The Biden White House held its third “summit” with business leaders about the global shortage of microprocessor chips, which is continuing to worsen in the United States, Europe and Asia, with six-month waits for deliveries and big increases in chip prices hitting industries across the board.
The Biden administration is treating this as a problem of supply being over concentrated in companies headquartered in Taiwan and Korea – by far the biggest suppliers being TSMC in Taiwan and Samsung in Korea — and is casting for ways to increase chip production in the United States. But the real history of the shortage – as reported again in a long analysis by Bloomberg News on April 7, for example – is one of the failure of major governments to create demand in the spring and summer of 2020 by development, healthcare and infrastructure projects. The major chipmakers lost a large part of their demand at that time, cut back production, and are still unsure that the current “stimulus” demand will last. It appears to be high because of greatly stimulated consumer spending, which could retrench as soon as the “stimulus” money-printing slows down.
