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Trump Says TSMC…

In a recent episode of The Joe Rogan Experience, former President Donald Trump dropped a bombshell: he accused Taiwan of “stealing” the U.S. chip industry. This remark wasn’t just a passing comment—it sent shockwaves through an industry that powers the most advanced technology on the planet. Trump’s statement was provocative, but it also hinted at an underlying frustration with a tech landscape where American companies depend on a small island halfway across the world.

Why would Taiwan—a longtime ally—be painted as a thief of American tech dominance? The story of how the U.S. lost its edge in semiconductor manufacturing has been years in the making, with tensions, economics, and even a little irony embedded in its complex web.

The Silicon Race

Once upon a time, the United States was the world leader in semiconductor production. But as the industry evolved, cost efficiency and advanced tech capabilities took priority. Taiwan Semiconductor Manufacturing Co. (TSMC) rose to the top, supplying 90% of the world’s advanced chips and becoming the lifeline of Silicon Valley’s AI ambitions.

But Trump believes the cost of outsourcing this manufacturing prowess is too high, and he’s voiced plans to take action if he returns to office. His solution? Tariffs. Trump envisions a scenario where a hefty price tag is attached to every chip import from Taiwan, ultimately favoring U.S.-based production. But a shakeup of this magnitude isn’t as simple as a tariff increase—it’s a move that could ripple through the global supply chain, causing prices to spike across industries.

CHIPS Act: A Double-Edged Sword

Ironically, the U.S. had already started laying the groundwork to boost its domestic chip industry. With the CHIPS Act, companies like TSMC received substantial government incentives to establish manufacturing plants in the U.S. For TSMC, this meant building a $7 billion plant in Arizona, projected to produce advanced chips by 2025. Yet, even as this plant takes shape, Trump criticizes the arrangement, claiming it opens American wallets for foreign companies without enough return on investment.

Trump’s skepticism echoes the fears of analysts and policymakers who wonder whether relying on foreign chipmakers—albeit on American soil—really bolsters U.S. tech independence. Citi analysts also weighed in, noting that tariffs would drive up costs, requiring audits and supply chain overhauls to track which devices use Taiwanese-made chips.

Geopolitics and the Bigger Picture

The relationship between Taiwan and the U.S. goes beyond tech. Taiwan is an invaluable ally in a region marked by rising tensions with China. With fears of a potential Chinese invasion simmering, the U.S. has found itself in a delicate balancing act—supporting Taiwan without risking greater conflict. Semiconductor dependency only complicates this scenario; if Taiwan’s chip production falters, American tech firms, including giants like Nvidia and Apple, would be caught in the crossfire.

But Trump’s proposed tariffs signal a shift in strategy. He wants American companies, like Intel, to return as leaders in chip production, even though they’ve had setbacks in staying on the “leading edge” of technology. A tariff-based policy would undoubtedly encourage companies to invest in domestic infrastructure, yet the question remains: will the cost of tech rise, and will the U.S. be prepared for the long haul?

What Happens Next?

Whether Trump’s vision becomes a reality remains to be seen, but the consequences of a tariff on Taiwanese chips could mark a turning point for the global tech industry. While U.S. companies like Intel and Texas Instruments would likely thrive in a tariff-friendly environment, many experts warn of a trade war escalation. Some speculate that China could retaliate by further restricting American tech sales in its markets, which have already dropped for companies like Nvidia due to the Biden administration’s export controls.

At the heart of this story lies the irony of the semiconductor industry. An industry that powers American innovation is, in many ways, reliant on Taiwan, a small but mighty player with the tech chops that America desperately needs.

The next presidential election could reshape this landscape in unexpected ways. If Trump’s remarks are any indication, the “stolen” U.S. chip industry might soon face a crossroad—either to return to its roots or adapt to a new reality where tech independence comes at a hefty price.