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Senate set to pass bill to subsidize US-made semiconductor chips

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The Senate is set to pass a bipartisan bill on Wednesday that would provide $52 billion in subsidies to domestic semiconductor makers, as well as billions in investments in science and technology innovation, with the aim of strengthen the competitiveness and self-reliance of the United States in what is considered a key industry for economic and national security.

The legislation — which has had many nicknames but which Senate Majority Leader Charles E. Schumer (DN.Y.) double the “Chips and Science” bill – lasted almost two years. It looks like the tentacle The US Innovation and Competition Act, the original form of the bill, which cleared the Senate last year but failed in the House.

If the Senate passes the bill on Wednesday as scheduled, it would then move to the House, where Speaker Nancy Pelosi (D-Calif.) said she has support for passage. Key members of Congress have said they could have the bill on President Biden’s desk by the end of the week.

“This is a major step forward for our economic security, our national security, our supply chains and, as I said, the future of America,” Schumer said Tuesday. “I feel this bill so passionately. It’s not one of those things that, you know, people immediately say, ‘Oh, yes, we have to do this.’ But it’s something we had to do.”

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Much of the $52 billion would go to chipmakers to spur the construction of domestic semiconductor fabs — or “fabs” — to make the chips, which power everything from vehicles to cellphones and more. by medical equipment and military weapons. A shortage of semiconductor chips during the coronavirus pandemic has caused price hikes and supply chain issues across several industries.

Biden said chip funding legislation is high on his agenda and called on Congress to get the bill to his desk as soon as possible.

” We are close. We are close,” Biden said Monday. ” So let’s go. It all depends on that.

Commerce Secretary Gina Raimondo, who has spearheaded White House efforts to lobby the bill, noted Monday during a White House meeting with business leaders and union leaders that the United States once made 40% of the world’s chips, but now makes about 12%. – and “essentially none of the cutting-edge chips,” which come almost entirely from Taiwan.

The United States has invested “almost nothing” in semiconductor manufacturing, she said, while China has invested $150 billion to build domestic capacity. Raimondo also warned that it was essential for the United States to be able to compete with countries around the world that have offered subsidies to semiconductor companies to build factories.

“Chip funding will be the deciding factor as to where these companies choose to expand,” Raimondo said. “We want them, we need them, to grow here in the United States.”

The White House has also pointed to the shortage of semiconductor chips as a national security concern. In an interview Tuesday with Washington Post Live, Sen. Kyrsten Sinema (D-Arizona), one of the bill’s original co-sponsors, said some senators joined a classified briefing weeks ago where they had learned some of the geopolitical concerns facing the United States.

“And that helped create a greater sense of urgency, I hope, both in the House and in the Senate … to help everyone see how important and urgent this is,” Sinema said. . “The good news is that we were able to react quickly. And I expect that by the end of the week, our bill will be on the president’s desk.

On Tuesday, the Senate voted 64 to 32 to limit debate and move the “Chips and Science” bill to a final vote. The Senate’s advancement of the bill on Tuesday came after months of debate and setbacks, and was nearly further hampered by weather delays and the absence of several members who recently tested positive for the coronavirus.

Although there was bipartisan support in the Senate to move the bill forward, several key Republican senators still voted no, including incumbents Richard C. Shelby (Alabama) and Patrick J. Toomey (Pennsylvania). Sen. Tommy Tuberville (R-Ala.) has also opposed moving the bill forward, though Lockheed Martin chief executive Jim Taiclet wholeheartedly endorsed the legislation during his meeting with Biden the day before. , pointing out that semiconductor chips are a critical part of Javelin missiles, which are made in Alabama.

Sen. Bernie Sanders (I-Vt.), who voiced opposition to the bill ahead of Tuesday’s vote, also voted against moving the legislation forward. Sanders has critical the bill as one that would give “blank checks to profitable microchip companies.”

Sen. Todd C. Young (R-Ind.), co-sponsor of the legislation, pushed back on that idea, saying he viewed the bill as an investment in national security.

“Ronald Reagan often said that defense is not about the budget,” Young said in an interview with The Washington Post Live. “You spend what you need, and if this economy over the pandemic so far has demonstrated anything, it’s that we need a more resilient economy.”

Pelosi pledged to act quickly on the bill once it hits the House. At an event in Michigan on Friday with labor leaders and the state’s congressional delegation, she said the bill has some support from GOP lawmakers.

“They understand the national security aspects,” Pelosi said. “I don’t know how much [Republican votes] we get, but it will be bipartisan.

Jeanne Whalen contributed to this report.




Washington

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