TECH NEWS – The President of the United States would rather impose tariffs than provide subsidies for domestic technology manufacturing.

Donald Trump has made his most serious criticism yet of the CHIPS Act. He said that US lawmakers should get rid of it altogether. According to Reuters, the US president told Congress that the 2022 law should be repealed and the remaining $52 billion in subsidies should be used to pay down debt instead of encouraging the construction of semiconductor factories in the US: “Your CHIPS bill is a terrible, terrible thing. We’re giving hundreds of billions of dollars and it doesn’t mean anything. They’re taking our money and not spending it. You should get rid of the CHIPS Act and whatever’s left over, Mr. Speaker, you should use it to pay down the debt,” Trump said in his speech to Congress.

The CHIPS and Science Act was seen as a landmark legislation to fund more technology production in the United States. It was passed by Biden, but it was a bipartisan bill and received a lot of praise. The $39 billion fund was specifically aimed at supporting chip manufacturing, including the introduction of new types of chips. The goal was to avoid the security risks associated with foreign-made goods, with the side effect that the US could potentially catch up with and possibly even overtake other countries (China, Taiwan), which could create many new jobs for US workers.

Chip manufacturing is also essentially an arms race. The technology is advancing at breakneck speed, and governments around the world want a bigger piece of the pie. Europe even passed its own €43 billion CHIPS law a year later, in 2023. Meanwhile, Trump has imposed tariffs on Canada and Mexico and doubled tariffs on China. In response, companies in countries that rely heavily on US exports (such as Japan) have already been stockpiling in the US.

But the CHIPS Act seemed to work. The U.S. has signed several agreements with all the leading chip manufacturers to open facilities in the country. This includes investments by Micron in New York and TSMC in Arizona, and Trump’s comments were seen by many as an attack on the industry. New York Gov. Kathy Hochul said the CHIPS Act was the reason Micron brought $100 billion and 50,000 jobs to central New York. And Arizona Congressman Greg Stanton called Trump’s words a “direct attack on Arizona’s semiconductor industry and tens of thousands of Arizona workers” and said TSMC’s $100 billion investment would not have happened without the law…

The question is whether this time there will be a bipartisan, bicameral rally for the law, or whether populism will take a victim.

Source: PCGamer