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CED’s Policy Backgrounders provide timely insights on prominent business and economic policy issues facing the nation.
The CHIPS and Science Act of 2022 is designed to incentivize the domestic production of semiconductors and support applied scientific research in the US. The bill, which garnered significant bi-partisan support, is largely in response to three main concerns: 1) the US need to remain economically competitive and a leader of technological innovation with the rapid growth and sophistication of the Chinese economy as an outgrowth of a substantial Chinese industrial policy; 2) concerns about disrupted supplies chains for such critical components for the modern economy due to the global pandemic and geo-political tensions, particularly with regards to Taiwan, the world’s leader in semiconductor manufacturing; and 3) maintaining the integrity of the chips value chains for national defense given the reliance of all major US defense systems and platforms on semi-conductors.
