The Chip Insider®–Sleepwalking towards conflict: China and the United States

As you know, in the 1990s and 2000s, China and the United States moved closer together as the latter’s belief in free trade at the time dominated a very positive relationship. Entering the 2010s, the relationship turned as China became discontented… this led to the country’s 2015 announcement of the “Made in China 2025” …the first big sleepwalking step towards conflict…

Inverted Tariffs: the US Government’s taking 15% of Nvidia’s and AMD’s AI semiconductor sales to China is certainly unique… It also represents a huge tactical pivot from a restriction strategy towards a run-faster strategy with Trojan Horse tactics.

The previous restriction strategy relied on the false assumption the Chinese were not smart enough to develop their own technology. Clearly the China has proven that wrong … The Trojan Horse comes in allowing Nvidia and AMD to sell dumbed down AI chips … This shifts revenues and R&D funding away from the PRC’s AI chip makers and towards America’s… The PRC knows this…

The administration’s grand strategy, which the run-faster strategy folds into, was revealed in Treasury Secretary Scott Bessent’s comments this week…

Trump takes charge of America’s Semiconductor Industry: … Trump’s … calling for Lip-Bu Tan to step down as testing the waters. Behind the scenes… Tan visits the White House, and Trump flips the tune … Bloomberg broke the story that talks were underway for the US government to take a stake in Intel…

Now look at how the US landscape on which Trump’s strategy has to be based … While China has been building its semiconductor capability since 2015, the United States has fallen behind…Without both leading-edge research and manufacturing in the US, the PRC has the ability to deny the US the ability to make chips…

The only alternative is IBM Research, who still does full-flow and full-stack research... So far, Intel’s problems are not technical. They are financial, which explains Trump’s position flip on Lip-Bu. And as you can see, he’s working at Trump Time speeds.

"Those that fail to learn from history are doomed to repeat it." – John Lewis Gaddis