Biden Administration’s $6.6 Billion Funding for TSMC in Arizona Raises National Security and Job Concerns

Man speaking with American flag background.
Democratic nominee for president Joe Biden gives a speech to workers after touring McGregor Industries in Dunmore, Pennsylvania on July 9, 2020.

The Biden administration’s $6.6 billion investment in TSMC’s Arizona facilities sparks controversy over job discrimination and national security concerns.

At a Glance

  • Commerce Department approves $6.6 billion for TSMC’s Arizona semiconductor plants
  • Project aims to create 20,000+ jobs, including 6,000 direct manufacturing positions
  • Class action lawsuit alleges discrimination against non-Asian workers
  • Investment part of larger effort to boost domestic chip production for national security
  • First facility expected to open in early 2025, focusing on advanced A16 technology

Massive Investment in American Semiconductor Production

The U.S. Commerce Department has approved a substantial $6.6 billion investment in Taiwan Semiconductor Manufacturing Company’s (TSMC) Arizona facilities, marking a significant step in the Biden administration’s efforts to bolster domestic semiconductor production. This funding, part of the CHIPS & Science Act, aims to strengthen America’s technological independence and create thousands of jobs. However, the project has become embroiled in controversy, raising questions about its impact on American workers and national security.

The investment is expected to catalyze a total of $65 billion in private investment from TSMC, resulting in the construction of three state-of-the-art semiconductor fabrication facilities in Phoenix, Arizona. These facilities are projected to create over 20,000 jobs, including approximately 6,000 direct manufacturing positions, focusing on advanced A16 technology crucial for AI and high-performance computing.

Job Creation or Discrimination?

Despite the promise of significant job creation, TSMC faces a class action lawsuit alleging discrimination against non-East Asian, non-Taiwanese, and non-Chinese individuals. The lawsuit claims that TSMC’s workforce in North America is predominantly from Taiwan or China, with many requiring visas. Job postings often require Mandarin fluency, and meetings are frequently conducted in Mandarin, creating a potentially hostile work environment for non-Asian employees.

“We have since delivered on that promise, catalyzing nearly $450 billion in private investment in semiconductors, creating over 125,000 new construction and manufacturing jobs, and reshoring critical technologies to bolster our national and economic security. Today’s final agreement with TSMC – the world’s leading manufacturer of advanced semiconductors – will spur $65 billion dollars of private investment to build three state-of-the-art facilities in Arizona and create tens of thousands of jobs by the end of the decade.” – Biden

Former employees have reported discrimination, verbal abuse, and unfair treatment, raising concerns about the true beneficiaries of this massive government investment. Critics argue that TSMC’s practices may be at odds with the project’s goal of creating jobs for American workers, as the company has faced criticism for planning to bring workers from Taiwan due to a perceived lack of skilled local workers.

National Security Implications

The Biden administration touts this investment as a critical step in strengthening national security by reducing dependence on foreign chip manufacturing. The project is part of a larger $36 billion national semiconductor initiative aimed at creating over 125,000 jobs across 20 states and revitalizing U.S. manufacturing.

“The Biden-Harris Administration’s investment in TSMC Arizona is a turning point for American innovation and manufacturing that will strengthen our economic and national security. The leading-edge chips that will be manufactured in Arizona are foundational to the United States’ technological and economic leadership in the 21st century. Because of President Biden and Vice President Harris, the most advanced semiconductor technology on the planet will be made in America, creating thousands of jobs in the process.” – U.S. Secretary of Commerce Gina Raimondo

However, the allegations of discriminatory hiring practices raise questions about whether this investment truly serves American interests. The reliance on foreign workers and potential preferential treatment for non-American employees could undermine the goal of building a robust, domestic semiconductor workforce capable of supporting long-term national security objectives.

As the first TSMC facility in Arizona prepares to open in early 2025, the controversy surrounding this massive investment highlights the complex challenges of balancing economic development, job creation, and national security in an increasingly globalized industry. The success of this initiative may ultimately depend on how effectively these concerns are addressed and whether the promised benefits truly materialize for American workers and the nation’s technological independence.

Sources:

  1. Biden Commerce Department approves $6.6 billion for semiconductor firm hit with discrimination suit
  2. Biden-Harris Administration Announces CHIPS Incentives Award with TSMC Arizona to Secure U.S. Leadership in Advanced Semiconductor Technology

RELATED ARTICLESMORE FROM AUTHOR