Senator Ron Johnson, who voted against the bill, called the package 'more corporate welfare'. Senator Bernie Sanders has called the legislation a 'bribe' and has argued that chip companies are, in effect, extorting American taxpayers. But critics believe it isn't worthwhile to reverse this trend. The decline in domestic chip manufacturing has spurred calls for legislation to bring chip production back to the US and bolster the competitiveness of the US semiconductor industry. The costs of owning a new chip factory in the US are roughly 30 percent to 50 percent higher than in Asia, according to the Semiconductor Industry Association. Manufacturing moved out of the US because of lower costs in Asia.

The US share of global semiconductor manufacturing capacity has been declining in recent decades - from 37 percent in 1990 to 12 percent today. But critics said it won't solve the problem because the chip factories won't be complete for years, and the demand for chips has already slowed. This country needs another 'Sputnik moment.''Īdvocates of the bill have been promoting it as a solution for the global chip shortage, which has caused price hikes and supply chain disruptions in several industries. 'Lack of the necessary technical skills can't be fixed in an instant. 'And the added question is whether the United States still has the required skills after being dependent on offshore manufacturers for decades,' said Koo. Industry experts have said that the funding is far from enough to bring back chip manufacturing to the US, because it's extremely expensive and complicated to build a new foundry, which costs close to $20 billion today.

Fifty-two billion dollars for semiconductor investments will move the needle but barely,' George Koo, a retired international business adviser in Silicon Valley, told China Daily, in response to the passage of the bill. The bill 'will accelerate semiconductor manufacturing in the US, lower prices, create jobs, and - critically - decrease our reliance on imported chips', he said in a statement Wednesday. The bill will head to the House, where it is likely to pass this week, and then move to President Joe Biden for his signature before it becomes law.īiden has said the legislation is one of his agenda's top priorities and urged the House to pass it as soon as possible. About $52 billion would go to chip companies to provide financial incentives for domestic semiconductor manufacturing. The US Senate passed a bill Wednesday that would provide $52 billion in subsidies to domestic semiconductor manufacturers to boost competition with China, but experts see some challenges in achieving that goal.īy a 64-33 vote, the Senate passed the $280 billion 'CHIPS and Science Act', formerly known as the CHIPS Act. US Senate Majority Leader Chuck Schumer speaks following the passage of the Creating Helpful Incentives to Produce Semiconductors (CHIPS) for America Act on Jin Washington, DC.

Bill daily