New York Times: Visions of a U.S. Computer Chip Boom Have Cities Hustling

November 17, 2021 Media

TAYLOR, Texas — The shortage of computer chips has zapped energy from the global economy, punishing industries as varied as automakers and medical device manufacturers and contributing to fears about high inflation.

But many states and cities in America are starting to see a silver lining: the possibility that efforts to sharply increase chip production in the United States will lead to a busy chip factory in their backyard. And they are racing to get a piece of the potential boom.

Steve Adler, the mayor of Austin, said subsidies that Austin gave to Samsung in the 1990s had had a positive effect on the city, which has seen rapid growth in recent years. Tesla and Oracle recently moved their corporate headquarters to Austin, and Facebook and Apple have large operations there. By one estimate, the city is the nation’s top site for commercial real estate investment.

Austin and its surrounding county have held their own talks with Samsung about the new factory the company has planned. Mr. Adler said he wanted the city to be a competitive site for the Samsung plant.

“It certainly paid a huge benefit to our city and our region, having them here,” Mr. Adler said about Samsung. But Pat Garofalo, the director of state and local policy for the American Economic Liberties Project, a liberal group that is critical of large tech companies, said the money would be better spent on projects that made a city attractive to a wide variety of businesses — like public schools — instead of on a single suitor.

He said the manufacturers sensed the “very real problem” of the semiconductor shortage and “are using it to capitalize on the tendency among state and local officials to pay a lot of taxpayer money for hosting one of these facilities.”