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Semiconductor, China competition bill clears key Senate hurdle

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US President Joe Biden during a virtual meeting on the Chips Act within the Eisenhower Executive Office Constructing in Washington, D.C., US, on Monday, July 25, 2022.

Jemal Countess | Bloomberg | Getty Images

A bipartisan bill to bolster domestic semiconductor manufacturing and boost U.S. competitiveness with China has cleared a key Senate vote, setting it up for final passage within the chamber in the approaching days.

The so-called cloture vote to interrupt the legislative filibuster was originally set for Monday evening, but had been postponed until Tuesday morning after severe thunderstorms on the East Coast disrupted some senators’ travel plans.

The vote passed 64-32.

Senate Majority Leader Chuck Schumer, D-N.Y., said he hopes lawmakers “can remain on course to complete this laws ASAP.”

The package, often known as “CHIPS-plus,” includes roughly $52 billion in funding for U.S. firms producing computer chips and a provision that provides a tax credit for investment in chip manufacturing. It also provides funding to spur the innovation and development of other U.S. technologies.

If it passes the Senate as expected, the House will then take up the laws. Supporters of the bill hope Congress will pass it and send it to President Joe Biden for his signature before the August recess, which begins in two weeks.

The laws, those advocates say, is significant for U.S. economic and national security interests in a world increasingly depending on technological advancement. Additionally they argue the bill could help counteract the consequences of a Covid-induced global chip shortage, and put the U.S. on a more competitive footing with China, which has invested heavily in its own chip-making capabilities.

“America invented the semiconductor. It is time to bring it home,” Biden said during a gathering on the White House on Monday afternoon. The president, who tested positive for Covid last week, participated within the meeting virtually.

The laws “goes to advance our nation’s competitiveness and our technological edge,” Biden said, urging Congress to “pass this bill as soon as possible.”

CHIPS-plus is a pared-down version of broader laws that was long stewing within the House and Senate. The larger measure got here under threat from Republican leadership earlier this month.

The slimmer bill passed an early procedural motion last week in a bipartisan 64-34 vote.

The votes come as Sens. Joe Manchin, D-W.V., and Lisa Murkowski, R-Alaska, each individually announced Monday that they tested positive for Covid. Each senators said they are going to work remotely and follow CDC distancing guidelines, but Senate rules require them to vote in person.

Their diagnoses should not expected to derail the Senate’s efforts to pass CHIPS-plus, but could impede Democrats’ other legislative goals before the August recess.

The Biden administration, meanwhile, wants Congress to act now.

In Monday’s meeting with Biden, national security advisor Jake Sullivan warned of enormous national security risks “that we face at once, today,” on account of supply-chain vulnerabilities made worse by the pandemic.

America’s continued dependence on overseas semiconductor producers is “flat-out dangerous, and a disruption to our chip supply can be catastrophic,” Sullivan said. “The longer we wait, the more dangerous the disruption.”

Executives from Lockheed Martin, jet-engine maker Cummins and medical-device manufacturer Medtronic echoed those national-security arguments through the meeting.

Chris Shelton of major labor union Communications Employees of America told Biden: “There isn’t any query that we want a comprehensive approach to compete and to tackle China’s unfair trade practices.”

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