GOP rep. warns US over tech making China the most 'dominating power' on the planet: ‘It’d be devastating’

As more warning signs come to the forefront about doing business with China, Texas Congressman Mike McCaul clarified what could make our adversary "the No. 1" world superpower.

"If there were a conflict tomorrow, I think Taiwan would be greatly outnumbered," Rep. McCaul told FOX Business’ Maria Bartiromo at the Milken Institute Global Conference. "The crown jewel here is TSMC – 90% of the world's advanced semiconductor chips are made on that island, making the entire world vulnerable, particularly the United States. It would make communist China the dominating power in the planet."

If China were to take formal military action and attempt to acquire Taiwan, McCaul warned the world’s primary microchip supplier could abruptly close and allow communist China to take over that market.

"They would own the market. We could build advanced weapons systems, your phones, your automobiles, everything has a little brain in it called the semiconductor chip," McCaul explained, but "from a technology standpoint, it'd be devastating."

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The People’s Liberation Army (PLA) of China earlier this month executed military drills around Taiwan in what appeared to be a dry run of its plan to take the island, with dozens of aircraft and ships gathering near Taiwan and seeming to surround it.

Taiwan reported as many as 70 fighter aircraft near the island, with half of the fighters detected as having crossed the median line of the Taiwan Strait and entering Taiwan’s self-declared air defense identification zone (ADIZ).

Last week, American billionaire investor Ray Dalio signaled the U.S. and China find themselves "on the brink of war," caught between a "great power conflict." Additional expert analysis has corroborated Dalio’s warning of looming conflict, including that of Atlas Organization founder Gordon Chang, who argued war could "very well" break out before 2025.

McCaul claimed U.S. lawmakers and defenses hope not to see any conflict, and allies like Japan, South Korea, Australia and the Philippines have begun partnership talks.

"The only way we can stop it is to provide deterrence. And we don't have that deterrence," McCaul said. "We hope the calculus for Xi is: the price is going to be too high, and we want peace."

"They want to dominate everything," the lawmaker added. "It's not just military, it’s economic, and they want to have the global currency, that being the digital Yuan, and they're well on their way to doing that now."

After a recent bipartisan trip to Taiwan, McCaul detailed Chinese battleships and carriers surrounding the island while they were on the ground.

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"We were warned by them beforehand, do not go to Taiwan. And then as I left, the military came to me and said: you've been sanctioned now by the Chinese Communist Party," McCaul recollected.

"That's a badge of honor to me," he continued, "but it just shows you how far they go to intimidate. And really they almost look kind of silly the way they overdo things like that."

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Fox News’ Peter Aitken contributed to this report.