Umair, I really wish you would you not use the chip factory example. It's not nearly as straightforward as you make it sound.
For example, do you know why Taiwan came to dominate the chip fabrication industry?
In the 60's and 70's fabrication of these chips was pioneered in the US and all of the early chip manufacturing was done in the US. Then came the Fairchild Semiconductor lawsuits.
See Umair, chipmaking is one of those industries that seems clean but is actually incredibly toxic. The solvents and chemicals used in chipmaking caused cancer clusters when they got into the water table and migrated.
Except for certain types of chips, the chip industry moved to Taiwan because of three factors.
1. Minimal regulation of the chemicals used.
2. The availability of huge amounts of water.
3. The Pacific ocean to dump wastewater into.
That's another thing about chipmaking. It takes a LOT, I mean a WHOLE LOT, of water. Like, it sucks aquifers dry amounts of clean water.
Taiwan is one of the rainiest places on the planet. They actually have massive quantities of water in a way few other places in the world do.
And, Taiwan is sitting right there on the eastern edge of the Pacific. The perfect place to flush all that contaminated wastewater that would be such a problem in the US, or Europe.
That's how Taiwan came to manufacture over nintey percent of the world's computer chips.
Still think you can just order up one for $50 Billion from the shop?
More important question, are you sure you want to?
Lastly, Biden's building a chip plant in the US has very little to do with any of the things you discussed. It's actually an admission of great weakness.
A war game and study by a think tank (Center for a New American Security) in January of this year highlighted how dependent the world is on Taiwan’s semiconductor foundries. The study concluded that,
The United States is more dependent on Taiwan’s high-end microchips than it was on Middle Eastern oil in decades past.
If we lose Taiwan, we are crippled as a superpower. If Taiwan gets bombed and the chip foundries get damaged, global production of products containing computer chips will be curtailed for at least 3 years and as much as 10. Those chip foundries are probably the most important manufacturing facilities on the planet.
We passed a 52 Billion dollar CHIPS ACT to boost US manufacturing of computer chips from 2% of our needs to 10% of demand over the next 5–10 years.
Why 10% of demand?
Because that’s how much we would need to keep making weapons in the event of a “hot war”.
If the supply of chips from Taiwan was compromised. We don't even make enough chips domestically to supply our own military. Building up our manufacturing capacity to that minimum level is a strategic necessity.
Until that time, for the next 5–10 years, we have to defend Taiwan like it is the 51st state.
The CHIPS ACT is military policy, not industrial policy. Which is why it passed on a 90 to 9 vote in the Senate. Even the whack job Republicans can see how much danger we are in.
