In this podcast (subscrip only) Carl Zha & TP Huang talk smartly about these issues.
Among the points they make:
1. The Chinese market is extremely important for revenue stream of US chip makers (as discussed in the NYT piece), so losing that is a big loss for US economy… that will get worse as Huawei & SMIC continue to develop.
2. The ‘national security’ claim for restricting China’s access to super-advanced or super-small US chip technology is pretty hollow as weapons systems don’t generally require extreme miniaturization or other aspects of super-advanced chips, which often are not robust enough for military use anyway. Hence, that claim looks more like a pretext for trying to shut down the PRC’s access to advanced chip tech.