China Bill With Semiconductor Aid to Be Included in U.S. Defense Measure
(Bloomberg) -- The Senate will add an expansive plan to help the U.S. better compete with China and bolster the U.S semiconductor industry to Congress’s annual defense authorization bill, Majority Leader Chuck Schumer said, jumpstarting action on legislation that’s been stalled for months.
Schumer said on the Senate floor Monday that he will move to attach the nearly $250 billion legislation to spur research and development as well as domestic chip manufacturing as an amendment to the National Defense Authorization Act because the “supply chain crisis needs attending to and we cannot wait.”
The New York Democrat set in motion procedures to begin Senate debate on the defense bill this week. If it passes there, the House and Senate would negotiate differences in the two measures.
House Armed Services Chairman Adam Smith, a Washington State Democrat, said Monday that he was “wide open” to adding the China bill to the defense measure, a strong indication that the language would survive House-Senate negotiations and make it into the final defense bill.
“But there’s a lot of people in the House who have different concerns with different pieces of” the U.S. Innovation and Competition Act, Smith added. “And as I like to say, we’ve got to get to good on that in order to figure out what we can include.”
The legislation is designed to make the U.S. more competitive with China by increasing research and development funding for manufacturing and scientific innovation. It also includes $52 billion in emergency appropriations to provide grants and incentives to companies that are looking to build semiconductor manufacturing facilities in the U.S. It passed the Senate with wide bipartisan support in June.
“Members from both sides of the aisle have expressed interest in getting this done,” Schumer said. “Passing USICA would be an essential far-reaching step that Congress can take to help fight inflation, help increase American workers’ wages and relieve strained supply chains, particularly with regard to the current chip shortage.”
Schumer said the Senate is working with House Speaker Nancy Pelosi and Republicans in both chambers to “find a path forward to get this important legislation over the finish line before the end of the year.”
The House version of the competitiveness bill had significant differences from the Senate’s legislation. Negotiations to resolve those had stalled and then took a backseat to efforts by congressional Democrats to act on President Joe Biden’s economic agenda.
Senator Todd Young, an Indiana Republican and the co-sponsor of the competitiveness bill, supports moving the legislation as part of the defense bill “in the hopes that this will finally get the House of Representatives to act,” spokesperson Heidi Reutebuch said.
Earlier on Monday, Senate Minority Leader Mitch McConnell praised the decision to advance the defense bill, but said he didn’t want “extraneous” items added. He didn’t elaborate, and a McConnell aide declined to clarify whether that might apply to the China competitiveness bill.
However, McConnell voted in favor of the legislation. A member of McConnell’s leadership team, Senator Roy Blunt of Missouri, said attaching the measure to the Senate bill could be a good way to move legislation that has slowed to a crawl in the House.
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