This Friday, the U.S. House of Representatives finally passed the America Competition Act of 2022 almost entirely along partisan lines. And if you go into details, among other measures, the newly passed, rather extensive 2,900 page bill provides for $ 52 billion in grants to subsidize the production of semiconductors. Moreover, it also authorizes almost $300 billion for research and development of various technical solutions. Because of this, we are now aware that if this law is eventually passed, it will be the most comprehensive attempt by the United States of America to match China’s newly established technological and industrial dominance in the country.
However, as the authoritative publication The New York Times notes, in its current version, this law is unlikely to go any further. Much of the current controversy boils down to ideological differences between how Democrats and Republicans believe the federal government can best position the country to compete with China. Republicans in this case are sure that this legislation includes too many extraneous provisions related to climate change.
For example, it provides for an immediate $8 billion in contributions to the Green Climate Fund, an initiative created under the Paris Agreement to help developing countries cope with the crisis. Moreover, the Republicans also argue that the bill currently being promoted is not enough to at least at a decent level catch up with China. However, Democrats and Republicans generally agree that the federal government should indeed spend a lot more money to support local chip manufacturing. When Intel officially announced last month that it was going to build its $20 billion semiconductor manufacturing facility in Ohio, the company also noted that it could eventually invest up to $100 billion in the facility within a next decade, but only if Congress approves additional support.
Well, if we refer to a recent report from the authoritative Bloomberg publication, the current president of the United States of America, Joe Biden, believes that the lack of domestic production of microcircuits is a security problem. The global chip shortage has also played a significant role in fueling inflation in recent months. So the bill mentioned at the very beginning, after a number of improvements, will clearly be adopted. It cannot be otherwise.
