President Donald Trump says he's imposing a 100% tariff on computer chips— a move that raises the specter of higher prices for electronics, autos, household appliances and other essential goods that depend on the processors.
The comments were Trump’s strongest criticism of the bipartisan CHIPS Act to date. “We don’t have to give them money,” Trump said, suggesting that avoiding new tariffs would be enough to convince them to build U.S. factories.
I think that, insofar as Trump has a coherent view, that’s it: he doesn’t want to give companies money to establish chip manufacturing in the USA, because he thinks it can be done instead by bullying them with tariffs so they are forced to fund it themselves if they want to stay in business.
I’m not saying that’s a wise view. There’s a good chance he just ends up creating more economic problems at home. And it’s in part driven by his desire to get revenge on Biden by undoing everything he did, rather than a rational appraisal of economics.
He’s been trying to prevent the US from manufacturing their own chips, so that can’t be the real goal…
https://www.reuters.com/technology/trump-wants-kill-527-billion-semiconductor-chips-subsidy-law-2025-03-05/
From that article:
I think that, insofar as Trump has a coherent view, that’s it: he doesn’t want to give companies money to establish chip manufacturing in the USA, because he thinks it can be done instead by bullying them with tariffs so they are forced to fund it themselves if they want to stay in business.
I’m not saying that’s a wise view. There’s a good chance he just ends up creating more economic problems at home. And it’s in part driven by his desire to get revenge on Biden by undoing everything he did, rather than a rational appraisal of economics.