China competition bill set to advance to final negotiations in Congress after months of delays

The Senate has forged ahead with a long-stalled bill to promote US production of microprocessor chips to better compete with China, preparing to inch the legislation forward and into a tough round of negotiations with the House.

President Biden has pressed Congress for quick passage of the sweeping legislation but key differences remain between the House and Senate versions.

The Senate version is the $250 billion US Innovation and Competition Act. The House counterpart is the $335 billion America COMPETES Act.

After months of stalls, Senate Majority Leader Charles E. Schumer set up the votes to get the legislation into a bicameral conference committee to begin reconciling the two bills.

“This legislation has been dissected and debated for well over a year now,” Mr. Schumer, New York Democrat, said on the Senate floor Tuesday. “But the need to pass this bill really boils down to two simple words: JOBS, jobs and COSTS costs.”

Both the House and Senate versions include a $52 billion boost for semiconductor manufacturing to combat a chip shortage.

“There’s nothing abstract about the shortage of chips,” Mr. Schumer said. “It impacts Americans’ abilities to buy cars, refrigerators, phones, and other household items. By passing bipartisan legislation that invests in domestic chip production, we can help alleviate this vexing chips crisis.”

The Senate version first passed in June with the support of 18 Republicans and 50 Democrats.

But the nearly 3,000-page House version also includes a hodgepodge of spending including $8 billion to help developing countries address climate change, funding to make the US less reliant on Chinese solar technology and $45 billion to shore up US supply chains.

House Republicans railed against the bill, which passed 222 to 210 last month, as a “foreign policy failure” that funnels taxpayer dollars into an “unaccountable UN slush fund” without addressing threats to US national security posed by China.

House Republicans also voiced frustration with the process, saying they were sidelined while Democrats wrote the bill.

Sen. Todd Young, an Indiana Republican who worked on the Senate version, said he is committed to making the final bill more palatable for House Republicans.

The bill is a priority for Democrats and its passage would be a big win for Mr. Biden, who has been hobbled by a string of legislative defeats.

Mr. Biden also has struggled to untangle a global supply chain hobbled by shipping delays and backlogs. And, the US has been edged out of semiconductor manufacturing in recent decades by overseas producers.

On Monday, Commerce Secretary Gina Raimondo urged lawmakers to quickly move the legislation through Congress.

“The situation as it relates to semiconductors is quite dire,” Ms. Raimondo said in a call with senators of both parties.

Ms. Raimondo brought in former Trump administration officials, for the call including former national security adviser HR McMaster, to help sway lawmakers.

During the call, Mr. Young said he welcomed the start of formal negotiations between the House and Senate but wanted an open process “with input from all of my colleagues and consistent with what we call around here regular order.”

“I know the vote will not be unanimous and that both parties and members of both parties are going to have to make principled compromises, principled concessions, in order to get an agreement done,” he said. “That’s always what happens when you approach a negotiating table. But America and the world will be better off with a bipartisan, broadly supported final product.”

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