The bill to boost US semiconductor production has been a top priority for the Biden administration. Patrick Semansky/AP .
. Patrick Semansky/AP
If you take stock of all the high-tech gadgets around you right now, including the device you’re currently using to read this article, you’ll find that they all need semiconductor chips to function.
And most of these chips are not made in the USA
The Biden administration wants to change that, with the president signing the CHIPS and Science Act this week. It will allocate more than $50 billion to bring semiconductor chip manufacturing to the United States and away from its current production hub in East Asia.
Sourabh Gupta is a senior Asia-Pacific policy scholar at the Institute of China-American Studies and joined All Things Considered to discuss what this means for our gadgets and what it could predict about the future of American technological manufacture.
This interview has been edited for length and clarity
On what would happen if the United States lost access to its semiconductor chip imports from Asia
Life would stop if we didn’t have chips, which are like oil, it’s the resource that runs our electronics, and actually runs our lives in many ways. A car contains hundreds of tokens. And we’re not talking about the most sophisticated cars. We are not talking about electric vehicles. We’re talking about your average car.
We’re just talking TVs for something as simple as that. Child players won’t have much entertainment if the tokens don’t come. What chips also do is that they form the basis of many innovations, the next generation innovation, what has been called the fourth industrial revolution.
On whether the CHIPS Act goes far enough to prevent this potential downturn
That’s enough. There’s a lot of money, and a lot of it is frontloaded, literally $19 billion frontloaded over the next 12 months to support chip manufacturing in the United States. But we don’t need to have all the chips or a very large number of chips made in the US
We just need a certain amount of chips that won’t keep the United States in a blackmail situation or in a peril situation if there is a war in East Asia, or if there is to others, just a general supply chain snafus.
On whether this law effectively strengthens the U.S. position and limits China’s influence in chip manufacturing
He absolutely does [shore up the U.S.’s position], but that does not necessarily curb China’s influence. This requires China to be able to come up with more local innovation to catch up with the United States – and its East Asian peers – in terms of chip manufacturing.
East Asian manufacturers are in conflict over the CHIPS law and certain disciplines imposed on them in terms of capacity expansion in China. But that being said, they appreciate the importance of the United States. And so the way they’re trying to move forward is to ask the US federal government to allow them to continue to produce legacy chips in China, chips that aren’t state-of-the-art – whereas they will produce the advanced chips in their home countries and in America so that this technology that goes into the advanced chips does not spread to China and in any way improve China’s production capabilities.
This story was adapted for the web by Manuela Lopez Restrepo.
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