The state is free to, and often does, engage in non-profitable production to ensure essential domestic needs can be satisfied.
This doesn't make sense from a market perspective, but it can often make sense from a needs based perspective.
Of course, you can always have a newcomer who can disrupt the market but most Moore's law advancements appear to happen in government funded research labs and large semiconductor companies.
And china has been flying incursions into Taiwanese airspace with increasing regularity.
Plus, China has broken its treaty obligations in Hong Kong, and explicitly expresses the view that Taiwan is part of China, and it has no strategic semiconductor fabrication capability of its own.
Given all this, I’m not sure why you’d imagine the US would ‘start something’ purely because of the dollar amount it has spent on the military.
https://www.wsws.org/en/articles/2021/03/17/pers-m17.html
"Even as more than 1,000 people die from COVID-19 every single day in the United States, and the disease surges around the world, the US is preparing for a conflict that risks incalculable human suffering. Joining this offensive is the United Kingdom, with the highest COVID-19 death rate of the major European countries, which announced Tuesday a massive expansion of its nuclear weapons program, calling China a “major threat.”
It is not COVID-19, but China that the US has planted firmly in its sights. As Blinken made clear, “Several countries present us with serious challenges, including Russia, Iran, North Korea… but the challenge posed by China is different. China is the only country with the economic, diplomatic, military and technological power” to “challenge” the United States.
On March 10, Adm. Philip Davidson, commander of the US Indo-Pacific Command, told a Senate Armed Services Committee hearing he believes that China is likely to invade Taiwan within the next six years. “I think the threat is manifest during this decade, in fact, in the next six years,” Davidson said.
Given that the United States has, in the words of Defense Secretary Austin, “commitments to support Taiwan’s ability to defend itself,” to predict that China will invade Taiwan within the next six years is to predict a major Sino-American war within that same time period."
What it doesn’t say, is anything about the US starting something.
It’s totally absurd to consider Taiwan to be like a US state such as Texas.
For that to be a valid comparison, Texas would need to have a treaty with China where China had agreed intervene militarily to protect Texas from US federal government control.
You must know this is an absurd comparison.
https://en.wikipedia.org/wiki/Diplomacy_of_the_American_Civi...
If Taiwan is properly regarded as a domestic issue, US intervention is improper and is "starting something" that would otherwise be contained locally... much like WWI's system of alliances.
It obviously isn’s because Taiwan had long standing treaties with the US for its defense.
Your analogy implies that Taiwan is part of China, and has already started a civil war by making alliances with a foreign power.
If Taiwan was part of China and is not already engaged in a civil war, they would not have been able to make these treaties.
Taiwan has been, de facto, an independent country for over 70 years, whether other countries give it diplomatic recognition or not.
Eventually the Puerto Rican's US gets very successful within the scope of an island nation and the Confederate USA starts planning on taking PR back, but PR US has since made alliances with a global military power.
Investors will not tolerate time lines of 10+ years and hundreds of millions to billions of dollars sunk.
Most short-term <10 year innovation is industry funded.
Industry mainly provides access to the scalable means of production for tinkering, which can be owned by anyone, not just industrialists.
There might be an exception here and there, but there will be some structural reason why long term planning is possible (such as competition not being able to step on each others toes). It's not true in the general case.
No more than Taiwan getting blown up. It's going to be about balance. No good to have all the eggs in a single basket, whether that is TSMC or some subsidised national attempt.
Note that this announcement comes right on the heels of TSMC announcing that they aren't reducing their prices this year.
The USG is perfectly happy to spend taxpayer money and foreigners' money to make their corporate constituency happy even if the financial equation is overall negative.