America Built the World’s Chipmaking Industry. Why Are We Making It Harder for American Companies to Compete?

For the better part of four decades, the United States has held one of the most strategically important advantages in the global semiconductor race. While much of the public debate focuses on companies that manufacture chips, America’s true competitive edge extends much deeper into the supply chain.

American companies build the sophisticated equipment, software, and engineering tools that make modern semiconductor manufacturing possible. 

From Lam Research and Applied Materials to KLA, Cadence, and Synopsys, these companies represent an industrial ecosystem that no other country has been able to replicate. Every advanced semiconductor factory in the world depends on technologies developed by American innovators. American equipment companies comprise approximately 50% of global equipment output, and 3 of the top 5 equipment companies are American. 

That leadership is one of America’s greatest strategic assets, but it is perishable. Two Chinese semiconductor equipment companies rank in the top 10 in 2025; an unimaginable situation in 2020, one that nobody can afford to undermine.

President Donald Trump has made winning the technological competition with China a defining objective of his administration. Strengthening domestic manufacturing, protecting critical technologies, and preventing China’s military from acquiring advanced semiconductor capabilities are all worthy and necessary goals. 

Export controls play a central role in achieving those objectives. 

But export controls only work when they are administered efficiently, consistently, and predictably. Used appropriately, they can prevent crown jewel technologies from going to military end users. Used too broadly, they are a petri dish to incubate non-American technology. Striking the right balance is crucial for maximizing US competitiveness and supporting the Administration’s pro-export, pro-growth, pro-market access goal. Recent reporting by POLITICO raises serious questions about whether the Commerce Department’s Bureau of Industry and Security (BIS) is executing one of the administration’s most important national security missions. According to the report, former BIS officials and others familiar with the agency describe delays in export license approvals, a slowdown in rulemaking, and growing uncertainty surrounding export controls. BIS disputes those claims, arguing it has adopted a more rigorous review process rather than the “rubber-stamping” of prior administrations.

Regardless of where one falls in that debate, uncertainty carries real costs.

Companies like Lam Research, Applied Materials, KLA, Cadence, and Synopsys operate in highly competitive global markets. Their customers are making billion-dollar investment decisions years in advance. Manufacturing schedules, capital expenditures, and supply chain planning all depend on clear regulatory expectations.

When export licensing becomes unpredictable, American companies don’t simply pause business. They face uncertainty that affects hiring, investment, production planning, and customer confidence. Reductions to revenue cause these companies to spend less on R&D, and their stock price can tank upon news of new competition from China. 

Meanwhile, foreign competitors have every incentive to capitalize on that uncertainty.

None of this suggests America should weaken export controls. 

Quite the opposite.

The United States should maintain the strongest export control regime in the world for technologies that advance China’s military capabilities. But strength should not be confused with delay.

A licensing system that takes longer than necessary to reach decisions does not automatically improve national security. Instead, it risks creating uncertainty for the very American companies Washington depends upon to maintain its technological advantage. It does not make sense to deny and delay shipments when there are foreign alternatives that have the same function.  

The semiconductor competition with China is not simply about who builds the most factories. It is about who controls the entire innovation ecosystem—from design software and manufacturing equipment to advanced materials and engineering expertise.

That ecosystem remains overwhelmingly American.

Washington should be asking a simple question: “Are we helping those companies compete, or are we making it harder for them to do what they already do better than anyone else in the world?”

President Trump has correctly identified semiconductors and artificial intelligence as central to America’s economic and national security future. Congress has invested billions in rebuilding domestic manufacturing. American companies continue to lead the world in semiconductor equipment and software.

Now the federal government must ensure its own regulatory processes reinforce that advantage rather than inadvertently weakening it.

China is moving aggressively to reduce its dependence on American technology. The United States should not make that task any easier through regulatory uncertainty at home.

America built the world’s semiconductor ecosystem.

If the US intends to keep it, policies must protect national security while giving American innovators the clarity and confidence they need to continue leading the world.