This is a big part of the reason why the United States is
seeking to retain dominance of the independent leaning island, and why it is
willing to threaten China with a military response if China seeks to rush for
full reunification of Taiwan with the mainland. China on the other hand,
historically, has always considered disunity in its nation as the biggest
threat to its peace and prosperity, which is the main motivation for it to want
to reunify with the technologically advanced island. The Chinese people feel at threat when they are not united. Complete dominance over
the world’s computer market would be a powerful side benefit of this
reunification.
So, you might think, well there is a really simple solution
to this, why doesn’t the United States just use its vast wealth, industrial capacity,
technological know how and educated citizenship, to invest in making themselves
a global leader in chip production again. Well, they are trying, but a
pernicious force is undermining their efforts; diversity requirements.
We read in the Daily
Mail, that these diversity requirements are so onerous that they are
forcing companies which produce semiconductors to seek better conditions for
their factories in other countries,
“Top microchip makers are
postponing their expansion into the U.S. and setting up shop in Israel and
Russia due to equity caveats that are required for them to receive grants from
the U.S. government.
The Biden administration
promised earlier this year that they would be handing out $39 billion in grants
to encourage semiconductor manufacturing in the U.S.
Shortly after the
announcement however, Intel announced they would be holding off on their
Columbus factory, while Samsung also delayed their facility in Texas.
Despite the billions in
subsidies, two experts believe the tech companies' decision to back out of
building manufacturing facilities in the U.S. stems from the diversity, equity
and inclusion policy.
In an opinion piece for The
Hill, CEO of Strive Asset Management Matt Cole and head of research at the
company, Chris Nicholson, say the subsidies are so 'loaded with DEI that it
can't move.'
The pair say that Intel has
now built manufacturing plants in Poland and Israel, meaning they would rather
deal with threat of Hamas rockets and Russian aggression than the government's
DEI regime…
…In their piece, Cole and
Nicholson said that part of the CHIPS money calls for the creation of Chief
Diversity Officers and helping minority groups.”[2]
The title of the article itself is pretty provocative,
stating that Biden’s DEI requirements are worse than Hamas. Not in reality of
course, but simply from the perspective that some of these companies would rather
function in countries where incoming rocket fire is a real possibility, than wade
through the diversity minefield that comes with the American government’s
grants.
Just take a moment to consider how serious a problem this
is. America cannot afford to lose access to Taiwan, without being fully chip
independent itself. Therefore, if it wants to maintain its military dominance
it has to become increasingly aggressive towards China in the South Pacific
region, so it can maintain this access. This is why the United States has so
militarized the region, it relies on this, and many other aspects of trade in
Asia for its dominance in the world. But because of its own self-retarding
diversity policies, it is not capable of creating its own re-energized semiconductor
sector. So, what we are saying here is the diversity initiatives might be a
major factor in a possible war with China. They at the very least make it more
likely.
Another source
explains why this is causing such an issue,
“The law contains 19
sections promoting DEI initiatives like prioritizing grants for
“minority-serving institutions” and mandating plans to boost the participation
of “underrepresented” groups in the semiconductor workforce.
Cole and Nicholson argue
these DEI strings have significantly slowed the disbursement of CHIPS money as
chipmakers must clear complicated bureaucratic hurdles. TSMC, for example, had
to agree to rely more on local Arizona workers rather than skilled employees
from Taiwan after backlash.
The authors contend national
security is being endangered by subordinating semiconductor supremacy to DEI
objectives. While the US pushes to diversify the chip workforce, strategic
rivals like China are rapidly expanding military capabilities and advanced
manufacturing.
Commerce Secretary Gina
Raimondo has defended prioritizing an inclusive semiconductor pipeline,
recently launching training at historically Black colleges funded by CHIPS
grants. However, critics insist DEI compromises are allowing America to fall
behind adversaries laser-focused on chip dominance over ideological aims.”[3]
Rather than being able to just get on with the job of making these chips so that the US can be more independent in this field, companies are being forced to fill quotas, align with union demands for who can be employed and many other roadblocks to getting these factories running. Another expert noted that these companies would be built, but they would just be built slower, less efficient, and less capable of advanced chip production because of all of these diversity regulatory requirements.[4] It is incredible, isn’t it. Some of us have warned about the danger of this push for diversity for years, and now we are reaping the fruit of these terrible policies, including the possibility of war.
It is not exaggeration that this could make war with China
more possible. America is putting more and more pressure on Taiwan to sure up
its independence from China, and China sees this as an act of aggression on
their nation. While reunification for cultural reasons is China’s main
motivation for incorporating Taiwan back into the fold, China also cannot
afford to lose access to Taiwan’s
technology base,
“China is, in fact,
strategically preparing for this scenario more than people realize. First, a
potential war scenario is a critical factor in the direction the country’s
economy is taking. China is pursuing an increasingly massive indigenization
drive for chips, technological supply chains and other critical goods, seeking
to phase out the need for foreign imports. The US has long sought to use the
semiconductor supply chain, and China’s dependence on Taiwan for a great deal
of that chain, as a strategic chokepoint in order to cripple China’s economic
and military development. Beijing has been investing aggressively to try and
break out of this containment and wean itself off such dependency as fast as
possible, all while simultaneously seeking to advance its own capabilities.
Secondly, China has long
been preparing for the possibility that the US will try and impose a full-blown
naval embargo on it, as unlikely as this may be. The Pentagon has been tasked
with preparing a study on how such an embargo would be possible. The goal, of
course, would be to cripple China militarily by depriving it of access to
foreign fuel supplies, again attempting to use its lack of energy independence,
owing to its population size as another chokepoint. Beijing’s biggest response
to this has been to build the Belt and Road initiative, and use strategic
partners such as Pakistan to create alternative maritime and commercial routes
which effectively avoid its naval peripheral regions that have been
increasingly militarized by the US. This also includes increasing strategic and
energy integration with Russia.
When these things are viewed
in context, China is certainly preparing for the contingency of a war, as well
as laying down the economic adjustments that would be needed in such a
scenario. However, it also remains true that at this point in time, Xi Jinping
has not given up on diplomacy, and as much as he retains an incentive to
economically develop the country through integration with Western markets, he
is not likely to take such a massive decision. However, we must be honest that
with the way the world is changing, this door is increasingly closing, and it
is obvious to most people that on the current trajectory, Taiwan has absolutely
no interest whatsoever in unification. So what options does China have left
with Taipei? It may be damned if it does and damned if it doesn’t.”[5]
Is it not remarkable that this situation could have been completely
avoided if America had not outsourced its chip building technology in the first
place. The greed of western corporate capitalists to turn third world countries into cheap
labour for their products has created a situation where now the most powerful
nation in the world feels that it may need to go to war with a country that it
helped develop this level of power and wealth and technology in the first
place? At multiple levels the drive for globalization and diversity are responsible
for pushing the world towards this new unnecessary war. Well, that and the old
things like avarice and the quest for power and dominance as well of course.
Those who pushed for the offshoring of manufacturing have
caused two major problems for the West; they have weakened our own
manufacturing base, making us vulnerable to broken supply chains in the event
of war, and they have made the countries which could go to war with us far, far
more powerful than they once were. Diversity really is a society killer in more ways than one. It
is shame that we had to learn this lesson again the hard way as a society.
List of References
[1] 2023,
The Economist https://www.economist.com/special-report/2023/03/06/taiwans-dominance-of-the-chip-industry-makes-it-more-important
[3] JP
Alegre, 2024, https://thedeepdive.ca/major-chipmakers-delay-us-factory-plans-despite-chips-act-subsidies-the-reason-dei/
[4]
Ibid.
[5] Timur
Fomenko, 2024, https://www.rt.com/news/598410-china-taiwan-war-consequences/
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