The Biden administration claims that this technology is essential to the US economy and national security, and the Senate on Tuesday decided to advance a bill that would offer subsidies for the manufacturing of semiconductor chips. By a vote of 64 to 32, the bill was approved.
The CHIPS for America Act, which stands for Creating Helpful Incentives to Produce Semiconductors for America, would allocate $52 billion in subsidies and provide an investment tax credit to entice semiconductor companies to increase their domestic manufacturing.
In order to highlight the fact that the United States relies too heavily on China for semiconductors that power electronics, medical supplies, and defence equipment, President Biden met virtually with CEOs and labour leaders on Monday to discuss the measure.
The bill needs to be signed by the president as soon as feasible.
Additionally, Mr. Biden has argued that boosting domestic semiconductor production will aid in the fight against inflation.
“The high cost of autos accounted for one-third of the core inflation during the previous year in 2021. Know the motivation behind that?
That is caused by an inability to produce more cars. Why? the semiconductor scarcity”
In an appearance with CBS News’ “Face the Nation” on Sunday, Commerce Secretary Gina Raimondo noted that the United States does not currently produce any “leading edge” semiconductors, the specialised processors required for high-end computing and military equipment.
She told moderator Margaret Brennan, “We acquire practically all of them from Taiwan… 90% of them we buy from Taiwan.
She stated that American businesses must increase their production in order for the U.S. Raimondo pointed out that incentives are also offered by other European nations.
Before the president could sign the law, it would still need to pass the House.
Raimondo is certain that the law will be approved. She anticipated that both the House and the Senate would vote in favour of this measure.
Additionally, she responded angrily to criticism coming from both the left and the right.
The law has been compared to a blank check for the semiconductor sector by Senator Bernie Sanders. According to Raimondo, the bill has strong bipartisan support.
“I completely disagree with Senator Sanders’ assessment of this. It’s not an open check,
“On Sunday, Raimondo stated.
“There are numerous restrictions. There are restrictions – businesses aren’t allowed to utilise this funding to construct facilities abroad.
Companies that receive this funding cannot afterwards start developing cutting-edge technology facilities in China.
Numerous conditions must be met in order to develop high-quality jobs and cooperate with small and minority-owned businesses. Labor laws offer protections.
Thus, to suggest that it is a blank check is utterly false.”