actually seriously considered producing LCD screens here given this light; the announcement would have been more to make Walker and other government officials ecstatic about the deal than an actual commitment to follow through. The fact that outrage towards the deal would lead to Walker losing reelection and his successor keeping a much closer eye on performance (or lack thereof) seems to me to have caught Foxconn completely off-guard.

I think there's another level going here in relation to internal Foxconn politics, but my recollection is too hazy to make a coherent explanation, and I don't want to make any false accusations here, so I won't go into any more detail.

I believe you're remembering this story:

https://www.theverge.com/21507966/foxconn-empty-factories-wi...

Yes, that does look like the one I was remembering.

For information, the plant has been built. The building is there, just empty.

Nope. The plant that was promised was never built. They did build some storage warehouses and started a propaganda program where they hired dozens to hundreds of locals to come in to the warehouses, sit around, and do nothing to appear like they were doing something.

The machines inside a LCD factory are dramatically more expensive than the building itself. The "plant" has not been built in any meaningful way.

Politics. Political capital. There are international advantages to having the US president endorse you, your project and your company. Those photos were probably worth the hassle.

Not just the photos but the initial publicity. People remember the beginnings of things if they're broadcasted through mass media. I recall many people claiming this a 'big win' at the time and attributing to the sitting president. I recall also being highly skeptical and suspecting a political stunt but completely forgot about the status until reading this.

Meanwhile, people at large don't follow progress of these endeavors. Some journalists may but there's selection bias from the journalist and the news consumer as to what they ultimately see and stay informed of. These stunts are forgotten by most (myself included) in the daily scramble of things we have to keep track of and manage. Did it fail? Did it succeed? Do I even remember it or just the emotion it attributed to something else I actually do remember?

Ambiguity hiding in complexity of daily life lets people say and do a lot of things and get away with it. It's often far too difficult and time consuming to unravel the ambiguity and complexity to show if something succeded, failed, or to even have cognitive capacity to keep track of. The end result, as you point out, is political capital people walk away with. The emotional impression at the time is what was sold and stuck to most people. "MAGA", "bringing back manufacturering", links to nostalgic economic golden eras for many workers.

Scott Walker, the governor, who signed the deal lost his office a year after it was signed in part due to backlash over the deal.

Think about it from Foxconn's perspective, if you got a sweetheart deal and the person who gave it to you got canned for it, are you going to follow thru and put in billions of your dollars on the assumption that you'll still get billions of government subsidies in return?

I wonder if it might have been water. They may have needed more than a sweetheart deal with the state. I think a big reason for the location was the water supply via Lake Michigan. They got a waiver of state environmental laws as part of the deal, but they still had to contend with federal laws, and a treaty with Canada that governs water use in the Great Lakes watershed.

There was quite a controversy over the environmental impact of this plant. The "word on the street" is that LCD manufacturing is a dirty industry requiring a lot of water.

Short story shorter: Terry Gou is a serial bullshitter

https://www.theverge.com/21507966/foxconn-empty-factories-wi...

Good article on the subject: https://www.theverge.com/21507966/foxconn-empty-factories-wi...

My take it was probably mainly a political stunt, lcd was never really possible (slump + wages + supply issues) and then they didn't know what to do.

Realized Americans don't want to live in factory compounds for 10 months doing repetitive labour.

In a nutshell, it mistook the nature of labor folks are used to here and its costs. Indeed wildly different from China and elsewhere.

This is a take that's wildly generous to FoxConn, painting them as the "aww schucks" kinda honest guys that just didn't know about the challenges of the US labor market.

The alternate take is that the whole deal was made in bad faith and FoxConn was hoping to collect subsidies and line its pockets. This version of events has some precedent[1]. It's especially hard to believe that FoxConn didn't know about US labor when this same situation played out in Pennsylvania in 2013[2].

[1] https://www.marketwatch.com/story/foxconns-history-of-broken...

[2] https://www.washingtonpost.com/business/economy/how-foxconns...

You're 100% spot on. I cannot be convinced a multi-national mega-corp is ignorant of US labor and the challenges in the US labor market. There just is no way that's possible for a company this size, or am I wrong?

So that leaves either bad faith, or they are just abjectly incompetent. I can't really see any other options. Or, again, am I way off base?

> I cannot be convinced a multi-national mega-corp is ignorant of US labor and the challenges in the US labor market.

Especially one that is a specialist in harvesting laborers from all corners of the world. I can only imagine selecting the right labor force has to be their main competences.

I mean, it was bullshit from jump street, but if Wisconsin had poured (more) money into Foxconn's pockets, I'm sure they'd have been happy to put something up.

For the record, they have put something up. Currently 1 large empty buildings and 2 medium sized, filled buildings. Also one perplexing glass globe.

You know what's bad faith? Politicians bullshitting that these kind of factory jobs are ever going to come back.

My smartphone will never be assembled in the US or Germany.

I'm not saying it's economical, but anyone willing to pay 2.5x the cost of a Made-in-China phone could have their phone assembled in the United States: https://puri.sm/posts/librem-5-usa/

(No relation to the company, though I did once have a very nice chat with Todd Weaver).

And to the larger point: I agree completely that politicians opening their mouths about jobs (and also about anything else, IMO) is bad faith bullshit.

It will never be assembled by humans in the US, but we should strive for US based robotic manufacturing.

This is the key people often overlook. If we stop using our AI geniuses to develop tracking algorithms and start building automation, we can have nextgen factories in the West. The environmental factor is yet to be solved though. For the most part, developing countries are trading environmental damage for money. Not much different from harvesting oil or other resources to an economist.

Physical manufacturing doesn't have the sort of profit margins that software provides. You can't give devs the kind of pay many expect when there are 10x more people in the production chain. Investors aren't going to flock to such businesses.

Inverstors are very short sighted. I am advocating for a 100 years plan. You can't expect a bunch of greedy boys to plan for returns after they are dead....

Well let’s see, work in adtech and make $1M TC and get treated with kid gloves by the company or work in industrial engineering and make $100K and be a cost center. How do we change the incentives? Ban advertising and tracking? But making the alternative more attractive is out of the cards...

I know and I agree. It's hard. But don't tempt me on banning ads! :P

If you look from the outside, as a society we are using a lot of our best brains for very frivolous things. I wish for a more efficient way of using our minds!

It's not unprecedented that someone who should know better, and has the best advisors in town, is blinded by their preconceptions about a country and its people. It's lost us a few wars.

I think it shows the idea that "Americans can't do business well", and historically, doing business well has been one thing that Americans pride themselves on.

edit I should add that I believe that spreading that kind of message has geopolitical implications, and that groups might want to create that image for strategic reasons.

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