President Joe Biden signed an executive order on Wednesday that required an extensive review of critical American supply chains, with a special focus on semiconductors, to “ensure our economic prosperity and national security.”
The executive order requires the Secretary of Commerce to ”submit a report identifying risks in the semiconductor manufacturing and advanced packaging supply chains and policy recommendations to address these risks” by June 4.
The White House explained the order’s focus on semiconductors in a fact sheet:
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“The United States is the birthplace of this technology, and has always been a leader in semiconductor development. However, over the years we have underinvested in production—hurting our innovative edge—while other countries have learned from our example and increased their investments in the industry.“
Relying on chips produced elsewhere also threatens various aspects of the U.S. economy and national security. The semiconductor shortage has slowed the production of automobiles, for example, which is vital to American manufacturing.
This isn’t a strictly American problem—TSMC’s decision to devote some of its production to automobile chips reportedly arrived due to pressure from Germany—but addressing it would quickly mitigate the chip shortage’s effect on U.S. workers.
The executive order also requires agencies to make recommendations regarding the resiliency of U.S. supply chains, reforms needed to improve analyses of those supply chains, and other factors “as soon as practicable” after the June 4 reports are filed.
All of these recommendations are supposed to help “revitalize and rebuild domestic manufacturing capacity, maintain America’s competitive edge in research and development, and create well-paying jobs” as well as “support small businesses, promote prosperity, advance the fight against climate change, and encourage economic growth in communities of color and economically distressed areas.”
