In her pitch for how the U.S. should get ahead, Vice President Harris pointed out AI and quantum computing—the latter still a largely experimental technology—as key industries. Meanwhile former President Trump argued that U.S. advanced chip production has dwindled since he left office, casting blame on the Biden administration, including Harris. 

The discussion, which lasted only a few seconds, came as both political parties focus on growing competition with China and the promise of AI. The U.S. and China are engaged in a back-and-forth of trade restrictions, and with the threat of China taking military action in Taiwan, the U.S. is looking to protect its own national and economic security by subsidizing domestic chipmaking. Like most of the world, the U.S. relies heavily on the Taiwanese manufacturer TSMC for semiconductors.

On the debate stage, Harris accused Trump of letting China buy American chips that let it advance its military during his time in office.

“He basically sold us out,” Harris said. Any U.S. trade policy with China should focus on making sure America “wins the competition for the 21st century,” she added. 

That means investing in U.S. technology and workers “to win the race on AI” and quantum computing, the vice president continued.  

While the Biden administration has expanded controls on the export of critical technologies to China since 2022, experts note that Trump started that trend back in 2019, when his administration banned sales to companies such as the Chinese smartphone maker Huawei. What the vice president was likely referencing were the loopholes in the Trump administration’s blacklist of products, like limited restrictions on advanced chips and waivers for American companies looking to grow market share abroad. 

Trade with China has been increasingly restricted under the Biden administration, with new limitations added as recently as last week and with a focus on high-tech sectors. 

While important, “export controls are not a panacea,” says David Sacks, a fellow for Asia studies at the Council on Foreign Relations. Government subsidies and investment by U.S. companies also play a role in security and competitiveness, he adds. 

During the debate, former President Trump countered that American manufacturers “hardly make chips anymore,” echoing criticisms he made to Bloomberg Businessweek in June. Harris reportedly shook her head off camera at this remark. 

In 2022, Biden signed the CHIPS and Science Act, which allocates around $50 billion to boost chip manufacturing in the U.S. The government has already allotted $6 billion for a TSMC factory in Phoenix, where work is now underway after some delay. Intel got $8.5 billion in CHIPS funding for projects in Arizona, New Mexico, Ohio, and Oregon, and Samsung got $6.4 billion to expand a manufacturing facility in Central Texas.

“We are in the early innings of rebuilding our chip manufacturing capabilities,” said Navin Girishankar, president of the economic security and technology department at the Center for Strategic and International Studies. The question going forward, he said, is how to strike the right balance of export controls and investments, like a CHIPS 2.0.

And while Trump was correct last night that U.S. advanced chip manufacturing is still down, and that most chips are produced in Taiwan today, Sacks said this is largely the result of private business decisions rather than policy. Once-dominant American companies like Intel increased profit margins by offshoring production, he said. And the biggest American name in chips today, by far, is Nvidia, which designs graphics processing units in Silicon Valley but also outsources chip manufacturing to TSMC. 

“That’s the result of consistent decisions by U.S. companies that they didn’t want to be involved in the foundry business,” Sacks said.