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$250B for Technology and Not a $ for Displays
The Senate approved the U.S. Innovation and Competition Act, a $250B package aimed at challenging China's technological ambitions. The bill passed 68-32 and now goes to the House, which has been weighing some different approaches but is likely to see wide support. The measure is one of the biggest government interventions in industrial policy in decades, which trounced traditional party differences over economic policy. About $190B would be directed at U.S. technology and research to better compete globally, including money for cutting-edge science and artificial intelligence via the National Science Foundation. $54B would be for increasing U.S. production and research into semiconductors and telecom equipment, as well as design and manufacturing initiatives. The US display industry is so far from the hearts and minds of the politicians that it wasn’t even mentioned. The Commerce Department will get $10B in funding to designate regional technology hubs for R&D and will be able to match financial incentives offered by states and local governments to chipmakers who expand or construct new factories. Federal R&D spending in recent years has totaled less than 1% of U.S. GDP, as well as less than 3% of total government spending, the lowest level since the space race in the 1960s. With regards to semiconductor manufacturing, it's been even worse. SEMI says the U.S. share of global chip-making capacity has tumbled from 37% in 1990 to 12%. Commerce Secretary Gina Raimondo said the funding could result in seven to 10 new U.S. semiconductor plants.
While Beijing has long-embraced a top-down approach to investing in favored sectors, it expressed "strong indignation and resolute opposition" to the U.S. bill, which showed "paranoid delusion of wanting to be the only winner." The measure also banned downloads of Chinese-owned TikTok on all government devices (not only military and Homeland Security phones) and will block purchases of drones manufactured and sold by companies backed by the Chinese government. It further expanded mandatory sanctions on Chinese entities engaged in American cyberattacks or the theft of intellectual property, while reviewing export controls on items that could be used to support human rights abuses.
What happens when the Chinese decide they won’t sell displays to the US for intelligence or weapons systems?
The Senate approved the U.S. Innovation and Competition Act, a $250B package aimed at challenging China's technological ambitions. The bill passed 68-32 and now goes to the House, which has been weighing some different approaches but is likely to see wide support. The measure is one of the biggest government interventions in industrial policy in decades, which trounced traditional party differences over economic policy. About $190B would be directed at U.S. technology and research to better compete globally, including money for cutting-edge science and artificial intelligence via the National Science Foundation. $54B would be for increasing U.S. production and research into semiconductors and telecom equipment, as well as design and manufacturing initiatives. The US display industry is so far from the hearts and minds of the politicians that it wasn’t even mentioned. The Commerce Department will get $10B in funding to designate regional technology hubs for R&D and will be able to match financial incentives offered by states and local governments to chipmakers who expand or construct new factories. Federal R&D spending in recent years has totaled less than 1% of U.S. GDP, as well as less than 3% of total government spending, the lowest level since the space race in the 1960s. With regards to semiconductor manufacturing, it's been even worse. SEMI says the U.S. share of global chip-making capacity has tumbled from 37% in 1990 to 12%. Commerce Secretary Gina Raimondo said the funding could result in seven to 10 new U.S. semiconductor plants.
While Beijing has long-embraced a top-down approach to investing in favored sectors, it expressed "strong indignation and resolute opposition" to the U.S. bill, which showed "paranoid delusion of wanting to be the only winner." The measure also banned downloads of Chinese-owned TikTok on all government devices (not only military and Homeland Security phones) and will block purchases of drones manufactured and sold by companies backed by the Chinese government. It further expanded mandatory sanctions on Chinese entities engaged in American cyberattacks or the theft of intellectual property, while reviewing export controls on items that could be used to support human rights abuses.
What happens when the Chinese decide they won’t sell displays to the US for intelligence or weapons systems?
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Barry Young
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