How the Computer Chip Shortage Could Incite a U.S. Conflict With China

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How the Computer Chip Shortage Could Incite a U.S. Conflict With China

But Taiwan and its semiconductors are far more important to America’s economy than Ukraine is — meaning it would very likely be far more difficult for the United States to stay out of a conflict involving Taiwan.

Taiwan accounts for half of the overall production of microchips that are critical to the functioning of mobile phones, consumer electronics, cars, military equipment and more. South Korea, the nearest competitor, has about 17 percent of the overall market. But Taiwanese chips are the smallest and fastest, and its foundries account for 92 percent of the most advanced designs.

“It’s almost impossible to duplicate Taiwan’s manufacturing capability of high-end chips, of low-end chips,” said Dan Blumenthal, a scholar at the American Enterprise Institute. “It’s just the manufacturing hub of the world.”

Although the United States and Europe are trying to boost their own domestic design and production of semiconductors, they do not have the abilities to mass produce the most advanced designs that the Taiwan Semiconductor Manufacturing Company, or TSMC, can make.

“If the semiconductor supply chain is infringed upon by China in some way, all of the sudden the things that Americans look to in their daily lives, to get to and from work, to call their loved ones, to do a variety of different things, those disappear,” Ms. Wasser said.

Other experts said it would be an overstatement to say that the United States would be dragged into a war over microchips. China will decide what kinds of coercive measures it will take against the Taiwanese based on the perceived threat to its sovereignty and the expected international backlog, said Bonny Lin of the Center for Strategic and International Studies.

“China is not going to base their Taiwan policy, or any decision to use force against Taiwan, based on chips,” Dr. Lin said. “China thinks about the costs of an invasion of Taiwan — there are significant political and military costs. That is why I don’t think chips would figure among the top three factors of using military force against Taiwan.”

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