The Jumbled Dream of US Chips
The global shortage of computer chips has stopped the production of cars, computers and even wall washers. But now the signs of a chip shortage – the teen parts that function like the brain or the memory in all the electronics – are coming to an end.
This may be good news for our budget. It was also an awkward moment for the Biden administration and U.S. lawmakers who have boosted taxpayers’ funding for computer chips with a number of goals, including shortages.
Some of those objectives are reasonable. But throwing government money to address the shortage seems to be in question. Now it seems wrong. Let’s talk about why:
Why is the chip so important?
Computer chips are essential for smartphones, video players and other consumer electronics. We also use them on fighter jets; In car ignitions, braking and entertainment systems; And monitor dairy production of dairy cows.
As my colleague Don Clark explained last year, it is not surprising that chips are temporarily lacking. What has been unusual in the last few years is the natural combination of epidemic-related disruptions and our full desire to buy more, which leads to a scarcity of diversity.
What has changed?
In recent weeks, computer chips seem to be abruptly abundant. Many computer chip companies have warned that their sales will heat up. Unused chips are picked up in South Korea, a major manufacturing center, in The fastest rate in many years.
The big reason is that people around the world are not buying as much electronics as laptops, smartphones and TVs as much as they did a year or two ago. Many people are worried about rising prices and the health of the economy and are struggling. So the company is cutting orders for the computer chips that will be built into many products.
This is how economics and computer chips tend to work. When people are feeling good and are spending more, the chip factory is increasing to make way more. Almost always, they overproduce and have too many chips. Some experts say the epidemic mania will be followed by chip breakage. We are not there yet, but we will see.
What does Biden management do with it?
I have previously written about the consensus in Washington on putting more U.S. government support behind American chip factories and expertise. Congress has debated – and still debated – the specifics of spending more than $ 50 billion in taxes to do so. The world’s most advanced chips are made in Asia, especially in Taiwan and South Korea.
One of the stated goals of funding is to help reduce the shortage of chips. And now? Nothing has passed, and the shortage is over for some kind of chip.
There is good reason for US taxpayers to subsidize the chip industry. Many experts cite the importance of building knowledge of advanced chip manufacturing in America. It is not good that so many essential chips are made in Taiwan, Dome To the extent of China’s potential. The U.S. military wants to ensure that there are uninterrupted supplies and their inspections. (There is a US chip factory dedicated to this.)
But the mission of the American chip plan is inconsistent. U.S. officials and industry have compiled a list of successful laundry Benefit from US Chip Funding, Including More Jobs for America, Compete with China and make the US industry like automotive products Make products.
The last one, honestly, never meant much. The serious fact is that cars have to fight for space in the chip factory line against the more lucrative chips for smartphones or other bizarre devices. Although there are more computer chips in America, there is no reason why Texas-made chips will only go on the Ford F-150s and not trucks from European or Asian companies.
The more fair the government crams in its plans for the chip, the less clear it is about what America is trying to accomplish.
Understand the global chip shortage
Lack. Globally, the industry is struggling because there are too few computer chips. Here are some things to keep in mind:
Read more from On Tech about computer chips:
Before We Go…
Twitter sues Indian government: The company is debating an order to remove some tweets and block accounts that India says violate the country’s laws, my colleague Karan Deep Singh reports. It’s the latest confrontation between US internet companies and the world’s largest democracy over the limits of free speech.
This is probably one of the biggest privacy breaches in China. Hackers are offering a Shanghai police database that could contain information about perhaps one billion Chinese citizens, reports my colleagues John Liu and Paul Mozur.
When the website for religious pilgrimages fails: Saudi Arabia has sent Westerners to a single government-licensed website to book trips to the Islamic holy city of Mecca. The Washington Post reports that technical conflicts have prevented thousands of people from attending the ceremony. Hajj. (Application may be required.)
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