A bill to increase American chip output and China competitiveness is passed by the House and sent to Biden.

 A bill to increase American chip output and China competitiveness is passed by the House and sent to Biden.

A bill to increase American chip output and China competitiveness is passed by the House and sent to Biden.

The House passed bipartisan legislation on Thursday to boost the United States' competitiveness with China by allocating billions of dollars to domestic semiconductor manufacturing and science research.


The bill was approved 243-187, with no Democrats voting against it. Despite a last-minute push by GOP leaders to oppose it, twenty-four Republicans voted in favor of the legislation.


The bill, which was approved by the Senate on Wednesday, now goes to the White House for President Joe Biden's signature.


It is "exactly what we need to be doing right now to grow our economy," Biden said after the vote. "I am excited to sign this bill into law."


Lawmakers pushed for a quick vote on the package before leaving Washington, D.C. for the August recess. However, the final vote came after years of wrangling on Capitol Hill, with the legislation taking various forms and names in both chambers.


The final version, known as the Chips and Science Act, includes more than $52 billion in funding for US companies that manufacture computer chips, as well as billions more in tax breaks to encourage investment in chip manufacturing. It also provides tens of billions of dollars to fund scientific research as well as to encourage the innovation and development of other US technologies.


House Minority Leader Nancy Pelosi, D-Calif., hailed the legislation as "a major victory for American families and the American economy."


In floor remarks before the vote, House Republican Leader Kevin McCarthy, R-Calif., urged his colleagues to "reject this deeply flawed bill" and "start from scratch."


The bill was approved by the Senate on Wednesday by a vote of 64-33, with 17 Republicans voting in favor. Senate Minority Leader Mitch McConnell, R-Ky., was among those voting yes, despite previously warning that Republicans would not support the China competition bill if Democrats pursued an unrelated reconciliation package.

Hours after the Senate's bipartisan vote on Wednesday, Senate Majority Leader Chuck Schumer, D-N.Y., and Sen. Joe Manchin, D-W.Va., announced a deal on a broad reconciliation bill.


"It's been a historic 24 hours here in Congress, a legislative one-two punch that the American people rarely see," Schumer said in a victory lap after the vote Thursday afternoon.


Schumer and Manchin are hoping to pass their reconciliation bill next week with a simple majority in the Senate, which is evenly divided between Republicans and Democrats, with Vice President Kamala Harris casting any tiebreaking votes.


Shortly after that agreement was announced, Republican leaders in the House urged their members to vote against the Chips and Science Act. They argued against giving chipmakers multibillion-dollar subsidies at a time of historically high inflation, while also noting the timing of the Democrats' reconciliation deal.


"The partisan Democrat agenda has resulted in record inflation, and they are now poised to send our country into a crushing recession," House Minority Whip Steve Scalise, R-La., said in a memo Wednesday night.


Republicans echoed that new stance during pre-vote floor debates. Rep. Frank Lucas, the top Republican on the House Science Committee, where many of the bill's provisions were first hammered out, said he would vote against it regretfully because it has been "irrevocably" linked to the reconciliation plan.


Rep. Eddie Bernice Johnson, D-Texas, chairman of that committee, responded by pleading with all lawmakers to "set aside politics" and vote for the bipartisan bill.


Some Republicans who opposed the bill on its own grounds claimed it lacked "guardrails" to prevent any of the funding from falling into the hands of China. Others have argued that the United States would need to spend many billions more to compete with the world's leading chipmakers.


However, supporters of the bill argue that it is critical to America's economy and national security to produce more chips, which are increasingly important components in a wide range of products such as consumer electronics, automobiles, medical equipment, and weapons systems.


During the Covid-19 pandemic, the chips were in short supply. Factory shutdowns at the start of the outbreak halted chip production in Asia, while consumer demand for automobiles and upgraded home electronics that require the chips increased during the lockdowns. In recent decades, the United States' share of global chip production has also declined sharply, while China and other countries have invested heavily in the industry.


In addition, the United States produces few of the most advanced types of semiconductors, which are mostly manufactured in Taiwan, the epicenter of rising political tensions with China.

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