A bipartisan group of 32 senators introduced legislation Thursday proposing $50 billion in federal investment to expand domestic semiconductor manufacturing, seeking to address vulnerabilities in the supply chain that have affected industries from automobiles to consumer electronics.
The bipartisan CHIPS for America Act would provide grants and tax incentives to semiconductor manufacturers willing to build or expand fabrication facilities in the United States. The legislation specifically prioritizes facilities that produce advanced logic chips currently manufactured primarily in Taiwan and South Korea.
"The semiconductor shortage exposed a critical vulnerability in our national security and economic competitiveness," said Senator John Cornyn of Texas, one of the bill's Republican sponsors. "We cannot continue relying on foreign manufacturing for technologies that power our defense systems and economy."
The legislation has attracted support from major technology companies including Intel, TSMC, and Samsung, all of which have announced plans to build U.S. facilities pending federal support. Intel has proposed a $20 billion expansion in Ohio, while TSMC is constructing a $12 billion facility in Arizona.
Critics have questioned whether federal subsidies should support profitable technology companies. "The market will allocate capital to semiconductor manufacturing if the returns are there," said Senate Budget Committee Chairman Jeff Merkley. "We should target this funding to strategic capabilities, not corporate welfare."
The bill must navigate competing priorities in the Senate, with some members pushing for stronger environmental requirements and others concerned about the geopolitical implications of the legislation's technology transfer provisions.