AYESHA RASCOE, HOST:
During the drama of last week's presidential debate, you might have missed this exchange.
VICE PRESIDENT KAMALA HARRIS: Under Donald Trump's presidency, he ended up selling American chips to China to help them improve and modernize their military.
DONALD TRUMP: First of all, they bought their chips from Taiwan. We hardly make chips anymore.
RASCOE: Chips can be found in almost all of our devices - phones, fridges, cars - and there's a battle playing out over who develops, makes, and controls them. Chris Miller is a professor at Tufts University, and the author of "Chip War: The Fight For The World's Most Critical Technology." Welcome to the program.
CHRIS MILLER: Thank you for having me.
RASCOE: They're called chips or semiconductors. What are they?
MILLER: Well, a chip is a piece of silicon with thousands or millions or often billions of tiny circuits carved into them. And these are the circuits that provide all of the ones and zeros that undergird all computing in your phone and your computer. But increasingly important is their role in data centers, where they're used to develop and to train AI systems and to fit billions of tiny circuits on a small piece of silicon, they have to be tiny. The smallest of them are the size of a virus.
RASCOE: Why have chips become such a big political and economic issue in recent years?
MILLER: Today, most of the advances that we're seeing in artificial intelligence are driven by the manufacture and design of better and better semiconductors. And so all of the world's major governments, as well as the biggest tech companies are focusing more than ever before on making sure they have access to the most cutting edge semiconductors.
RASCOE: Is it really just about AI, or is it also about, like, military use and weapons?
MILLER: Well, there's really no distinguishing those two, because just like consumers will use AI and companies will use AI, militaries and intelligence agencies already are for their own applications. And so when it comes to a core technology like this, which will undergird how economies and societies function, there's no clean differentiation between civilian versus military. And that's why the U.S. government has rolled out a series of restrictions that limit the ability of adversary countries to acquire cutting-edge U.S. chips.
RASCOE: As you just mentioned, so President Biden had put restrictions on the most sophisticated chips being sold to China. How effective have those restrictions been?
MILLER: Well, it's now been over half a decade since the U.S. first imposed restrictions on the sale of chip-making equipment, as well as advanced chips to Chinese firms. And China is spending tens of billions of dollars a year trying to catch up technologically to the U.S., but it's still meaningfully far behind, and the restrictions that have been in place haven't halted China's technological development, but they certainly have slowed it, making it more difficult for Chinese firms to produce cutting-edge chips at scale.
RASCOE: While China is not able to get these chips from us now and they're developing their own technology - is it the idea that the U.S. will be able to get ahead of China because China has to try to catch up?
MILLER: That's exactly right. And the chip industry races forward with faster technological improvements than almost any other segment of the economy? It's known as Moore's law, the idea that the computing power of chips doubles every two years. And so the U.S. is betting that because it and its friends have some of the most innovative and capable companies, it's likely to stay ahead of China at least for the foreseeable future. And if it does so, it'll have privileged access to the types of chips that make training bigger and better AI systems possible.
RASCOE: But the U.S. strategy has also been to try to beef up chip production at home. Why are they focused on that?
MILLER: Well, here's the thing. The most advanced chips are designed by US companies, firms like Invidia or AMD, but they're largely manufactured in Taiwan, where the Taiwan semiconductor manufacturing company produces around 99% of the world's AI accelerator chips. As tensions between China and Taiwan ramp up, and as the U.S. gets concerned about the security situation in the Taiwan straits, there's real worries that we're over reliant on Taiwan. And that's spurred Congress, as well as the Biden administration to support manufacturing operations in the United States with the aim of diversifying the supply of chips.
RASCOE: So who has the upper hand for control of these chips right now?
MILLER: The U.S. has an advantage, but it's only in partnership with Taiwan, Japan, and, like, the Netherlands, all of whom work together to produce the capabilities that are necessary to manufacture the most advanced chips, and you really can't do it. You can't make the cutting edge chips that AI requires without tools and materials and software from each of these countries. And that gives the Western allies an advantage over China, but it's not guaranteed to be the case going forward. And I think the U.S. has more work to do to guarantee that its companies have the right environment needed to make sure that they keep winning this race, because if they ever slow down, there's no doubt that Chinese firms are right behind them trying very hard to catch up.
RASCOE: That's Chris Miller, author of "Chip War." Thank you so much for joining us.
MILLER: Thank you for having me. Transcript provided by NPR, Copyright NPR.
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