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Senate to contemplate chips China competitiveness bill

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The U.S. Senate could begin work on a pared-down China competitiveness bill as soon as next week, with the goal of passing it through Congress before lawmakers depart Washington in August, NBC News reported Thursday.

Senate Majority Leader Chuck Schumer, D-N.Y., has told senators that a floor vote could come as early as Tuesday to kick off the legislation-writing process on a bill that features billions in funding for semiconductor manufacturing, a source told NBC.

It will also include an investment tax credit from one other bipartisan chip-manufacturing bill, and extra components might be added as the method plays out, based on NBC.

The plans come after Senate Minority Leader Mitch McConnell, R-Ky., threatened to dam a wider bill to spice up competitiveness with China, called america Innovation and Competition Act, or USICA.

U.S. Senate Majority Leader Chuck Schumer (D-NY) speaks to reporters following the Senate Democrats weekly policy lunch on Capitol Hill in Washington, February 8, 2022.

Brendan McDermid | Reuters

The House and Senate have passed different versions of the bill, with the upper chamber’s version garnering more bipartisan support. The Senate bill, which passed 68-32 in June 2021, would total roughly $250 billion, including $52 billion to fund the semiconductor research, design, and manufacturing initiatives.

But McConnell late last month said the competitiveness bill would lose Republican support if Democrats continued to pursue an unrelated reconciliation package to fund their climate, tax, and prescription drug goals, which is reportedly being negotiated by Schumer and Sen. Joe Manchin, D-W.V.

If it meets the Senate’s strict budget reconciliation rules, that spending package could pass the chamber with only a bare majority as an alternative of the 60 votes required for many other bills to surpass the filibuster.

“Let me be perfectly clear: there might be no bipartisan USICA so long as Democrats are pursuing a partisan reconciliation bill,” McConnell tweeted June 30.

Senators and Biden administration officials hope to send the chip-funding laws to the White House for President Joe Biden’s signature before Congress goes on its annual recess in early August.

“We wish them to barter and get a bill done by August 4,” Commerce Secretary Gina Raimondo told reporters Wednesday. In an interview with Axios published that very same day, Raimondo said, “There is a real time urgency there, because these chip corporations are making their decisions right away about where to expand.”

Secretary of Defense Lloyd Austin on Thursday made a national security-focused case for passing chip funding.

“Weapon systems employed on the battlefields of today and emerging technologies of tomorrow rely upon our access to a gentle, secure supply of microelectronics,” Austin said in a statement. “Our strategic competitors are making substantial investments on this area – China, the U.S. military’s pacing challenge, has already spent $150 billion updating its semiconductor industry.”

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