Stop dithering on $52 billion CHIPS Act

Get your act together, Congress. The United States has a chip shortage that threatens its economic future.

China is committing $150 billion to expand its semiconductor industry. Taiwan’s chipmakers are investing $120 billion to strengthen their grip on the global market. Japan has provided subsidies with the intention of tripling its chip production by 2030. South Korea has plans to spend $450 billion over the next 10 years to stay ahead of its foreign competitors. Even the European Union has committed to $47 billion to chip production in an effort to become less dependent on foreign firms.


The United States? Despite broad bipartisan support for the CHIPS Act, the legislation providing $52 billion for American chipmakers, continues to languish in Congress. Every day that the CHIPS Act fails to pass is another day in which the United States falls further behind in the chips war.

Blame Senate Minority Leader Mitch McConnell for this blatant act of congressional malpractice. His decision to block the legislation is a threat to our national and economic security.

The Senate and the House passed different versions of the CHIPS Act 18 months ago as part of a national defense bill. But the bills included different funding approaches, requiring a compromise by Senate and House lawmakers. McConnell has threatened to sink the entire bill unless Democrats give up on reaching a separate climate, energy and tax deal with Sen. Joe Manchin, D-W.Va.

Now the leading U.S. chipmakers are saying that if lawmakers failure to act promptly, they will have to consider taking their planned manufacturing plants elsewhere.

It’s not an idle threat.

Intel CEO Pat Gelsinger said last month that he would delay construction of a $100 billion chip factory in Ohio unless Congress funded the CHIPS Act. Intel planned to use a portion of the legislation’s $52 billion to help pay for the factory. Intel announced plans for the investment in January, citing the need for the United States’ need to “build a more resilient supply chain and ensure reliable access to advanced semiconductors for years to come.”

While the current shortage helps highlight the need for urgency, our primary concern should be the United States’ ability to retain its innovative edge for the long term. A recession may result in a sharp drop in demand for the chips that drive our smart phones, automobiles, computers and other devices, but our long-term ability to compete in the global marketplace requires that we not become dependent on foreign chipmakers to meet our technological needs.

Caving into McConnell’s ploy shouldn’t be an option. Climate change is too important an issue for Democrats to set aside. They should instead remind voters that McConnell’s stance not only threatens U.S. security, but it also risks losing the thousands of high-paying jobs that would be created by Intel’s investment in Ohio and other U.S. chipmakers’ plans for plants in other parts of the nation.

If that fails, Democrats should consider abandoning efforts to reach a compromise for funding of the CHIPS Act. They could instead simply pass the Senate’s version of the legislation and score a significant victory for American innovation.

— Mercury News and East Bay Times

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