Most of the debate about America’s technology competition with China focuses on software, algorithms, and artificial intelligence. That’s understandable. Those technologies dominate today’s headlines.

Study that competition long enough, however, and something else comes into focus. Before there can be artificial intelligence, there must first be semiconductors, the tiny pieces of silicon that make every digital technology possible. Once you understand how those chips are manufactured, you begin to understand what is truly at stake in America’s technological future.

Consider this thought experiment. Imagine someone removed every microchip from America for just one hour. Traffic lights go dark. Airliners stop flying. Banks freeze. Hospitals lose critical equipment. Military command networks fall silent. The economy does not merely slow. It stops. Those slivers of silicon have become the nervous system of modern civilization. Yet the astonishing process required to manufacture them remains one of the least understood — and most strategically important — industrial achievements in human history. Most Americans have no idea.

What a Chip Actually Is

Think of a microchip as a city compressed onto a piece of silicon smaller than your thumbnail. Roads connect neighborhoods. Traffic lights control movement. Power stations provide energy. Now shrink everything until it fits on your fingernail and replace vehicles with electrons racing through microscopic pathways at nearly the speed of light. The intersections are transistors — tiny electronic switches that turn signals on and off billions of times every second.

The latest processors contain tens of billions of those switches — more than there are people on earth — packed into a surface you could cover with your thumbnail. Together they process information, store data, perform calculations, and control machines: the brain inside every modern machine, from a smartphone to a satellite to a precision-guided weapon. The average modern vehicle now contains more than 1,700 of them. A decade ago, it was a fraction of that number.

The Most Astonishing Factory on Earth

People assume chips roll off an assembly line the way appliances do. Nothing could be further from reality. A leading-edge semiconductor fabrication plant (a “fab”) costs $20 to $40 billion to build and takes years to construct. Even then the fab is only the beginning.

Inside one, some of the world’s best engineers begin with silicon purified to extraordinary levels, because impurities invisible to the naked eye destroy chips. A nearly flawless silicon crystal is grown, sliced into wafers, and then subjected to more than a thousand individual process steps. The chip is not carved. It is built, layer by microscopic layer, sometimes more than one hundred layers, each aligned within a few nanometers. Features are measured in billionths of a meter — dimensions so small they are difficult to comprehend.

The key tool in this process is extreme ultraviolet lithography (EUV). Those machines contain more than 100,000 precision components, cost hundreds of millions of dollars each and fire lasers at microscopic droplets of molten tin to generate the light needed to print circuit patterns onto silicon. A single dust particle invisible to the naked eye can ruin an entire production run. Chipmaking cleanrooms are dramatically cleaner than hospital operating rooms. We admire aircraft carriers and celebrate rocket launches. The fab engineers quietly working inside these anonymous buildings may be performing an equally consequential feat of human ingenuity.

Why Almost Nobody Else Can Do This

Only a handful of places on earth produce the world’s most advanced chips. Taiwan Semiconductor Manufacturing Company (TSMC) leads in high-volume manufacturing of cutting-edge logic chips. The Dutch company ASML is the world’s sole producer of extreme ultraviolet lithography machines. Japan supplies specialty chemicals and materials the industry cannot function without. South Korea dominates memory. America leads in chip design, research tools, and the software ecosystem. No single nation, including the United States, controls every link in this chain.

The deeper question is why more countries cannot simply build their way in. Economists call it tacit knowledge. You can purchase equipment. You cannot purchase the accumulated judgment of engineers who have spent careers solving problems no textbook anticipated. Supplier relationships and the hard-won ability to diagnose invisible production failures take decades to develop.

China has poured more than $150 billion in state-led investment into its semiconductor industry — roughly three times what the CHIPS and Science Act of 2022 earmarked for domestic U.S. production. Beijing’s military-civil fusion strategy is designed to ensure that advances in civilian semiconductor technology strengthen the People’s Liberation Army as well.

The Foundation beneath the Contest

Earlier this year I argued that this contest ultimately concerns who controls the infrastructure of advanced computing. Semiconductors are the physical foundation beneath that infrastructure — beneath every automated system, command network, and weapons platform either nation deploys. Without advanced chips there is no meaningful leadership in artificial intelligence or autonomous weapons. China’s 15th Five-Year Plan uses language comparable to wartime mobilization in its drive for semiconductor self-sufficiency, and its computing infrastructure is explicitly designed to serve military ends. Export controls are slowing Beijing’s access to the most advanced equipment. But China is not standing still, and the pace of its investment has not slackened.

What America Must Do

America has begun rebuilding its semiconductor base. In March 2025, TSMC announced that its total U.S. investment would reach $165 billion — the largest foreign direct investment in a greenfield project in American history — covering six fabrication plants, two advanced packaging facilities and a research center near Phoenix. The CHIPS Act delivered $6.6 billion in direct funding to anchor that build-out. The foundation exists. The self-imposed obstacles are what remain.

Those obstacles are not abstract. Advanced fabrication plants should be treated as critical national infrastructure — in the same category as nuclear laboratories, permitting timelines compressed accordingly. Reliable electricity has become a strategic resource. Semiconductor fabs require enormous and uninterrupted power; a grid that cannot guarantee supply is a grid that cannot sustain a fab. And talent is the foundation beneath everything else. America cannot produce enough semiconductor engineers and technicians from its current educational pipeline. That pipeline must be widened, deliberately and urgently.

None of this is a solo endeavor. The advanced chip supply chain spans continents. Deepening semiconductor cooperation with Taiwan, Japan, South Korea, and the Netherlands is as much a strategic necessity as any military alliance America maintains.

The Stakes

Daniel, a captive in the most technologically and militarily advanced empire of his age, did not despair at Babylon’s power. He asked God for wisdom to understand what human ingenuity had built — and what only God could reveal. “Blessed be the name of God forever and ever,” he prayed, “to whom belong wisdom and might. He changes times and seasons; he removes kings and sets up kings; he gives wisdom to the wise and knowledge to those who have understanding” (Daniel 2:20–21, ESV). That is not a counsel of passivity. It is a call to faithfulness within the contest — to bring wisdom, discernment, and long-range thinking to decisions that will shape what the next generation inherits.

Tomorrow morning your alarm will ring, your phone will wake you, your car will start. You’ll never think about the tiny chips making those ordinary moments possible. That’s understandable.

But America must.

Because those microscopic pieces of silicon are becoming what oil was during the last century, the indispensable resource upon which prosperity, military strength, and freedom depend. The contest to master them is a contest over who will build the future.