Bill to boost US chip production and competitiveness with China advances in Senate
A bipartisan bill intended to boost domestic semiconductor manufacturing and help the U.S. compete with China in the development of cutting edge technologies has passed a key Senate vote.
The legislation, known as “CHIPS-plus,” passed 64-32 in the Senate Tuesday, and includes approximately $52 billion in government subsidies for U.S. semiconductor production. It also includes $24 billion in investment tax credits for chip plants and other funding to spur innovation and research of other key U.S. technologies.
The bill, which is expected to get a final vote in the Senate and the House in the coming week, could significantly affect the federal government’s IT components supply chain along with domestic manufacturing supply chain security that is monitored by the National Institute of Standards and Technology (NIST).
Semiconductors, which are essential and expensive components of modern-day technology ranging from cell phones to sophisticated military systems, have seen an explosion in demand in the past decade. Supply chain issues resulting from the pandemic have contributed to a global shortage of the component.
In a new report published Tuesday, the Government Accountability Office highlighted the importance of bolstering the chip manufacturing workforce, including through new training programs and immigration reform to allow skilled workers into the country.
The watchdog, which interviewed over 70 semiconductor policy experts for the most effective measures to address the shortage, also suggested securing access to critical manufacturing materials, improving supply chain security and prioritizing chip supply based on industry need.
In a joint letter to Congress sent July 13, Commerce Secretary Gina Raimondo and Defense Secretary Lloyd Austin said semiconductors are “ground-zero” in the tech race between the U.S. and China.
“They are driving innovation and competitiveness in nearly every emerging technology” including AI, and also have “a wide range of critical national security applications,” they wrote.
