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The US Has Lost Its Way on Computer Chips

When it comes to a semiconductor strategy, American policymakers don’t know which direction to turn.

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Illustration: Travess Smalley for Bloomberg Businessweek

In June 2021 the US Senate passed a bill dedicating more than $50 billion to increase the manufacture of semiconductors. At the time pandemic-related shortages in computer chips were highlighting US vulnerability to supply chain shocks, just as rising tension with China heightened national security concerns over technology. Bolstering domestic capacity to make components with such profound economic and strategic importance seemed like an easy win for officials across the political spectrum.

Over a year later that money—the centerpiece of a bill called the Chips Act—still hasn’t been deployed. Senate Minority Leader Mitch McConnell said his party won’t support a bill to do so unless the Democrats abandon plans for spending on climate and other issues. The Democrats, whose broader agenda has stalled anyway, are preparing a slimmed-down version for an imminent vote, and GOP leadership seems ready to support it.