All signs are pointing to a U.S. Senate vote sometime this week on a multi-billion bill designed to make the nation’s semiconductor industry more competitive.
The Creating Helpful Incentives to Produce Semiconductors for America Act, otherwise known as CHIPS, would provide, if passed, about $52 billion in tax breaks and subsidies to American chip manufacturers.
Those incentives would specifically be applied to the construction of new factories designed to produce semiconductors in a larger effort to remain competitive with China manufacturers.
In a sign of the bill’s likely fortunes, members of the Senate last week approved by a margin of 64 to 34 a procedural measure to advance the legislation.
In a statement, Charles Schumer, Senator Majority Leader, remarked that to “ignore the chip crisis means higher costs, squandered job opportunities, and greater dependance on foreign chip producers.”
Computers chips are used in the auto making, electronics, and energy industries, to name just a few. A chip shortage in the U.S. caused by an ever-tightening supply chain was first reported in late 2020 and early 2021, ultimately resulting in more than $200 billion in global automotive industry losses.
The CHIPS bill will specifically allocate $39 million for the construction of fabrication facilities in the U.S., with another just over $11 billion going for semiconductor research and development.
Earlier this spring, New Mexico Senate Martin Heinrich asserted that by “ramping up the production of the chips that have become key components in so many products, we will substantially lower costs for American families on purchases from smartphones to cars and home appliances.”
The publication Fortune says that while the CHIPS act is important, “the U.S. likely needs hundreds of billions more in funding, and decades to secure its chips supply.” Even so, the US Chamber of Commerce has endorsed the legislation, saying the chip shortage has underlined the “need for increased domestic manufacturing capacity.”
If the legislation passes the Senate, it is expected to be immediately taken up by the House.
By Garry Boulard
