In Congress, a growing bipartisan consensus acknowledges that our supply chain is a problem, and nowhere more so than in semiconductor production. Last year, 104 companies worldwide raised $3.3 billion to manufacture semiconductors. Fifteen of those companies were American. Seventy were Chinese, and they accounted for 80 percent of the funding. The Biden administration is currently trying to secure funding for the Creating Helpful Incentives to Produce Semiconductors (CHIPS) for America Act, a bill passed under the Trump administration that has since gone unfunded. CHIPS would allow U.S. companies to apply to the Commerce Department for grants of up to $3 billion to create semiconductor-fabrication plants, or fabs. China has already declared self-sufficiency in semiconductor production a national priority. Strategic technologies such as artificial intelligence and quantum computing—to say nothing of already fielded military technologies—rely on advanced semiconductors. Today, major U.S. companies such as Amazon, Apple, and Google rely on Taiwan to manufacture 90 percent of their semiconductors. Russia, which is currently facing a semiconductor shortage due to sanctions, has resorted to sourcing computer chips from home appliances like refrigerators for its tanks. The country has also resorted to pulling vintage T-62 tanks out of mothballs, because these older models require no semiconductors.

“What’s happening in Russia could happen to us,” Gilman Louie told me. He is the CEO of America’s Frontier Fund (AFF), a nonprofit strategic-investment fund. Louie and his colleagues—a group of entrepreneurs, investors, scientists, and defense professionals that includes the former IBM CEO Samuel Palmisano and the former national-security adviser H. R. McMaster—believe that shoring up America’s supply chain is the single greatest challenge to our national defense, and that it requires a generational transformation of the incentive structure around American manufacturing. Since the tech boom of the ’90s, American companies have enjoyed significant profitability by leveraging a system in which innovation can occur at home while manufacturing occurs abroad. In East Asia, where operating a fab costs 30 to 50 percent less than in the United States, this has been not only an economic boon but an intellectual one. China, in particular, has long benefited from its access to technologies developed in the United States.