$8 Billion for Intel Won’t Fix America’s Chip Problem
Laying the groundwork for a competitive industry requires more than writing big checks.
Not so fab.
Photographer: Rebecca Noble/Getty Images
Since its enactment in 2022, the Chips and Science Act — a $280 billion splurge intended to revive US semiconductor manufacturing — has been at best a mixed success. A $7.9 billion grant to Intel Corp., announced by President Joe Biden’s administration last week, shows how this gravy train may be headed off the rails.
Boosting domestic chipmaking is a reasonable goal. Although the US leads the world in chip design, it accounts for only about 10% of global production. That has left American companies — and, more pointedly, the Department of Defense — heavily reliant on overseas manufacturers, especially in Taiwan, which makes 92% of leading-edge chips. Citing national security, Congress has offered tens of billions in grants, loans and tax credits to entice companies to build chip factories (called fabs) on US soil.