The US Senate voted by a wide margin to begin debate on legislation to provide more than US$52 billion in grants and incentives for the US semiconductor industry, a major milestone for the long-stalled package that proponents say is vital to national security.
The 64-to-34 procedural vote on Tuesday night met the criteria set by US Senate Majority Leader Chuck Schumer to add research and development initiatives promoted by US senators Todd Young and Kyrsten Sinema to the legislation, which could be passed by the Senate next week.
Schumer before the vote called it “legislation our country desperately, desperately needs.”
Photo: EPA-EFE
Details of the bill, a scaled-down version of the original and more expansive measure intended to make the US more competitive with China in technology and advanced manufacturing, are still being worked out.
In addition to money to assist semiconductor companies building fabs in the US, a draft bill circulated by the Senate leadership includes a 25 percent investment tax credit for manufacture of semiconductors and tools to create them, US$500 million for an international secure communications program, US$200 million for worker training and US$1.5 billion for public wireless supply chain innovation.
The provisions proposed by Young and Sinema would establish a directorate for technology and innovation within the US National Science Foundation to support basic and applied research, and bolster education in science, technology, engineering and mathematics.
Schumer had said the Senate needed at least 60 votes to show support for those provisions.
The legislation would also have to pass the US House of Representatives, where House Majority Leader Steny Hoyer said Democrats would support the Senate version, even if some wanted a broader bill.
“We need to do the chips part, and if we don’t do that, we will lose chip manufacturing to other places,” he said.
Senate Minority Leader Mitch McConnell, who had previously threatened to block the wider legislation until Democrats dropped their plans for a tax and climate package, voted against starting debate.
He earlier in the day said that he wanted to see what is in the eventual legislation first, even though he called domestic chip manufacturing “a national security issue of significant proportion.”
US President Joe Biden’s administration, lawmakers from both parties and the semiconductor industry have called the chips incentives urgent amid a global shortage and supply chain disruptions that have affected industries including vehicles, electronics and appliances.
The US still leads the world in chip design, but manufacturing has shifted to Asia. The legislation aims to bring more chipmaking back to the US.
Some US companies, including Intel Corp, and a lobbying group, the Semiconductor Industry Association, have been seeking changes to the legislation to allow production of more advanced chips in China.
The current version bans investment in plants that produce chips smaller than 28 nanometers, while some facilities in the country are already producing 16-nanometer chips.
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