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July 28, 2022 3:24 PM, EDT

Congress Approves Semiconductor, Supply Chain Bill

President Joe Biden speaks virtually to discuss the Chips ActAppearing virtually on July 25 while recovering from COVID, President Joe Biden discusses the CHIPS Act with business leaders. (Susan Walsh/Associated Press)

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Legislation to boost domestic semiconductor manufacturing while improving freight access along the nation’s supply chains was sent to President Joe Biden’s desk July 28.

The legislation, which drew bipartisan support and which is strongly endorsed by the commercial transportation sector, was approved in the U.S. House of Representatives 243-187, a day after its 64-33 bipartisan passage in the Senate. President Biden indicated he would enact it into law upon its arrival.

While the chamber debated the policy merits of the measure, House Speaker Nancy Pelosi (D-Calif.) called on colleagues to clear it for the White House. “Once enacted, the CHIPS and Science Act will bolster our nation’s production of semiconductor chips – reinvigorating American manufacturing and creating nearly 100,000 good-paying, union jobs. Crucially, these federal investments come with strong guardrails, ensuring they go straight into our economy – not into corporate pockets,” said the speaker.

“This legislation will power innovation nationwide – investing in next-generation technology, broadening our [science, technology, engineering and mathematics] workforce and establishing job-creating hubs in communities throughout the country,” she added.

Several Republican leaders in the House also expressed support for the bill. Rep. Tom Cole (R-Okla.), ranking member on the Rules Committee, observed: “The measure includes a significant investment in our semiconductor industry so that we will be able to manufacture those critical pieces of technology domestically, plus significant investments in the sciences.”

Specifically, the semiconductor “chips and science” bill would dedicate $54 billion in grants for domestic manufacturers as well as access to industry resources. It is a scaled-back version of legislation that had advanced in each chamber during this session of Congress.

Sen. Maria Cantwell

Cantwell

During floor debate, Senate Commerce Committee Chairwoman Maria Cantwell (D-Wash.) explained her support for the bill. “We have a chip shortage today, and it’s costing our economy and it’s increasing inflation,” Cantwell said.

“We know that there is going to be a chip demand that is going to be threefold from where we are today in the very near future. So that means if we don’t start building here, we’re not going to catch up. But more importantly, is the national security elements of making sure that the United States is making the most advanced semiconductors.”

For several months, Commerce Secretary Gina Raimondo had urged Congress to pass comprehensive semiconductor legislation. Doing so, the secretary has argued, would address national security concerns and inject economic certainty to freight supply chains.

“Our country runs on semiconductors and creating a robust chip manufacturing ecosystem in the U.S. will keep our economy strong, our nation safe, and create high-quality, good-paying jobs in communities across the country,” the secretary said. “The Senate’s bipartisan vote for this legislation sends a strong signal to American workers, American industry and countries around the world that we’re committed to leading in the 21st century.”

Bill Sullivan

Sullivan

American Trucking Associations was among the stakeholders supportive of Congress’ response to semiconductor manufacturing for the commercial transportation sector. “Semiconductors and computer chips make our economy and industry run – right down to the trucks we drive – and we have seen the consequences of decades of neglecting domestic manufacturing of these critical components,” ATA Executive Vice President for Advocacy Bill Sullivan said after the Senate vote and before the House vote. “Even in an extremely polarized environment, the Senate vote proves our leaders can still come together in a bipartisan fashion to pass critical legislation.”

Sullivan continued, “We urge the House to follow the Senate’s lead and pass this important bill so that President Biden can sign it and we can begin the hard work of rebuilding our capacity to manufacture semiconductors here in America – shoring up our national security, shortening supply chains and reducing costs for businesses across the economy.”

Separately, the U.S. Chamber of Commerce observed: “Semiconductors are essential to nearly every sector of the economy. Unfortunately, demand for chips has outstripped supply, creating a global shortage and resulting in lost growth and jobs here at home.”

“Passing this legislation to incentivize semiconductor research, design, and manufacturing in the United States will strengthen our economy and our national security,” the chamber recently argued.

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