By KEVIN FREKING, Associated Press
WASHINGTON (AP) — The Senate on Tuesday introduced a $280 billion bill aimed at boosting the U.S. semiconductor industry and accelerating high-tech research that funders say will be essential to the economy in the decades to come.
The Senate needed 60 votes to move the bill forward, and the vote was 64-32. The bill is now on its way to final passage in the Senate later this week. The House is also expected to pick up the package this week.
The White House has backed the bill, along with industry leaders who say government subsidies are needed to compete with other nations that are also spending billions of dollars to lure manufacturers. They say the pandemic has exposed the dangers to the economy and national security of relying too heavily on foreign-made computer chips.
The bill provides about $52 billion in grants and other incentives for the semiconductor industry as well as a 25% tax credit for companies that build chip factories, or fabs, in United States. The cost of the tax relief should be around $24. billion over 10 years. The bill also authorizes about $200 billion to improve scientific research over the same period.
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The Congressional Budget Office projected the bill would increase deficits by about $79 billion over 10 years. Critics have objected to the spending requested in the bill as inappropriate or excessive.
“At a time when working families in this country are falling further and further behind while the very wealthy are getting much richer, let’s get our priorities straight,” said Sen. Bernie Sanders, I-Vt.
But the bill has drawn support from bipartisan lawmakers who say the investment is essential for American innovation and for staying ahead of its economic rivals in the decades to come, namely China.
“I firmly believe that the passage of this bill will mark a turning point for American leadership in this century,” said Senate Majority Leader Chuck Schumer, DN.Y. “The benefits of this legislation will reverberate across the country for years and decades to come.”
Senate Republican Leader Mitch McConnell led a group of 17 Republican senators who voted to limit debate and move the bill forward. While some Republicans have expressed concerns about the bill’s spending, others have pointed to the need to address national security vulnerabilities stemming from the United States’ reliance on factories in Taiwan and Korea. South for the most advanced computer chips.
“We’re not used to providing these kinds of financial incentives to companies, but when it costs 30% less to build these manufacturing facilities across Asian seas and our access to this supply chain is potentially compromised by very real threats, it’s a necessary investment for us to make,” said Sen. John Cornyn, R-Texas.
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