Through the combination of world-class research and entrepreneurial spirit the United States created the semiconductor industry and that country's companies, most notably Intel, have led it ever since, up until now.
Now the US is fighting hard to maintain its strategic position against the rising tide of technical and volume capability in China (see US government reinforces Huawei chip embargo). That is a problem of the United States' own making. In the 1990s it relaxed the Cocom regulations it had imposed on the world because it's semiconductor ecosystem companies wanted to be able to sell to a larger market.
Meanwhile raw technical leadership in semiconductors has moved to South Korea and Taiwan. These are, effectively, client states whose independence from China is guaranteed by the US. But the fact that the leadership has now passed from Intel to Samsung and TSMC and the most advanced manufacturing could become unavailable to the US, is clearly driving the US government to provide strategic support for on-shore manufacturing (see CHIPS for America Act promises $22.8 billion in aid and Second piece of US legislation earmarks $25 billion for domestic chip making).
But even if European politicians have also grasped the seriousness of the situation they may have limited understanding of the complexity of technical development and how long it takes to attract and nurture the talent and build up capability.
So we now come to the time-scale element.
Napoleon Bonaparte said of battlefield dynamics: "Space we can recover, lost time never."
The €145 billion -- if it is real money rather than a European Union accounting artefact -- may be enough money to alter the semiconductor landscape in Europe and the situation is urgent. But if you spend that money too quickly you will almost certainly spend it unwisely and waste it. Do not underestimate the amount of time it takes to develop a semiconductor ecosystem. Perhaps the politicians do not realize how far behind the leading-edge Europe has fallen and that the leading-edge is now a very specialized place devoted to consumer electronics and high-performance computing.
The idea that Europe will design AND manufacture at 2nm within five years is not only almost impossible to imagine but may be ill-advised despite the strategic aims of self-sufficiency in key technologies.
Repair the disconnect
If we set aside the amount of money and the timescale there are other issues this initiative needs to address. Not least that at present it is solely a political instrument that lacks the commitment of the companies that would be required to act out its requirements and achieve its goals.
We have been here before. Back in 2013 the European Commission was talking about creating an Airbus of Chips (see European Commission repeats call for "Airbus of chips"). The semiconductor companies in Europe, then as now, are multinational enterprises responsible to their shareholders, not to the European Commission or even to their national governments, and they have to deal with the world as it is – including the cost of capital.
As a result, the CEOs of the day had little interest in European strategic thinking and continued to pursue fab-lite strategies albeit with some additional focus on specialized manufacturing. I am thinking of power electronics in the case of Infineon and sensors in the case of STMicroelectronics.
So how will these 17 countries' politicians change European chip companies' responsibilities and actions in the 2020s?
At present I don't think those politicians know the answer to that question, and that is worrying.
Next: Don't spread the butter too thin