US Lawmakers Want Bill To Boost Chip Competition With China

Members of Congress will meet Thursday to open negotiations on a compromise measure that would fund $52 billion in semiconductor manufacturing subsidies and boost US competitiveness with Chinese technology, a source told Reuters.

The Senate passed its version of the bill in June 2021, while the House passed a similar bill in February. More than 100 House and Senate lawmakers have been named to a “conference committee” that will meet for the first time Thursday. Congressional aides said it could still take months before a final agreement is reached.

A persistent shortage of chips has disrupted the automotive and electronics industries, forcing some firms to scale back production. The issue has prompted responses across the world, with European Commission President Ursula von der Leyen announcing in February that the commission will propose new legislation to deal with microchip shortages in Europe.

“It’s crazy it’s taken this long,” Senator Mark Warner told Reuters on Thursday. He noted that since the United States began considering incentives, other countries like Germany have announced and finalized new chips incentives.

Warner said some major investments in new U.S. chip production could be jeopardized without action from Congress. On Wednesday, the Senate made more than two dozen motions to instruct negotiators on a range of issues.

Although the motions were not binding, they convey a sense of what senators would like to see in the final bill and what could keep it from getting enough votes to become law.

The Senate bill approved in June had $52 billion for chips and authorized another $200 billion to boost U.S. scientific and technological innovation, but then stalled in the House. The House passed a version in February that had $52 billion in chips funding but was significantly different on other science and technology provisions that ultimately stalled the proposal.

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