Former President Donald Trump urged lawmakers on Tuesday to repeal the CHIPS and Science Act, a 2022 bipartisan law that provides $52.7 billion in subsidies to support semiconductor manufacturing in the United States. Trump suggested reallocating any remaining funds to reduce the national debt.
“The CHIPS act is a horrible, horrible thing. We give hundreds of billions of dollars and it doesn’t mean a thing. They take our money and they don’t spend it,” Trump stated during a speech to Congress. “You should get rid of the CHIPS Act and whatever is left over, Mr. Speaker, you should use it to reduce debt.”
Signed into law by then-President Joe Biden in August 2022, the CHIPS Act includes $39 billion in direct subsidies for semiconductor manufacturing, along with $75 billion in government lending authority. The initiative aimed to strengthen domestic chip production and address national security risks associated with reliance on foreign semiconductor supply chains.
Commerce Secretary Howard Lutnick has defended the program but indicated plans to reassess awards granted during the Biden administration. Under Biden, the Commerce Department successfully secured commitments from all five leading-edge global semiconductor firms to establish manufacturing operations in the United States. In its final weeks, the administration approved over $33 billion in awards, including:
- $4.75 billion for South Korea’s Samsung Electronics
- Up to $7.86 billion for Intel
- $6.6 billion for Taiwan Semiconductor Manufacturing Company (TSMC)
- $6.1 billion for Micron
Concerns have been raised that Trump may seek to overturn these agreements. New York Governor Kathy Hochul criticized Trump’s position, highlighting the economic impact of the legislation. “The law is the reason Micron is bringing $100 billion and 50,000 jobs to Central New York. Trump just said he wants to get rid of it,” she said.
Despite Trump’s remarks, TSMC recently announced plans for a new $100 billion investment in the U.S., including five additional semiconductor facilities. Lutnick acknowledged TSMC’s previously awarded $6.6 billion in subsidies but stated that no new funding was planned for the company. TSMC disclosed last month that it has already received $1.5 billion of its allocation.
Meanwhile, about one-third of the staff at the U.S. Commerce Department office responsible for overseeing the $39 billion in semiconductor subsidies was laid off this week, according to sources familiar with the matter. The Trump administration is currently reviewing projects approved under the previous administration as part of a broader restructuring of the federal government.
