Chip industry defines modern global civilization
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Across the world, manufacturers are producing computer chips at a rate of billions per year, creating a supply chain that rivals ancient wonders like the Pyramids of Giza.
While seemingly small, these microchips contain incredibly dense circuitry, a city for electrons etched onto a fingernail-sized tile. The United States once led chip production, but by the 1980s, firms faced competition from Japan and economists favored inexpensive foreign production.
This shift in manufacturing is now a concern, as chips are essential for artificial intelligence and modern economies. Nvidia, a chip designer, accounted for fifteen cents of every dollar returned by the S. & P. 500 last year. Demand currently outstrips supply, impacting industries from automobiles to consumer goods and raising fears about future availability. However, the majority of the world’s most advanced chips are manufactured in Taiwan, a self-governed island that China views as a breakaway province.
A disruption to Taiwanese chip production, through invasion or blockade, could devastate the global economy, costing an estimated $10.6 trillion in the first year alone. The U.S. government is now investing in domestic chip production, recognizing the strategic importance of a reliable supply, and hoping to foster the complex international collaboration that has defined the industry.
