Oh well, I suppose that is an honest answer. But it was not very helpful.
I am not a a semiconductor industry insider. I would not even qualify as an outsider. But I do have a very strong professional interest in that industry.
Perhaps you are not aware, but neither Intel, nor IBM (their Vermont facility notwithstanding) will do any development work for the US. That is not consistent with their business plan, unfortunately. Sandia is okay, but what Sandia makes is either out of date, or much too expensive.
Ah, a salesman/woman... that would explain most of it !!
The expression I used was "capital is cheaper overseas". It is a highly technical term (sometimes people say "cheaper capital costs") that roughly means that it is easier to raise boatloads of money in Taiwan and China than it is in the US.
Labor is, indeed, cheaper overseas.. but that is not the only factor in this particular case. It is not even the dominant factor.
I would recommend that same google search for you: DARPA + TRUST.
The DoD (and the NSA) have done just what you asked for... set up a state of art foundry in the US. It is run by IBM in Vermont. Problem was that it was outdated even before it was operational, and it cost a huge amount of money.
State of art foundries are getting more expensive as the "lithography resolution" shrinks. And the industry is rapidly moving overseas because capital is cheaper there. Because of the capital costs, and because of the large masking costs, it is rapidly getting to a stage where the DoD cannot even afford state of art ICs (yeah...sounds funny, doesnt it)
It is a very significant strategic concern.
You can google DARPA & TRUST to get a whole lot more on that. You may still be able to find (on DARPA's website) a DoD position paper on this dated 2003 or 2004 that provides a lot more detail on the strategic problems, and the various things the DoD was doing to address it.
Well, I wont grudge you on your positions... it is definitely well thought out. Most people who have accused me of "recklessness" would rather just sit back and watch.
But, to borrow an old phrase that you once used, I think you are quibbling on the fine print. I suspect that, behind the public fingerwaggings, the diplomats are scurrying back and forth discussing various incentives.
JFK, if you recall, never publicly discussed the incentives he offered to the Soviets during the Missile Crisis.
As to your specific positions... I agree that NATO is not the right vehicle for this. And neither is the UN.. it has to be an informal coalition, perhaps centered around an economic bloc such as the G-7/8.
I can quibble with some of your specific incentives, but I agree with the gist of your arguments.
Some of it is softcoded (and sofcoded secrets are a problem as well, but of a different nature).
But some of it is hard coded... bottomline is that if a smart organization got hold of some ICs... then it could seriously compromise some of the most precious secrets. This leaves the DoD in a bit of a pickle: how do you make state of art ICs, when all the state of art foundries are overseas. That is a far more likely scenario of the Chinese (and Taiwanese) getting their hands on those secrets, than with another spyplane type incident.
There are no good solutions to that, unfortunately!
Are you talking about the trusted foundries by any chance ? They are woefully out of date.. ICs made there are of no interest to anyone these days.. including the DoD (although the DoD does not have very many good options here)
Most of the avionics on the old planes are new. But the Chinese are (or were) not after the avionics either ~ there are plenty of smart Chinese engineers who can make plenty of fine electronics. In any case, most of the electronics is fabricated there (or in Taiwan) these days.
But, there are some crown jewels of encryption (GPS is one instance), where getting your hands on the physical hardware is very valuable. Because, given enough time, you can take the integrated circuit apart, and figure out it's programming... and get the coding.. and then apply it for other reasons.