The Chips Act Is Becoming a $280B Flop

“People are very open-minded about new things—as long as they’re exactly like the old ones.” – Charles Kettering

Taiwan makes 90% of the world’s chips, and China plans to annex Taiwan over in the next year or so. Since chips are vital to our national security, China taking control of chips creates a very serious problem for the United States.

The US government introduced the CHIPS Act in 2022 to promote domestic semiconductor growth and attract giant industry players to set up facilities in the US.

The $280 billion CHIPS Act aims to boost US semiconductor manufacturing and reduce reliance on TSMC in Taiwan, which produces 92% of leading-edge chips, raising national security concerns.

The scheme brought in $400 billion worth of incentives in the form of tax credits, loans, and grants. As a result, several firms were key to capitalize on the opportunity, with Intel and TSMC leading the race.

However, a report from the Financial Times has disclosed that approximately 40% of major manufacturing investments haven’t reached their conclusion yet.

Identity politics, an evil racist policy called DEI, “diversity, equity, and inclusion,” is largely responsible. It reduces the pool of candidates to anyone but white men and often white women. It affects the supply chain that makes chips, which are key to AI, weapons, and more.

It’s a matter of national security when only the best should be hired.

The Hill Opinion Piece

The Biden administration recently promised it will finally loosen the purse strings on $39 billion of CHIPS Act grants to encourage semiconductor fabrication in the U.S. But less than a week later, Intel announced that it’s putting the brakes on its Columbus factory. The Taiwan Semiconductor Manufacturing Company (TSMC) has pushed back production at its second Arizona foundry. The remaining major chipmaker, Samsung, just delayed its first Texas fab.

It’s the DEI Curse

They did it because the law contains 19 sections aimed at helping minority groups, including one creating a Chief Diversity Officer at the National Science Foundation, and several prioritizing scientific cooperation with what it calls “minority-serving institutions.” A section called “Opportunity and Inclusion” instructs the Department of Commerce to work with minority-owned businesses and make sure chipmakers “increase the participation of economically disadvantaged individuals in the semiconductor workforce.”

The department interprets that as a license to diversify. Its factsheet asserts that diversity is “critical to strengthening the U.S. semiconductor ecosystem,” adding, “Critically, this must include significant investments to create opportunities for Americans from historically underserved communities.”

[…]

Handouts abound. There’s plenty for the left—requirements that chipmakers submit detailed plans to educate, employ, and train lots of women and people of color, as well as “justice-involved individuals,” more commonly known as ex-cons. There’s plenty for the right—veterans and members of rural communities find their way into the typical DEI definition of minorities. There’s even plenty for the planet: Arizona Democrats just bragged they’ve won $15 million in CHIPS funding for an ASU project fighting climate change.

It is government madness and incompetence.

Look what has happened with the government broadband initiative. The government was going to connect the nation for $65 billion. Not one person has been connected after three years. Starlink could have done it faster and cheaper, but Elon Musk is no longer a government friend, so they wouldn’t have used Starlink.

Watch:

PowerInbox