As Congress Debated Landmark China Bill, Beijing Surged Ahead

In the weeks before the House and Senate passed the $ 280 billion chip and science law after 13 months of debate, chip makers backed by major Chinese nations shocked the world a bit. Cleared the technical hurdles.

Experts say how China is in an effort to produce semiconductors that are comparable to Taiwanese semiconductors that the circuit supplies to both China and the West, with very small dimensions of about 1 / 10,000 of human hair. I am evaluating whether it has made great strides. The Biden administration has been highly specialized in making these chips from the hands of China, as advances in chip manufacturing are being scrutinized as a way to define national power, much like nuclear tests and precision guided missiles. An extraordinary effort was made to maintain the equipment. It was during the last Cold War.

No one yet knows if China can take advantage of this breakthrough on a large scale. It may take years. But one lesson seemed clear. Congress discussed whether to support US chip makers, how to support them, and whether to support a wide range of research in other technologies, from advanced batteries to robotics and quantum computing. Washington took years to put together his actions.

“Our Congress is moving at political speed,” said Eric Schmidt, former Google CEO who headed the National Security Commission on Artificial Intelligence. Like advanced semiconductor manufacturing in a fragile supply chain world. “The Chinese government is operating at a commercial speed.”

In China, the willingness to catch up and manufacture cutting-edge chips is part of the Made in China 2025 program. The effort began in 2015. Few people in Congress want to admit this, but as promised Thursday, the U.S.-funded technology when President Biden signs the bill is primarily replicating China’s list. increase.

This is a classic industrial policy, but leaders of both parties have avoided the term. The term conveys the opposite sense of state management planning to most Republicans and provides direct support and tax credits to some of America’s largest companies that anger some Democrats.

But 2025 isn’t too far away. This means that money will only flow while the Chinese and other competitors move on to the next set of goals. Meanwhile, the US semiconductor industry has declined, basic technology was born here, and despite the name Silicon Valley, no state-of-the-art chips are manufactured in the United States.

None of this means that America’s competitiveness will be ruined. Japan seemed to be a 10-foot-high technology giant in the late 1980s and early 1990s, but with some of the biggest breakthroughs in mobile computing, Windows operating systems, and even chip manufacturing. As you missed, China is discovering it. Money alone does not guarantee a technical advantage. But it helps.

It took much longer for Congress to reach the same conclusion. Still, China turned out to be one of the few issues that Republicans and Democrats could get together — the bill abstained Thursday and passed Houses 243 to 187. Twenty-four Republicans voted in favor. It was billed by GOP leaders after Senate majority leader Chuck Schumer in New York and West Virginia Senator Joe Manchin III announced a surprising deal on climate, energy and taxes. This is because I urged them to oppose it. on wednesday.

China quickly denounced the bill as an isolationist move by Americans intended to free themselves from dependence on foreign technology. This is a strategy called “decoupling” that China itself is trying to duplicate.

Zhao Lijian, a spokesman for the Chinese Foreign Ministry, told reporters in Beijing that China’s progress “does not hinder restrictions or oppression.” This is a clear reference to the efforts of the United States and Europe to deny the technology that accelerates China’s technological independence.

But the big question is whether Congress was destined to work late to awaken to America’s competitive shortcomings. Mr. Biden and his lawmakers sought to build support for the bill by describing the chips found in everything from refrigerators to thermostats to automobiles as “oil” in the 21st century. It was already hacked a year ago.

In the late 1980s, one of Silicon Valley’s pioneers and early leader of Intel Corporation, Andrew S. Grove warned of the dangers of the United States becoming Japan’s “techno colony.”

Taiwan semiconductor manufacturing company produces about 90% of the most advanced semiconductors. It sells them to both China and the United States.

While Taiwan Semiconductor and Samsung are responding to political pressure to build new manufacturing facilities in the U.S. and address U.S. supply chain concerns, the end result is that only a single-digit percentage of their production is in the U.S. It will be done in the soil.

“Relying on Taiwan for sophisticated chips is unacceptable and unsafe,” Secretary of Commerce Gina Raimondo told the Aspen Security Forum last week. As the demand for more sophisticated chips grows, newer generations of vehicles will require more and more semiconductors. “The domestic supply is not enough,” she said.

She claimed that the $ 52 billion federal subsidy of the bill would be backed by private funding and turned into “hundreds of billions” of investments. She basically used the argument that the federal government had long used to justify incentives for contractors in the defense industry. Politicians knew that dangerous new spy satellite technology, or underwriting of stealth drones, would be easy to sell in Congress if described as a significant defense spending rather than an industrial policy.

But now the logic comes to mind. Independent contractors in the defense industry need not only the F-35, but also state-of-the-art commercial chips for artificial intelligence systems that could one day change the nature of the battlefield. The old distinction between military and commercial technology is severely undermined. As a result, the government brought Defense Secretary Lloyd J. Austin III into a pressure campaign to pass the bill, arguing that future weapons could not be relied on by foreign suppliers.

The bill’s authors say starting today is better than continuing to see American lead eroded while they are late for work to rebuild the industry. Indiana Senator Todd Young said China’s recent progress has been “calm”, but “if we mobilize a lot of resources, no one can innovate the United States.”

Another advantage of the United States is “economic and geopolitical relations with other countries,” Young said. “China has no friends. They have vassals.”

Innovation was a powerful proceeding in the United States. The microprocessor was invented here. But again and again, the vulnerability in the United States lies in the manufacturing industry. And China is not the only competitor. To withdraw cash from Congress, Intel and other allies are trying to seduce Germany and other allies to build “fabs” (airtight and clean manufacturing centers for chips) on their territory. Stated.

But in the end, it was China that promoted the vote.

One of the first evaluations of the new Chinese chip by Semiconductor Manufacturing International Corporation, I’m from a researcher at a company called TechInsights..

After reverse engineering a chip made in China, they concluded that it uses a circuit that is only 7 nanometers wide. Until 2020, Chinese manufacturers were struggling to fall below 40 nanometers.

Experts say the chips made to mine cryptocurrencies may be based on Taiwan Semiconductor or stolen from Taiwan Semiconductor. So far, TSMC continues to be the most important single manufacturer in the world, and its vast facilities near Taipei could provide maximum protection against island invasion. China cannot afford to risk its destruction. And the United States can’t afford it to be destroyed.

But that delicate balance doesn’t last forever. Therefore, China has both commercial and geopolitical motivations to make the fastest chips in the world, and the United States has competitive motivations to prevent Beijing from acquiring the technology to do so. It’s the ultimate 21st century weapons race.

“The government can afford to stand by,” Schumer said Wednesday in the Cold War against the Soviet Union a generation ago, hoping for private industry to invest. Now he said, “I can’t afford to sit on the sidelines.”

Katie Edmondson Contribution report.