U.S. Senate vote to approve the CHIPS Act

Following the passing of cloture on Tuesday, the US Senate voted 64-33 to approve the CHIPS Act on Wednesday. The bill will now be debated in the House, as it includes $52 billion to boost domestic semiconductor development. The United States Innovation and Competition Act, which successfully made it through the Senate before stalling in the lower congressional chamber, is very similar to the current law.

The move is in response to the current chip scarcity that has been spurred by a number of global issues, including the pandemic, trade wars between the United States and China, and the ongoing Russia-Ukraine tensions. These elements, along with the centralization of manufacturing in Asia, have resulted in a shortfall of the chips that power almost every device from smartphones to smart homes.

Due to his COVID-19 diagnosis, President Joe Biden met digitally with a number of CEOs earlier this week to discuss the CHIPS matter. The President tweeted Wednesday morning that semiconductor chips are the foundation of the modern global economy since they power all electric devices and automobiles. He added that manufacturing was outsourced for a long time and it’s time to bring it home. Biden said there was a need to produce goods in the country, for the benefit of American employment and its economy. All of which will be accomplished under the CHIPS for America Act.

In a statement related to the vote, Senate Majority Leader Chuck Schumer said, "We are moving forward on the Senate CHIPS bill." Adding that it will target the national deficit of semiconductor chips, reduce costs for American consumers, and foster employment growth in the sciences.

The implications of not adopting the bill, according to Commerce Secretary Gina Raimondo, might be disastrous. She said it’s a "scary scenario" if the United States supposedly lost access to Chips currently manufactured in Taiwan, amid the ongoing severe recession. She said it will be the country's inability to build military weaponry to defend its citizens. "We need a manufacturing base that produces these chips" on the American soil, or at least enough of them to keep Americans from becoming overly reliant on foreign suppliers.

The bill has drawn criticism from both sides of this debate in addition to bipartisan support. In a statement, Bernie Sanders recently alleged that the bill supports "crony capitalism". 

At the recent Aspen Ideas Festival, Intel CEO Pat Gelsinger dismissed the notion that his industry was searching for favors and added that further delays would force chipmakers to relocate to other non-U.S. regions, such as Europe. The president claimed that despite Congress' inability to complete this, the rest of the world is advancing quickly. “We greatly appreciate the bill’s Senate champions for advancing it, commend today’s strong bipartisan vote, and urge the House of Representatives to swiftly follow suit and send the CHIPS Act to President Biden’s desk to be signed into law. The stakes are high, and the time to act is now”