May 26, 2022

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Future Technology

House passes bill to jumpstart US chip manufacturing

The US Capitol Building.


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The House of Representatives has passed a bill to ramp up chip manufacturing in the US and ease supply chain woes. All that’s left is for Congress to reconcile it with a similar bill passed by the Senate last year to get legislation to the White House.

The COMPETES Act passed in the House in a 222-210 vote along party lines, with one Republican in favor and one Democrat against the legislation. Colloquially called the “China competition” bill, the COMPETES Act offers economic stimulation including $52 billion to fund semiconductor manufacturing in the US to start weaning the country off dependence on chip fabrication in China.

The bill provides $39 billion in subsidies to fund new semiconductor fabrication facilities, including those already being built like the TSMC plant in Arizona. While many of these facilities wouldn’t start production for years, more local production could help reduce the global chip shortage that has affected many industries.

President Biden’s office lauded the passing of the House bill, which must now be reconciled with the US Innovation and Competition Act passed in the Senate in 2021.

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