When President Trump and Chairman Xi met in Beijing this past spring, according to an op-ed in American Thinker, one of Beijing’s clearest asks wasn’t about tariffs or military posture. It was about airplanes. Specifically, continued access to American-made aircraft and aviation equipment — much of it built in South Carolina.
That detail, writer Sean Nottoli argues in a September 17 piece, reveals something Washington routinely misses: the U.S.-China competition won’t be settled in the capital. It will be settled in Columbia, Phoenix, and dozens of other state capitals whose industrial policies rarely make the Sunday shows but increasingly shape what leverage America actually has.
The C919 Problem
Nottoli points to China’s flagship airliner, the COMAC C919, as a case study in the gap between aerospace ambition and aerospace reality. The plane is marketed as a triumph of domestic production and a symbol of Chinese self-sufficiency, but it still relies on Western engines, avionics, and other critical systems from companies including GE Aerospace, Honeywell, and Collins Aerospace.
This is not, in his telling, a matter of Chinese engineering talent. China can design an airframe and manufacture its components. What it hasn’t reproduced is the layered aerospace ecosystem — suppliers, skilled workforces, university pipelines, certification infrastructure — that the U.S. and its allies spent decades assembling. South Carolina hosts and fosters a meaningful share of that ecosystem.
The state’s rise as an aerospace hub wasn’t accidental. South Carolina operates under a constitutional requirement to balance its budget, meaning lawmakers couldn’t simply spend their way into an aviation cluster. Instead, they directed state funds toward infrastructure, education, and workforce-university partnerships that made the state attractive to long-term investors — Boeing chief among them. The result, according to Nottoli, is thousands of Boeing jobs and a statewide aerospace sector with an economic impact exceeding $38 billion, while helping preserve America’s edge in large commercial aircraft manufacturing.
Arizona’s Semiconductor Bet
South Carolina is one example, not the only one. Nottoli directs attention to Arizona, which he credits with securing American competitiveness in artificial intelligence and the advanced semiconductors that underpin it. The Pentagon has described microelectronics as essential to virtually every element of modern military capability, and a 2025 Government Accountability Office report found that foreign-dependent supply chains for microelectronics in advanced weapons systems pose a credible national security risk.
Congress responded with the CHIPS and Science Act in 2022, aimed at boosting domestic production of advanced chips and semiconductors. But Nottoli argues that states beat Congress to it. Motivated by jobs and tax revenue, Arizona began courting foreign investment and building domestic capacity for technology the Pentagon treats as strategically vital before the federal legislation landed.
The centerpiece: In 2020, then-Governor Doug Ducey announced that TSMC, the world’s leading contract manufacturer of advanced semiconductors, had selected Arizona for its first advanced chip plant in the state. According to Nottoli, that decision was the product of deliberate planning rather than luck. State lawmakers passed A.R.S. § 41-1512, creating refundable income-tax credits for companies like TSMC to build or expand in Arizona, while Phoenix invested in the roads and water infrastructure the plant needed.
The payoff was twofold: thousands of Arizona jobs and the restoration of domestic production of leading-edge semiconductors, a capability the United States had largely lost.
Fiscal Discipline as a Feature, Not a Bug
One element of Nottoli’s argument that cuts against the usual assumptions about industrial policy: neither state abandoned fiscal discipline to land these investments. South Carolina’s balanced-budget requirement and Arizona’s comparable constraints didn’t stop them from using targeted incentives, infrastructure spending, and workforce investments to attract strategic industries. In his framing, the constraints arguably forced a more surgical approach.
The broader case he makes is that state and local officials who don’t think of themselves as players in great-power competition should start. Washington writes the policy — tariffs, export controls, diplomacy, military strategy — but the industrial ecosystems that determine whether those policies are sustainable are being built far from the Beltway, in community colleges, industrial parks, and state economic development offices.
When Arizona and South Carolina compete for investment from Boeing or TSMC, they aren’t conducting foreign policy. But they are building the capabilities that decide whether Washington’s foreign policy has anything behind it. That distinction matters, because it reframes what looks like a parochial fight over tax incentives as something closer to a national security function.
Nottoli closes by noting that China’s leadership understands national power rests as much on the ability to innovate and build at scale as on military strength. His argument is that America’s 50 states, not just its federal agencies, will determine whether the country has the industrial backbone to hold its position. It’s a case for looking at state capitals as front-line institutions in a competition that Washington can shape but not, on its own, win.
The op-ed is a reminder that the most consequential national security decisions in recent years — where an airliner gets assembled, where a leading-edge chip gets fabricated — were made by governors and state legislators as much as by presidents and senators. Whether that decentralization is a strength or a vulnerability is the question Nottoli leaves hanging, but his answer leans firmly toward strength.
Source: www.americanthinker.com — https://www.americanthinker.com/articles/2026/09/the-50-state-strategy-for-america-s-competition-with-china/