Jul 27, 2022 - Technology

Senate passes major chip funding bill

Illustration of a US flag made of semiconductor chips.
Illustration: Shoshana Gordon/Axios

The Senate voted 64-33 Wednesday to approve a $280 billion package meant to spur U.S. chip manufacturing, a major victory for the Biden administration and chip-makers.

Why it matters: The bill aims to reverse a long-term decline in domestic manufacturing of the computer chips that go into cars, computers, appliances and a range of other everyday items, after the pandemic exposed the fragility of the international supply chain.

Driving the news: The bill, which has gone through many names (most recently the Chips and Science bill), includes $52 billion in funding for domestic production of semiconductors.

  • Intel and other chipmakers have aggressively lobbied for the subsidy, arguing the U.S. government needs to incentivize chip production on American soil to catch up to other countries.
  • The legislation also authorizes (but does not fund) about $200 billion for scientific research, including $81 billion for the National Science Foundation for a technology directorate aimed at translating basic research into commercial products made in the U.S.

Between the lines: The funding won wide bipartisan support, but Sen. Bernie Sanders (I-Vt.) opposed the legislation as a "blank check" for the profitable microchip industry without guardrails.

What's next: The bill heads to the House, which previously passed a broader version of the legislation.

Go deeper: How the Senate's CHIPS-plus bill ballooned by billions

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