Source: United States Senator for Colorado Michael Bennet
Washington, D.C. – Today, Colorado U.S. Senator Michael Bennet, a member of the U.S. Senate Select Committee on Intelligence, hailed the bipartisan passage of the CHIPS & Science Act of 2022, which will boost the domestic semiconductor industry, fund the largest five-year investment in public research and development (R&D) in the nation’s history, and create regional technology hubs nationwide to spur broad-based job creation and innovation.
“Our semiconductor industry has lost ground because it’s not competing on a level playing field. This bill will provide a major boost to make the chips we need in America, lowering costs for Coloradans, creating good-paying jobs, and strengthening our national security,” said Bennet. “It also includes a major investment to accelerate secure, next generation wireless networks and end our dependence on foreign companies like Huawei and ZTE.”
The CHIPS & Science Act provides $52 billion to boost the domestic production of semiconductors. It also establishes a 25% tax credit for investments in advanced chip manufacturing to help level the playing field for America’s semiconductor industry.
The bill also invests $1.5 billion to deploy open-architecture wireless technologies, or Open-RAN, to deploy next generation wireless networks without relying on insecure equipment from companies like Huawei and ZTE. This historic investment comes directly from the bipartisan USA Telecommunications Act Bennet introduced in 2020 along with U.S. Senators Mark Warner (D-Va.) and Marco Rubio (R-Fla.).
“The CHIPS Act of 2022 and FABS Act are critical investments to even the global playing field for U.S. companies, and strategically important for our economic and national security,” said Ganesh Moorthy, President and CEO of Microchip Technology Inc.
“This legislation represents a major step forward toward a bold vision of renewed national research excellence, scientific competitiveness and innovation,” said Philip P. DiStefano, Chancellor of the University of Colorado, Boulder. “CU Boulder applauds Senator Bennet and Senator Hickenlooper for their steadfast support of these ambitious goals and our university community stands ready to accelerate discovery, innovation and the development of solutions to our collective challenges across Colorado and the nation.”
“This bill’s timely investment in Open Radio Access Network (Open RAN) technologies will help spur American job creation, enhance wireless network security, and foster a more U.S.-centric supply chain for 5G. As DISH continues to be at the forefront of the Open RAN movement through its greenfield U.S. buildout of the world’s first cloud native, Open RAN 5G broadband network, we applaud the Senate’s passage of this critical legislation and Senator Bennet’s continued support of more robust competition and innovation in the American 5G supply chain,” said Stephen Bye, Executive Vice President and Chief Commercial Officer, DISH Wireless.
A summary of the bill is available HERE. A section-by-section of the bill is available HERE.
Background
Today, only 12% of chips are manufactured in the United States, down from 37% in the 1990s. America’s semiconductor industry has lost ground as foreign competitors have generously supported their semiconductor firms with financial aid, tax incentives, and other supportive policies. Until now, Washington has done virtually nothing to help level the playing field. As a result, a staggering 75% of global production now takes place in East Asia, including 92% of the advanced chips we rely on for everything from smartphones to fighter jets.
In January 2021, as part of the William M. (Mac) Thornberry National Defense Authorization Act, Congress passed funding programs authorizing the Commerce, Defense, and State departments to undertake a range of programs to stimulate domestic semiconductor manufacturing. The CHIPS Act of 2022 would provide the appropriations to implement these programs, while ensuring the funds cannot be used to build factories in countries that threaten U.S. national security.
The CHIPS Act of 2022 also provides the largest five-year investment in public R&D in the nation’s history. It dramatically increases funding for next-generation science and technology, from artificial intelligence to quantum computing, advanced manufacturing, 6G communications, and energy and material science. The bill also establishes new technology hubs across the country, increasing the participation of underrepresented populations and regions in innovation and boosting the creation of good-paying jobs.
Scientific research and development (R&D) is critical to a strong economy, public health, and national security–as much as 85% of U.S. productivity growth in the first half of the 20th century came as a result of technological advances. But federal R&D spending as a percentage of GDP is near its lowest point in over 60 years, and total U.S. R&D spending as a percentage of GDP has fallen from 4th place in the 1990s to 9th place today, behind advanced economies like South Korea, Japan, and Germany. The CHIPS & Science Act of 2022 will help reverse these trends, and represents a critical first step in strengthening America’s economy, competitiveness, and security.