Through government investments and subsidies, as well as intellectual property theft of companies like Idaho’s Micron, China has tried to dominate the $1.5 trillion electronics industry, reports Material Handling & Logistics (July 31, 2019). This, according to the U.S., creates serious, far-reaching threats to the supply chains that support the U.S. government and military. The MICROCHIPS Act, introduced July 30 in the U.S. Senate, creates a “coordinated approach to identify and prevent these efforts and others aimed at undermining or interrupting the timely 
and secure provision of dual-use technologies vital to national security.”
Chinese companies, according to Senator Mark Warner, which export telecommunication technology equipment into software, hardware, and services used in the U.S., hope to export 5th-generation technology (5G) to the U.S. that could potentially harm and expose both consumer and U.S. military information. “While there is broad recognition of the threats to our supply chain posed by China, we still lack a coordinated strategy to defend ourselves,” said Warner. “As a result, U.S. companies lose billions of dollars to intellectual property theft every year, and counterfeit and compromised electronics in U.S. military, government and critical civilian platforms give China potential backdoors to compromise these systems. We need a national strategy to unify efforts across the government to protect our supply chain and our national security.”
The MICROCHIPS Act addresses China’s practice of four major areas of electronic warfare, including supply chain exploitation through supplying faulty software hardware and components; cyber-physical attacks on U.S. systems; cyber-attacks on computer systems; and bad actors gaining sensitive information.
Classroom discussion questions:
- What is the purpose of the MICROCHIPS Act?
- What supply chains is the Senate most concerned with?