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US Conservatives Find New Merit in Industrial Policy

Yi-Hua Lee

   WASHINGTON - For decades, American conservative politicians have
   championed the power of the free-market economic model to determine
   which companies succeed and fail. The government, they argue, is better
   off letting competition in the U.S. economy determine which businesses
   thrive. In most cases, the government should not intervene.

   Now, when it comes to semiconductors, the electric components inside
   every high-tech product, conservatives argue the government needs to
   step in and financially support American companies.

   When the Senate called a vote in July that would direct billions of
   federal dollars to semiconductor manufacturers, nearly every Republican
   supported it.

   The [1]measure will provide semiconductor manufactures with $3 billion
   in federal funding, calls for a national strategy for the semiconductor
   industry and the establishment of a national semiconductor technology
   center.

   The reason for the shift on conservative thinking is China, said Robert
   Atkinson, president of the Washington based Information Technology and
   Innovation Foundation.

   He said for the past few decades, there was a sense among most
   mainstream Washington politicians that China was going to be a
   responsible global actor.

   "That view now has been largely rejected," he said.

   "So that has really changed the landscape, and made more people on both
   sides of the aisle understand that we've got to make sure that we're
   stronger than China," Atkinson continued, "We have to have much
   stronger technology base to support our military capabilities against
   the Chinese should we need them."

   American companies are at the forefront in designing the cutting-edge
   semiconductors that advance the capabilities of high-tech products.
   That means the U.S. takes nearly half of global chip sales revenue, yet
   American production capacity stands at only about 12%.

References

   1. https://www.congress.gov/congressional-record/2020/06/29/senate-section/article/S3658-1

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