Senate passes $280 billion industrial policy bill against China

WASHINGTON — The Senate on Wednesday passed a comprehensive $280 billion bill aimed at building America’s manufacturing and technological edge against China.

The legislation reflected a remarkable and rare consensus in a polarized Congress. Intensifying geopolitical rivalry with Beijing. The program focuses on investing federal money in cutting-edge technologies and innovations to improve the country’s industrial, technological and military strength.

The measure passed 64 to 33, with 17 Republicans voting in favor. Bipartisan support for trade and military competition with Beijing — as well as the promise of thousands of new American jobs — has dramatically shifted long-standing party orthodoxies, creating an alliance between Republicans and Democrats who once shunned government intervention in markets. Big companies with federal big companies.

“No country’s government — even a strong country like ours — can stand aside,” Senator Chuck Schumer, Democrat of New York and the majority leader who helped push the measure, said in an interview. “I think it’s going to be a sea change.”

The legislation will next be considered by the House, where it is expected to pass with Republican support. President Biden, who has supported the package for more than a year, could sign it into law as early as this week.

The bill, a combination of economic and national security policy, would provide $52 billion in subsidies and additional tax incentives to companies that make chips in the United States. It will add $200 billion for scientific research, particularly in artificial intelligence, robotics, quantum computing and other technologies.

The bill calls for $10 billion for the business sector to create 20 “regional technology centers” across the country. Senator Todd Young, Republican of Indiana, and Mr. Schumer’s brainchild, the centers aim to connect research universities with private industry in an effort to create Silicon Valley-like hubs for technological innovation in areas hollowed out by globalization.

The legislation would help the Department of Energy and the National Science Foundation in their efforts to create a workforce pipeline for advanced semiconductor manufacturing, as well as workforce development programs that improve both basic research and research and development. occupations.

This effort at industrial policy, which has little precedent in recent American history, raises countless questions about how the Biden administration and Congress will implement and oversee a massive undertaking involving hundreds of billions of taxpayer dollars.

2019 at Senate Gym Mr. When approached by Young, Mr. Schumer says the legislation is the culmination of years of effort. Mr. Young, A A fellow Chinese hawkHe had previously worked with Democrats on foreign policy.

In the end, Senate support was made possible only by unlikely factors: a pandemic that exposed the costs of a global semiconductor shortage, heavy lobbying from the chip industry, Mr. Young was persistent in urging his colleagues to break away from the party. Convention and support for the bill, and Mr. Schumer is up for a top job in the Senate.

Many senators, including Republicans, saw the legislation as an important step toward strengthening America’s semiconductor manufacturing capabilities, as the nation becomes dangerously dependent on foreign countries. An increasingly vulnerable Taiwan – For advanced chips.

Mr. Trump said it would not be too difficult to garner votes from Democrats, who are less averse to government spending. Schumer said. But he nodded to supporting Republicans, including the minority leader, Sen. Mitch McConnell of Kentucky: “To their credit, 17 Republicans, including McConnell, came and said, ‘This is an expense we have to do.'”

Known by an ever-changing carousel of high-sounding names in Washington, the law defies easy definition. Over 1,000 pages long, it is simultaneously a research and development bill, a near- and long-term jobs bill, a manufacturing bill and a semiconductor bill.

Its initial version, Mr. Schumer and Mr. Written by Young, it became known as the Law of Infinite Limits. [1945MainReport[1945முக்கியஅறிக்கை President Franklin D. Roosevelt was asked how the federal government could promote scientific progress and manpower.

“New frontiers of the mind lie before us, if we wage this war with the same vision, courage and drive that they pioneered,” Mr. Roosevelt then wrote, “We want a full and fruitful. Employment and full and fruitful life.

With the U.S.’s share of state-of-the-art manufacturing capacity declining to 12 percent, the passage of the legislation is seen as an important step toward strengthening U.S. semiconductor capabilities. It has become increasingly dependent on foreign countries amid a chip shortage that has sent shockwaves through global supply chains.

The subsidies to chip companies are expected to create tens of thousands of jobs in the short term, with manufacturers pledging to build new factories or expand existing ones in Ohio, Texas, Arizona, Idaho and New York. While chip companies won’t receive the federal money immediately, many of them have said they will make business decisions in the coming weeks based on assurances that the money will arrive soon.

The bill seeks to create long-term research and development and manufacturing jobs. These include measures aimed at building pipelines of workers — through workforce development grants and other programs — that have been concentrated in once booming industrial centers through corporate offshoring.

In an interview, Mr. Young described the legislation as an effort to equip American workers affected by globalization to jobs in advanced sectors.

“These technologies are critical to our national security,” said Mr. Young said. “We’re giving chip manufacturing Americans an opportunity, for example, to play a meaningful role in not only supporting their families, but also using our creativity, talents and hard work to conquer the 21st century.”

The bill is expected to pave the way for the construction of factories across the country, along with tens of thousands of jobs.

Chip manufacturers were heavily coercedAnd often brazen about the subsidies, which in recent months threatened to sink their resources into building plants overseas like Germany or Singapore, Congress soon agreed to give them federal money to stay in the U.S.

The law also says chipmakers who receive federal funding and tax subsidies granted by the law cannot expand existing factories or build new ones in countries including China and Russia in an effort to curtail advanced chip production in countries that present national security concerns. .

Senators said the Commerce Department would withdraw funding provided by the bill if the companies did not comply with those restrictions.

Most senators, especially those representing states served by chip companies, saw those efforts as a reason to quickly pass the legislation. But they particularly angered Senator Bernie Sanders, a Vermont independent, who bluntly and frequently accused the wealthy executives of such companies of swaying Congress.

“To make more profits, these companies took government money and used it to send good-paying jobs overseas,” said Mr. Sanders said. “Now, as a reward for that bad behavior, these same companies are in line for a massive taxpayer handout to undo the damage they’ve done.”

Several times during the bill’s life, it looked like it would collapse or be severely diluted. In its short form, it would have sidestepped long-term strategic policy provisions and left only $52 billion in subsidies to chip companies as the most commercially and politically urgent measure.

Mr. If Senate Democrats continue to advance their social policy and tax plan, the centerpiece of Biden’s domestic agenda, Mr. The bill appeared to be vulnerable late last month following McConnell’s announcement.

In a private conversation, Mr. Young, Mr. He asked McConnell to reconsider.

Mr. Mr. McConnell “sees a near-term value proposition, and frankly, the importance of funding the CHIPS Act.” Young recalled.

However, Mr. With McConnell’s position uncertain and other Republicans refusing to support the measure, Mr. Schumer last week forced a quick vote on semiconductor subsidies, leaving open the possibility that the broader bill could be sidelined.

That would require enough Republican support for Mr. That prompted Young’s last-minute effort — at least 15, Mr. Schumer had told him – to restore critical investments in manufacturing and technology. For several days, Mr. Young and his allies worked the phones to try to win over Republicans, stressing the national security importance of the bill and the opportunities it could bring to their states.

At a private banquet lunch on Tuesday, Mr. Schumer gave his members a pitch of his own.

“This bill is going to have some of the biggest and biggest consequences we’ve ever had in America,” said Mr. Schumer told Democratic senators. “A lot of your grandchildren will be in good paying jobs because of your vote.”

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