Engineering hurdles to clear ahead of tech 're-shoring'

The Trump administration has national security concerns when it comes to foreign dominance in microelectronics, but research and engineering advances are needed as a precursor to new policy, a top official said.

circuit board (Pixel B/

The Trump administration has national security concerns when it comes to foreign dominance in microelectronics, but research and engineering advances are needed as a precursor to new policy.

"The semiconductor industry is at the root of our nation's economic strength, national security, and technological standing," Michael Kratsios, the White House's chief technology officer who is also acting as the Defense Department's Undersecretary of Defense for Research and Engineering Kratsios said during an address at the Defense Advanced Research Projects Agency's Electronics Resurgence Initiative Summit Aug. 18.

Semiconductors are foundational for tech like cloud computing, artificial intelligence, 5G, and autonomous vehicles, and increasingly officials are waking up to the idea that relying on foreing suppliers creates national security vulnerabilities.

The U.S. leads the world in semiconductor design and R&D, according to data from the Semiconductor Industry Association, but "the lion’s share of chip manufacturing is now occurring in Asia," the trade association stated in a recent report. Additionally, the COVID-19 pandemic has disrupted supply chains, workforces and demand.

"We cannot allow the continued attrition of our manufacturing base," Kratsios said.

Kratsios' comments follow those from other DOD officials, including top acquisition official Ellen Lord, who worry about the possibility of sensitive defense information being accessed by adversarial countries at the manufacturing level.

"We have gotten ourselves into a potentially compromised position where we have U.S. intellectual property in terms of designs going offshore for fabrication and packaging leaving us with some vulnerability there that is unacceptable moving forward," Lord said in July.

Congress has also taken up the issue in the 2020 National Defense Authorization Act with provisions for DOD to evaluate supply chain and operational security standards and requirements for microelectronics. The issue came up again in the House draft of the 2021 NDAA, suggesting a phased approach that would gradually increase the percentage of domestically manufactured microelectronics.

Kratsios also stressed zero-trust principles be adopted in addition to re-shoring microelectronics manufacturing.

The Defense Department has been working to increase security in the microelectronics supply chain and is "moving towards a new quantifiable assurance strategy based on the zero trust principles found in cybersecurity that will allow us to quickly, and safely build and deploy leading edge electronics technologies," Kratsios said.

Microsoft CEO Satya Nadella said, during a fireside chat with Kratsios, standardized principles and policies were needed because "transactional costs, at a societal level, go up when you can't trust something."

"When you can trust something, you can use something with confidence whether it be in the DOD or in our consumer lines," Nadella said, suggesting the need for federal policies and standards on transparency and the ability for systems and to be verified, audited, and explained with technologies like artificial intelligence.

"We also need a set of principles and a set of policies that allow us to be able to have that level of transparency that engenders trust at use" from design to deployment, Nadella said.

Kratsios said there was a "unified consensus on achieving those goals," at least when it came to setting principles for artificial intelligence, but "the question is in the details; you actually need to have a technical engineering solution to 'explainability'. If we woke up and said going forward, anytime you use an AI algorithm, it must be explainable, that presents an onerous burden on industry that they could never achieve."

Kratsios said policy goals can't be reached until there are breakthroughs in research and engineering to support the needed technical solutions -- along with research investments, public-private partnerships with technology transfer between the two, and malleable frameworks that "allow these technologies to succeed."

For now, the administration is looking to regulatory guidance and an AI framework from the Office of Management and Budget that's expected later this year.

"Until we make those breakthroughs, we can't actually deliver on a lot of the ultimate policy goals," Kratsios said.