WASHINGTON — Senators are moving forward this week on a scaled-back package to boost domestic computer chip production. They just don’t know what’s in the bill yet.
The Senate on Tuesday took the first step to advance what lawmakers are calling “CHIPS-plus” to try to combat the global chip shortage that has affected everything from auto manufacturers to the video game industry. The package is a slimmed-down version of a much broader China competitiveness bill that House and Senate negotiators had struggled for months to reach a deal on.
Fearful that impatient chip manufacturers would build their semiconductor fabrication plants elsewhere if they didn’t act soon, top Democrats made the call to switch tactics: Congress would take up a more narrowly focused bill including $52 billion in subsidies to chip manufacturers, then deal with the larger China competition package later.
CHIPS-plus on Tuesday evening cleared its first procedural hurdle in a 64-34 vote, needing just 51 votes to advance. And key senators said they could pass the bill and send it to the House as early as this week. But they still haven’t agreed on what will be added into it and what will be shelved.
What they have agreed on is that this is an urgent matter. In recent days, Senate Majority Leader Chuck Schumer, D-N.Y., Republican leaders and top Biden administration officials have all made the argument that passing the CHIPS package soon is an economic and national security imperative as China and other nations ramp up production amid global supply-chain woes.
“We will see if members can come to an agreement on adding other provisions to the bill, but the bottom line is that we must come up with a package that is capable of passing this chamber without delay,” Schumer told reporters Tuesday after Senate Democrats’ weekly lunch.
“We must act as soon as we can to make sure we bring chip manufacturing back to America because our nation’s security depends on it,” he added.
After holding separate classified briefings with House and Senate lawmakers last week in the Capitol, Commerce Secretary Gina Raimondo warned: “This is about national security. This isn’t about politics, and we are out of time.”
Schumer’s GOP counterpart, Senate Minority Leader Mitch McConnell of Kentucky, said he also believed the “CHIPS thing is a national security issue of significant proportion.” But, he said he’s “not going to vote to proceed until I know what we’re proceeding to.”
“I want to see what we’re voting on,” McConnell said.
The No. 2 Republican in leadership suggested that the authors of the bill want to gauge the GOP appetite on the floor and craft it on that basis.
“We don’t know what the bill is. That’s the challenge right now,” Senate Minority Whip John Thune, R-S.D., told NBC News. “They’re going to cobble it together based on, I think, how big the Republican vote to get on it is.”
But other senior Republicans said they ultimately expected to vote for the CHIPS bill, boosting chances that it will secure votes needed to clear the Senate.
“It looks like we’re running out of time,” said Sen. John Cornyn, R-Texas, whose state is a hub of chip makers, including Micron and Texas Instruments.
“If the right signals aren’t being sent now, those fabs are going to be built in other places around the world and not in America,” he said. “I’ll probably support whatever Schumer puts on the floor.”
Sen. Todd Young, R-Ind., co-author of the broader competition bill, said the smaller package will likely end up being “CHIPS plus Endless Frontier,” referring to another technology competitiveness bill he co-wrote with Schumer, totaling about $250 billion authorized and appropriated.
Young huddled with a bipartisan group of a dozen senators Monday evening — including Sens. Kyrsten Sinema, D-Ariz., and Susan Collins, R-Maine — and said he’s still working to ensure some pieces will make it into the final package, including science and research provisions.
“This is an investment in breakthrough research, which will occur primarily in our research universities — this is where some of the best talent in the world resides,” Young said. “And we need to harness that talent, that creativity and expertise to produce technologies like hypersonics, artificial intelligence, quantum computing, semiconductors, et cetera, and then spin off intellectual property and help drive the 21st-century economy.
“I am confident that the House will take up what we pass,” Young added.
Both the House and Senate had passed their own version of the larger China competitiveness bill and negotiators had been meeting to hammer out their differences. But McConnell quashed the talks after learning that Democrats had revived efforts to pass a partisan reconciliation package.
One House negotiator, Rep. Veronica Escobar, D-Texas, said she would likely be supportive of the smaller CHIPS bill but was disappointed the broader negotiations broke down.
“I felt as though we could have gotten this across the finish line were it not for Mitch McConnell saying that he was taking his ball and going home,” Escobar said in an interview Tuesday. “I am disappointed that it will be a skinny version and that it will not take into account conversations that happened during negotiations.”
Senate Finance Chair Ron Wyden, D-Ore., said the CHIPS bill is critical to reducing U.S. dependence on foreign suppliers for automobiles and other items.
“From the time you get up in the morning until the time you go to bed at night, we’re using chips,” he said. “And this is an enormously important national security issue, an economic security issue.”