The writer is the former director of the Chips Program Office at the US Department of Commerce
At the start of this month, President Donald Trump and CC Wei, chief executive of Taiwan Semiconductor Manufacturing Company, announced that TSMC would invest $100bn at its chip fabrication site in Arizona, adding to an existing $65bn commitment. TSMC is the world’s dominant manufacturer of semiconductors, particularly advanced “leading-edge” logic chips. The plan represents a significant win for US national security.
Unfortunately, the announcement has also provided occasion for some members of the current administration, including Trump, to call into question the utility of the US Chips Act, which has been a critical catalyst for TSMC’s investments. These critics cast the 2022 act as a partisan Biden-era effort and argue that tariffs are sufficient to achieve the goal of revitalising US semiconductor manufacturing. Having served as the director of the Chips Program Office at the Department of Commerce, I want to explain why they are mistaken.