The US triumph in the global microchip showdown

A Cold War tech gambit

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

In 1962, Soviet leader Nikita Khrushchev welcomed Joseph Berg and Philip Staros, two former Silicon Valley engineers who had defected from the US. Their goal? To establish a Soviet microtechnology hub, mirroring the innovation that fueled America’s semiconductor rise.

Zelenograd’s copycat approach

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

Rather than encouraging original innovation, scientists at Zelenograd relied on smuggled US technology. Instead of leading the charge, they remained stuck one step behind Silicon Valley.

The innovation gap

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

Moore’s Law, which predicts that transistor counts on chips double roughly every two years, highlights why both the USSR and China have struggled to match the rapid semiconductor advancements made by the US and Taiwan.

The market advantage

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

Economic policy played a key role in the Soviet Union’s struggle to compete in chip innovation. As Chris Miller, author of 'Chip War,' notes, the US benefited from a large civilian market, driving demand and innovation, which the USSR couldn’t replicate.

Markets divide east and west

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

During the Cold War, the US benefited from global markets with a strong demand for semiconductors, whether for military or commercial use. In contrast, the USSR was limited to the Communist bloc, restricting its ability to match America’s semiconductor scale.

The fall of Zelenograd

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

When the Soviet military disbanded in 1992, Zelenograd’s fate was sealed. Its semiconductor fabs, where silicon wafers became integrated circuits, were shut down, and the once-restricted city slowly reopened to the public, marking the end of its microchip ambitions.

Russia’s semiconductor shift

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

Moving away from microtechnology, the Russian Federation shifted focus to energy and raw materials. Today, the Kremlin depends largely on semiconductors from US-aligned countries like Taiwan and South Korea, a reliance that weakens its military capabilities.

How China boosted others' tech

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

In China, political persecution during Mao Zedong’s Cultural Revolution (1960s–70s) devastated the country's tech sector.

Starting behind

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

After the Cultural Revolution ended and Deng Xiaoping took over, China’s emerging semiconductor industry remained far behind its global competitors, struggling to match the technological progress achieved by rivals like the US and Taiwan.

Staying in the game

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

Unlike the Soviet Union, China has remained competitive in the semiconductor race. Its resilience can be attributed, in part, to Beijing's embrace of a more open economic model following Mao Zedong's death, which allowed for greater technological advancement.

State control and stagnation

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

Limited privatization once helped Chinese tech firms thrive, but Xi Jinping’s recent crackdown on private enterprise is curbing growth. Increased state involvement in the tech sector risks repeating the Soviet Union’s mistakes.

The US's foreign dependence

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

Ultimately, the US relies on foreign technology in ways comparable to, or even greater than, Russia and China. Key American consumer goods, like iPhones and Teslas, would vanish from the market if Taiwanese chip suppliers faced disruptions.

US-Taiwan trade risks

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

Reshoring microchip manufacturing remains a formidable task. Despite substantial subsidies provided by the 2022 CHIPS and Science Act, the complexity of establishing domestic production poses significant troubles.

Lessons from China

A Cold War tech gambit, Zelenograd’s copycat approach, The innovation gap, The market advantage, Markets divide east and west, The fall of Zelenograd, Russia’s semiconductor shift, How China boosted others' tech, Starting behind, Staying in the game, State control and stagnation, The US's foreign dependence, US-Taiwan trade risks, Lessons from China

As the US explores semiconductor development options, China’s efforts offer valuable lessons. Challenges such as talent mismanagement, overregulation, and corruption have hindered China’s progress and serve as cautionary examples.

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