The U.S. is making a big bet on America’s chip industry. The Biden administration has brokered a deal with Intel, funneling a whopping $8.5 billion in direct funding and $11 billion in loans towards computer chip plants across four key states: Arizona, Ohio, New Mexico, and Oregon.
This move underscores the administration’s push to bolster domestic chip production, a move seen as crucial for national security and economic stability. With the U.S. currently producing zero of the most advanced AI chips, Commerce Secretary Gina Raimondo spoke about how urgent the need is to invest in advanced semiconductor manufacturing in the U.S., saying “We can’t just design chips. We have to make them in America.”
The Intel investment is not just about creating jobs; it’s also about geopolitics. Lawmakers have expressed concerns about China’s dominance in chip production, with the majority of advanced chips originating from Taiwan. The bipartisan CHIPS and Science Act, passed in 2022 with Biden’s backing, aims to reduce dependency on Asian-made chips, mitigating risks to the U.S. economy.
The impact of this investment is expected to be significant. Intel CEO Pat Gelsinger sees it as a pivotal moment, likening the CHIPS Act to the most critical industrial policy since World War II. The funding is projected to create 30,000 jobs in manufacturing and construction, a boon for states like New York and Ohio.
This deal is also a reflection on the broader economic priorities in the U.S.. The Biden administration has emphasized workforce training and affordable childcare as key components of agreements with companies like Intel. This signals a broader commitment to inclusive growth, ensuring that economic benefits reach communities across the nation.
This investment isn’t just about chips – it’s about shaping the future of American industry and securing its place on the global stage. From manufacturing to geopolitics to social policy, this deal touches on a multitude of issues critical to the nation’s economic prosperity.
And in the high-stakes game of global competition, every chip counts.
Biden to tout government investing $8.5B in Intel’s computer chip plants in four states