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0 pointsmannerheim4y ago0 comments

How do you identify all the vital components for not just what you need to manufacture, but the components of those components? How many people here knew Ukraine was a major producer of neon prior to this, and its importance to semiconductor manufacturing?

You could try to become totally autarkic, but then you have to support a national semiconductor industry along with every industry it relies upon indefinitely, while foreign semiconductor companies won't be encumbered by restrictions to purchase every component for their process from within your country; they, at least, will have the option to go with the cheapest or the best options. And so, if you want your national semiconductor industry's chips to actually be used, you have to provide incentives for that, too, and/or require domestic electronics companies to use their chips. Then, since you're making domestic electronics companies uncompetitive, you have to incent consumers to purchase those electronics, ban or heavily tax foreign electronics...

In a modern, globalised economy, it seems to me the only way to have a semiconductor industry that isn't vulnerable to these sorts of problems is full top-down control of a substantial chunk of the economy.

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fragmede4y ago

Does it need full top-down control of a substantial chunk of the economy to happen? A few regulations saying 10% has to be made in-country, along with investigators and fines to back it up seems like it would work without going full centralized-and-planned economy.

mannerheimOP4y ago

10% of what? Semiconductors? Sure, that's easy, and already done; US semiconductors are 13% of the global market, so presumably they're about that share of the domestic market and probably more.

The components necessary to manufacture them? Much more difficult. And remember, any encumbrance you put on Intel provides a competitive advantage for TSMC.

The other issue is if you require 10% of semiconductors to be made in the US, and 10% of their components likewise, that only leaves you with 1% of the semiconductor capacity you need if you really need to become autarkic. And that's only considering first order dependencies; what about the components needed for the components you need?

Now, even ignoring that, consider if Intel has to make 10% of its chips using machines and components made in America. Say ASML makes the best photolithography machines in the world. Some other foreign company makes the best of another machine in the world. And so on. So Intel has to manufacture 10% of its chips using subpar equipment. Who's going to buy those chips? If electronics need better chips, can you replace them with these in a pinch?

You either need to fully commit, or else it's pointless to begin with.

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