Fareed Zakaria Criticizes US Chip Subsidies Amid Global Tech Rivalry

CNN host Fareed Zakaria criticizes US government subsidies to chip manufacturers, citing Intel's struggles with Taiwan Semiconductor Manufacturing Company and Nvidia. The global chip race has intensified, with the US, EU, and China investing billions to develop next-generation chips.

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Bijay Laxmi
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Fareed Zakaria Criticizes US Chip Subsidies Amid Global Tech Rivalry

Fareed Zakaria Criticizes US Chip Subsidies Amid Global Tech Rivalry

In a May 1 PBS 'Firing Line' interview, CNN host Fareed Zakaria expressed criticism of the US government's decision to provide subsidies to chip manufacturers. Zakaria cited Intel's struggles in keeping up with Taiwan Semiconductor Manufacturing Company (TSMC) and Nvidia in cutting-edge chip production as a reason for his disapproval of the subsidies.

Why this matters: The outcome of the global chip race will have significant implications for national security, economic growth, and technological advancement. As the world becomes increasingly dependent on semiconductors, the country that dominates this industry will have a significant advantage in shaping the future of technology and global affairs.

The criticism comes amidst an escalating global rivalry between the US, European Union, and China for supremacy in the semiconductor industry. Governments worldwide have earmarked a total of $380 billion to boost the production of more powerful microprocessors, with the US and EU investing nearly $81 billion in the development of next-generation chips.

This surge in investment has pushed the Washington-led rivalry with Beijing over cutting-edge technology to a critical turning point, which experts believe will shape the future of the global economy. The race to develop and manufacture the most advanced semiconductors has significant implications for a wide range of industries, from consumer electronics to military applications.

The US has long been a leader in the semiconductor industry, with companies like Intel and Nvidia at the forefront of innovation. However, in recent years, Intel has faced increasing competition from TSMC, a Taiwanese foundry that manufactures chips for many of the world's leading technology companies, including Apple and Qualcomm.

Despite the US government's efforts to bolster domestic chip production through subsidies and incentives, critics like Zakaria argue that these measures may not be enough to keep pace with the rapid advancements being made by competitors like TSMC and Nvidia. As the global chip shortage continues to impact industries worldwide, the pressure on governments and companies to secure reliable supplies of these critical components is only set to intensify.

As the race for chip supremacy heats up, the outcome will have far-reaching consequences for the global economy and the balance of power in the technology sector. With billions of dollars at stake and national security concerns looming large, the rivalry between the US, China, and other key players in the semiconductor industry shows no signs of abating.

Key Takeaways

  • Fareed Zakaria criticizes US gov't subsidies to chip manufacturers, citing Intel's struggles.
  • Global chip race has implications for national security, economic growth, and tech advancement.
  • $380 billion invested globally in chip production, with US and EU investing $81 billion.
  • US faces increasing competition from Taiwan's TSMC and Nvidia in chip production.
  • Outcome of chip race will shape global economy and tech sector balance of power.