Team Trump readies national security card to justify taxing Americans for foreign chips Uncle Sam is kicking off a probe into the national security risks associated with America relying on imported foreign-made semiconductors. The move is a likely precursor to sticking steep tariffs on imported chips: The Trump administration has been applying similar levies to foreign goods ostensibly to, among other things, …
I remember after the Brexit vote not feeling a lot of sympathy because they will have got what they voted for. Well now the shoe's on the other foot and I'm getting to watch my own country crater things much worse than Brexit did if Trump isn't stopped.
I have found that I don't really care that much. I've never been particularly patriotic, and I kind of feel that if this is what people voted for they need to get it so they can find out how stupid they were. A world where the US has a lot less power and influence is probably a good thing anyway, so long as it isn't replaced by a world where China takes America's place that regard. It is ironic that by taking more power for himself domestically, Trump is greatly reducing his power and influence over the rest of the world. He's far too much of a simpleton to realize that, he thinks power comes from military might but you have to be willing to go into a shooting war to exercise such power. US presidents have for decades been able to exert a lot of power and influence across the globe using "soft power", but Trump has pretty much permanently discarded the entire US supply of soft power in less than three months.
If things get bad I'll leave the US behind and not shed a tear if it turns into some sort of Gilead or an empire in permanent decline. I won't consider it to be me abandoning the US, because the US will have abandoned me first.
I'm just assuming that nothing's going to stop this Administration -- even if things truly crater they'll just start a war of distraction or something. Its a bit of a pessimistic position, I know, but I'm hoping that the long term effect will be that "we, the people" will learn to appreciate our system of government and look after it a bit better in the future.
(I am assuming that the system will survive because its replicated in all the states so -- worst case -- any attempt by the Federal government to impose its will on the larger states by diktat is likely to provoke the disintegration of the Union.)(They might be a bunch of wannabe fascists over there but some of us like our democracy, even with its warts and faults.)
The chips taxes, like everything else coming out of DC now, just demonstrates crass ignorance, a doctrinaire approach to government and a general lack of understanding about how things work. I'm surprised that the TechBros -- especially Musk -- haven't tried to correct their thinking but maybe Project 2025 is just too much for them. (Grabbing that bit of fur seemed like a nice idea at the time, too bad they didn't notice it belongs to a rabid tiger.)
"any attempt by the Federal government to impose its will on the larger states by diktat is likely to provoke the disintegration of the Union"
I had wondered if this a likely outcome, especially when Trump tries to abolish the two term limit. of course, given that he's taking his orders straight out of Pootie's spotty arse, perhaps the disintegration of the USA is actually something he has been tasked to accomplish.
If things get bad I'll leave the US behind and not shed a tear
As an individual decision, that has internal logic. However, lots of people won't have the opportunity of leaving and "me first" was very much what got the US into this in the first place. Even if the US becomes a festering slough of despond, it will be a festering slough of despond with nuclear weapons, so leaving it to its own lethal devices is maybe not the smart option.
And what exactly would change if I stayed here in such a circumstances, other than my personal misery? I can speak out from either place, and Trump wants protesting against him to be a crime bad enough to stick you in a deep dark hole in El Salvador so that wouldn't do me much good.
I can still vote against the terrible from across the ocean. Though if it gets bad enough for me to actually leave, voting will probably no longer matter whether you live here or not just like it doesn't matter in Russia.
I totally get where you're coming from, and agree with the sentiment, I honestly don't care if the United States loses all relevance on the world stage, but fuck, as a trans person currently stuck here with no clear path to leave, things are going to suck really badly for the next few years.
It’s much worse than that it’s far from a sales tax as it’s a procurement tax …
.. the impact felt on your cash flow from the moment it hits the Container Port until finally sold. I’m sure having to pay the Import Duty will lead to companies extending their payment terms for the actual goods even further. What terms are CBS and Dept of External Revenue going to offer ?? Normally it’s hostage terms??
Actually selling the goods or end product assembled with components… That could be many-many months you have to take that additional cost hit to your cash flow.
“…… but the country's potential to handle domestic production of affected chips as well,….”
Well that’s effectively zero, at least at scale and the types of chips needed. And it’s not just building the foundries, which takes years, but who staffs them, who runs them?
Does the US have the number of qualified engineers to do this, can you train people, who trains them? Is this seen as a ‘good’ career choice; maybe becoming yet another lawyer is more lucrative? Always need more lawyers!
Update the education system, push STEM subjects more, how about State or Federal funded college degree courses for certain disciplines?
And that’s going to take a decade!
"Update the education system, push STEM subjects more, how about State or Federal funded college degree courses for certain disciplines?"
I understand the current administration is working hard to destroy the existing universities and abolish the department of education. Oh, and empty the libraries.
I am not quite understanding how this strategy improves the workforce to get the skills to build the hypermodern factories that will produce the new semiconductors.
It might be the ultimate masterplan balancing act to keep the population ignorant enough to vote MAGA and skilled enough to produce high tech.
Or, maybe, this just incompetence?
Yeah, George Bush's No Child Left Behind Act was just way too liberal and ideological, thank god for Betsy DeVos who straightened that right up so public funds could be steered away from traditional public shools, and so that her All Children Matter PAC could illegally launder donations into political campaign funds, as it should!
But things are getting even better now that professional wrestling heads the Department of Education, it's much more entertaining for one thing, with more violence and sexualization of young women, it's gonna be great, a veritable "SmackDown! Your Brains"!
Let it not be said that the Magnificent Incubus Orange takes education unseriously! Not a word ... Reverse wheelbarrow, kneedraw mashup, piledriver, suplex! Just what every concerned parent wants!
And his education secretary that you mentioned repeatedly referred to AI as "A1" recently
https://gizmodo.com/trumps-education-chief-linda-mcmahon-repeatedly-calls-ai-a1-in-school-speech-2000587329
One too many chair shots to the head obviously, or she just really wanted some steak sauce.
The problem with pushing STEM is exaggerated expectations. We're all familiar with Linkedin, Quora, Reddit etc. so are familiar with a common sort of question, one along the lines of "Which pays better, Embedded Systems or CS?". The specifics vary but the underlying message is the same, that being with your newly minted CS degree you're expecting a six figure starting salary, a desirable working environment that requires minimal on site attendance and so on. This is utterly incompatible with "work", a point that TSMC's CEO alluded to when he described staffing difficulties are a planned facility in Arizona.
This isn't just a problem in making semiconductors. There's a lot of engineering jobs going begging due to the lack of skilled personnel. To remedy that shortage -- something that people have been complaining about for decades -- is going to take an overhaul of both education and expectations.
Incidentally, thanks to the way we're using educational debt as both a handy source of recurring income and a way of enslaving the potentially better paid its impossible for us to produce STEM graduates that are prepared to learn (unless they belong in the minority of truly self-motivated -- but then there's always been that cadre). They just can't afford to. The moment they've got that piece of paper they've got to be making those payments because interest is always accruing and this particular debt can't be wiped by bankruptcy -- its literally for life.
When a chip is designed in the US but fabricated elsewhere, how hard is it to verify (by inspecting a random sample) that the samples match the design?
If this is done, and the malicious fabricator expects it to be done, how hard/costly is it to manufacture a small number of trojan horses and hide them in a large batch?
This approach obviously makes it less likely that a bad chip will be used in a sensitive system. To what extent does that make the technique effectively useless?
What sort of chip (CPU, GPU, other) is the best target for attack?
"When a chip is designed in the US but fabricated elsewhere, how hard is it to verify (by inspecting a random sample) that the samples match the design?"
Not possible. What you *can* verify that it does what the documentation says, but you *can't* verify what else it can do.
Adding 'additional functionality' would be more or less impossible to notice without reverse engineering whole chip. One by one.
Right now, probably not. The IP license is not physical and won't appear on an import docket, so no tax. That may change whenever the US wants to charge more to the UK, for example if the UK were to put a retaliatory tariff on the US, but for now, it should be free from that.
The major limitation though is the lack of fabs in the US, not where the IP comes from.
Even thought I don't agree with the current totalitarium US gov, this is exactly what I would do, world powers should never rely on chips whether cpu/gpu .... made elsewhere. Doesn't matter how hard or easy it is to spot any spyware, the number one goal would be only trust what YOU make and nothing else.
The levels of sophistication required to add spyware are going to get easier and being able to spot it probably harder, so best to avoid the situation. Then again I guess if it's home made you have to trust the people making it as well, first thing don't let it fall into foreign hands.
For all major world leaders this is not a choice , it's a neccessity and should be given highest mandates and budgets , going into the future this will lead into much faster, better and more accurate AI/AGI/ASI/ML espeically , where it gets deployed first - in the military.
I think there actually was an effort already to stop "good" AI chips going to China - the top of range Nvidia products - and a bit of a disappointment when a Chinese AI chatbot was unveiled anyway. And, yes, a "popular" application of AI is military equipment that can go out and kill people with little or no involvement by a human commander. Of course, the AI will make mistakes, maybe very often, or even all of the time. But so do human human-killers.
I say that the science fiction future scenario where robots fight robots while no humans are left alive any more is quite achievable. There will come soft rains, and all that.
Strengthening the US advanced semiconductor development and manufacturing - that's pretty much what the 2022 "CHIPS and science act" was all about. I guess its commendable that Trump shares those goals, though where the '22 act outlines a detailed plan to achieve this from incentivising manufacturers to build up US capability to training an appropriate workforce, Trump seems to think all he needs to do is to slap some tariffs on imports. The contrast says a lot.
(tl;dr - No-one will move semiconductor manufacturing in the face of such massive uncertainty, and Americans will simply end up paying more for their electronics.)
Exactly this. There's a legitimate case for the US- and the rest of the world- to want to reduce its dependence on both China and Taiwan for semiconductor production.
However, if there's one thing investors hate- and one way to kill potential investment- it's uncertainty.
Whatever one thinks of the CHIPS act, any sensible proposal would have attempted to keep some level of continuity while it was amended and replaced. Abruptly scrapping it for purely partisan, Not-Invented-Here reasons and replacing it with an unpredictable and chaotic mess of tariffs being used as a blunt instrument is going to have the complete opposite effect to the one intended.
There's no way any company in its right mind is going to make a genuinely serious investment in the US if the economic regime and situation it was built upon can change overnight on the whim of a capricious government.
Ironically, in the context of the current discussion, this applies *far* more strongly to semiconductors than almost any other industry, purely because of the costs involved, i.e. several billion dollars for a single plant.
All the current situation is likely to achieve is:-
* A few regime-pandering token gestures (temporarily upping production at existing plants), and
* Big-but-noncomittal proposals that curry favour by giving the government an "investment" to crow about even though it's obvious they're not going to happen (à la the obvious scam Foxconn Wisconsin plant from the first Trump era).
* Companies decide the least risky option is to not to move their manufacturing and live with whatever the tariffs are likely to be next week, knowing their rivals will have done the same, and
* Americans paying a lot more for their electronics with no obvious change in the situation beyond the fact they're ultimately paying a huge backdoor tax
The number of people in the US I see saying "China needs us more than we need them" blows my mind. They seem to think that the US buys all of China's output. When in reality US exports are only about 3% of China GDP. Over half of production is local consumption now. Selling stuff to a nation of 1.4 billion people that are getting richer. BYD alone sells over 50,000 cars a week in China. The rest of their production gets sold to the rest of the world.
Would losing 3% hurt? Sure. Would it be a disaster. No. Would losing all Chinese imports hurt the US? It would absolutely crater the US economy.
This is why Xi is simply ignoring trump and watching his tariff policies implode. China doesn't need to do anything.
As for any local production, Intel's contract fab business is a disaster and TSMC are struggling to get staff for their Arizona fabs. They have also already said that there will be a premium for anything made outside of Taiwan.
All I can say is good luck to anybody reading in the US and if you didn't vote for this administration you have my sincere sympathies. If you did, well you are getting what you voted for.
The clever bit was not just blocking China but starting a simultaneous trade war with all our allies and partners.
China might be abandoning Boeing but at least we can sell them to Europe, while tariffing Rolls Royce and CFM engine imports to the USA
Trump's authority to vary tariffs at will is tenuous at best and is now subject to a legal challenge from the State of California. Trump will likely ignore any unfavorable count rulings (as he has done over the case of the person unlawfully detained and rendered to El Salvador) but the problem he'll then face is that if he ignores rulings then we as a state can do so as well. His only power base is 'the power of the purse' (also legally tenuous) and a relatively tiny DoJ law enforcement establishment (which is supposed to uphold the Constitution, hence the rush to get rid of anyone who won't swear fealty to Trump).
The whole thing is a formula for lawlessness -- "Might is Right" -- which threatens the integrity of the Union. If push comes to shove and its a choice between our Constitution and a wannabe dictator...
I recently read about some gamers in North Dakota who were complaining about the tarts hurting them. They pointed out a particular seeder used to limit the churn of soil and erosion was produced in Canada and cost $1M. After tariffs it added another $250k which basically killed it. My question is, when the fad technology they need from European companies takes the hit, or the EU places and export tax on them on makes them prohibitively expensive, will the US bow?
Also, would the fab tech providers block them the way the US has blocked China? I can imagine Microsoft quickly backpedaling on windows 11 requirements when chip makers are stuck on legacy fab.
I think the valid logic of treating trade in products which contain semiconductors as the same as trade in semiconductors, is, someone can buy the products in order to get the semiconductors from them. For instance, the chip in an Apple iPhone 17 which reads the user's thoughts, in order to generate acceptable advertising. You could extract that chip and just use it to read thoughts.
Wikipedia has an article on "Chicken tax", which I heard about recently. This obviously is a tariff on certain trucks imported to the U.S. Workarounds, apparently eventually defeated, included fitting a truck with full passenger seating and calling it a minibus. Once the minibus was on U.S. soil, the seats were removed, and the truck was sold tariff-free. If you still want to know about the chickens, see Wikipedia.
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