Senate Democrat proposes $52 billion for U.S. chips production, R&D
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[May 19, 2021]
By David Shepardson
WASHINGTON (Reuters) - U.S. Senate
Democratic Leader Chuck Schumer unveiled revised bipartisan legislation
late Tuesday to approve $52 billion to significantly boost U.S.
semiconductor chip production and research over five years.
The emergency funding proposal will be included in a more than
1,400-page revised bill the Senate is taking up this week, as first
reported by Reuters on Friday, to spend $120 billion on basic U.S. and
advanced technology research to better compete with China.
"American manufacturing has suffered rather dramatically from a chip
shortage," Schumer said. "We simply cannot rely on foreign processors
for chips. This amendment will make sure that we don't have to."
The proposal includes $49.5 billion in emergency supplemental
appropriations to fund the chip provisions that were included in this
year's National Defense Authorization Act, but which require a separate
process to garner funding.
President Joe Biden has also called for $50 billion to boost
semiconductor production and research.
Supporters of funding note the U.S. had a 37% share of semiconductors
and microelectronics production in 1990; today just 12% of
semiconductors are manufactured in the United States.
"There is an urgent need for our economic and national security to
provide funding to swiftly implement these critical programs. The
Chinese Communist Party is aggressively investing over $150 billion in
semiconductor manufacturing so they can control this key technology," a
bill summary released Tuesday said.
The measure would "support the rapid implementation of the semiconductor
provisions" in the defense bill.
As reported by Reuters, the bill includes $39 billion
in production and R&D incentives and $10.5 billion to implement programs
including the National Semiconductor Technology Center, National
Advanced Packaging Manufacturing Program and other R&D programs.
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U.S. Senate Majority Leader Chuck Schumer (D-NY), with Senator Gary
Peters (D-MI) and Senator Bob Menendez (D-NJ), speaks to reporters
during the weekly news conference following the Democratic caucus
policy luncheon on Capitol Hill in Washington, U.S. May 18, 2021.
REUTERS/Jonathan Ernst
Last month, Ford Motor warned the chip shortage might slash its
second-quarter production by half, costing it about $2.5 billion and
about 1.1 million units of lost production in 2021, while General
Motors has extended production halts at several North American
factories because of the shortage.
The bill also includes $1.5 billion in emergency funding to help
boost Western-based alternatives to Chinese equipment providers
Huawei Technologies and ZTE Corp, aiming to accelerate development
of an open-architecture model (known as OpenRAN) backed by U.S.
carriers.
Another provision prohibits the Chinese-owned social media app
TikTok from being downloaded to government devices "to better
safeguard the privacy and security of Americans."
Schumer said the U.S. must address the rising threat from China on
many fronts, notably the technology race. "If we don’t step up in a
big and bold way, we risk missing out on a generation of good-paying
jobs, millions and millions of them," he said.
(Reporting by David Shepardson; editing by Richard Pullin)
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