Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Stay on top of the latest market trends

Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Illustration: Aïda Amer/Axios

Warning bells are sounding for the U.S. semiconductor industry as Intel grapples with internal and competitive challenges that could imperil the future of domestic chipmaking.

Why it matters: Chips are some of the only strategic tech products that are actually manufactured in the U.S., accounting for a quarter-million U.S. jobs. They're also a small but key piece in the power struggle between the U.S. and China.

Driving the news: Intel is weighing whether to outsource some manufacturing after struggling mightily to get its next-generation chip production up and running.

  • Costly delays are already handing a technical edge to rivals like AMD, which outsources its manufacturing to Taiwan's TSMC.
  • The percentage of chips made in the U.S. has already declined from 37% in 1990 to 12% today, according to the Semiconductor Industry Association, the trade group that represents U.S. chipmakers.

Policymakers and chip industry reps are now pleading for government intervention to keep what remains of U.S. chip manufacturing in the country.

The big picture: Beijing has grand designs on dominating the global chip market, which would in turn boost China's economic and technological might and could give the country an edge in A.I. and other next-generation technologies.

  • China's efforts have run into troubles of their own, but Intel falling behind will do the U.S. no favors.

Between the lines: For all the talk of how computers and smartphones should be made in the U.S., the practical reality is that we have neither the infrastructure nor the labor force nor the economic setup to bring such manufacturing here.

  • Chips, on the other hand, are highly strategic, require a modest but well-paid labor force and are already made here.

What they're saying: Both Treasury Secretary Janet Yellen and Defense Secretary Lloyd Austin talked about the strategic importance of the U.S. chip industry in their confirmation hearings.

  • SIA head John Neuffer said in a statement to Axios, "Semiconductors are critical to our economy, national security, and future innovation."
  • "To strengthen America’s semiconductor supply chains and keep our country on top in chip technology, leaders in Washington need to fully fund the semiconductor manufacturing incentives and research investments called for in the annual defense bill."

That bill — the most recent incarnation of the National Defense Authorization Act — has a provision that provides for federal incentives for domestic manufacturing and investments in semiconductor research.

  • However, those provisions still need to be funded through congressional appropriations.

Be smart: The right government investment and incentives could encourage other firms to expand U.S. chipmaking and prevent an exodus of chip jobs even if Intel does reduce the amount of manufacturing it does in-house.

What's next: Pat Gelsinger, recently tapped to be Intel's new CEO, acknowledged on an earnings call last week that "it's likely that we will expand our use of external foundries for certain technologies and products."

  • But he maintained that he remains "confident that the majority of our 2023 products will be manufactured internally."

Go deeper

Mike Allen, author of AM
4 hours ago - Politics & Policy

Biden adviser Cedric Richmond sees first-term progress on reparations

Illustration: "Axios on HBO"

White House senior adviser Cedric Richmond told "Axios on HBO" that it's "doable" for President Biden to make first-term progress on breaking down barriers for people of color, while Congress studies reparations for slavery.

Why it matters: Biden said on the campaign trail that he supports creation of a commission to study and develop proposals for reparations — direct payments for African-Americans.

Cyber CEO: Next war will hit regular Americans online

Any future real-world conflict between the United States and an adversary like China or Russia will have direct impacts on regular Americans because of the risk of cyber attack, Kevin Mandia, CEO of cybersecurity company FireEye, tells "Axios on HBO."

What they're saying: "The next conflict where the gloves come off in cyber, the American citizen will be dragged into it, whether they want to be or not. Period."

Cedric Richmond: We won't wait on GOP for "insufficient" stimulus

Top Biden adviser Cedric Richmond told "Axios on HBO" the White House believes it has bipartisan support for a stimulus bill outside the Beltway.

  • "If our choice is to wait and go bipartisan with an insufficient package, we are not going to do that."

The big picture: The bill will likely undergo an overhaul in the Senate after House Democrats narrowly passed a stimulus bill this weekend, reports Axios' Kadia Goba.