Top Democrat says Trump administration is worsening chip shortage

The top Democrat on the House China committee has blamed the Trump administration for rising consumer electronic prices, accusing it of undermining efforts to bring chip manufacturing to the US.

In a letter to Commerce Secretary Howard Lutnick, California Democrat Ro Khanna said the White House was undermining efforts by the Biden administration to provide financial incentives to encourage Samsung and SK Hynix — the world’s biggest memory-chip makers along with Micron in the US — to build out chip manufacturing facilities in America.

“The Trump administration may have undermined this progress and, by extension, paved the groundwork for the surge in consumer electronics pricing we are experiencing,” Khanna wrote. “Recent reporting suggests the commerce department may have interfered in existing Chips and Science Act funding promised to Samsung and SK Hynix.”

Khanna also asked the Trump administration to clarify whether it would let US companies procure memory chips from Chinese chipmakers, including the blacklisted supplier CXMT, and how it would mitigate any economic and security risks.

Apple has been lobbying the administration for clearance to buy chips from CXMT amid a surge in global demand due to the AI boom. The surge has sparked a dramatic increase in chip prices that Apple blamed for its recent decision to raise the price of MacBooks and iPads by 20 per cent.

Khanna warned that the shortage of memory chips could have negative repercussions for US national security.

“If US or Korean firms are unable to meet American demand, it potentially could lead manufacturers of consumer electronics to turn to People’s Republic of China memory-chip makers for their supply, including CXMT,” Khanna said. “Needless to say, it is not in our nation’s interests to increase our dependency on PRC supply chains.”

The Pentagon has placed CXMT on a blacklist of companies with alleged ties to the Chinese military. CXMT denies having any connections.

While the move does not bar…