Chip giant Taiwan Semiconductor Manufacturing Co.'s decision to triple its investment in Arizona is part of a national rush to re-shore key inputs for the American economy.

Driving the news: President Biden traveled to TSMC's Arizona plant on Tuesday to bask in the glow of the announcement. The company — which by some measures manufactures over half the world's chips — said the three-fold increase would bring its investment to around $40 billion.

• TSMC says the plants will create more than 10,000 high-paying tech jobs, including 4,500 directly at the plants themselves.
• "American manufacturing is back, folks," President Biden said, speaking at the TSMC facility.

The big picture: The last few years of economic disarray — broken global supply chains, high inflation, Russia's war on Ukraine, and growing trade and technology tensions with China — upended the system of globalization that emerged after the Cold War.

• That global network required that people, commodities, capital and goods could — and would — always flow easily across borders.
• But the onset of COVID generated a series of global government scrambles for essentials — first masks and vaccines, then semiconductors, and now oil and gas — that at times blurred the line between economic security and national security.

State of play: The disorder also highlighted the importance of developing domestic production of cutting-edge semiconductors, now sourced from a Taiwan that finds itself increasingly imperiled by an aggressive China.

• The $280 billion Chips and Science Act of 2022 — signed into law in August — includes $52 billion in subsidies to coax companies into building production plants in the U.S.
• Corporations have been receptive, in part because Russia's invasion of Ukraine and China's response to Speaker Nancy Pelosi's visit this year "have really hammered home the fact that there is no guarantee of peace in the Taiwan Straits going forward," says Chris Miller, a Tufts University history professor and author of the new book "Chip War: The Fight for the World's Most Critical Technology."

Context: TSMC's announcement is just the latest in a string of high-profile investment plans from computer chip companies.

• In early 2022, Intel announced it would spend $20 billion on a new chip production facility near Columbus, Ohio, and has plans to spend a similar amount building out plants in Chandler, Arizona.
• Samsung Electronics has floated the possibility that it could follow a previously announced $17 billion investment in chip production in Austin, Texas, with up to $200 billion on 11 plants in the area, according to Bloomberg.

What they're saying: The U.S. and European focus on boosting chip manufacturing, along with China's simultaneous desire to lead global tech "all point to increased semiconductor capital expenditure in the coming decade," analysts with S&P Global wrote in a recent research report.

The bottom line: In the aggregate, the reshuffling of the global chip market along national lines could be inefficient and costly as countries around the world rush to build, or rebuild, their own local supply of chips.

• But in the U.S., it will make for good politics, offering shovel-ready photo ops for politicians at plants that promise good-paying jobs that, by definition, won't be outsourced to China.