Semiconductors Don’t Need Subsidies
America has tried industrial policy in the past, with poor results.
Last week, assembly lines at Ford and General Motors ground to a halt—all for lack of a few pieces of silicon smaller than your pupil. The pandemic and the move to remote work has put unprecedented pressure on semiconductor supplies. Like the two carmakers, companies everywhere are scrambling to purchase them or simply shutting down.
Advocates of “industrial policy,” or government support for specific industries, have seized on the shortage to argue for more federal money. The CHIPS for America Act and the American Foundries Act would spend tens of billions of dollars to encourage semiconductor manufacturing in the United States. Both bills have found bipartisan support in Congress.