- Trump calls CHIPS Act a “horrible thing,” suggests cutting funding.
- Repealing the law would require congressional approval.
What happened: Trump questions CHIPS Act funding during speech
Former US President Donald Trump criticised the CHIPS Act during his address to Congress, calling it a “horrible, horrible thing.” He urged House Speaker Mike Johnson to consider using the remaining funds for debt reduction or other purposes. The CHIPS Act, passed in 2022 under President Joe Biden, allocates $52.7 billion to boost semiconductor manufacturing in the US.
So far, the Commerce Department has allocated or disbursed $36 billion for projects nationwide. Despite Trump’s remarks, sources indicate no formal plans exist to repeal the bipartisan legislation. The CHIPS Act was introduced in response to semiconductor shortages and aims to strengthen domestic production. A repeal would require congressional action, and with the law creating jobs in key states, widespread support for dismantling it appears unlikely.
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Why it’s important
The CHIPS Act was enacted to address semiconductor shortages that disrupted global supply chains during the COVID-19 pandemic. The US currently produces only 10% of the world’s semiconductors, while 75% of chip fabrication occurs in Southeast Asia. The legislation aims to bolster domestic manufacturing to reduce dependency on foreign suppliers.
If the CHIPS Act were repealed, it could impact ongoing projects and financial commitments already made by semiconductor firms. Additionally, states benefiting from the funding may resist efforts to cut the programme. Trump’s remarks highlight ongoing policy debates regarding government spending and economic competitiveness in the semiconductor sector.
