A little more than a year ago, The Columbian editorially observed: “Surprisingly, there is a way to break the partisanship that typically paralyzes the United States Senate. Efforts to help the United States compete with China apparently are enough to cut through the intransigence.”
Those efforts finally came to fruition last week, with passage of the CHIPS and Science Act in both the Senate and the House of Representatives. The legislation authorizes nearly $250 billion in federal spending for research, development and manufacturing in science and technology.
Pundits say the bill is designed to stem China’s growing prominence in technology development and reestablish the United States as the global leader in the field. But regardless of the motivation, the legislation could be an important boost for the industry throughout the country and in the Northwest.
“I want to thank my colleagues here today for responding to that threat of competition from around the globe,” said Sen. Maria Cantwell, D-Wash. and chair of the Senate Committee on Commerce, Science and Transportation.
Earlier, on the floor of the Senate, Cantwell said: “We don’t know exactly what innovations will come out of this, but we do know this: America will be more competitive because of it. And we do know this, that we will be able to grow our economy for the future because of the investments that we’ve made today.”
Several facets of the legislation — officially the Creating Helpful Incentives to Produce Semiconductors for America Act — stand out. One is its bipartisan nature, with a 64-33 vote in the Senate and with 24 Republicans joining Democrats in the House (Rep. Jaime Herrera Beutler, R-Battle Ground, was not among them). The common enemy represented by China’s growing economy apparently is enough to bring lawmakers together.
More important is the investment the bill represents in America’s future. According to the Semiconductor Industry Association, the United States accounted for 37 percent of the world’s semiconductor manufacturing capacity in 1990 but now accounts for 12 percent.
That decline has been evident in the Northwest, where there once were visions of a Silicon Forest to rival California’s Silicon Valley. As American production has declined, a Northwest hub for the industry has failed to materialize. A boost to the industry could benefit our region, which has amenities such as an educated workforce, an abundant water supply and relatively inexpensive electricity — all essential to the semiconductor industry.
The CHIPS and Science Act includes tens of billions of dollars to fund scientific research and spur the innovation and development of other U.S. technologies. It also includes tax breaks for manufacturers, which drew opposition from some Republicans in Congress.
Subsidies for a particular industry warrant debate, but the importance of the semiconductor industry cannot be ignored. The chips are the engine of modern life, providing the brains for everything from smartphones to computers to home appliances to automobiles. A global shortage of semiconductors has contributed to inflation by delaying the production of consumer goods over the past two years. As Cantwell said: “Just last year alone, chip shortages cost the U.S. economy $240 billion. … Chips are just as essential as wheat is in America.”
Government intervention for a floundering-but-essential industry is warranted. Ideally, that industry will enjoy a resurgence in the Northwest and elsewhere.