Cold War Temperature Dialed Up Ahead Of Yellen’s Beijing Visit
Stay out of our clouds. (There's a balloon joke there.)
The Biden administration is poised to cut Chinese companies off from Amazon Web Services and Microsoft Azure, or at least constrain their access to the platforms when used for the purposes of A.I. development.
That's according to The Wall Street Journal, which contextualized the prospective move by reference to the new restrictions on chip exports discussed here+ last week. The White House, the Journal said, is trying to "clos[e] loophole
It is starting to look to me to like this is escalation of tensions for escalation sake by the Biden administration, I will give them the benefit of the doubt, but I would also like to see an honest effort to engage with China, not just curtail and sanction.The current path only leads to confrontation, not pretty or beneficial to either country. Have sanctions really been effective in Russia or Venezuela so far? We have weakened those regimes but they persist, is regime change the ultimate goal in China? Diplomacy seems to have perished along with common sense in the US. I don’t like a lot of what is going on in China nor do I approve of the way China conducts internal and international policy, but I don’t like the odds of trying to bully Xi and the party into submission, there has to be a middle ground.
The US-China trade war is closely linked to the China-Taiwan dispute and Taiwan’s semiconductor capacity. If China lacks advanced semi capacity, then China should be less willing to risk destroying Taiwan’s semi capacity in a war. When the US has advanced semi capacity, then the US should be less focused on preserving Taiwan’s semi capacity. As more advanced fabs and the rest of the semi ecosystem are built in the US over the next several years, the motivations may evolve. Perhaps not in Taiwan’s favor.
A minor detail on rare earth minerals. Supplies are, indeed, abundant around the world. What are not abundant are refineries to create useful metals from the ores. At the moment, most of that refinery capacity is in China. That’s partly because the refineries are very polluting. Few countries or localities have welcomed them, though two projects are under construction in the US. Not sure how soon they will produce meaningful amounts.
Gallium and germanium seem to be available from non-China sources, including the refined material.
https://www.asahi.com/sp/ajw/articles/14948979
So China has less leverage than with rare earths. Even with rare earths, alternate sources have been/are being developed (Australia, US).
A couple of projects under construction, not currently producing refined metals. Sorry, but even when the MP & Lynas smelter projects in Texas are finished, they will hardly be producing enough to replace Chinese supply.
Large production projects, and at least one refining project, in Australia too.
Despite what the China hawks in the US say, we are far from self-sufficient in logic chips and rare earth minerals. For instance, the completion date for the TSMC fab in Phoenix keeps getting pushed back. And even when it is up and running it will not supply anywhere close to US needs.
Rare earth mineral smelters remain in the planning or under construction stages.
For years our friends in the GOP fought against any aid to domestic chip producers, rare earth minerals, solar panel technologies etc = “We don’t pick winners. Don’t you remember Solyndra?”
Leaving it all to the private sector ….