Is America's microchip bill aimed at China? - ABDULLAH MURADOĞLU

Is America's microchip bill aimed at China?

U.S. President Joe Biden held a phone call with his Chinese counterpart Xi Jinping on Thursday, lasting about two hours and 17 minutes. The main issues the two presidents discussed during the call were the trade wars between the United States and China.


Chinese media reported that President Xi Jinping told Biden that measures that violate basic economic laws such as cutting supply chains and economic ties will not help boost the U.S. economy, and will only make the global economy more vulnerable.


There is no doubt that the target behind the Chinese president's words is the U.S. bill passed by the Senate and the House of Representatives with bipartisan support.


The bill, known as the "China Act" or the "Electronic Chips Act," grants $52 billion to support and stimulate the manufacture of U.S. semiconductors and advanced electronic chips.


The bill provides for tax exemptions of 25 percent for companies that will enter the field of semiconductor manufacturing. Large amounts of money will also be allocated for research and development.


In this context, major arms companies and manufacturers of cars and computers have put pressure from many sides on the Biden administration and the Senate and House of Representatives to pass the electronic chip bill. Last week, the lobby groups carried out a lightning operation in Washington to pass the law.


The chips are used in the manufacture of many weapons systems, especially the Javelin anti-armor missiles that the United States sent to Ukraine.


Lobbyists assert that the United States should prioritize chip production to maintain its military technological edge. Of course, the target is China.


Supporters of the chip bill stress that China is very close to overtaking the United States in a military technology competition.


Accordingly, the issue of chip manufacturing is categorized as a national security issue for America. This China-focused labeling certainly bothers her a lot.


In fact, the chip bill had been on the agenda for a year. But members of the Republican Party were able to block the bill in the Senate and House of Representatives.


This prompted Democrats to accuse Mitch McConnell, the Republican majority leader in the US Senate, of siding with the Chinese Communist Party against American workers and industry.


Then McConnell changed his mind last week. Also, 17 Republican senators voted "yes" on the bill in the vote that took place last Wednesday.


In the US House of Representatives, 24 Republican lawmakers voted "yes" to the bill, despite calls by Republican leaders to vote "no."


According to the Republicans who voted "no" to the bill, they believe it is not tough enough on China.


On the other hand, the share of the United States in the manufacture and production of semiconductors (electronic chips) has fallen from 40% of global production in 1990 to only 12% today.


The reason for this is that semiconductor production has moved to countries with cheap labor, particularly China. Taiwan and China are associated with the Chip Act because Taiwan ranks first in the world in the ultra-high-end chip industry.


Taiwan also produces more than 90 percent of all kinds of chips, including the world's most advanced chips.


“Semiconductors are ground zero in our technology competition with China, and that industry is essential for technologies from artificial intelligence to hypersonic weapons to next generation networks,” Deputy Defense Secretary Kathleen Hicks said during a meeting with representatives of arms companies before the bill was introduced. next one".


According to the Biden administration, imposing restrictions on chip supplies from abroad, especially from Taiwan, would significantly weaken the US defense capacity against China.


Meanwhile, Republican and Democratic hawks, dubbed the "anti-China party", hint that China will invade Taiwan in the very near future.


Accordingly, when China includes Taiwan, it will have the ability to control the production of chips in global markets.


The hawks call electronic chips (semiconductors) the "new oil", so they see Taiwan as a way to halt China's economic rise.


The control of oil resources during the twentieth century was one of the highest priorities of the world's hegemons. As for the twenty-first century, it seems that the electronic chip industry (semiconductors) will replace oil, especially in light of the geotechnological war between the United States and China, which comes under the framework of the new Cold War.


Now, a song that goes like this: "Those who control the semiconductor chip industry can control the new technology, and thus control the world." plays in the background of the new Cold War,

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