Raimondo: U.S. Needs to Invest to Win Chip Race

Four years after the Biden administration made the race for chip manufacturing a top priority, Commerce Secretary Gina Raimondo says efforts to restrict China's access to technology haven't held back the country's progress, and federal funding for domestic innovation is what will keep the U.S. ahead of Beijing.

- ALEXANDER WARD AND ASA FITCH

"Trying to hold China back is a fool's errand," she said in an interview. The $53 billion CHIPS and Science Act, which incentivizes U.S. firms to invest in semiconductor manufacturing and innovate in the sciences of tomorrow, "matters more than export controls."

President Biden has made industrial policy the cornerstone of the administration's economic revitalization and China competition strategy, and earlier this month boasted that the Chips Act and other related legislation amounted to "the most significant investment in America since the New Deal." The administration has also pushed forward with efforts to block Chinese companies from buying chips from American firms semiconductor-making components, and urged U.S. allies, including Japan and the Netherlands, to join in the effort to restrict Beijing's access to the technology.

Raimondo, who has responsibility for executing Biden's industrial strategy, has lobbied lawmakers to pass mammoth bills that underwrote the plan, ramped up export control enforcement and pushed to remake the Commerce Department from a plodding bureaucracy to the primary driver of efforts to expand the U.S. chip industry.