Why Taiwan Matters
The Silicon Shield Behind America’s Security and Innovation
“The next war won’t just be fought over territory - it’ll be fought over transistors.”
When Americans hear the word “Taiwan,” most instinctively think of geopolitics. A democracy in China’s shadow. A flashpoint in U.S.-China relations. A potential tripwire for global conflict. But what they should think of, first and foremost, is semiconductors.
Tiny, invisible, and indispensable, semiconductors are the strategic fulcrum of 21st-century power. And Taiwan, more specifically Taiwan Semiconductor Manufacturing Company (TSMC), is the keystone in that system. Without it, the U.S. military would lose its technological edge. The U.S. economy would lose its innovation engine. And the free world would lose its ability to outpace authoritarian adversaries.
TSMC: The Most Important Company You’ve Never Heard Of
TSMC manufactures nearly all of the world’s most advanced semiconductors, especially those at the 7nm, 5nm, and soon 3nm process nodes. These chips are what drive the most capable artificial intelligence systems, next-gen military platforms, advanced communications networks, and bleeding-edge scientific research.
American companies like Apple, NVIDIA, AMD, and even the U.S. Department of Defense depend on TSMC to manufacture chips they design, but cannot currently fabricate on U.S. soil. Even Intel relies on Taiwan’s fabs for certain high-performance production.
To put it plainly: TSMC enables the U.S. to stay ahead militarily and economically.
Why the Military Needs the Most Advanced Chips
Every major U.S. defense system, from F-35 fighter jets to missile defense arrays to future drone swarms and battlefield AI, is powered by semiconductor-based architectures. These chips are what make “smart weapons” smart.
The Department of Defense does not manufacture its own chips. Instead, it sources them from trusted foundries and commercial suppliers. And because military systems demand unique performance characteristics (like radiation hardening or low latency in autonomous systems), those chips often need to be custom-fabricated at extreme precision.
Currently, TSMC manufactures many of those chips, including field-programmable gate arrays (FPGAs) used in critical defense systems. Without that access, the U.S. defense industrial base would slow down—or worse, fall behind.
The U.S. cannot outmatch AI-enabled adversaries operating at machine speed without access to cutting-edge AI chips and those chips are made in Taiwan.
Why the Economy Needs TSMC Too
While national defense often takes priority in these discussions, the U.S. civilian economy is equally dependent. Apple, Google, Amazon, and nearly every sector of the U.S. innovation economy (including autonomous vehicles, quantum research, 5G, and biotech) requires top-tier semiconductors.
No chips, no cloud.
No chips, no smartphones.
No chips, no next-gen anything.
TSMC is the hub of that global value chain. Without it, the U.S. wouldn’t just face a temporary shortage, it would face a generational setback in innovation.
The Strategic Risk: One Island, One Company, One Point of Failure
Here’s the problem: TSMC’s most advanced fabs are all located within 110 miles of China’s coastline.
That geographic reality creates one of the most precarious supply chain vulnerabilities in the modern world. A war, blockade, coercive action, cyberattack, or even natural disaster could interrupt the flow of chips not just to the U.S., but to the entire democratic world.
Even if China never invades Taiwan, the risk of chokehold leverage over TSMC is enough to give strategists nightmares.
China’s Race to Catch Up and Control
Beijing understands this vulnerability, and is racing to overcome it. China is investing heavily in its own chip manufacturing capabilities. But it remains several generations behind. So how does it close the gap?
Industrial espionage
Technology transfer
Coercive diplomacy
Recruitment of Western experts
Potential influence over TSMC or Taiwan itself
If China succeeds in leapfrogging U.S. microelectronics dominance, every domain of warfare — land, sea, air, cyber, space — could tilt in its favor.
Reshoring Is Essential, But Not Immediate
The U.S. is building TSMC fabs in Arizona. Intel is investing in 7nm production. Congress passed CHIPS Act legislation. But these are long-term projects. For the foreseeable future, the U.S. remains dependent on Taiwan for the most advanced chips.
That’s not a slight against domestic effort — it’s a call for urgency and realism.
Why Taiwan Matters
Taiwan is more than a democratic ally. It is more than a flashpoint in great power competition. It is more than a small island resisting a larger neighbor.
Taiwan is, quite literally, the hardware backbone of American power.
It enables U.S. military superiority by fabricating chips for advanced defense systems and AI-enabled operations.
It sustains U.S. economic competitiveness by powering the private sector’s most critical innovations.
And it anchors the semiconductor supply chain in a region where authoritarian disruption is a very real threat.
Conclusion: Protecting Taiwan Protects America
If we lose Taiwan — or lose access to TSMC — we lose more than chips. We lose time. We lose capability. We lose momentum.
The United States must continue to defend Taiwan, de-risk the supply chain, and accelerate domestic semiconductor capacity. But it must also recognize that for now, and for the near future, Taiwan is the bottleneck through which American power flows.
And that makes its defense not just a moral imperative—but a strategic one.
This article reflects the personal views of the author and does not represent the official position of any U.S. government agency. It is intended as commentary and analysis in support of national security and innovation policy.
Photo by Pok Rie: https://www.pexels.com/photo/closed-up-photo-of-black-dell-central-processing-unit-1432680/