U.S. Commerce Secretary Gina Raimondo said that it cannot continue to rely on Taiwanese semiconductors and that legislation needs to be passed to support domestic production of high-end computer chips, and she described the U.S. as facing a “Sputnik moment.”
Raimondo said on Thursday (21st) that “my country’s dependence on Taiwan for chips is unsustainable and unsafe.” The U.S. is facing a “Sputnik moment,” she said, referring to the American Chip Act, a more than $50 billion package to increase semiconductor manufacturing within the United States.
In 1957, the Soviet Union successfully launched the first artificial satellite “Sputnik 1”, which shocked the world and took the lead in the US-Soviet science and technology competition. The United States, following a painful remorse, began to fully develop the space industry during the tenure of former President Kennedy, and successfully landed on the moon in 1969, creating a milestone in human history.
For more than a year, the U.S. Congress has been discussing a bill to strengthen the technology industry, but disagreements between the House of Representatives and the Senate have resulted in the core content of the bill being stuck. Senate Republican Leader Mitch McConnell said last month that if Democrats seek an economic bill approaching $1 trillion in size, there will be no progress on any bill.
The Senate passed a procedural vote on the “American Chip Act” on Tuesday, and it is expected to be sent to the Senate for a vote as soon as next week, following which it still needs to be voted on by the House of Representatives.
Data from the Congressional Budget Office (CBO) shows that if Congress passes the bill, the U.S. budget deficit will increase by $79 billion over 10 years.
Raimondo also discussed the Biden administration’s economic strategy towards China, saying that the United States needs to increase domestic investment and weaken China’s advantages.
She said the U.S. needs to protect intellectual property rights, protect companies from “unfair practices” — including China’s dumping of cheap steel and aluminum into the U.S. — and work to level the playing field for companies and help U.S. companies gain access to the Chinese market.
“There is only so much we can do” to slow China down, Raimondo said. “We need to be sober regarding export controls and reject Chinese technology originating in the United States, which will give them an advantage.”
