In recent weeks, Nvidia’s CEO Jensen Huang waxed effusively about Taiwan Semiconductor Manufacturing Co. (TSMC), claiming that anyone investing in the company would be “very smart.” At a glance, this might seem like a routine endorsement coming from a CEO, but beneath the surface, it encapsulates a profound reorientation of global tech power. While Washington burns with ambitions to dominate semiconductor manufacturing through initiatives like the CHIPS Act, real power resides with Taiwan and its semiconductor giants. Nvidia’s praise isn’t merely about gratitude; it’s an implicit acknowledgment that the true backbone of modern chip manufacturing, and therefore technological innovation, is increasingly dependent on Taiwan—regardless of U.S. government bravado or ambitions for independence.
In this context, the U.S. effort to acquire stakes in foreign chipmakers or to bolster domestic production is more symbolic than substantive. TSMC’s superiority in manufacturing technology and global dominance means that any attempt by Western governments to wield influence—or worse, control—over these firms risks exposing a fundamental vulnerability. If anything, Nvidia’s glowing words highlight how Taiwan’s semiconductor ecosystem acts as an indispensable linchpin in the global supply chain. The statement that “anyone who wants to buy TSMC stock is very smart” is more than praise; it’s a subtle, yet striking, recognition of Taiwan’s strategic centrality that no amount of legislation or subsidies can easily replicate.
The US’s Grey Zone Strategy and Its Limitations
The American government’s push to invest in semiconductor firms—most notably through the CHIPS Act—is driven by a desire to regain technological sovereignty. But reality exposes the limitations of this approach. Funding and fiat cannot substitute for the intricate, world-class expertise cultivated over decades in Taiwan. TSMC has been refining its manufacturing processes for years, perfecting the art of advanced chip fabrication in a manner that U.S.-based firms are only beginning to catch up with.
The Biden administration’s efforts to deepen U.S. involvement—such as promising billions in grants to Arizona plant projects and seeking equity stakes—are well-intentioned but fraught with challenges. For one, these initiatives risk fostering a false sense of security. Investing in local fabrication plants cannot mimic the global supply network that Taiwan has built through years of strategic focus. Moreover, the U.S. ambitions to take stakes in TSMC or other foreign firms might instead alienate the very partners needed to sustain a resilient supply chain.
Nvidia’s emphasis on TSMC’s technological prowess underscores where true power lies: in the specialization, innovation, and strategic positioning Taiwan holds. Washington’s focus on acquisition and control may be appealing politically, but these moves overlook the complex realities of international manufacturing networks. The recent tightening of export restrictions on Nvidia’s chips to China further demonstrates how geopolitics and supply chain resilience are intertwined—yielding a fragile balancing act that could backfire if Taiwan’s strategic position is undervalued.
Economic and Geopolitical Dependencies: An Uncomfortable Reality
Taiwan’s expanding investments and partnerships abroad are signs of resilience, not complacency. TSMC’s announcement of a $165 billion investment in the U.S. signifies recognition that establishing fabrication facilities in America is part of a broader geopolitical chess game. It is a move driven by necessity as much as opportunity, but it does not diminish Taiwan’s overwhelming dominance in the sector.
Nvidia’s growing footprint in Taiwan and its active collaboration with local system vendors and chipmakers exemplify how global supply chains are deeply embedded with Taiwanese industry. AI chips, CPUs, and general-purpose processing units—these high-tech products are currently crafted on Taiwanese soil, with the US and China competing for influence over its future. Nvidia’s challenges with China, such as export restrictions on its H20 chips, highlight an uncomfortable truth: regardless of economic or strategic intentions, Taiwan remains the keystone.
The relationship between these global powers and Taiwan has evolved into a complex dependency, one that must be acknowledged rather than dismissed with nationalistic bravado. The Chinese security concerns over Nvidia’s chips, for example, exemplify how intertwined geopolitics and technology are. Despite U.S. efforts to decouple and diversify supply chains, the fundamental reliance on Taiwanese manufacturing persists. The “smart” investors acknowledging TSMC’s significance are quietly recognizing that the real leverage lies with Taiwan itself—not through political rhetoric, but through technological mastery and strategic positioning.
Technology as the New Sovereignty: An Inevitable Reality
The narrative surrounding U.S. efforts to dominate semiconductor manufacturing is partly rooted in a desire for technological sovereignty. Yet, as Nvidia’s praise reveals, sovereignty in the modern era is increasingly about control over complex, globalized supply chains that hinge on Taiwan’s unrivaled expertise. Washington’s policies risk forcing an awkward, costly pivot that could impair innovation and inflate costs without unlocking the strategic advantages they seek.
In the grand scheme, Nvidia’s leadership—through expressions of gratitude and the expansion of its Taiwanese operations—illustrates how the future of tech leadership is more likely to be shaped in Taiwan than in either Washington or Beijing. The assertion that “anyone who wants to buy TSMC stock is very smart” is not merely flattery; it is an implicit recognition that the real game is played in mastery of manufacturing precision, technological adaptability, and geopolitical resilience.
As the world increasingly depends on the semiconductor industry not just for economic growth but for national security and global influence, the centrality of Taiwanese firms becomes all the more apparent. Any center-right liberal perspective recognizes that protecting these strategic assets involves nuanced policies—neither heavy-handed nationalism nor naive dependence but a pragmatic acknowledgment of where real power resides. Nvidia’s comments serve as a wake-up call: the future of global tech dominance is being shaped in Taiwan, and the United States must adapt its strategy accordingly, not through bravado but through genuine partnership and respect for Taiwanese innovation.