Trump goes after Taiwan in a spat over semiconductors. 
New Tariffs on Chips
The Washington Post reports New Tariffs on Computer Chips, Semiconductors Are Coming Soon.
“In the very near future we’re going to be placing tariffs on foreign production of computer chips, semiconductors and pharmaceuticals to return production of these essential goods to the United States of America,” Trump said Monday at a retreat of House Republicans at his Doral golf resort in Miami.
Trump said he wanted the manufacturers of semiconductors and chips — which are used in many high-end consumer electronics and sophisticated AI-powered technology and research — to open factories in the United States and would use the threat of high taxes and tariffs to force them to relocate.
“They’re not going to want to pay a 25, 50 or even 100 percent tax,” Trump said. “If you want to stop paying the taxes or the tariffs, you have to build your plant right here in America.”
Trump criticized the Biden administration’s policy of using taxpayer money to subsidize the construction of U.S. semiconductor manufacturing facilities as wasteful and claimed many of the companies that received subsidies didn’t need them and might use the money to expand overseas.
“We don’t have to give them money. They’re going to come in because it’s good for them to come in,” Trump said.
“They left us, and they went to Taiwan,” Trump said Monday. “We want them to come back, and we don’t want to give them billions of dollars.”
Trump Tariff Video
Here’s a Trump Video Clip on X regarding tariffs on semiconductors and Trump’s threats on Taiwan.
Dear Trump Just Do It
The following statement highlights the economic ignorance of Trump: “If you want to stop paying the taxes or the tariffs, you have to build your plant right here in America.”
Taiwan will not pay a dime of tariffs. US consumers will.
And it’s not like we can get advanced chips anywhere else. Thus, US customers will pay more than anyone else in the world for chips, and computers too.
How exactly is that supposed to help the US?
The one and only thing I can come up with that Biden did right is woo Taiwan Semiconductor to the US. They are building in the US.
Readers know I hate subsidies. But I am open to them in cases of a genuine national security threat. Microchips and rare earth minerals qualify. Underwear and toys don’t.
Taiwan Semiconductor should threaten to leave the US. Let Trump deal with Intel.
And Canada should do its part to fix its trade surplus with the US. I suggest Canada should stop sending oil to the US. We would instantly have the trade surplus with Canada that Trump wants.
Happy days would surely be here.
Make Depressions Great Again
I am tired of these perpetual tariff threats with no action. I want to see a global trade war the likes of which we have not seen since Smoot-Hawley and the Great Depression.
It’s time to make depressions great again. So I am openly rooting for Trump to stop talking and start acting.
The best way forward is 100 percent tariffs on everything. And if that does not immediately work, then 500 percent tariffs surely would.
Build Here Irony
The irony in Trump’s build here rant rant is Taiwan Semiconductor is building in the US, and Nippon Steel wants to.
Nippon would even upgrade our steel plants to do so.
Both Biden and Trump said no to Nippon on preposterous grounds of national security. How the hell is a steel plant in the US a security threat?
Everyone with an ounce of common sense who looked at the deal understands it’s union pandering that really puts America last.
For discussion, please see Biden’s Block of Nippon Steel Merger Makes the United States Less Secure
Biden blocked the Nippon purchase of U.S. Steel. Trump would have too. It’s union pandering that makes the US less secure.
Related Nonsense
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January 23, 2025: A Great Tariff Experiment as Trump Repeats Threat of Universal Tariffs
All eyes are on February 1 as Trump renews his threat for universal tariffs.
But Mish, you don’t understand.
America is the greatest at everything; it’s just that it is the victim of unfair cheating by other parties… Barring all those foreign imports, everything would be great.
Trump should go next step. No trade & no communications:
It’s just contamination of American purity.
Good article!
Gotta love some harridan in congress from the northeast lovin some SSRIs.
I appreciated when the electronic ignitions came out ~ 50+ years ago. Who needs some back alley guy setting points with a matchbook cover.
Biden snubbed Arabia Saudi or Israel. Trump menaces Taiwan, Germany, Canada…
How to lose friends and alienate allies. Russia, Iran and China must be laughing.
Probably not… all this wasn’t cheap for them.
Chips for washing machines, microwaves etc. are ten generations behind, cheap and reliable. The US doesn’t make home appliances anyways.
Chips for low power, mobile devices are the domain of TSMC. The US doesn’t make them either. Trumps seems to think, Taiwan stole it because the microprocessor was invented in the US.
The strategy is called raiding the vassals, but vassals can be fickle.
Sun Tzu says, when the enemy is destroying itself, don’t interfere.
From the River to the Sea students will be deported.
are you a bot? relavency to article??????????
Just one of my vast army of meatbots.
Tell that to the endless army of $250,000+ / year useless college administrators.
“How the hell is a steel plant in the US a security threat?”
How is a national security threat a national security threat? The term is so abused, like “threat to our democracy” is. Anything and everything can be declared a national security threat.
Be afraid … it’s patriotic!
Trump’s China’s #1 booster.
Make life for your allies painful enough & sooner of later they’re not your allies anymore.
Mish please comment on this embarrassing hearing of RFK. The lack of decency he’s being shown is off the charts but not unexpected.
He’s a former heroine addict. known liar and fabulist. he is not even close to qualified. a true dei hire
Sorry. I don’t throw people away for life because they used drugs. How ridiculous.
Indeed… and a junkie will be very loyal when we grant him access to the White House pharmacy .
We only changed a letter: White Equity and Inclusion.
I’d take Cheech & Chong before Elizabeth Warren.
A lot of vested interests are threatened. They are afraid of the truth coming out. Caroline’s smear yesterday is typical of what i would expect of Democrats at the hearing, as well as some Republicans.
He’s a big boy. He’s a big-time lawyer that used to fight mega corporations in his former quest to save the environment for the rest of us. He can handle some questions from some politicians.
Questions yes. And they should feel free to vote against him. Yelling at him and not even allowing him to answer questions is disrespectful no matter who’s up there. The Senate shouldn’t act like that…..As to whether the bought and paid for by big pharma crew will support him he’s at like 75% to be approved so more than likely he will be.
Yelling is improper for democrats, which makes it easy to shout them down,
I want to see him approved because medicine in this country needs to be stirred up.
It is clear that the medical industrial complex in this country fears him greatly, as can be seen by how much resistance he is engendering.
Is he wearing shoes?
Yes indeed, Trump was elected 50 years too late.
Now, the United States will have to fool the world that somehow, 20% of our population is still relevant and buying our debt is a great investment.
The rest need not apply.
“Readers know I hate subsidies. But I am open to them in cases of a genuine national security threat. Microchips and rare earth minerals qualify.”
Well, Intel blew its cash on stock buybacks (to goose the stock price up so the insiders can make tons of profits). Then they went to the government asking for funds, which they wouldn’t have needed if they hadn’t blown it on stock purchases.
Classic money-laundering scheme. But when the rich and the corporations benefit, the FOS libertarians are so gleeful.
Intel is the analogy of deadbeat borrower that you need to keep afloat or go over the cliff. An MBA run corporation in a ZIRP nirvana.
Many have been complaining about how stock buybacks bring little value to the economy or the country for decades. The SEC could probably put a stop to this but have refused to do so because Wall Street profits nicely from the practice.
Ukraine, Denmark, Canada, Taiwan… more and more countries are realizing that it is far more deadly to be an “ally” of the US, than to be its enemy!
– Ukraine is a joke of a Country, being run by a joke in Z who is simply getting rich off the War! No reason NOT to have Peace right now.
– Canada, is about as un-American as you can get. They are shades away from full blown Communism.
– Denmark? Are you kidding me?
– Taiwan? Are you kidding me?
They are all allies, and some are even in NATO. Can’t get any closer than that.
The U.S. doesn’t have allies. It has vassals and enemies. The enemies are doing better than the vassals lately. Any country depending on the U.S. for its security is dumb. That goes for Taiwan, too, which is not a country.
Yes, allies aka vassals – that is certainly different from enemies. That is my point.
US children fall further behind in reading, make little improvement in math on national examAnd four years from now?
https://www.cnn.com/2025/01/29/us/education-standardized-test-scores/index.html
Diversity is our strength! Plus, these kids need a couple hours per day to ruminate on getting their wieners or boobs lopped off.
Our “Teachers Unions” hard at work, collective Big Fat Paychecks, but teaching about as much as a TV show can do, so not needed, not hard, and basically babysitters. They obviously don’t teach Reading, Writing or Arithmetic if you look at the “Public Schools Test Scores”
Many can’t even speak coherently, read at more than at a 5’th grade level upon graduation, yes they still graduate these incompetent individuals, so as not to look too bad as Teachers. They would be fired long ago, if it were not for the Unions, who protect their incompetence. Some “Gravy Train” they got going on over there…
Part of the plan … dumb down America so we can manipulate them, and import intelligence via H1B. We’ll build a nation of slaves and they won’t even know they’re slaves!
“I am tired of these perpetual tariff threats with no action.”
I think what you mean is you are tired of all the tariffs and *real* threats of tariffs that are not producing the dire consequences you desire.
Nothing but wins so far. But do let us know when the sky finally falls down. Until then, these calls for doom and gloom are really getting old.
I have never seen people so happy! On TV you see it everywhere! People are just giddy with the success going on!
People did not expect this overwhelming change to take place so clearly and rapidly! The total support and backing by American Citizens is quite astonishing! This Country has Roared Back like never before, as if it has been most salivating for a savior to come along.
The U.S. Has its “Groove Back” Go Trump, Go America!!!
I am definitely enjoying the libs having a meltdown.
Tariff or no tariff, all trade with China is unfair. There is no way to compete with an enormous slave labor force. China however will always lose in the only trade that matters which is quality of life for the average citizen. Take any average rural town in China and compare it to one in the US. I say compare but it’s not a comparison.
Compare China now to China 30 years ago. Their government is more popular with its citizens than ours is.
And the ones that call Xi Pooh Bear? You really believe they built something of value in 30 years. Let me break this down for you very easy. The US poor and lower class can afford Chinese goods. The Chinese poor can’t afford their own goods. Let that really stew for about 2 seconds.
We melted down the prior 4 years… It’s only fair. Politics is a series of tantrums.
haha. Chines life expectancy has now surpassed the us. keep telling yourself this fantansy of chines “slave labor”
Never heard of Chines but I also never heard of a peasant farmer in China bragging about how much better their life is compared to the poor Americans. Life expectancy isn’t quality of life. A prisoner lives to 100 but Steve Jobs dies in his 40’s….which one would you rather be?
Steve Jobs died at age 56 and referring to his health/illness, he said, “You can hire someone to drive your car, but you can’t hire someone to lie in a hospital bed for you”, which I think shows that he felt those who lived long were fortunate. It also shows that no matter how much money someone has, it can not help when their time comes.
Upcoming issue…
Vaccine Debate – Robert Kennedy Jr. vs Alan Dershowitz
https://www.youtube.com/watch?v=IfnJi7yLKgE
FYI – this debate was in July 2020. Not a current one. (You can tell by how thin PDB is lol). Still a great debate.
Yes.
4 1/2 years later and the whole charade played out just as RFK jr said it would in this debate.
In the year of the Snake Trump reduces risks from chips invaders, encouraging internal production and trade in the US of what is the most important to our national interest, to prevent chaos and collapse. It’s a wall which protects skilled workers, innovations & knowlege bc we are lagging behind our rivals in production.
There is a growing risk of rare earth minerals snake’s bites..
Mish,
You may want to start a list of all the tariffs. Trump announces tariffs on copper and aluminum.
https://www.reuters.com/markets/commodities/trumps-copper-aluminium-tariffs-may-raise-costs-us-consumers-2025-01-28/
“It’s turtles all the way down and inflation all the way up!”
+1 for all ‘turtles all the way down’ references.
I never liked Mitch either…
I find it amusing how gullible Usonians get as soon as the cape of national security is flown.
Which successful countries don’t care about national security?
Which countries define “national security” as the need or the ability to mess around with countries on the other side of the planet????
That would be None!
We have to switch from trans panic to keep it fresh.
The problem with government grants is the reporting and compliance costs. It is easy to waste >20% of the government funding on BS paperwork to make sure you aren’t wasting government funds.
It is far more efficient to use tax policies.
This is why billions spent on wind and solar tax credits have created huge industries, while EV charger grants have accomplished almost nothing.
Ideally, the government lets markets select winners, but when intervention is needed, tax policies are far more efficient than grants.
The ‘Iron Dome for America’ BoondoggleThe only things that the U.S. would get from massively expanding its missile defense systems is a lot more debt and arms races with other nuclear weapons states.https://daniellarison.substack.com/p/the-iron-dome-for-america-boondoggle
Israel’s vaunted Iron Dome was overwhelmed by Iran’s April attack. Iran sent hundreds of cheap, slow-moving drones to absorb Iron Dome missiles (and air to air weapons fired by U.S. and Jordanian pilots). Then Iran fired its supersonic missiles which hit the intended targets – even taking evasive action to avoid Israel’s missile defense system. The U.S. needs an Iron Dome as much as it needs an expanded cavalry.
Refresh my memory. Please list the targets in Israel that Iran’s massive attack actually hit. I believe it was one airfield and some shrapnel that hit a building or two.
I’ll get a chunk of that… quite lucrative.
Presidents can’t influence interest rates?
I thought the Fed interbank rate was the benchmark. I also understood the US Treasury Secretary was a Presidential appointment as well as the individual Fed members. Each of which can be removed, by the President, for cause.
I’d say Trump can influence interest rates.
He doesn’t influence rates. If he did they will cut today. And they’re not cutting today. They shouldn’t have cut to begin with but that’s another story.
So how did we get zeroes from 2008 mostly onward if the government didnt want zeroes?
The demoncrats did it on Satan’s orders.
“…US customers will pay more than anyone else in the world for chips, and computers too…”
If this happens tons of products will increase in price. Chips are in all sorts of things from washing machines, refrigerators, heat pumps, cars, toys, phones, TVs….I could go on and on.
This is a really dumb move.
I don’t like tariffs because I’m a consumer. I don’t like working out everyday, either. A little pain upfront typically saves me a lot of pain later.
Not a tariff fan but let’s see how this plays out.
Why would you want to to pay more for a product with little to no guarantee that the stated goal of the tariff will actually come to fruition? Did tariffs work the 1st time Trump tried them? What about when Biden continued them?
I don’t understand why so many Americans tie their identity to their ability and willinness to struggle. It’s very bizarre to me.
it takes decades for new factories to ramp up for high value items. For cheap stuff, toys and underwear, that production will never return unless fully automated. either way its higher prices for everyone and the dems will use that to run successfully run against trump and undo tariffs and lower prices again
Not sure washing machines etc need cutting edge chips from Taiwan. They likely run just fine on 25 year old Pentium chips that cost 25 cents each.
A washing machine is an extravagance for a serf to begin with. There are laundromats.
Laundromats??? A stream and a rock work just fine!
Good point… as long as this doesn’t take place in the viewshed of any mansions.
The thing is Trump is totally clueless. Building a “chip plant” isn’t the only thing needed to manufacture chips, there is a whole ecosystem and supply chain that needs to be built otherwise you will constantly be exposed to tariffs on various components needed to make the chips. If I were an investor, I’d rather just pay the tariff or move manufacturing to a country where I can bypass the tariffs.
And if all of that failed, I’d just wait 4 years for Trump to be out of office then make investment decisions. It’s easy to move my capital to different investments while I wait. I’ve been avoiding real estate for 3 years now and sitting on T-Bills raking in cash. Easy peasy.
https://gordianknot.stanford.edu/sites/g/files/sbiybj22971/files/media/file/The%20Semiconductor%20Ecosystem.pdf
Semiconductor Industry Segments
The semiconductor industry has seven different types of companies. Each of these distinct industry segments feeds its resources up the value chain to the next until finally a chip factory (a “Fab”) has all the designs, equipment, and materials necessary to manufacture a chip. Taken from the bottom up these semiconductor industry segments are:
1. Chip Intellectual Property (IP) Cores
2. Electronic Design Automation (EDA) Tools
3. Specialized Materials
4. Wafer Fab Equipment (WFE) Make the Chips
5. “Fabless” Chip Companies
6. Integrated Device Manufacturers (IDMs)
7. Chip Foundries
Wait 4 years? If he keeps this shit up he’ll be a lame duck in 2. If the Democrats wisen up, they could really capitalize on this BS. I suspect they won’t though.
Not to worry, if we can’t prevent an election, we can certainly steal it by then.
So capital will be employed by self-interested persons to maximize their return? I think you’re onto something here.
Sanctions against China “never work” because China just decided to start building their own chips. Trump tariffs won’t have the same effect and new US computer chip manufacturers won’t build plants in the US? I’ll take a bit of lag to get high paying jobs in the US.
trump will be long dead before these tariffs create a single new job
I’ll still be around.