The future of the CHIPS and Science Act, which has allocated billions to boost domestic semiconductor production, hangs in the balance as President Trump returns to the White House. Trump's past criticism of the legislation and his administration's stance towards its implementation remain unclear, prompting speculation about potential changes to the program.
The Biden administration has invested tens of billions of dollars under the bipartisan CHIPS and Science Act, passed in 2022, to stimulate domestic semiconductor production . However, the return of President Donald Trump to the White House has ignited speculation about the future of these projects. Trump was highly critical of the legislation before the election, denouncing it as a 'bad deal' during an October interview on 'The Joe Rogan Experience.
' He argued against allocating billions of taxpayer dollars to 'rich companies' and proposed imposing tariffs on foreign-made chips as a more effective way to relocate production to the U.S.Republican House Speaker Mike Johnson initially suggested in November that Republicans 'probably will' attempt to repeal the CHIPS Act, but quickly retracted his statement, asserting that the legislation was 'not on the agenda for repeal.' Last month, Claude Barfield, a Senior Fellow at the American Enterprise Institute, penned a scathing op-ed expressing doubt about the seriousness of Trump's opposition to CHIPS funding upon assuming office, pointing out his history of making campaign promises that he didn't follow through on. Barfield emphasized the dangers and delusions of potentially scrapping the CHIPS semiconductor 'fabs' funding, noting the strong bipartisan support the legislation garnered, particularly from states where CHIPS Act funding is driving new facilities and job creation.Despite the uncertainty, Trump's nominee for secretary of commerce, Howard Lutnick, reportedly assured outgoing Commerce Secretary Gina Raimondo during a staff meeting that he was committed to progressing with the program, according to a Bloomberg report citing anonymous sources. Notably, at least one chipmaker appears confident about the continuation of Trump administration funding for its U.S. manufacturing projects. Taiwan Semiconductor Manufacturing Co. (TSMC) CFO Wendell Huang recently stated to CNBC that the firm anticipates receiving the $6.6 billion awarded for building three facilities in Arizona. Intel, the primary beneficiary of the CHIPS Act, included a mention of the program in its congratulations to Trump on his inauguration. Industry experts anticipate the CHIPS Act to remain in effect under Trump 2.0, although some minor adjustments are possible. Scott Lincicome, Vice President of General Economics and Trade at the Cato Institute, told FOX Business that superficial changes to the law's enforcement are likely, but major revisions are improbable. He cited Trump's past support for onshoring semiconductor production, the national security concerns surrounding U.S. chip manufacturing, and the politically significant locations of the chip projects. Lincicome concluded that he doesn't foresee significant alterations to the CHIPS Act's funding figures, although some changes regarding the Biden administration's implementation, such as the mandated childcare for construction workers and DEI-related initiatives, might be implemented
CHIPS Act Donald Trump Semiconductor Production Biden Administration Taiwan Semiconductor Manufacturing Co. Intel
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