Congress Trying to Negotiate on Plan for Chip Manufacturing

Congress Trying to Negotiate on Plan for Chip Manufacturing

( – The lack of computer chips has hit US markets hard. These tiny components are essential to various goods, from cars to televisions. Both houses of Congress have passed bills addressing the issue. But the upper and lower houses must now come together and resolve their differences to finalize legislation they can send to the president to sign.

The Bills

The Senate passed the Innovation and Competition Act on June 8, 2021. More recently, the House of Representatives passed the America COMPETES Act, which contains provisions for computer chips, on February 4, 2022.

To find a compromise on the bills, the House and Senate will send members to a committee to negotiate and blend the legislation into one final law. The committee includes 49 Democrats and 32 Republicans from the House. The Senate will contribute 13 members from each party.

Points of Disagreement

The committee must clear some hurdles to bring everyone together on the same page, and the first big jump might be the total spending allowance for this bill. The Senate act budgeted around $250 billion, whereas the House legislation budgeted over $400 billion. According to an April 18 report from the Associated Press, these are some of the main differences in the House and Senate bills.

The House wants to see investment to improve the US supply chain. The plan involves funding tribes, companies, and local governments to set up manufacturing plants for critical goods. The Senate bill contains nothing of this nature.

The House also wants to provide financial help to people who suffer a job or income loss due to imports increasing. The funding would assist them with training and provide financial aid to keep them afloat while seeking new employment. The Senate didn’t address this issue.

Also, the House included provisions not present in the Senate bill for climate change assistance to other countries and the creation of a new visa to assist entrepreneurs in becoming lawful permanent residents.

Points of Agreement

Both bills address the need to invest in helping companies build or renovate existing operations to produce semiconductors. Each piece of legislation agrees with the concept of funding research and development with plans to create technology hubs across the country.

The bottom line here is both houses of Congress and political parties understand there’s a pressing need for the US to figure out how to fix the supply chain issues and add more computer chips into the market. They can agree on the needed outcome, but getting there will be a challenge as opposing sides are sure to butt heads on many of the details required to pass unified legislation quickly.

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