- The Washington Times - Wednesday, July 27, 2022

The Senate on Wednesday passed its $280 billion technology spending bill aimed at boosting domestic semiconductor manufacturing and spurring scientific research in a key legislative win for President Biden ahead of Congress’ August vacation.

The bill, which includes a long-stalled $52 billion payout to chip manufacturers, passed 64-33 in the chamber following administration warnings that time was running out before U.S. companies pulled their domestic investments and set up shop overseas.

“For decades, some ‘experts’ said we needed to give up on manufacturing in America,” President Biden said in a statement praising the Senate’s passage of the bill. “I never believed that. Manufacturing jobs are back. Thanks to this bill, we are going to have even more of them.”



The legislation now proceeds to the House where it is expected to pass before lawmakers depart for recess.

The Senate’s passage caps months of tense negotiations over partisan differences that nearly derailed the legislation aimed at bolstering U.S. competition with China. The final deal stands ready to deliver a modest win to the White House and Democrats hungry for a legislative victory ahead of the Nov. 8 midterm elections.

“This is a very good day for the American people, for American leadership and for American prosperity in the 21st century,” Senate Majority Leader Charles E. Schumer, New York Democrat, said on the Senate floor. “After years of hard work, the Senate is passing the largest investment technology in decades.”


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“This is one of the most significant, long-term thinking bills we passed in a very long time,” he said.

Proponents of the bill, which includes more than $50 billion in the next five years for chip manufacturing and a 25% tax credit through 2026 for new chip production, say it will reduce America’s dependence on China and resolve a major supply chain issue that has contributed to high inflation.

Without a steady flow of semiconductors, which are used to manufacture a variety of goods, such as smartphones, washing machines and advanced weapons, proponents warn that the U.S. will be severely hobbled in maintaining economic stability in the future.

Administration officials have also laid out a national security imperative for the incentive, warning that the global supply of advanced chips is concentrated in Taiwan, which many experts fear could be the center of a clash with China within the next decade.

The White House has, for weeks, been in a full-court press to get the measure passed, urging lawmakers to shed a bevy of tough-on-China measures to get the broadly supported semiconductor funding to his desk before industry heavyweights take their money elsewhere.

Commerce Secretary Gina Raimondo, who led classified briefings this month on Capitol Hill to compel lawmakers to shuttle the stalled chip funding across the finish line, warns the U.S. is running out of time to woo chip manufacturers to its shores as other countries begin to roll out similar incentives.

Three major semiconductor firms — TSMC, Intel and GlobalFoundries — recently warned that they will scale back plans to produce semiconductors if Congress can’t seal the deal.

Former Trump officials also came on board in recent weeks to rally support from Republican stragglers.

Trump administration Secretary of State Mike Pompeo urged lawmakers to pass the bill “for both our national and economic security.”

“We have to become less dependent on China for critical technologies - and this is how we do it,” Mr. Pompeo tweeted Monday.

But opponents of the legislation also span the ideological divide.

Nikki Haley, the former U.S. Ambassador to the United Nations under the Trump administration, called the bill “reckless spending and corporate welfare” which she said “won’t stop China.”

“The Senate is voting to give $280 billion in handouts and giveaways while inflation is at 9.1%,” she said. “This 1,000-page bill gives hundreds of millions of dollars for liberals’ green agenda and mentions ‘China’ only 11 times.”

Sen. Bernard Sanders of Vermont labeled the $52 billion chips funding as “corporate welfare.”

The liberal independent said the bill gives a “blank check” to already profitable chip manufacturers whom he accused of extorting Congress by threatening to build factories overseas if they do not get money.

“At a time when the working families of this country are falling further and further behind while the very rich are getting much richer, let us get our priorities right,” he said in a floor speech on Monday. “Let us rebuild the U.S. microchip industry, but let’s do it in a way that benefits all of our society, not just a handful of wealthy, profitable and powerful corporations.”

The bill is expected to sail through the House where it is supported by the top Republicans on the House Foreign Affairs, Intelligence and Homeland Security committees.

Rep. Michael T. McCaul, a Texas Republican who was the original sponsor of the bill, cheered the Senate‘s progress on the bill earlier this week and urged his House colleagues to follow suit.

House Speaker Nancy Pelosi, California Democrat, has pledged to move the bill quickly through the House once it passes the Senate.

• Joseph Clark can be reached at jclark@washingtontimes.com.

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