The U.S. government is very, very, very interested in computer chips — or, more specifically, who is designing and manufacturing computer chips.

Case in point: On Tuesday, the Commerce Department revoked a waiver it had granted Taiwan Semiconductor Manufacturing Company to use U.S. machinery to make older generation semiconductors at a plant in China.

From President Biden’s CHIPS Act to President Trump trying to get an equity stake in Intel, the federal government has taken a proactive role in beefing up the U.S. chip industry. How’s that working out?

Pretty much all the most advanced computer chips in the world — the kind that power cutting-edge AI technology like ChatGPT — are made in Taiwan by TSMC.

With Taiwan's very existence being something of a sore spot for China, that’s a problem.

“There was a recognition, both in the U.S. government as well as, you know, in Taiwan and TSMC, that that there's just a geopolitical need to shift some of the, some of the production to the U.S.,” said Matt Pearl at the Center for Strategic and International Studies.

So with a $6.6 billion enticement from the CHIPS Act, TSMC started building those massive chip plants in Arizona you’ve probably heard about.

Chip manufacturing started late last year and TSMC Arizona is now churning out semiconductors for phones and other electronics, the first of their kind made on U.S. soil.

But Pearl said we’re still a ways away from being close to what they have 100 miles off the Chinese coastline.

“It’s gonna take time,” he said. “It’s not only a matter of building the facility and having things in place, this is really deep, deep process knowledge that you have in Taiwan.”

Like the Biden White House, the Trump administration still wants to reshore chip manufacturing and keep China behind on the latest chip tech.

But it’s tactics are different. See: Uncle Sam’s 10% ownership stake in Intel in exchange for CHIPS funds.

 Stacy Rasgon at Bernstein Research said American chip fabricators are few and far between.

“So if you want a U.S.-based or U.S.-headquartered company that can do leading edge manufacturing as well as leading edge R&D, Intel is the only game in town,” he said.

But Rasgon worries even if the government has a passive share in Intel, it’s possible politics could sway the company in the wrong direction, like pushing it to manufacture AI chips it may not be that good at manufacturing.

“If you built out a semiconductor factory with no customers, you’re basically just digging a hole, throwing money into it and setting it on fire,” he said.

And a 10% equity stake in a fire hole may not be worth all that much.