President Trump’s recent attack on the bipartisan CHIPS Act during his address to Congress has sent shockwaves through Washington. The law, aimed at reducing American reliance on Asia for semiconductors, has been a rare unifying force in politics, leading to the allocation of $50 billion to rebuild the U.S. semiconductor industry.
Trump’s criticism of the CHIPS Act has left many in the tech industry alarmed, with fears that funding may be revoked and contracts terminated. The Commerce Department has already laid off 40 employees from the CHIPS Program Office, nearly a third of the team, and discussions are ongoing about changes to projects that received subsidies.
Despite these challenges, the semiconductor industry remains committed to investing in the U.S. TSMC, Intel, Micron, Samsung, and others have pledged hundreds of billions of dollars to build new chip-making facilities, with TSMC alone committing to increase its U.S. investment by $100 billion.
While Trump has proposed using tariffs to incentivize investment in the U.S., industry insiders question the effectiveness of this strategy, as most chips are imported indirectly through overseas electronics factories. Lawyers and executives have been working to convince Trump of the value of the CHIPS Act since the election and are hopeful that the administration will continue to support the program.
As lawmakers and industry leaders navigate the uncertainty created by Trump’s comments, the long-term impact on the U.S. semiconductor industry remains unclear. However, the CHIPS Act has already shown success in revitalizing domestic chip production, with the potential for further growth and innovation in the future.
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