Where’s the government?

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Where’s the government?

The tech war between the United States and China is getting fiercer than ever. In Monday’s teleconference at the White House to discuss U.S. strategy for semiconductors, President Joe Biden made clear his determination to put the brakes on China’s attempt to control high technology. Biden invited Samsung Electronics, the global leader in producing memory chips, and Taiwan Semiconductor Manufacturing Company (TSMC), a leader in manufacturing non-memory chips, to the teleconference. Given America’s share of the intellectual property needed to make semiconductors, major semiconductor producers around the globe can hardly refuse the United States’ request to take its side in the standoff.
The conference seems to be an economic equivalent of the Quad, the U.S.-led security alliance among the U.S., Japan, India and Australia. Business executives from South Korea, Taiwan and the Netherlands took part in the meeting. After introducing a letter from 65 Senators and House representatives to support the U.S. president, Biden announced his administration’s aggressive investment plan for semiconductors and batteries to rein in China’s ambition to realign and dominate global semiconductor supply networks. The teleconference was also attended by key U.S. companies such as Alphabet Inc., Google’s parent company, AT&T, Intel, Micron, General Motors and Ford. With the participation of Samsung, TSMC, and NPX Semiconductors, a Dutch company, a total of 19 companies from four countries attended the White House-led meeting.
As seen in the congressional letter, there is a bipartisan consensus in the U.S. to maintain America’s tech strength after China accelerated its effort to boost domestic demand and achieve technology independence. The Biden administration is engaged in a technology war against China that’s more strong than the Trump administration’s. Biden accented the need to build the “infrastructure of today, not repair the one of yesterday.” He stressed that the United States will lead the world again.
To accomplish that goal, his administration is pressing ahead with a massive infrastructure project amounting to $2.5 trillion. A $50 billion budget for research and production of semiconductors was included in the package. Biden’s swift addressing of the battery legal battle between LG and SK is linked to his strategy to contain China’s rise. If this contest continues, the global supply chains will be affected.
That poses a serious challenge for South Korea, which has benefited from a robust global supply chain. The country is being forced into an impossible choice between cooperating with America or play nice with China because of its huge market. Since high tech is directly linked to military power and security, the Sino-U.S. confrontation will most likely turn into a zero-sum game. Regrettably, the Moon Jae-in administration does not show any understanding of the seismic shift unfolding before its eyes. A country’s fate depends on the strength of its economy. The government must come up with effective strategies for the country’s survival rather than simply leaving them to the private sector.
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