Democrats pushed through the House on Friday that they believe will position the United States to compete more economically and globally with China with China by bolstering the domestic semiconductor industry and supporting tense supply chains.
The bill was passed by 222-210 votes. It marks an important step for a top priority for the Biden administration, but the legislation is likely to undergo extensive review as negotiators reconcile differences with what the Senate passed about eight months ago. President Joe Biden urged lawmakers to come to a deal quickly, saying, “America can’t afford to wait.”
The nearly 3,000-page bill, not counting the dozens of amendments added this week, involves massive investments aimed at boosting semiconductor manufacturing in the US. help the semiconductor industry and $45 billion (about Rs. 3,35,900 crore) to strengthen supply chains for high-tech products.
But the Democrats also tucked into other priorities that have raised GOP concerns about the bill’s cost and scope. Rep. Adam Kinzinger of Illinois was the only Republican to vote for the measure, while Rep. Florida’s Stephanie Murphy was the only Democrat to vote against.
The bill includes $8 billion (about Rs. 59,700 crore) for a fund that helps developing countries adapt to climate change; $3 billion (about Rs. 22,400 crore) for facilities to make the US less dependent on Chinese solar components; $4 billion (about Rs. 29,900 crore) to help communities with unemployment rates significantly higher than the national average; and $10.5 billion (about Rs. 78,400 crore) for states to store drugs and medical equipment.
Democrats were in a festive mood ahead of the vote after the latest jobs report showed employers added 467,000 jobs in January. They said the legislation on that front would lead to more good news.
“The bill we’re talking about today is a jobs bill, a jobs bill for manufacturing in America, for making in America,” Pelosi said.
The bill gives Democrats a chance to allay voters’ concerns about the economy at a time when shortages of computer chips have led to higher prices for cars, electronics and medical equipment. Showing his administration is tackling inflation concerns, Biden highlighted the mood at a White House event on Friday and reminded Americans of Intel’s announcement two weeks ago that it would build two computer chip manufacturing plants in Ohio.
Republicans, who have hammered Democrats for months about soaring inflation, called the move “toothless” and not enough to hold China accountable for a range of economic and human rights actions. They also said it would waste taxpayers’ money on environmental initiatives and other unnecessary programs.
“This bill is really just a long list of progressive dream policies that have nothing to do with China at all,” said R-Minn Representative Michelle Fischbach.
Commerce Secretary Gina Raimondo met with Democratic House lawmakers this week to discuss the bill. She said the most “urgent need” in the bill is $52 billion for domestic chip production because of the global chip shortage affecting the economy, including the automotive sector, and the national security implications of so many semiconductors in the world. be made abroad.
“We just can’t wait anymore,” she told reporters on Friday. “We are so far behind. We are in such a dangerous place when it comes to national security just because of our reliance on Taiwan for our most advanced, advanced chips.”
Major chipmakers like Intel and Samsung recently announced plans to build new factories in the US, but Raimondo noted that they’ve also indicated they could go “bigger and faster” with federal help.
One of the biggest flashpoints is the $8 billion (about Rs. 59,700 crore) for legislation to help developing countries reduce their emissions and cope with climate change. Former President Barack Obama pledged $3 billion (about Rs. 22,400 crore) for the fund, but former President Donald Trump withheld $2 billion (about Rs. 14,900 crore) of that amount.
Representative Michael McCaul, the Republican on the House Foreign Affairs Committee, called it an “unexplained UN slush fund” that has already provided at least $100 million (about Rs. 750 crore) to China.
Meanwhile, America’s share of global semiconductor manufacturing has steadily declined from 37 percent in 1990 to about 12 percent today. The Biden administration and lawmakers are trying to reverse that trend, which industry officials say is being driven by foreign competitors receiving significant government subsidies.
The pandemic has put pressure on the chip supply chain. The Commerce Department released a report last week showing that the median inventory of some semiconductor products had fallen from 40 days in 2019 to less than five days in 2021. The report also said stakeholders don’t see the problem disappearing in the next six months. . The administration cited the findings by calling on Congress to take action.
Tensions with China are reflected in many legislation. As a nod to concerns about the origins of COVID-19, the bill instructs the president to submit a report to Congress on the most likely origin of the virus, the level of confidence in that assessment, and the challenges of making such an assessment.
Republicans dismissed the provision as “no independent investigation, no sanctions, no punishment.” They want a select committee of lawmakers to investigate the origins of COVID-19. for a report,” said Republican leader Kevin McCarthy of California.
Another provision would subject more cheaper products made in China to tariffs. Currently, imports worth less than $800 (approximately Rs. 59,700) are exempt from expedited processing and tariffs. The bill will lift the threshold for certain countries, notably China.
The Senate passed its computer chip legislation in June by a vote of 68-32, representing a rare bias on important legislation. Negotiators will now try to work out a compromise that both chambers can accept, although it is uncertain whether they can do so before the midterm elections.
Whatever comes out will need the support of 10 Republicans in the 50-50 Senate to be passed into law.
“We’ll be sending House Republicans a much better option to vote on in the coming months,” said Senator Todd Young, R-Ind., who worked with Senate Leader Chuck Schumer on the Senate version of the legislation.
“Democrats in the Senate and House know we have a lot more work to do to bridge our two proposals together and take this bill to the president’s desk, and I believe we will,” Schumer said.
