Former CPO Director on chips: You want a stable long-term policy environment & incentive structure

CHIPS Act and Semiconductor Industry Objectives - The CHIPS Act aims to incentivize domestic semiconductor manufacturing by closing the cost gap with countries like Taiwan and Korea [3] - The core objective is to bolster national security by reducing reliance on foreign chip manufacturers [5][10] - A stable, long-term industrial policy is crucial due to the significant investment (e g, $25 billion for a leading-edge fab) and long construction timelines (3-5 years) involved in semiconductor manufacturing [8] Equity Stakes vs Grants - Providing equity as an incentive differs from grants, as companies can typically raise equity in private markets [4] - Concerns exist that equity stakes may attract companies primarily seeking liquidity rather than enhancing competitiveness [12] - Grants are designed to make companies cost-competitive with international manufacturers [11] Government's Role and Potential Risks - The government's role is to take calculated risks to support the semiconductor industry [20] - There's a need to protect taxpayer dollars through structured awards tied to milestones [19][20] - The government should focus on the demand side to help companies like Intel fill their fabs [21] - Pressuring private enterprises to purchase domestically produced chips raises complex questions [22] Industrial Policy Toolkit - Tariffs, grants, tax credits, and loans are all tools in the industrial policy toolkit [7] - The current administration has increased the tax credit for CHIPS investment [7] - A diversified investment portfolio across companies like Micron, Samsung, TSMC, and Intel is essential [19]