What’s good about the Chips Act?

This is going to go down as one of the major bipartisan achievements of this Congress, along with the infrastructure investment and jobs act and the recent gun safety law. The American people deserve to see more examples like this, of both sides coming together to do very, very big things that will leave a lasting impact on our country.” –Senate Majority Leader Chuck Schumer

In order to make more profits, these companies took government money and used it to ship good-paying jobs abroad. Now, as a reward for that bad behavior, these same companies are in line to receive a massive taxpayer handout to undo the damage that they did.–Senator Bernie Sanders

The Senate has passed and the House is likely to pass H.R.7178 – CHIPS for America Act. This bill would subsidize domestic semiconductor production. Supporters argue the legislation is long overdue and will lower U.S. reliance on China for chip manufacturing, which they say poses a national security risk. Is it a good idea?

The bill, a convergence of economic and national security policy, would provide $52 billion in subsidies and additional tax credits to companies that manufacture chips in the United States. It also would add $200 billion in scientific research, especially into artificial intelligence, robotics, quantum computing and a range of other technologies.Catie Edmondson, The New York Times, July 27

Chip manufacturers lobbied heavily, and often shamelessly, for the subsidies, in recent months vocally threatening to plunge their resources into building plants in foreign countries like Germany or Singapore if Congress didn’t quickly agree to shower them with federal money to stay in the United States. Ibid.

Here are my concerns:

  • Will the bill effectively support U.S. semiconductor manufacturing, research and development, and supply chain security?
  • Will the $200 billion for research be spent responsibly?
  • Is it reasonable to spend $50 billion to encourage private domestic manufacturers to invest in plants, equipment, and workers?

Bipartisan support for a bill in the Senate is rare these days. Some Senators may expect to see much spent in the state they represent. Others may hope that an influx of money will boost the economy. Both groups may get their wish, whether or not other things the bill promises bear fruit.

In Japan, in the 1970s, I learned that Japanese manufacturers preferred not to use American made chips, doubting their reliability.

Professors, students, and others all over the world are already studying artificial intelligence, robotics, quantum computing, and anything else that will attract funding.

About whungerford

* Contributor at NewNY23rd.com where we discuss the politics, economics, and events of the New New York 23rd Congressional District (Allegany, Cattaraugus, Chautauqua, Chemung, (Eastern) Ontario, Schuyler, Seneca, Steuben,Tioga, Tompkins, and Yates Counties) Please visit and comment on whatever strikes your fancy.
This entry was posted in Congress, Homeland Security, Legislation, Political, trade and tagged , . Bookmark the permalink.

2 Responses to What’s good about the Chips Act?

  1. josephurban says:

    We can always find billions and billions for big business. And complain when a family gets food stamps for $300 a month. Disgusting.

    Liked by 1 person

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