Is automotive industry all that EU cares about? What about IoT/robotics? The fact that TSMC want to build only their older fab here is really disappointing to me.
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Chips are a global industry, so yes, the factories will end up there but we will be able to buy chips subsidised by US tax payers. Many economists would claim that business and citizens would be more likely to efficiently allocate that $50B themselves. The increased tax on businesses in the US is going to hurt their innovation elsewhere in the economy, it just won't be as visible.
Governments picking winning industries has a very spotty track record. Often the industry does not turn out to be as crucial as thought, or subsidies end up in the wrong pockets. Every other generation this lessons needs to be re-learned it seems.
The chip shortage is creating an economic incentive to expand production capacity on its own, there is no need for subsidies but countries should accommodate new fabs by making them viable to build them in the first place.
One big problem with fabs is that they need specialized staff, they are not going to employ the average worker.
You can't separate the two in the case of the US. Having the semi fabs in the US is an economic factor because it's a national security factor, even if it involved adding zero net new jobs because it was all automated by AI + robotics.
Insurance is a very important segment of economy. Risk limiting, prevention. Security, both cyber and physical. And so on. For a business they're critical to sales even though they're costs and not generative for the businesses in terms of sales, they help to make sales possible by protecting the business (like having shelter for your employees). Building fabs in the US plays that same role to the US economy, it's a form of insurance, and it also helps to maintain/retain tech know-how. It's absolutely critical to the US economy, when you consider the realistic context of the world, re the US & China (as opposed to running a spreadsheet economic scenario that involves no potential politics, conflicts or wars).
Semiconductors are critical now and will be more so in the future. The US has both the world's largest economy, most to lose in the tech sector, most powerful military (which depends on semiconductors and will more so tomorrow) and the most wealth of any nation. A superpower without a military is no superpower; the most wealth without a military to protect it, you won't keep that wealth for long. It's pretty obvious that's a very massive economic factor. Being brought to your knees as a superpower - both militarily and economically - by your primary global rival because you failed to build some fabs, would be particularly stupid. It's similar to the rare earth metals problem, both in terms of economy and national security.
You might be able to separate the fab context of economy from national security to a limited extent in smaller nations, where realistically there's nothing you can do to stand off against far larger nations regardless of what you do about semiconductors (you'll lose whether you build that fab or not). Such is not the case with the US however. The US has epic scale global economic interests that very strongly benefit from having global military projection and security.