President Biden signed into law on Tuesday bipartisan legislation to provide billions of dollars in incentives to the domestic semiconductor industry and fund scientific research that proponents say will help boost U.S. competitiveness and solve supply chain challenges.
“Today is a day for builders. Today America is delivering,” Biden said at the bill signing event at the White House. “And I, honest to God, believe that 50, 75, 100 years from now, people who will look back on this week, they’ll know that we met this moment.”
The bill — formally known as the CHIPS and Science Act — passed the Senate and House at the end of July, after more than a year of work on Capitol Hill and multiple iterations of the legislation.
The bill includes more than $50 billion in incentives for manufacturers of semiconductors, or chips, to build domestic semiconductor plants. It also includes more than $80 billion for the National Science Foundation authorized over five years to support innovation and research.
“We are better positioned than any other nation in the world to win the economic competition of the 21st century. You’re the reason why I’m so optimistic about the future of our country,” Biden said, thanking lawmakers and business leaders at the White House, which included the chief executives of Lockheed Martin, Intel and Micron.
He called the CHIPS and Science Act a “once in a generation investment in America itself,” and said the bill will create good jobs, employ workers, grow the economy, change the course of human health and disease, lead the world in future industries and protect U.S. national security.
“The CHIPS and Science Act is going to inspire a whole new generation of Americans to answer that question: what’s next?” Biden added, quoting Apple co-founder Steve Jobs, whom he awarded the Presidential Medal of Freedom to posthumously last month.
Biden was joined onstage for the event by Speaker Nancy Pelosi (D-Calif.), Senate Majority Leader Charles Schumer (D-N.Y.), Commerce Secretary Gina Raimondo, and Joshua Aviv, CEO of SparkCharge, an electric vehicle charging network.
The White House has billed the legislation as a solution to supply chain challenges laid bare by the COVID-19 pandemic, during which a global chip shortage caused delays in automobile and electronics production. Chips are used in everything from cars to cellphones to weapons.
The new legislation is designed to increase domestic production of semiconductors over the long term to reduce U.S. reliance on foreign suppliers. Proponents also say it will help the U.S. compete with China, which has its own chip market.
Biden noted in his remarks that China is trying to move ahead of the U.S. in manufacturing such chips and that “it’s no wonder the Chinese Communist Party actively lobbied U.S. business against this bill.”
“The United States must lead the world in the production of these advanced chips. This law will do exactly that,” he added.
The passage of the bill represented a major bipartisan win for the Biden administration. Raimondo and other officials have been pressing Congress to act quickly on the legislation, arguing it is in the interest of national and economic security.
Schumer, in his remarks on Tuesday, thanked Sen. Todd Young (R-Ind.) for his partnership for over three years working on semiconductor-related legislation, which was originally called the Endless Frontier Act and has been given various other names before it was passed as the CHIPS and Science Act last month.
Pelosi recognized Raimondo for shepherding the bill through Congress, saying she had “persistent brilliance” in getting the legislation passed.
“The president said don’t give up … keep going, find another way,” Raimondo said at the event.
Other lawmakers in attendance for the event included Young, Sens. Rob Portman (R-Ohio), Chris Van Hollen (D-Md.) and Chris Coons (D-Del.), and Reps. Joyce Beatty (D-Ohio) and Don Beyer (D-Va.), among others. Additionally, scientists, engineers, college presidents and Illinois Gov. J.B. Pritzker (D) and Pennsylvania Gov. Tom Wolf (D) were at the White House.
“By making more semiconductors in the United States, this bill will increase domestic manufacturing and lower costs for families,” Biden said in a statement Thursday hailing the bill’s passage.
“And, it will strengthen our national security by making us less dependent on foreign sources of semiconductors,” Biden continued. “This bill includes important guardrails to ensure that companies receiving tax payer dollars invest in America and that union workers are building new manufacturing plants across the country.”
The Senate approved the bill on July 27 in a bipartisan 64-33 vote, with Senate Minority Leader Mitch McConnell (R-Ky.) and 16 other Republicans voting in favor of it.
However, the House GOP encouraged members to vote against the legislation after Schumer and Sen. Joe Manchin (D-W.Va.) announced an agreement on a larger climate and health care spending package shortly following the upper chamber’s passage of the chips bill.
McConnell had threatened Republican votes for the chips bill if Democrats moved forward with the larger package – which they intend to pass with a simple majority in the Senate through a process known as budget reconciliation – and House Republican leaders moved to oppose the chips bill once it became clear there was a deal on the reconciliation bill.
Not all Republicans in the House followed directions from leadership, however, and 24 ultimately voted for the semiconductor bill the day after it passed the Senate.
With the bill signed into law, the Biden administration will now go about implementing the legislation.
White House National Economic Council Director Brian Deese told reporters at a recent press briefing that the bill would have near-immediate impacts on decisions by companies to stand up operations in the U.S. But he acknowledged the impact on the domestic supply chain would be longer term.
“This is a long-term project, a long-term national project, that is a vital economic and national security consequence, and the ultimate impact of that will be felt over the course of years,” Deese said.
Updated at 11:17 a.m.