Home Business Essay: The “core” method reflects the heart disease of American hegemony – China Daily

Essay: The “core” method reflects the heart disease of American hegemony – China Daily

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Xinhua News Agency, Washington, August 12th Essay: The “core” method reflects the heart disease of American hegemony

Xinhua News Agency reporter Xiong Maoling

The United States has officially released the “2022 Chip and Science Act” (hereinafter referred to as the “Chip Act”), which not only wants to promote the “return” of chip manufacturing to the United States, but also attempts to suppress the development of other countries and maintain American hegemony. The intentions and practices of the United States run counter to the laws of the market and the trend of globalization, which will distort the global semiconductor supply chain and disrupt international trade.

The “Chip Act” is regarded as one of the most important industrial policies introduced by the US government in recent years. Under this bill, the U.S. government will invest funds to support U.S. chip manufacturing and research and development. The bill also stipulates that as long as it accepts US government subsidies, it will not be allowed to expand advanced chip production capacity in China or any other country for 10 years. Once the bill was introduced, it was widely criticized and questioned. “The New York Times” said that the bill looks ambitious, but I am afraid that it will not be effective.

The “Chip Act” runs counter to the market law of optimal allocation of elements. For decades, the US chip manufacturing industry has been shifting to East Asia, in the final analysis due to the high cost of production in the United States. According to the American Semiconductor Industry Association, the cost of building an advanced chip factory and maintaining it for ten years is about 30%-50% higher than that of Asia-Pacific economies. The US government’s abuse of executive legislation to disrupt the market order will only lead to higher chip production costs and hurt consumers. The US government’s claim that the bill will bring “cheaper cars, cheaper computers” to the American people is pure self-deception.

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The “Chip Act” engages in economic coercion, forcing “selection of sides” and disrupting the stable operation of the global industrial chain and supply chain. With the wave of globalization sweeping the world, the chip industry has established a cross-regional industrial chain supply chain network on a global scale, forming an efficient pattern of mutual cooperation. However, in order to maintain its hegemony, the United States has forced the cutting and reorganization of the global industrial chain and supply chain, which has impacted the stable operation of the global industry. South Korea’s “Han Minh Daily” published an editorial bluntly stating that the US’s demands have reached the level of infringing on South Korea’s economic sovereignty and seriously undermining the mutual trust between the two countries. The US “Capitol Hill” pointed out that if the US forces industrial transfer or decoupling, it will inevitably lead to chaos in the global division of labor, aggravate the shortage of chip supply, and further aggravate the problems faced by the United States itself.

The “Chip Act” is full of Cold War mentality, and it is well known that it is suppressing in the name of competition and containing other countries. In recent years, the United States has made great fuss about chips, and has repeatedly politicized, instrumentalized, and weaponized technology and economic and trade issues. A Chinese foreign ministry spokesman bluntly said it was “a typical techno-terrorism”. This chip industry protection policy dominated by the Cold War mentality is doomed to backfire. Institutions such as the Boston Consulting Group estimate that if the United States adopts a policy of “hard technology decoupling” against China, American semiconductor companies will suffer more, and it is expected that they will lose 18% of the global market share and 37% of their revenue and reduce 15,000 to 4. Thousands of high-skilled jobs.

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The “Chip Act” reflects the “heart disease” of the United States in maintaining economic hegemony. The so-called “decoupling” and “broken chain” go against economic laws and corporate choices, and go against the general trend of deep integration of the global economy. Interfering with the innovation and development of other countries by engaging in technological monopolies, blockades, and barriers is nothing but a shrewd calculus.

(Xiong Maoling)

[Editor in charge: Xu Dan]

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