Congress Passes CHIPS Act, Terrible Erik Estrada Headline Joke Deleted For You, The Reader
Because we care.
The House of Representatives yesterday passed the "Chips and Science Act," a $280 billion package of technology funding aimed at boosting production of computer chips in the USA and increasing tech competitiveness with China. Why are people calling it the CHIPS Act, apart from rampant early-'80s nostalgia? When it wasintroduced in the Senate in June , it was cutesily named the "Creating Helpful Incentives to Produce Semiconductors for America Act," that is why. The new name is gooder.
Twenty-four House Republicans voted for the bill along with nearly all House Democrats. On Wednesday, the Senate passed its version of the bill on a 64-33 vote, after which Democrats made Republicans mad by announcing the agreement between Majority Leader Chuck Schumer and Sen. Joe Manchin on a climate bill. That was very tricksy and bad, so Senate Republicans lashed out and screwed over veterans, while most House Republicans suddenly decided they hate business subsidies.
So what's in this sucker? Most of the attention is going to the "chips" part of the bill, which will provide $52 billion to help US companies that will manufacture computer chips here in the USA, where semiconductor manufacturing has fallen far behind China and elsewhere in Asia, especially Taiwan, which makes nearly all the most advanced chips on the market. With China in another phase of suggesting it would very much like to take control of Taiwan, the bill is being touted as a national security counter to Chinese lightsaber-rattling, too.
Continued worldwide shortages of microchips have stymied the recovery of the auto industry, and the reduced supply of new and used cars has been a major driver of inflation. The stimulus from the CHIPS bill won't immediately get US-manufactured microchips on the market, but it's expected to help stabilize supply chains going forward, and as the Wall Street Journal reports, that's dollar-sign music to corporate ears:
Steven Croley, chief policy officer and general counsel at Ford Motor Co., cited recent investments in electric vehicles and batteries and said the bill “will help make those manufacturing lines hum.” [...]
Several chip fabricators like Intel Corp., Taiwan Semiconductor Manufacturing Co. and GlobalFoundries Inc. have already announced plans to build plants in the U.S. contingent on the bill’s passing.
Sen. Bernie Sanders (I-Vermont) argued against the bill in the Senate, condemning the chips part of the bill as a "blank check" for already profitable tech companies, and he's not wrong there. He said he could support a bill to expand microchip production in the US, but only if such a bill also helped working and middle-class Americans with education and social support, particularly "at a time when the working families of this country are falling further and further behind while the very rich are getting much richer."
"If private companies are going to benefit from generous taxpayer subsidies, the financial gains made by these companies must be shared with the American people, not just wealthy shareholders," Sanders added. "In other words, if microchip companies make a profit as a direct result of these federal grants, the taxpayers of this country have a right to get a reasonable return on that investment."
"Bottom line: Let us rebuild the U.S. microchip industry," he argued, "but let's do it in a way that benefits all of our society, not just a handful of wealthy, profitable, and powerful corporations."
Other parts of the bill, like a total of $200 billion for a wide range of scientific, academic, and research and development investments, will push cool new tech like robotics, artificial intelligence, and quantum computing, which is especially important because it has all that quantum in it. Also, look at how good the AIs are getting at making pictures from dumb prompts like "futuristic high tech cityscape composed of computer chips, detailed science fiction art":
That far larger tranche of sci/tech funding may not exactly be socialist, but is at least aimed at spreading the tech money around more widely, as the Journal notes:
Chunks of that funding are expected to flow to rural states under new formulas for distributing research dollars. The legislation also directs the Commerce Department to create 20 “regional technology hubs” designed to create more tech jobs across the country.
The technology R&D investments target fields including artificial intelligence, quantum computing, wireless communications and precision agriculture.
The National Science Foundation would oversee a new $20 billion directorate focused on accelerating the development of technologies critical to U.S. security, in addition to an increase to $61 billion for its core activities funding researchers at universities and elsewhere.
The Energy Department’s Office of Science’s five-year authorization would increase to about $50 billion to boost a series of programs focused on clean energy, nuclear physics and high-intensity lasers.
The bill also provides additional funding to NASA, including a formal commitment to keep the International Space Station operating through 2030, although other members of the ISS partnership will need to sign on as well. Russia earlier this week stomped its moon boots and vowed to pull out of the ISS program, although it's still not clear how serious the threat was.
And while there's certainly some value in the Chips and Science and Fish bill's having pissed off Republicans, it's probably more significant, as Wired magazine points out, for the fact that it "marks a shift in government from faith in the free market to the kind of industrial policy that has long been out of vogue." Wednesday, after the Senate passed the bill, Commerce Secretary Gina Raimondo called it
a significant step toward securing America’s scientific leadership and revitalizing America’s ability to make the chips that keep our cars on the road and fighter jets in the air.
And also our clean energy transition moving forward; let's not forget that part.
Update: Also too, a detail we hadn't seen,via Bloomberg News: in what oughta be a mandatory rule for all bills that send taxpayer money to private businesses, the Chips and Science Act prohibits companies from using funds from the program for foreign investments or stock buybacks. That latter is super important, since buybacks don't do a bit of good for workers or the economy as a whole; all they accomplish is making stocks more valuable, enriching the investor class. Let's see that kind of restriction in more bills, please!
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