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Senate Proposes $52 Billion Fund For U.S. Chip Production And Development

U.S. Senate Democrat leader Chuck Schumer has put forth an emergency funding proposal that would sideline $52 billion to support domestic chip production and development.

The funding proposal is included in a 1,400 page bill the Senate will table this week, according to Reuters, and suggests spending $120 billion in total on advancing the development and production of U.S. technology – including $52 billion for chip production, research and development.

“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.”

A shortage of semiconductor chips has crippled the U.S. auto industry this year, forcing General Motors, Ford and other automakers to curb vehicle output in an effort to safeguard their limited chip supply. GM has idled its Lansing Grand River plant in Michigan until late June due to a shortage of chips, while the automaker’s Fairfax Assembly plant in Kansas and CAMI Assembly plant in Ontario will remain offline until late July. Despite the setbacks, GM still predicts it will post annual earnings “at the higher end of the $10 billion to $11 billion EBIT adjusted range,” that it outlined at the beginning of the year.

The majority of microchips are currently manufactured abroad, mainly in Asian countries like Korea, Taiwan and Japan. The bill put forth this week noted that China is ramping up its chip production efforts in an attempt to control more of the global chip supply, making U.S. chip production critical for the future of the country.

“There is an urgent need for our economic and national security to provide funding to swiftly implement these critical programs,” the bill said. “The Chinese Communist Party is aggressively investing over $150 billion in semiconductor manufacturing so they can control this key technology.”

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Comments

  1. How about just simply not taxing the companies to death if they make the parts in the US. Hmm such a novel idea. We need the fair tax and the US would be the worlds biggest manufacture…..well until the Greenies think its bad for the enviroment.

    Reply
    1. The problem for chip plants isn’t tax, it’s energy cost and environmental regulations. They use an incredible amount of power; 1 chip plant = mid-sized 1 power plant. On top of that, the chemicals they use are very nasty (hydrofluoric acid), have to be transported through communities, and have large GWP (SF6).

      It all sounds good until they start building one in your backyard. That’s also one thing people miss about Taiwan, they have a very robust chemical industry which avoids having to ship things very far, and minimizes supply chain disruptions (South Korea-Japan arguments, which have shut down manufacturing before)

      Reply
  2. Let’s give back the money we take from companies and people on ideas we think are smart. Let’s artificially try to create a chip base here in USA. That will work great. In Schumer’s home state people in buffalo are still waiting for jobs to be created by Tesla creating solar panels. Same concept that fails time and again. If government thinks something is a good idea, run away.

    Reply
  3. 1400 pages, why?

    Reply
    1. because 1399 pages have nothing to do with chips

      Reply
      1. Yep, probably alot of pork in that bill.

        Reply
  4. Too little too late. The government should have never let this situation become as dire as this. Inability to manufacture cars is one thing but these chips are instrumental in many of the products our military uses. Seems sensible to have at least one manufacturer that has the capabilities to produce these chips.

    Reply
    1. The Department of Defense went nuts when the last remaining advanced US foundry, IBM, sold off their chip fabs to the Government of Abu Dhabi in 2014. (Actually, they paid them to take it off their hands)

      The problem was Obama was in charge and he couldn’t care less about what DoD was saying, free trade and everything.

      Reply
  5. To little, to late, chip factories take years to build.

    Reply
  6. Politicians are great, first they make it impossible to make a product here, many of which we develop, then they want to spend tons of money to recreate them. All along buying off pet supporters.

    Reply
  7. First government (democrats) creates the problem then they try to create a solution. All part of the McKinsey & Co. strategic plan.

    Reply
  8. How about they just quit the senate and start their their own factory and pay each employee a living wage with their own money, not our money?
    Living comes with consequences and that includes the byproducts of manufacturing. Otherwise buy your own island somewhere and don’t allow anything but bicycles or peddle cars. Oh…. and corn cobs.

    Reply
  9. Obama CAUSED the shortage by screwing big business. Biden should let the MARKET fix itself not make things WORSE!!

    Reply
  10. With all this pork why is bacon so expensive?

    Reply

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