At 10:24 p.m. last night, Natalie Andrews from the WSJ filed this update on the unexpected vote yesterday on the CHIPS Act and the FABS Act:
“A bipartisan bill subsidizing domestic semiconductor production cleared its first procedural hurdle on Tuesday in a 64-34 vote, even as the details of the legislation were still being worked out.
The legislation would provide roughly $52 billion in subsidies to encourage chip companies to boost production in the U.S., seen by the White House and leaders of both parties as a critical national-security need. Lawmakers worked until late Tuesday to negotiate other elements in the competitiveness package [known as the United States Innovation and Competition Act of 2021 or USICA].
The Senate last year approved an expansive version of USICA that included significant increases in federal funds for scientific research. It focused on cutting-edge technology research in areas such as quantum computing and artificial intelligence. In all, it authorized around $190 billion in spending in addition to the semiconductor subsidies, according to a congressional analysis. Earlier this year the House passed its own version of the legislation, a $350 billion package.
But the two chambers failed to come to an agreement on the two bills, and semiconductor manufacturers began threatening to cancel proposed U.S. chip-making sites, increasing pressure on lawmakers to reach a deal. Lawmakers instead moved to a narrow bill that could have bipartisan support and resemble what the Senate passed last year.
Lawmakers are also negotiating tax credits for research and development to increase U.S. competitiveness for the long term. Along with $52 billion in subsidies for chip makers, the legislation would allocate $2 billion for the Department of Defense to create a national network of university-based prototyping and development of semiconductor technologies that funds testing to ensure the chips can be manufactured at scale.” (1)
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