Senators, industry leaders discuss the meaning of CHIPS Act to national economy and security

WASHINGTON, D.C. – America’s share of global semiconductor production has fallen from 37% in 1990 to just 12% today. During the same period, semiconductor use has risen to define almost every aspect of life.

“To use your phone, to use your computer, to turn your car on, you need microchips. And right now, we are heavily dependent on foreign nations for them,” said U.S. Senator Krysten Sinema (D-AZ), adding that such dependence represents economic and security risks to the country.

Sinema was speaking at “CHIPS for America: Winning the race to make the best microchips in the world,” an event hosted by Arizona State University and the Washington Business Journal on Sept. 22 at the ASU Barrett & O’Connor Washington Center in Washington, D.C.

Two panel discussions overviewed the importance of the new $52-billion CHIPS and Science Act as a catalyst for improving American research, innovation, manufacturing, workforce development and national security related to semiconductors.

ASU President Michael Crow moderated the first panel on workforce development with Sinema and U.S. Senator John Cornyn (R-TX). After referencing the importance of advanced semiconductor technology to tackling societal challenges from healthcare provision to climate change, Crow asked the senators how to expand public engagement with initiatives like CHIPS.

“How can we get people to understand the need for ongoing investments in science and technology,” Crow asked.

Sinema responded that most people don’t think about the challenges of the semiconductor manufacturing industry. “But this is not about investing money in corporations. This is about investing money in our country’s future so that the people we care about—our kids and our grandkids—can take advantage of the opportunities that are coming,” she said.

Crow agreed that developing human capital is crucial to success. He shared that ASU has expanded its engineering enrollment from 6,000 to 30,000 students, comprising the largest university engineering program in America. But even more talent is required and demand continues to grow.

Jeremy Bash, managing director of Beacon Global Strategies, moderated the second panel and led a discussion focused on national security with U.S. Senator Mark Kelly (D-AZ) and Bruce Andrews, corporate vice president and chief government affairs officer for Intel Corp.

Bash asked Andrews to offer his perspective on the importance of the CHIPS Act, and Andrews described it as likely the most important competitiveness legislation passed by the U.S. since World War II.

“We have all lived in a world of globalization and seeking the lowest cost market,” he said.“But we are moving from a world of ‘just in time’ to a world ‘just in case’ because we’ve realized we can’t rely on being over-consolidated in one region. We need to have diversification and resilience. We just can’t be successful without it.”

Bash, who served as chief of staff to the U.S. Secretary of Defense during the Obama Administration, asked Kelly why he believes the CHIPS Act is important from a security perspective. Kelly said advanced semiconductors at the heart of American military aircraft, submarines and satellites come from South Korea and Taiwan.

“Having a supply line that goes across the Pacific Ocean to get critical microelectronics components for our defense hardware is not good for anybody’s national security,” Kelly said. “Well, certainly not ours nor our allies. We need that capability here.”

Bash asked Kelly how Arizona is helping to improve domestic capability. Kelly noted that Intel, the country’s largest chipmaker, has had a big presence in the state for decades, and is now devoting $20 billion to open two new “fabs” or factories at its Chandler, Arizona, campus. Simultaneously, global chip giant Taiwan Semiconductor Manufacturing Co. is investing $12 billion to open its first North American factory in Phoenix.

The U.S. Commerce Department is expected to dispense CHIPS and Science Act funds next year as manufacturing incentives, resources for research and development, and support for workforce development. Kelly said it will take a little time to see the impact, but he believes this effort will help catapult the country forward to global leadership of the semiconductor and microelectronics industries.