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Senate passes bill to boost computer chip production in US

WASHINGTON (AP) – A bill designed to encourage more semiconductor companies to build chip plants in the United States passed the Senate on Wednesday as lawmakers raced to finish work on a key priority of the Biden administration. .

The $280 billion measure, which is awaiting a vote in the House, includes federal grants and tax breaks for companies that build their chip facilities in the US. economic competitiveness in the coming decades.

The Senate’s passage came with a vote of 64-33. A House vote is expected later this week as lawmakers try to wrap up business before returning to their states and districts in August.

House Speaker Nancy Pelosi, D-Calif., said she is confident she has enough GOP support to overcome potential splits from Democrats who are eyeing the subsidy effort to boost semiconductor companies. as a false priority.

Seventeen Republicans voted for the measure. Sen. Bernie Sanders, I-Vt., broke ranks with Democrats to vote against the bill.

Proponents of the legislation say other countries are spending billions of dollars to woo chipmakers. Backers say the US must do the same or risk losing a secure supply of the semiconductors that power cars, computers, appliances and some of the military’s most advanced weapons systems.

Senate Majority Leader Chuck Schumer, D-N.Y., said the bill represents one of the nation’s largest investments in science and manufacturing in decades and that with the Senate’s approval, “we would say the best America’s years are yet to come.”

Opponents criticized the price of the bill. It is projected to increase federal deficits by about $79 billion over 10 years.

President Joe Biden said the bill would create jobs and lower costs for a wide range of products from cars to dishwashers.

“For decades, some ‘experts’ have said we should stop manufacturing in America. I don’t believe that at all. Manufacturing jobs are coming back,” Biden said. “Thanks to this bill, more they. The House must pass it immediately and send this bill to my desk.

The bill has been in the works for a long time, starting with the efforts of Schumer and Sen. Todd Young, R-Ind., to increase government investment in high tech research and development. While the bill took many twists and turns, a recurring theme that lawmakers emphasized in Wednesday’s debate was the need to continue China’s massive investment in cutting-edge technology.

The Chinese government plans to “win the (artificial intelligence) race, win future wars and win the future,” Young said. “And the truth is, if we’re honest with ourselves, Beijing is already well on its way to achieving these goals.”

Sen. Roger Wicker, R-Miss., said: “Unfortunately, we are not in the driver’s seat of many important technologies. China.” Congress, he said, now has “an opportunity to put us back in the right direction and put America back in a place to win the game.”

The bill provides more than $52 billion in grants and other incentives for the semiconductor industry as well as a 25% tax credit for companies investing in US chip plants. over 10 years, though Congress must follow through by approving that money in future spending bills.

Despite years of work, the bill’s future didn’t look too good about a month ago. That’s when Senate Republican leader Mitch McConnell tweeted that there would be no chip legislation as long as Democrats maintain a party line on energy and economic initiatives. GOP support is critical in the Senate to get the 60 votes needed to overcome a filibuster.

But when Sen. Joe Manchin of West Virginia the idea of ​​imposing higher taxes on the rich and corporations, the leading Republicans said it was an opening to the continuation of semiconductors. Meanwhile, the Biden administration is pushing to pass a bill before the August recess, although it has been said to be more narrowly focused on $52 billion in semiconductor incentives.

Commerce Secretary Gina Raimondo told lawmakers behind the scenes and the public that semiconductor companies are making plans on how to meet the increased demand for chips. He said that the development of the industry will continue with or without the United States and if the legislators do not act quickly, those companies will simply choose to build in other countries that offer more financial incentives.

Schumer said that after McConnell’s statement, he called the CEOs of chipmakers and companies like General Motors and Ford and joined “unlikely allies” like the US Chamber of Commerce and the Business Roundtable. He urged them to reach out to Republican senators about the importance of the bill.

“And they changed things,” Schumer told The Associated Press. “They really, for the first time, the industry really helped with a good government program.”

The House may begin the bill on Thursday. While most Republicans are expected to oppose it, some of the ranking Republicans on the committees dealing with national security – Reps. Michael McCaul of Texas, Michael Turner of Ohio and John Katko of New York – support the step. So are most Republicans in a bipartisan group called the Problem Solvers Caucus, made up of moderates from both parties.

Copyright 2022 The Associated Press. All rights reserved.

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