Senate passes massive package to boost U.S. computer chip production

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WASHINGTON, D.C. (WHEC) — The Senate on Wednesday approved a sweeping package aimed at boosting domestic production of computer chips and helping the United States stay competitive with China.

The 64-33 vote represents a rare bipartisan victory a little more than three months before the crucial November midterms; 17 Republicans joined all Democrats in voting yes. The package, known as “CHIPS-plus,” now heads to the House, which is expected to pass it by the end of the week and send it to President Joe Biden for his signature.

"Are we on the brink of another generation of American ingenuity, of American discovery, of American leadership? By passing our chips and science bill today, the Senate says, ‘Yes, we are,’ and in a loud bipartisan voice," Senate Majority Leader Chuck Schumer, D-N.Y., said on the floor before the vote.

"Today, by approving one of the largest investments in science, technology and manufacturing in decades — in decades — we say that America’s best years are yet to come."

The centerpiece of the package is more than $50 billion in subsidies for domestic semiconductor manufacturing and research.

Supporters on Capitol Hill, as well as key members of Biden’s Cabinet, have argued that making microchips at home — rather than relying on chipmakers in China, Taiwan and elsewhere — is critical to U.S. national security, especially when it comes to chips used for weapons and military equipment.

The package also includes tens of billions more in authorizations for science and research programs, as well as for regional technology hubs around the country.

The Congressional Budget Office said CHIPS-plus would cost nearly $80 billion over the next decade.

The final chips bill is a slimmed-down version of a much-broader China competitiveness package that House and Senate lawmakers had been negotiating. Earlier, the Senate passed its bill known as USICA, while the House passed its own version, the America COMPETES Act. But lawmakers couldn’t resolve their differences, and leading Democrats decided to switch their strategy and scale back the legislation.

The final package more closely resembled the House-passed bill, a senior House Democratic aide said.

In recent weeks, Commerce Secretary Gina Raimondo and Deputy Defense Secretary Kathleen Hicks had been making the rounds on Capitol Hill, pushing for a narrower chips-focused bill and arguing that failing to act by the summer recess would put America’s national security at risk.