Senate passes massive package to boost US computer chip production

WASHINGTON — The Senate on Wednesday approved a sweeping package of measures aimed at boosting domestic production of computer chips and helping the United States stay competitive with China.

The 64-33 vote represents a rare bipartisan victory just over three months before the crucial November midterms; 17 Republicans joined all Democrats in voting yes. The package, known as “CHIPS-plus,” is now heading to the House, which is expected to pass it by the end of the week and send it to President Joe Biden for his signature.

“Are we on the verge of another generation of American ingenuity, American discovery, American leadership? In today’s passing of our Flea and Science Bill, the Senate is saying, ‘Yes, we are,’ and in a strong bipartisan voice,” the Senate said. Majority Leader Chuck Schumer, DN.Y., said on the floor before the vote.

“Today, by approving one of the biggest investments in science, technology and manufacturing in decades – in decades – we are saying that America’s best years are yet to come.”

The centerpiece of the package is more than $50 billion in grants for domestic semiconductor manufacturing and research.

Capitol Hill supporters, along with key members of Biden’s cabinet, have argued that making microchips at home — rather than relying on chipmakers in China, Taiwan and elsewhere — is critical to security. United States national security, particularly with respect to chips used for weapons. and military equipment.

The package also includes tens of billions more in permissions for science and research programs, as well as regional technology hubs across the country.

The Congressional Budget Office said CHIPS-plus would cost nearly $80 billion over the next decade.

The final chip bill is a stripped-down version of a much broader Chinese competitiveness package that House and Senate lawmakers had negotiated. Earlier, the Senate passed its bill known as USICA, while the House passed its own version, the America COMPETES Act. But lawmakers couldn’t resolve their differences, and leading Democrats decided to change tack and scale back the legislation.

The final package looked more like the bill passed by the House, a senior House Democratic official said.

In recent weeks, Commerce Secretary Gina Raimondo and Deputy Secretary of Defense Kathleen Hicks had been touring Capitol Hill, pushing for a narrower chip-focused bill and arguing that not acting before the summer vacation. summer would endanger American national security.

The global pandemic and supply chain issues have resulted in a shortage of chips in the United States, affecting companies such as automakers as well as manufacturers of smartphones and home electronics. Raimondo said 90% of the world’s most advanced chips are made in Taiwan, which faces threats from China.

“The purpose of all this money is to have more chips made in America,” Raimondo said in a recent appearance on CNBC. “The national security vulnerability here … is almost unique in the fact that we are so dependent on Taiwan and it is such a necessary commodity for innovation and military equipment.”

The bill’s passage marked the second time this summer that Senate Democrats and Republicans have come together to pass major bipartisan legislation as national attention shifts to the midterm elections.

In June, the Senate adopted the most sweeping gun bill designed to prevent gun violence for decades following mass shootings at a grocery store in Buffalo, New York, and at an elementary school in Uvalde, Texas. This week, lawmakers reacted to an economic crisis: the shortage of chips, which they say has contributed to rising inflation.

After the vote, a group of senators from both parties gathered at a press conference and took a victory lap.

“I was struck, not only by the substance of this legislation, but during this time of tribal politics and a lot of cynicism, frankly, about our federal government,” said Sen. Todd Young, R-Ind. , a top GOP negotiator.

“I think we should highlight the importance of this moment for the institution of the United States Senate or more broadly Congress and our federal government,” he said. “We can do difficult things. We can do really important things in the middle of all the Sturm und Drang.”

Still, more than 30 Republicans voted no, which makes sense. Ted Cruz of Texas, Josh Hawley of Missouri, Tim Scott of South Carolina and other rumored 2024 candidates.

Sen. Bernie Sanders, a Vermont independent who caucus with Democrats, also voted no, denouncing the bill as “massive corporate welfare” for the semiconductor industry.

“All of these deep and serious deficit concerns fade away when it comes to providing a $76 billion blank check to the highly profitable microchip industry, with no protection for the American taxpayer,” said Sanders in the Senate.

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