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The US is spending billions to boost chip manufacturing. Will it be enough? | CNN Business

Published

3 years ago

October 18, 2022

The US is spending billions to boost chip manufacturing. Will it be enough? | CNN Business

CNN
—

The USA authorities is pulling out all of the stops to spice up home semiconductor manufacturing, injecting billions of {dollars} into the beleaguered sector and flexing all coverage muscle tissues out there to present it a leg up over competitors from Asia.

When the pandemic hit in 2020, companies initially curtailed orders for these micro constructing blocks wanted for smartphones, computer systems, automobiles and lots of different merchandise. Then, as folks started working from dwelling, demand soared for info and communication expertise – and the chips that energy them. A chip scarcity ensued, and auto vegetation needed to cease manufacturing as a result of they might not receive chips. This contributed to skyrocketing new and used automobile costs, a significant driver of the painful inflation People had been feeling.

In an announcement earlier this 12 months, Commerce Secretary Gina Raimondo dubbed the semiconductor scarcity a “nationwide safety” problem as a result of it uncovered the dependency of US manufacturing on imports of semiconductors from overseas. Chips additionally serve vital navy functions and are crucial for cybersecurity instruments.

The Biden administration and lawmakers rallied in response, passing the CHIPS and Science Act into legislation in August. The laws contains $52 billion to strengthen semiconductor manufacturing in the US. Of this, $39 billion is earmarked for manufacturing incentives, $13.2 billion for analysis and growth and workforce coaching, and $500 million for worldwide info communications expertise safety and semiconductor provide chain actions.

In opposition to that backdrop, a number of outstanding corporations have introduced vital investments in US manufacturing. Taiwan Semiconductor Manufacturing Firm (TSMC), a powerhouse within the trade dedicated at the very least $12 billion to construct a semiconductor fabrication plant in Arizona, with manufacturing anticipated to start in 2024. At the beginning of the 12 months, Intel mentioned it deliberate to construct a $20 billion semiconductor manufacturing plant in Ohio, and groundbreaking for the brand new chip plant came about simply final month. And this month, Micron mentioned it might make investments as much as $100 billion over the following 20 years to construct an enormous semiconductor manufacturing facility in upstate New York.

In a flurry of tweets earlier this month President Joe Biden pledged: “America goes to paved the way in microchip manufacturing.”

However the US has a lot catching as much as do. US-based fabs, or chip manufacturing vegetation, at the moment solely account for 12% of the world’s trendy semiconductor manufacturing capability, in response to information from the Semiconductor Business Affiliation commerce group. Some 75% of the world’s trendy chip manufacturing is now concentrated in East Asia – a majority of that in geopolitically-vulnerable Taiwan. And even with these renewed efforts, the US doesn’t at the moment have the identical expertise and provide chain pipeline as some Asian markets do to help a strong homegrown trade.

To complicate issues, the surge in private and non-private investments comes at a questionable time, as considerations over the worldwide chip provide scarcity have eased. Pandemic-related provide chain blockages are letting up considerably and a worsening financial outlook has hampered demand.

In an earnings name final week, TSMC CEO C.C. Wei warned it expects the “semiconductor trade will probably decline” in 2023. “TSMC additionally isn’t immune,” Wei added, however mentioned it expects “to be extra resilient than the general semiconductor trade.”

Selling semiconductor manufacturing in the US now might danger resulting in overcapacity and extra provide. And with demand weakening, it isn’t instantly clear if authorities subsidies will probably be sufficient to beat different obstacles the nation faces in creating a aggressive semiconductor manufacturing hub.

To grasp the most recent US efforts, it’s essential to be clear on the place the nation stands – not simply within the general chip trade, however in relation to particular, useful pockets of it.

“The US may be very unlikely to extend its share of world manufacturing as a result of even because the US brings on-line extra fab capability; TSMC, Intel and others are asserting fabs somewhere else and constructing them much more rapidly,” mentioned Scott Kennedy, a senior adviser on the Middle for Strategic and Worldwide Research.

“However I don’t essentially suppose that’s actually an enormous downside,” he added. He famous that measuring manufacturing based mostly on pure output lumps collectively the lower-end chips and the cutting-edge, higher-end chips which are a extra reasonable and vital measure of chip manufacturing success. “The US does must develop chip manufacturing for a particular sort of chips, which are straight associated to American nationwide safety,” he mentioned.

The Biden administration final Friday imposed sweeping new export curbs designed to limit China’s entry to superior semiconductors made with US gear, in a transfer that targets the manufacturing of superior weapons methods.

Whereas solely “about 10% to 14% of chips offered [globally] come from US manufacturing services,” in response to Columbia Enterprise Faculty professor Dan Wang, the US does produce other strengths. “When it comes to design experience, lots of that also resides within the U.S.”

Technicians inspect a piece of equipment during a tour of the Micron Technology automotive chip manufacturing plant Feb. 11, 2022, in Manassas, Va.

Nonetheless, the shortcomings are actual. “Relating to foundries, that are the manufacturing facet of semiconductors, the U.S. has probably not been a significant participant for a lot of, a few years,” mentioned Wang. Whereas it very a lot was, manufacturing started migrating to Asia in the course of the Nineteen Eighties and ’90s, Wang mentioned. “One of many large causes for that is that the price of labor is decrease, and it’s simply far cheaper to supply at a really large scale, built-in circuits and chips, in these components of the world,” Wang added. Morris Chang, the founding father of TSMC, mentioned that it prices 50% extra to fabricate chips within the U.S. than in Taiwan.

Now, merely having the services already set as much as produce or develop chip manufacturing offers Asia an enormous benefit. Wang mentioned he thinks that is perhaps why you see the U.S. “axe-throwing a lot cash at corporations to arrange vegetation in the US.” It’s not simply to reply to demand and change into extra self-reliant, “but additionally as a result of it is advisable to get this stuff up and operating very, in a short time, in an effort to even be within the race in any respect.”

Constructing new chip fabs itself is a expensive and time-consuming endeavor. “A contemporary fab is one thing like half 1,000,000 sq. ft,” mentioned Bob Johnson, an analyst at Gartner, and requires “monstrous clear rooms which have large air dealing with capabilities.” He added that these large buildings require “exceptionally robust foundations.” As he put it, “you can’t have any vibration within the fab as a result of it may possibly wreck the manufacturing course of.”

As well as, a single excessive ultraviolet lithography machine, required to map out the circuitry of chips, prices about $150 million, and Reuters reviews “a cutting-edge chip plant wants 9-18 of those machines.”

Furthermore, the manufacturing of semiconductors requires a spread of specialised inputs, together with pure chemical compounds resembling fluorinated polyimide, and etching gasoline, chip etching machines, and extra. In locations like Taiwan and Fukuoka, Japan, provide chains have developed the place the suppliers of those merchandise are positioned near the semiconductor factories. There are additionally one or two corporations that produce very important inputs and which were reliable suppliers to corporations in Asia for a very long time. This isn’t but the case in locations like Arizona and Ohio, the place plans to construct large chip manufacturing vegetation are already underway.

You additionally want a labor pressure prepared and capable of do the work.

In the US, there may be each a scarcity of recent graduates and skilled staff with the technical and engineering information essential to manufacture semiconductors. Lots of those that may need the suitable expertise as an alternative want to work in trendier industries, in response to Kennedy.

“If we had been to at present, snap our fingers and have ten new fabs with the world’s main chips, we in all probability wouldn’t have sufficient folks to workers them,” Kennedy mentioned. “That’s the largest bottleneck to the growth of America’s fab capability, not capital.”

Intel has tried to determine shut relations with Arizona State College to recruit engineers, however it’s unclear whether or not it and different corporations constructing fabs in America will be capable to rent sufficient skilled engineers and technicians. If not, even the billions of {dollars} dedicated by the personal and public sector will not be sufficient to reshore semiconductor manufacturing.

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Greg Casar Pitches a ‘Resistance 2.0’ for Democrats in the Age of Trump

Published

9 hours ago

April 28, 2025

Press Room

Greg Casar Pitches a ‘Resistance 2.0’ for Democrats in the Age of Trump

When he was a 29-year-old on the Austin City Council, Greg Casar led a charge to repeal a ban on camping in the city so that homeless people would not rack up criminal records that could make it harder to find permanent housing.

Tent cities sprang up, conservatives protested and residents voted to reinstate the ban.

These days, Mr. Casar, 35, is the chairman of the House Progressive Caucus and a rising star in a Democratic Party struggling to find its footing during the second coming of President Trump. He has shifted his emphasis to respond.

“We can’t be known as the party of just the most vulnerable people,” Mr. Casar, the bilingual son of Mexican immigrants, said in a recent interview in an Uber en route to a town hall in Thornton, Colo. “This isn’t just about lifting up the poorest people, and that’s where the progressive movement has been.”

Mr. Casar’s goal now is winning back the working people who feel as though the Democratic Party is not for them anymore. He said that also means making economic matters, rather than cultural or identity issues, the party’s bread and butter.

“I’m shifting and changing,” he said. “On immigration, for example, in 2017, I would say, ‘Immigrant rights are human rights.’ I still believe that, but I’m now saying, ‘We need to make sure that all workers have equal rights.’ ”

He and his team refer to it as Resistance 2.0, and Mr. Casar took it out for a test drive last week. On a school stage here in this city north of Denver, more than 900 miles away from his district, he stood beside a cardboard cutout of a Republican lawmaker whose feet had been replaced with chicken claws.

The rest of the cutout’s body depicted Representative Gabe Evans of Colorado, a hard-right lawmaker elected in November who has held just one town hall since being sworn in. So here was Mr. Casar instead, hoping to show Democrats that their leaders were working to fill the void and defeat politicians too scared to show their faces in their districts amid a public backlash against Mr. Trump’s policies.

It was Mr. Casar’s third town hall in a Republican district, and he pushed back on the idea espoused by veteran party strategists like James Carville that Democrats should simply keep a low profile and “play dead,” letting Mr. Trump’s unpopular agenda win elections for them. If Democrats don’t make vast changes, he said, they will pave the way for a President JD Vance.

“A corpse is not an inspiring political leader,” Mr. Casar said at the town hall. “We need to be out there picking a villain and saying, ‘Elon Musk is stealing your Social Security money for himself.’”

Many attendees did not sound convinced that the Democratic Party was doing much inspiring at all. One after another, they lined up for questions and expressed general fear and pointed concern that the Democrats were not standing up to Mr. Trump in any real way. They demanded to know what, exactly, the plan was.

“I’d like some confidence that my Democratic votes are actually going to result in strengthening a system and protecting it,” Deb Bennett-Woods, a retired professor, told Mr. Casar.

“It’s frustrating when we feel like our Democrats — I’m sure they’re doing the work, but we don’t hear it,” another woman vented at the microphone.

As a young leader in his second term in Congress, Mr. Casar may be uniquely positioned to answer such angst. He is sprightly — in high school, he placed sixth at the Texas state championships in the mile and once ran a 4-minute, 17-second pace. Despite the anxiety of the current political moment, Mr. Casar presents as a sunny, happy warrior. And his roots are in the progressive populism of Senator Bernie Sanders, independent of Vermont, whom he endorsed early in the 2016 presidential campaign and introduced at Mr. Sanders’s first Texas rally of that campaign.

“Isn’t our party supposed to be working for the many against the few that are screwing them over?” Mr. Casar said in the interview.

Ahead of the town hall on Thursday, Mr. Casar popped up at a Hyatt in downtown Denver to meet with workers fighting their employer for an extra dollar an hour in pay that they said they were promised in their last contract negotiation.

“You deserve a raise,” Mr. Casar told them, first in English and then in Spanish. “I’m here with you in this. I’m not here asking for your vote. Your vote is your business, but what I want is to make sure that we all push for other politicians to be out here with you. Workers in this country deserve a big raise.”

He then accompanied them to hand-deliver a letter outlining the pay raise request to the head of human resources at the hotel, who looked uncomfortable and begged the group not to film her.

Standing with the workers, he said, was the most fun he’d had all day.

“It feels a lot more productive,” Mr. Casar said. “I prefer to do this than just voting ‘no.’ So often in Washington, we just get trapped in these senseless meetings.” (He likes to kick off his own caucus meetings by playing Marvin Gaye and Aretha Franklin, hoping to distinguish them from the tedium.)

Those workers, he noted in the car, may not have voted in past elections. Maybe this kind of outreach from a Democrat could change that in the next one.

Mr. Evans’ spokeswoman responded to Mr. Casar’s presence in Colorado’s Eighth District by calling him a “defund the police activist who wants to see socialism and transgenderism take over America.”

Mr. Casar rolled his eyes at that. But he said he had made a purposeful pivot to responding to the political crisis in which he finds himself and his party. It means fewer purity tests, and a bigger tent.

And it means allying himself with more moderate Democrats who represent competitive districts and emphasize their military backgrounds to get elected — the types who would never fight for urban camping rights for the homeless.

He is on a text chain with Representatives Pat Ryan of New York and Chris Deluzio in Pennsylvania, two Democrats representing swing districts who also want the party to focus on working people and make villains out of the billionaires benefiting from Mr. Trump’s policies.

“We’re just talking about issues that are central: utility bills, health care bills, housing affordability,” Mr. Ryan said in an interview. “We can rebuild a broad American and patriotic coalition.”

Mr. Ryan does not love the “Resistance 2.0” framing, but he and Mr. Casar share a vision for what the party needs to be about.

“If we’re resisting something, we’re resisting harm to our constituents, from a big corporation or a billionaire or a corrupt government official,” he said.

Mr. Casar concedes that he has made some mistakes since taking over the Progressive Caucus, a group of nearly 100 lawmakers that is one of the largest in the House. It was his idea for Democrats to hold up signs that read “Musk Steals” and “Save Medicaid” during Mr. Trump’s address to a joint session of Congress. The signs were widely panned, and Mr. Casar now admits they were a bit dopey.

“Looking back on it, I think that just showing up and then leaving would have been better,” he said. “We get pressured into acting like we never make a mistake. I learned that some of the things we pushed for in 2017 became too-easy targets, so we’ve got to change. And I learned from that speech that when the president is just going to lie through the speech, it’s probably best just to walk out.”

But he has been consistent since Election Day that economic populism is the right approach for his party.

After the election, when Democrats were bemoaning that incumbents worldwide lost because of inflation, Mr. Casar advised his colleagues to take a look at President Claudia Sheinbaum’s decisive victory in Mexico, where a representative of the incumbent party won on a populist economic agenda.

Since then, he has participated in a “Fighting Oligarchy” rally with Mr. Sanders and Representative Alexandria Ocasio-Cortez, Democrat of New York. He sees himself as a team coach, and he refers to Ms. Ocasio-Cortez as “the No. 1 draft pick we’ve seen in my lifetime.”

Jetting around constantly can take a toll, especially on a young person attempting to have a normal life. He got dinged last year for skipping President Joseph R. Biden, Jr.’s address to House Democrats and going to a Joni Mitchell concert instead. It has also been tough at times on his partner.

“It’s really hard,” his wife, Asha, a philanthropic adviser, said of the realities of being married to an ambitious politician. “Greg is my favorite, but it’s not my favorite.”

He knows this, but Mr. Casar uses the word “resolute” to describe his commitment to the job and the fight ahead.

“There is a level of anxiety across the country that did not exist under Trump 1,” Mr. Sanders said in an interview, referring to Mr. Trump’s first term. “Greg understands that the future of American politics is to do what the Democratic leadership does not understand. That is to start addressing the serious crises of working families.”

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Spain and Portugal hit by huge power outage

Published

12 hours ago

April 28, 2025

Press Room

Spain and Portugal hit by huge power outage

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Spain and Portugal were hit by a huge power cut on Monday that paralysed transport networks and disrupted mobile communications, with authorities warning that obstacles remained before electricity could be fully restored.

Hours after it began, Spanish Prime Minister Pedro Sánchez said experts were looking for the cause of the outage, which immobilised the rail system, delayed flights and made traffic lights go dark.

Data from the Spanish electricity operator showed that consumption dropped by more than 10GW when the blackout hit shortly after 12.30pm local time, suggesting that it was one of the biggest in recent European history.

Weather data showed that temperatures in southern Spain increased sharply between midday and 1pm local time. Higher temperatures can limit how much electricity cables can carry.

Eduardo Prieto, director of services at Spain’s operator, Red Eléctrica, said that a “very strong oscillation” in the network during that time had cut off Spain’s electricity grid from the rest of continental Europe, which had led to the collapse of the system.

Red Eléctrica said that by late afternoon power had been restored across northern and southern Spain — parts of the country that can be more easily supplied by France and Morocco respectively. But it cautioned that fully restoring supply to the whole country would take between six and 10 hours.

“We are going to go through some critical hours before we totally recover electricity,” Sánchez said after a crisis meeting with top government officials.

In an address to the nation he called on people to minimise travel, pay attention to official statements rather than social media, and restrict their use of mobile phones. He also noted the outage’s “tremendous impact” on everyday life as well as economic loss and “anxiety in millions of homes”.

Sánchez, who said he was in contact with King Felipe, political leaders and the EU and Nato about the crisis, added that the technical experts were working to provide a solution as soon as possible.

By mid-afternoon, all of the country’s nuclear power stations remained offline, according to Montel, the energy data specialist, as they sought to respond to the disruption.

Metro stations in Madrid were closed during the power outage © Susana Vera/Reuters

Spain’s chief traffic authority called on people not to drive their cars, because traffic lights were out of operation due to the cut. The government added that medium- or long-distance rail transport would not resume during the day.

In Madrid, people spilled out on to the streets, as metro stations were evacuated and shops, restaurants and offices closed. Mobile phone coverage was also initially hit. Local media said some — but not all — hospitals were functioning as normal with the aid of backup generators.

Isabel Díaz Ayuso, the conservative leader of the Madrid regional government, called on Spain’s Socialist-led national administration to activate emergency plans “to allow the army to keep order, if necessary”.

Alberto Núñez Feijóo, the head of Spain’s opposition People’s party, criticised Sánchez’s government for being slow to provide updates on the blackout. “We need timely information,” he said.

Nearly 400 flights were delayed at Madrid airport as of mid-afternoon, including more than half of scheduled departures, while at Lisbon airport, 171 flights were delayed and almost 200 flights cancelled.

Aena, which runs Madrid airport and 45 others across Spain, said it was relying on backup power supplies to operate, adding that the extent of the delays would depend on whether crews and passengers could get to the airports.

Spain gets 43 per cent of its electricity from wind and solar power, but grid and storage capacity has not kept pace with the country’s rapid development of renewable energy.

The country has long lamented being an “energy island” due to its poor connections with France.

French grid operator RTE said parts of France had been briefly affected by the outage but that power had been quickly restored.

Additional reporting by Philip Georgiadis and Andy Bounds

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Trump to sign executive order highlighting sanctuary cities fighting immigration enforcement

Published

13 hours ago

April 28, 2025

Press Room

Trump to sign executive order highlighting sanctuary cities fighting immigration enforcement

Trump’s executive orders will total more than 140 during his first 100 days in office, which press secretary Karoline Leavitt said was more than the Biden administration had in four years.

One Trump order will ‘unleash’ law enforcement, press secretary Karoline Leavitt said.

WASHINGTON – President Donald Trump will sign two executive orders to bolster immigration enforcement and highlight which jurisdictions restrict cooperation with federal law enforcement, according to press secretary Karoline Leavitt.

The signings April 28 come on the 99^th day of Trump’s second term in office. His Republican administration is promoting tougher border enforcement as one of his central priorities, with what border czar Tom Homan called “historic low” border crossings.

“It’s quite simple: obey the law, respect the law and don’t obstruct federal immigration officials and law enforcement officials when they are simply trying to remove public safety threats from the nation’s communities,” Leavitt told reporters during a morning White House briefing. “This administration is determined to enforce our immigration laws.”

DOJ, DHS to highlight sanctuary cities: Leavitt

The first order aims to “strengthen and unleash America’s law enforcement to pursue and protect innocent citizens,” Leavitt said.

The second order calls on Attorney General Pam Bondi and Homeland Security Secretary Kristi Noem to publish a list of the communities nicknamed “sanctuary” jurisdictions. Leavitt said the communities “obstruct the enforcement of federal immigration laws.”

Homan said he would visit Rochester, New York, on April 29 to support local law enforcement officers after several were disciplined for aiding a Homeland Security official who called for emergency assistance.

“Cops need to help cops, especially in an emergency situation. But they got disciplined,” Homan said. “I’m going up there to support the men and women of law enforcement.”

Focus on sanctuary cities arrives amid court battles

The administration’s conflict with sanctuary cities and states is being fought in court. Leavitt’s announcement came after FBI agents arrested a local Wisconsin judge on April 18 for allegedly interfering with federal authorities trying to arrest an immigrant who didn’t have legal authorization to be in the country.

Milwaukee County Circuit Court Judge Hannah Dugan was charged with alleged interference with a federal law enforcement operation and unlawful concealment of an individual subject to arrest.

Immigration and Customs Enforcement officials and others were trying to arrest Eduardo Flores-Ruiz, a Mexican citizen previously removed from the U.S. and recently charged with multiple counts of domestic abuse-related battery. Dugan allegedly directed the federal authorities away from Flores-Ruiz after he appeared in her court.

Dugan had an initial appearance in court April 25 to be advised of her rights and her arraignment is scheduled May 15. Trump blasted the judge on April 27 as “terrible.”

Lawsuits challenge validity of sanctuary cities

A group of 16 cities and counties filed a lawsuit against Trump’s policy withholding federal funding from so-called sanctuary jurisdictions that limit cooperation with federal immigration enforcement.

U.S. District Judge William Orrick in San Francisco blocked the policy on April 24 by ruling the government was unlawfully trying to force cooperation from jurisdictions such as Minneapolis, Portland, Santa Fe and Seattle.

The Trump administration isn’t always the defendant. Bondi sued Illinois, Chicago and Cook County alleging they “obstruct” federal authorities from enforcing immigration laws.

Bondi also sued New York state and its Department of Motor Vehicles for a “green-light” law that limits cooperation with federal immigration enforcement.

“The American public doesn’t want illegal criminal aliens in their communities,” Leavitt said. “They made that quite clear on Nov. 5.”