Hope US semiconductor companies’ ‘petition’ wakes up Washington: Global Times editorial

chip Image: VCG

Photo: VCG

As rumors grow of the “Biden administration expanding restrictions on chip exports to China,” opposition within the US is also rising. In a rare move, American semiconductor companies have launched a “petition movement.” On July 17, CEOs of American chip companies such as Intel, Qualcomm and NVIDIA met with top US officials including Secretary of State Antony Blinken, Commerce Secretary Gina Raimondo, National Economic Council Director Lael Brainard, and National Security Advisor Jake Sullivan. They have openly expressed opposition to the US government’s tightening of export controls on chips and semiconductor manufacturing equipment in China. On the same day, the Semiconductor Industry Association (SIA) issued a statement warning that restrictions on chip sales in China could backfire in the US.

Since October of last year, when the US government began a chip blockade against China, which The New York Times described as “an act of war,” American semiconductor companies have been expressing their opposition through various means. However, instead of taking them seriously, the US government has continued to worsen the blockade. It is widely rumored that the new restrictions will be announced by the end of this month, representing a significant increase from the export restrictions implemented in October last year. This led to a concentrated explosion of discontent and concerns among American semiconductor companies. They are urging the Biden administration to avoid taking this step and stop imposing further restrictions on China’s chip exports before the last “window of opportunity” closes. However, people have little confidence that the White House will listen and adopt their suggestions.

The joint action of the American industry is not accidental but a sign of a new phase in the so-called “chip war.” It is clear that the US industry and Washington have completely opposite attitudes on the issue of export controls in China. There can only be one side that is right, and it is obvious who is right and who is wrong. Ironically and absurdly, the US government started the chip blockade against China under the guise of “national security” – a term that is overused, and which claims to protect the interests of the domestic semiconductor industry. Whether it is “protection” or damage, the parties directly involved know best. Now they have given a clear answer, and it is harmful.

China has long anticipated such consequences and repeatedly warned the US. China is the largest semiconductor market in the world, and the sales of American chip companies in China cannot be replaced by executive orders from Washington or certain subsidies. Imposing crazy restrictions on exports to China will not only cause difficulties for the development of related industries in China but will also harm the livelihood of American semiconductor companies. It is truly a case of harming others without benefiting oneself.

As this is set to be a no-win war, there is considerable controversy within the Biden administration. It is reported that one side, represented by Treasury Secretary Janet Yellen, hopes to reduce the scope of the impact. Yellen herself has repeatedly stated that the related restrictions will be “targeted” and “not broad controls that will affect US investment in China.” However, these statements did not translate into visible views within the industry.

SIA said in its statement that “the imposition of overly broad, unclear, and sometimes unilateral restrictions could reduce the competitiveness of the US semiconductor industry, disrupt supply chains, create significant market uncertainty, and prompt China to further escalate retaliation.” On July 19, the China Semiconductor Industry Association also issued a statement, expressing its commitment, with industry colleagues around the world willing to cooperate, in safeguarding the globalization of the semiconductor industry. This resonance between the semiconductor industries of China and America shows that the true pattern of mutually beneficial cooperation between the industries of the two countries has been formed, which fundamentally contradicts the zero-sum competition narrative propagated by Washington.

There used to be a popular term in the US called “national security fortress,” which referred to a country that makes decisions and looks at everything from the perspective of war and “national security,” while setting aside market principles, policies and the private sector. The US today increasingly resembles a state living within a “national security fortress.” This “petition movement” reflects that the differences and contradictions between the US business community, representing economic interests, and the US national strategic elites, representing political thought, have reached the point of direct confrontation.

Again, it is important to emphasize that the US’s strong repression of China can create chaos and difficulties that can harm the interests of both sides. However, it will not crush China, nor will it hinder China’s development and technological progress. The cost that the US has to pay for this is very high. American chip companies have clearly seen this, and we hope their “petition” will wake up some people in Washington.

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