The most advanced computer chips in the world, the ones used in everything from F-35 fighter jets to iPhones to the AI systems that the entire US tech industry now runs on, are mostly made by a single company on a single island. The company is Taiwan Semiconductor Manufacturing Company, or TSMC. The island is Taiwan, which sits about 100 miles off the coast of China. Beijing has said openly and repeatedly that it considers Taiwan to be part of China and is willing to use force to bring it under control. American war planners spend a significant chunk of their time thinking about what would happen if it ever tried.
Reporting from the New York Times, the Financial Times, Bloomberg, and the Center for Strategic and International Studies all describe the same basic picture. Roughly 90 percent of the world’s leading-edge chips, meaning chips at 7 nanometers and below, come from TSMC. About 65 percent of all semiconductors used in US weapons systems originate in Taiwan. A 2024 RAND Corporation analysis concluded that a Chinese blockade or invasion of Taiwan would cause an immediate global GDP contraction larger than the 2008 financial crisis, primarily through the disruption of the chip supply chain.
The CHIPS Act, signed in 2022, set aside $52 billion in subsidies and incentives to bring chip manufacturing back to American soil. The early results are real but partial. TSMC is building plants in Arizona, the first of which began limited production in late 2024 and is ramping up through 2026. Intel is building new fabs in Ohio and Arizona. Samsung is building in Texas. Micron is expanding in New York and Idaho. The combined capacity, when all the announced plants are operating in 2028, will produce roughly 20 percent of the world’s leading-edge chips on US soil, up from essentially zero in 2022. That is real progress. It is also still a long way from making the country self-sufficient.
Here is what this country needs to be straight with itself about. For three decades, we shipped our manufacturing base overseas in exchange for cheaper goods. For most categories, that trade was probably worth it on the consumer side, even if it hurt towns that lost factories. Semiconductors are not most categories. They are the central nervous system of the modern economy and the modern military. Letting that nervous system get concentrated 100 miles from a country that has openly named us as its principal rival was a strategic mistake of the first order, and it was a mistake committed by administrations of both parties, supported by business leaders of both parties, and quietly cheered by Wall Street the whole time.
The good news is that the country has finally figured this out and started spending money to fix it. The harder news is that semiconductor fabs take five to seven years to build and a decade to run profitably, and the political cycle does not have that kind of patience. Whatever your view on industrial policy in general, the case for bringing chip manufacturing home is one of the cleanest national-security arguments out there. The CHIPS Act is doing its job. Anyone running for federal office in 2026 should be asked, plainly, whether they would continue it. Their answer matters more than most things they will say on television.