President Joe Biden on Tuesday signed a multibillion-dollar bill into law to boost domestic semiconductor and other high-tech manufacturing sectors that US leaders fear risk being dominated by rival China.
As stated by the White House, the government’s commitment to bolstering high-tech industries is already attracting large-scale private investors, with $50 billion in new semiconductor investment alone. The lion’s share of that is a $40 billion investment by US firm Micron in domestic expansion by 2030.
In a White House speech, Biden stated that the cash injection from the Chips Act will help the country “win the economic competition in the 21st century.”
Since taking office, one of the Democrats’ main themes has been the need to re-establish US leadership in cutting-edge innovation and rebuild the domestic industrial base in the face of China’s massive state-backed investments.
Semiconductors are of particular concern because they are used in everything from washing machines to sophisticated weapons, and nearly all of them are manufactured in other countries. Despite the fact that the semiconductor was invented in the United States, the country only produces about 10% of the global supply, with the remaining 75% coming from east Asia.
Biden is also banking on the Chips Act to generate voter enthusiasm as his Democratic Party attempts to defend a razor-thin congressional majority against a Republican takeover in this November’s midterm elections.
Biden will sign another bill increasing funding for military veterans who have been exposed to toxins on Wednesday. This, like the Chips bill, received bipartisan support in a typically polarised Congress.
Soon, Biden is expected to sign a massive domestic investment bill backed solely by Democrats, aimed at combating climate change and lowering healthcare costs.