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Biden, chips, and the Silicon Shield
A smartphone with a displayed TSMC (Taiwan Semiconductor Manufacturing Company) logo is placed on a computer motherboard in this illustration taken March 6, 2023.
REUTERS/Dado Ruvic
April 08, 2024
On Monday, the Biden administration announced it would provide up to $6.6 billion from the bipartisan Chips and Science Act to allow the Taiwan Semiconductor Manufacturing Company to expand its existing facilities in Arizona. The US goal is to ensure that TSMC, the world’s lead maker of advanced microchips, can boost semiconductor production on US soil. Taiwan’s tech titan now produces the overwhelming majority of the world’s advanced chips.
For all countries with advanced manufacturing capabilities, future chip production will be crucial for both economic dynamism and national security, because semiconductors will be an indispensable component in everything from electric vehicles to consumer electronics to satellites and advanced weapons systems.
Monday’s announcement marks a political victory for President Joe Biden, who can now claim he’s adding a “Made in America” label to the world’s most advanced technologies.
There is an important security implication from this announcement, one that Taiwan’s government may not like. TSMC remains at the heart of the island nation’s “silicon shield,” the protection that semiconductor dominance provides Taiwan by giving the United States good reason to protect it from Chinese attack. Shifting more of TSMC’s production to Arizona reduces that incentive.
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