Doge Hubris: The Chips and Science Act was signed into law in August 2022 by President Joe Biden, providing hundreds of millions of dollars to boost the US domestic semiconductor industry. The bipartisan bill combined two separate drafts: the Endless Frontier Act and the Chip for America Act. However, he is now essentially dead as there are no federal employees left to manage the plan.
Technology consulting firm Semiconductor Advisors cites unnamed sources, recent news reports and previous statements from Trump administration members, predicting the imminent end of the Chip and Science Act fundraising initiative. According to the SA, the law never achieves its ambitious goals due to mass shootings of federal employees enacted by the new US administration and Elon Musk’s Doge organization.
The Chips Act funding project is managed by employees hired last year by the National Institute of Standards and Technology (NIST). However, the administration is currently planning to fire around 500 NIST employees due to “probation” status, the SA reported, and plans to effectively dismantle the core workforce responsible for overseeing the initiative. Without these staff, no one will prove that the company meets the legal requirements for receiving allotted funds.
SA has also condemned the management of “taking of Congress through mass shootings.” The company has referenced a recent report on Trump’s plan to dismiss NIST probation staff, saying it expects internal sources at the agency to avoid and lose their jobs. The reduction will also affect the US AI Safety Institute, which was working to implement new safety regulations for future AI models.
NIST is preparing to fire 497 employees, sources report. The affected experts include 74 postdoctoral researchers, 57% of staff working on chips, and 67% of R&D personnel. The agency itself faces an uncertain future, as President Trump has yet to appoint new leaders to lead the organization.
Trump’s main focus is enforcing tariffs to promote domestic semiconductor manufacturing. A new 25% collection for imported semiconductor products is expected soon. However, SA argues that this approach is deeply flawed. “I don’t think the administration is fully considering all the impacts, as 100% of AI chips are imported from Taiwan,” SA said.
Furthermore, the increase in the share of Intel-designed chips is produced by TSMC and other foreign foundries in Taiwan, but the majority of AMD and memory chips come from overseas. Overall, more than 80% of chips sold in the US are made in the foreign country.
According to the SA, this is not a bluffing or negotiation tactic, but a complete change in strategy by the new administration. Chipmakers who had planned to fund U.S. operations through the Chips Act are now likely to abandon their plans, leading to an industry-wide slowdown in 2025.
