Congress seeks compromise to boost computer chip industry

    A global shortage of computer chips makes it difficult for consumers to buy cars, computers, and other modern necessities, so Congress is looking to boost chip production and research in the United States by billions. dollars from the federal government.

    Both the House and Senate have passed major legislation on the issue, and the effort is one of lawmakers’ last opportunities ahead of the November election to show voters that they are addressing the issues. the nation’s strained supply chain.

    Now they must figure out the significant difference in the two bills. And Senate Republicans have already begun studying before formal talks begin.

    President Joe Biden has made semiconductor legislation a top priority, but he will need the support of 10 Republicans in the Senate, and perhaps more, to get a bill on the table. his job. Senate Republican leader Mitch McConnell underscored that point when congressional leaders recently announced which lawmakers would serve on the operating committee to reconcile the two bills.

    “Without major concessions and changes from House Democrats, this legislation has no chance of becoming law,” McConnell said.

    House Democrats say their voices need to be heard in the negotiations.

    “We need to make sure everyone has an input,” said Rep. Suzan DelBene, D-Wash., president of the New Democratic Alliance, a 19-member negotiating group. “We have a strong bill in the House, and I think there are important components there that the Senate should consider as well.”

    Where does everything stand?

    House and Senate leaders selected lawmakers to join a committee tasked with merging the two bills into one.

    House Speaker Nancy Pelosi selected 49 Democrats and one Republican, Representative Adam Kinzinger of Illinois, the only GOP member to vote on the House bill. Republican Leader Kevin McCarthy selected 31 Republican members for the committee.

    McConnell and Democratic Senate leader Chuck Schumer each selected 13 senators.

    The House has approved its participants, while the Senate still has some procedural work to do before it can do so.

    The Senate bill is expected to increase spending by about $250 billion over 10 years. The House bill would spur spending by more than $400 billion over the period.

    Where there are many deals

    The Senate and House bills allocate more than $52 billion for semiconductor research and production. Grants and loans from the federal government will subsidize some of the costs of building or renovating semiconductor plants.

    “The chip funding is absolutely the cornerstone of this bill — it’s bipartisan,” said Josh Teitelbaum, senior counsel at Akin Gump, a law firm and lobbying group.

    Some overlap, but key difference

    Both bills authorize increased spending for the National Science Foundation, but they have different priorities for receiving research funding.

    The Senate bill provides $29 billion over five years for a new board of directors focused on strengthening U.S. leadership in artificial intelligence, semiconductors, robotics and other technologies. other advanced technology.

    The House bill provides $13.3 billion over five years for a new director of science and engineering solutions. It lists climate change, environmental sustainability and social and economic inequality as part of the focus of its board of directors.

    The two sides will have to present their competing visions to the National Science Foundation and the new technology board.

    The two bills also establish tech hubs in the region — with the Senate earmarking $10 billion for the program and the House spending $7 billion. The Senate bill calls for 20 such centers, while the House bill allows at least 10.

    The seed money will go to regional organizations seeking to advance a variety of national security and economic priorities.

    This approach has bipartisan support from legislators with large rural and minority constituencies who want to make sure money doesn’t go to universities or communities where there are already many technology studies.

    Where there is a big difference

    The bills differentiated on supply chain issues, trade, immigration and climate change, to name a few areas of disagreement.

    One of the big targets is the $45 billion program in the House bill to strengthen supply chains in the US. There is no such provision in the Senate bill. This money will provide grants, loans or loan guarantees to companies, local governments and tribes that are trying to build or relocate manufacturing plants that produce important goods. .

    “This is an area of ​​real focus for companies and for communities that want to try to get production back on track,” said Teitelbaum.

    Another obvious difference is in terms of trade. The House of Representatives reauthorizes a program to provide training and financial assistance to people who lost their jobs or had their hours cut due to increased imports. The Senate has no such provision.

    “It won’t move without trade regulatory support,” Representative Earl Blumenauer, D-Ore., said of the bill.

    Meanwhile, the Senate bill includes a trade provision that would exclude more products from the tariffs the Trump administration has imposed on imports from China. These exclusions have almost expired. The Senate bill restores them, a priority of business groups like the American Chamber of Commerce.

    The House bill addresses immigration, while the Senate bill does not. It will create a new type of visa for entrepreneurs and will allow those with ownership interests in successful projects to apply to become lawful permanent residents.

    The House bill, unlike the Senate bill, also addresses climate change. It sets aside $8 billion for a fund to help developing countries adapt to climate change. That might not be a smart thing for Republicans, who oppose using American taxpayer money for that purpose.

    No one expected the negotiation to be easy.

    Senator John Cornyn, R-Texas, said: “I have trouble explaining to my friends and members that when the White House supports something, when the Democrats support something, Republicans support something. , the House supports it, and the Senate supports it, we still can’t seem to get it done. But I hope that we will take advantage of this opportunity. “

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