Alternatively, you add a 20% tax on CPUs made outside the US. That would incentivize the fans manufactured in the US even if it’s a foreign company.
I don't think tariffs will work when the alternative requires massive outlay of capital and decades to recoup.
Not to mention, there is no reality where manufacturing these chips in the US costs less than Taiwan, for example. There is no reason to build a fab in the US with the current economic and regulatory climate. So... we have to force it to happen... which is what this bill does.
And they are, and have always been.
Push it up 50 percent. This quarter trillion dollars is going straight on the debt pile so it will hurt a lot, just not today.
At least this money will have a tangible, appreciable outcome. Supply chain security for such critical things such as chips is really hard to overstate the importance of for the US.
The chicken tax, as been an incredibly efficient way to assure that car's are manufactured in the USA, so much so that the cost difference between a Ford manufactured in Mexico and a Toyota manufactured in TX is basically 0.
There is no reality where manufacturing a car in Mexico costs the same as in Michigan. We've artificially increased the cost of the Mexico product... that is what will happen if you try that approach with chips - they will be more expensive for no real good reason.
It also appears to cost many multiples more capital to build a chip fab than a car plant according to these sources[1][2].
[1] https://www.exacthowmuch.com/how-much-does-it-cost-to-build-...
[2] https://builtin.com/hardware/american-made-semiconductor-cos...
Its hard to have an exact 1:1 comparison, but I think most people would agree they are roughly the same price for roughly the same product. And yet one is largely designed and manufactured in the USA (the Toyota).
So, maybe they it costs more to employ someone in San Antonio, but maybe that doesn't really matter in the grand scheme of things vs flying engineers to MX to work out kinks in the assembly line.
And its probably the same with semiconductor manufacturing. Intel isn't behind because it costs more to manufacture things in the US, they are behind because they didn't invest in EUV, and made some technical mistakes, as well as business mistakes around contract manufacturing and refusing low margin deals.
I think if you look at the results of the IBM/Lenovo deals its abundantly clear that where the manufacturing was located had nothing to do with the success of the products (It was outsourced to Lenovo long before it became their business). The American management was the problem, and kicking it to the curb allowed them to grow the business 10X+.
And lets not ignore Samsung which has a large fab just down the road from me. So it can't be a terrible environment for USA based semiconductors if a Korean company is willing to fab things here.