Senate OK’s Billions for U.S. Chip Manufacturing

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After months of political jockeying and procedural hurdles, the Senate on Tuesday approved a roughly $190 billion science and technology bill to boost U.S. competitiveness with China. The bill invests several billion into U.S. semiconductor production and emerging technology industries like artificial intelligence and quantum computing.

The bill — titled the US Innovation and Competition Act or USICA — builds off a previous proposal from Senate Majority Leader Chuck Schumer (D-NY) called the Endless Frontier Act. Endless Frontier was one of the first big bipartisan bills to come from the Biden administration. But over the last few months, the bill grew and much of the original funding was watered down as it moved through the Senate, reported The Verge.  

In its current form, the bill provides $52 billion for domestic semiconductor manufacturing, as well as a 30 percent boost in funding for the National Science Foundation and $29 billion for a new directorate to focus on applied sciences. “Whoever wins the race to the technologies of the future will be the global economic leader,” Schumer tweeted. “We must invest in science, R&D, manufacturing, and innovation.” 

The Semiconductor Industry Association — which represents companies such as Qualcomm, Intel, IBM and Micron — pushed for passage of the legislation, Inside Towers reported. “The U.S. has more of the semiconductor market than anyone else, and we lead in design, which is how we make new chips. Where we don’t lead is fabrication, and that has moved to Taiwan,” Jim Lewis, a senior vice president and director of the Strategic Technologies Program at the Center for Strategic and International Studies, told The Hill. “If we are serious about getting fabrication back in the United States … we have to use subsidies,” he said.

If passed, the measure would provide $100 billion in funding for a new science directorate at the National Science Foundation to promote research in emerging tech fields. It would distribute billions to regions across the country to build out new tech hubs and encourage tech companies to find homes outside of Silicon Valley and the coasts.

Earlier this year, President Joe Biden signed an executive order to combat growing concerns over a global semiconductor shortage. The order called for a 100-day government review of supply chains to address shortfalls in acquiring chips. That review was published Tuesday, and the White House launched a task force to address supply chain disruptions, Inside Towers reported.

The package still needs to move through the House before President Biden can sign it into law. Schumer said he was “quite certain that we will get a really good product on the president’s desk.” It’s unclear how long that will take or if the bill will change further.

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