US CHIPS and Science Act Signed Into Law

By Oliver Peckham

August 9, 2022

Just a few days after it was passed in the Senate, the U.S. CHIPS and Science Act has been signed into law by President Biden. In a ceremony today, Biden signed and lauded the ambitious piece of legislation, which over the course of the legislative process broadened to include hundreds of billions in additional science and technology spending. He was flanked by Speaker of the House Nancy Pelosi, Secretary of Commerce Gina Raimondo, Senate Majority Leader Chuck Schumer and SparkCharge founder and CEO Joshua Aviv, among others.

“The CHIPS and Science Act supercharges our efforts to make semiconductors here in America,” Biden said. “America invented the semiconductor. They powered NASA’s mission to the moon, federal research and development brought down the cost of making them[.] As a result, over 30 years ago, America had 40 percent of the global production of these chips.” But now, Biden said, the United States barely produces 10 percent, despite being “the leader in chips design as well as research.”

The CHIPS part of the CHIPS and Science Act (a backronym for “Creating Helpful Incentives to Produce Semiconductors”) allocates $54.2 billion toward bolstering the American semiconductor supply chain: $39 billion in incentives for the construction or expansion of domestic fabs, $11 billion for research and development; $200 million for the semiconductor workforce; $2 billion for a Department of Defense-affiliated semiconductor fund; $500 million for an international security and innovation fund; and $1.5 billion for public wireless supply chain innovation. The remaining ~$225 billion in the CHIPS and Science Act contains myriad other computing-adjacent allocations, which you can read about in more detail here. The bill passed the House 243-187, with Democrats united in support and 24 Republicans joining them; in the Senate, it passed 64-33, including support from 17 Republicans. (For more on the legislative process behind the bill’s passage, read our prior coverage here and here.)

“This increased research and development funding is going to ensure the United States leads the world and the industries of the future,” Biden said, “from quantum computing to artificial intelligence to advanced biotechnology, the kinds of investments that will deliver vaccines for cancer cures for HIV, invent the next-gen big things that hadn’t been imagined yet. … We’re going to make sure we include all of America, supporting entrepreneurs and technological hubs across America, including historic Black colleges and universities, minority serving institutions, tribal colleges. We’re going to tap into our greatest competitive advantage: our diverse and talented workforce — urban, rural, suburban and tribal.”

“Thanks to everyone’s leadership, we secured the tools the administration needs to identify, develop and recruit our nation’s best minds — building an inclusive STEM workforce and fostering innovation in every corner of America,” Pelosi said. “[The bill] delivers game-changing investments to drive decades of discovery, especially at the National Science Foundation.” She added that “strong guardrails” had been added to keep the benefits on U.S. soil and prevent profiteering.

The moment after the bill was signed. Image courtesy of the White House.

Ahead of the formal signing today, industry leaders met with government officials from the White House and the Department of Defense yesterday to discuss semiconductor strategy. Those leaders included executives from Applied Materials, Ford, General Motors and GlobalFoundries, among others. In a press release, the co-hosts of the summit (Applied Materials, Ford and GlobalFoundries) said that they aimed to “engage in a constructive dialogue to discuss how these public investments can accelerate semiconductor and emerging technology manufacturing, support the electrification of automobiles with a ready supply of chips, including feature-rich chips, and strengthen the United States’ economy, supply chains, and national security.”

The bill was also publicly lauded by AMD CEO Lisa Su and Nvidia Chief Scientist and Vice President of Research Bill Dally at the meeting of the President’s Council of Advisors on Science and Technology (PCAST) on July 28th. And immediately ahead of the signing today, two major private investments were unveiled: Micron announced a $40 billion investment in memory chip manufacturing in the U.S., which the White House says will bring the U.S. share of memory chip production from two percent to 10 percent; and Qualcomm and GlobalFoundries announced a $4.2 billion expansion of GlobalFoundries’ manufacturing facility in upstate New York.

“All too often, government and businesses are accused of thinking too short-term,” Schumer said. “But this is one of the most significant long-term thinking bills in ages. I firmly believe our grandchildren will work in jobs we can’t even envision now because of these great investments. And to the innovators, job-creators and workers who have witnessed the slow erosion of America’s semiconductor industry: we will bring these jobs back to our shores and end our dependence on foreign chips.”

Indeed, the CHIPS and Science Act is a major victory for the Biden administration — one of several such wins for the White House in recent weeks. Another on the near horizon, the Inflation Reduction Act, is a sweeping tax and climate bill that appears poised to deliver additional computing-related provisions. As drafted and passed by the Senate, the bill includes hundreds of billions for laboratory infrastructure and scientific research, including a specific carveout of $163.8 million for advanced scientific computing research facilities. The bill similarly includes $190 million for “high-performance computing, data processing capacity, data management, and storage assets” for the National Oceanic and Atmospheric Administration (NOAA) in service of its climate and weather research agenda. The House is expected to pass the Inflation Reduction Act by the end of the week.

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