By Natalie DeCoste
On Tuesday, the U.S. Senate passed one of the largest industrial bills in U.S. history in an effort to ensure that the country remains competitive with China in the tech industry.
The bipartisan bill, S.1260, known as the U.S. Innovation and Competition Act, passed by a 68 – 32 vote. The bill was passed to build up U.S. manufacturing and tech to compete with China.
The bill authorizes roughly $250 billion in funding for scientific research, subsidies for chipmakers and robot makers, and an overhaul of the National Science Foundation. In addition, the bill includes about $190 billion for measures to strengthen U.S. technology and research.
The bill also includes a separate approval for $54 billion to increase U.S. production and research into semiconductors and telecommunications equipment, which includes $2 billion dedicated to the chips used by automakers that have been in short supply during the pandemic, leading to significant production cuts in the auto industry.
The money for the semiconductor development has been allotted to the Commerce Department and is the centerpiece of the new legislation.
The final bill that was passed was the product of six separate Senate committees and almost all chamber members. It is also likely to be one of the only major bipartisan efforts of 2021, reflecting the U.S.’s dedication to countering China’s power in the global tech industry.
In response to the new bill, China’s parliament expressed “strong indignation and resolute opposition.” The parliament said that the U.S. bill showed a “paranoid delusion of wanting to be the only winner” and had distorted the original spirit of innovation and competition.
During an assessment in April, U.S. intelligence officers included China on a list of countries considered global threats to U.S. interests. Between the coronavirus outbreak originating within the Chinese borders and the subsequent disruption of the global supply chain, tension between the two countries is on the rise.
“The premise is simple, if we want American workers and American companies to keep leading the world, the federal government must invest in science, basic research, and innovation, just as we did decades after the Second World War. Whoever wins the race to the technologies of the future is going to be the global economic leader with profound consequences for foreign policy and national security as well,” said Senate Majority Leader Chuck Schumer (D-NY).
There are several other Chinese-related elements to the bill that are not reflected in the research and development side of the bill. Some of these provisions include prohibiting Chinese social media app TikTok from being downloaded on government devices, blocking the purchase of drones manufactured and sold by companies backed by the Chinese government, and allowing Taiwanese diplomats and military officials to display their flag and wear their uniforms while in the United States on official businesses.
The bill must pass in the House of Representatives and be signed by President Joe Biden before becoming law, and it is unclear what the House may wish to change about the bill. Meanwhile, President Biden has already expressed his support for the bill.
“I applaud the United States Senate…for coming together to pass the U.S. Innovation and Competition Act… We are in a competition to win the 21st century, and the starting gun has gone off. As other countries continue to invest in their own research and development, we cannot risk falling behind. America must maintain its position as the most innovative and productive nation on Earth,” read a statement from President Biden and the White House.
