https://www.wsj.com/articles/silicon-not-steel-will-win-the-next-war-11545598669
The Trump administration this year imposed tariffs on steel, claiming that imports “threaten to impair the national security of the United States.” But the age is long past when steel was the most important input in a nation’s military arsenal. The modern military depends more on digital technology—semiconductor chips, sensors and software—than it does on steel.
The U.S. pioneered the technology that made today’s advanced weapon systems possible. But America’s competitive advantage in the digital economy is eroding at an alarming pace, along with its domestic high-tech manufacturing capacity. The majority of electronic systems first invented in the U.S. now are designed and made overseas, mainly in Asia. With few and dwindling exceptions, the U.S. no longer makes things like flat-panel displays, memory devices, light-emitting devices, lasers, imaging chips for digital cameras, and computer system packaging software.
As the manufacture of these component technologies has migrated offshore, so have many key systems suppliers. Intel is the only remaining U.S. company capable of fabricating high-density, high-performance computer chips in America. International Business Strategies estimates that investors are pouring $50 billion a year into advanced chip production facilities in Asia, more than 10 times the level of domestic spending. A state-of-the-art chip-fabrication plant can cost $20 billion to build and must be continuously upgraded.
The national-security implications of this industrial migration are dire. Without a domestic capability in critical electronic technologies, the U.S. may find itself unable to translate innovation into effective weaponry. Overseas supply chains are inherently insecure. Unless the manufacture of critical technology remains under domestic control, American systems are vulnerable to espionage and sabotage.