As America and the rest of the globe continue to crawl out of the clutches of COVID, the effects of a near two-year pandemic are starting to take its toll on every industry. Among the hardest hit has been the electronic-based industries. From cars to computers, to cameras, to kitchen appliances, anything that requires a computer chip to operate has been impacted at least to some degree.
U.S. Commerce Secretary Gina Raimondo gave a briefing to reporters on 25 January 2022 and let them know that we still have a long way to go. With a new Department of Commerce report coming out, it outlines where the problems are exactly. One of the biggest problems has come from the 17% increase in demand from 2019 to 2021. With the innovations in consumer electronics in that timeframe, it shouldn’t be a surprise.
Another area of concern is the rolling stock of chips available for use. The chip industry typically keeps a 40-day inventory on hand to ensure smooth production in case of a problem. Currently, they are down to 5 days’ worth of supplies. As the report indicates “This means a disruption overseas, which might shut down a semiconductor plant for 2–3 weeks, has the potential to disable a manufacturing facility and furlough workers in the United States if that facility only has 3–5 days of inventory.”
The report also clarifies the biggest problems come from the “legacy logic chips (used in medical devices, automobiles, and other products), analog chips (used in power management, image sensors, radiofrequency, and other applications), and optoelectronics chips (used in sensors and switches).” These chips, as you can see, are used in nearly every application Americans depend on them for.
President Biden and his administration need to act on this, and soon. This report has him and the rest of the White House urging Congress to get the CHIPS Act out and rolling. This act alone would provide $52 billion to stimulate the domestic production of semiconductor chips. The House of Representatives has been stalling this bill for some time, despite it flying through the Senate with very strong bipartisan support.
While this won’t fix the problems in our supply chain, car manufacturing, or ending inflation, it certainly would be a step towards making that happen. These chips make up so much of our society and technology that it is foolish that we ever let the manufacturing of them leave American shores. While places like China and Taiwan are capable of making nearly the same (and in rare cases better) quality chips at a lower cost, the loss of American jobs and innovation is a cost we never should have paid.
As the bill sits and rots away, the American people are waiting for an answer. Despite Intel pledging $20 billion for a new semiconductor plant to be built in Ohio, it won’t be up and running fast enough to make an impact now. Down the line though, it has the potential to completely change the landscape of chip usage here in America.
The one thing the progressives did a great job in was brainwashing America into the idea of foreign production for lower costs over keeping it here. The prices never went down, innovation never expanded, and it was just a great way for them to line their pockets at the expense of American jobs; most of which were union positions. This decimation of the American dream wasn’t because of capitalism, instead, it was sold as a way to give opportunities to people in third-world countries. Opportunities our own Americans needed more than ever, and now we are seeing the fall out from that.