
Lawmakers Push to Invest Billions in Semiconductor Industry to Counter China - bigpumpkin
https://www.nytimes.com/2020/06/11/business/economy/semiconductors-chips-congress-china.html
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bigpumpkin
"WASHINGTON — China’s technological ambitions are eliciting rare bipartisan
agreement in Washington, with lawmakers considering investing tens of billions
of dollars in America’s semiconductor industry over the next five to 10 years
to help the United States retain an edge over Beijing.

A bipartisan measure introduced this week is one of several proposals that
would provide substantial funding for the semiconductor industry, which
manufactures chips that serve as the tiny brains or memory of electronic
devices from smartphones to fitness trackers.

The efforts reflect a shifting consensus in Washington, as lawmakers look to
more expansive government intervention in private markets to help American
firms compete. That includes Republicans, who have long criticized government-
led industrial plans as inefficient and redolent of communism but have watched
with dismay as such efforts in China have allowed it to dominate industries
from steel and solar panels to shipbuilding.

The future of the semiconductor industry is viewed as particularly significant
because it is a foundational technology that can give nations an edge in
innovation. China has been shoveling billions into developing its own chip
industry, which has long been dominated by the United States and has helped
propel a boom in 5G technology, artificial intelligence and robotics.

Semiconductors are still one of America’s largest exports, and American
companies that design and sell chips still account for nearly half of global
revenue in the sector, the greatest share of any country. But the United
States only accounts for around 12 percent of global semiconductor production
capacity. Decades ago, domestic designers began turning to foundries in places
like Taiwan and South Korea to manufacture their chips.

While past government subsidies have largely focused on chip research, the
latest bill puts a heavy emphasis on domestic manufacturing. A centerpiece,
which would put more than $22.8 billion toward the industry, is a new trust
fund for federal grants to match state subsidies to encourage new factories.
As much as $10 billion a year could be placed in the fund, with the money to
come from the import tariffs the administration has placed on China, rather
than a congressional appropriation..."

