[Congressional Record Volume 168, Number 22 (Thursday, February 3, 2022)]
[Senate]
[Pages S512-S514]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                         CHIPS for America Act

  Mr. CORNYN. Madam President, in the summer of 2020, the senior 
Senator from Virginia, Senator Warner, and I introduced the CHIPS for 
America Act to reshore semiconductor manufacturing here in the United 
States.
  I didn't know much about semiconductors when we got started, but I 
have learned a lot, and what I have learned is that this is an 
essential commodity that we have over time offshored to places like 
Asia that we need to reshore or bring back to America for our economy 
and for national security.
  Currently, 90 percent of the semiconductors in the world are 
manufactured in Asia. Sixty-three percent of the semiconductors in the 
world come from one place: Taiwan. If COVID has taught us one thing, it 
has taught us how vulnerable our supply chains can be. And the truth 
is, semiconductors have become so critical to our way of life, to our 
economy, and to our national security, to everything we do, that if 
that supply were blocked for some reason--either as a result of another 
pandemic or a natural disaster or, Heaven forbid, a military conflict--
it would be devastating to the United States and our economy and our 
national security.
  That is why, when our bill was introduced as an amendment to the 
Defense authorization bill, it passed 96 to 4. Clearly, we had strong, 
bipartisan support here in the Senate. It took less than 7 months from 
the time we introduced the bill until it became law, and then 6 months 
later, the Senate passed the U.S. Innovation and Competition Act, with 
$52 billion in funding for the CHIPS Program.
  Had this legislation been introduced years ago, before the pandemic, 
I don't think it would have received either such quick action or such 
broad bipartisan support. That is not because this type of investment 
wasn't needed. There is clear data that showed a concerning trend in 
U.S. chip manufacturing.
  We saw big investments made by other countries in their own 
capabilities and a business model primarily by Taiwan Semiconductor 
Manufacturing Company, which I visited along with colleagues in Taipei 
just a few months ago, where their business model is to manufacture 
chips made and designed--I should say designed by companies that need 
those semiconductors. But rather than build their own manufacturing 
capability, their own foundry, they outsourced that to Taiwan 
Semiconductor. So Taiwan and particularly Taiwan Semiconductor have 
become the focal point for the production of semiconductors around the 
world.
  Well, there was general agreement that something should be done 
before COVID-19, but it certainly wasn't at the top of everyone's 
priority list. But, as I said, when the pandemic hit, the vulnerability 
of our supply chains for everything from PPE--personal protective 
equipment--to semiconductors became apparent.
  Well, how has that affected everyday Texans, folks from Nevada or 
Colorado? Well, we found out that an absence or a lack of 
semiconductors meant empty car lots. You couldn't buy a new car. You 
couldn't get a computer, perhaps for your child to be able to study 
virtually during a quarantine period or during a period of virtual 
learning at schools across the country.

  We saw higher prices adding to the problem with inflation. Suddenly, 
those concerning data points turned into real-world problems. Consumers 
who never even dreamed or thought about a semiconductor before found 
themselves impacted by this global shortage. The new car they had been 
saving up for wasn't available. The Christmas gift they planned to 
order for their children was out of stock.
  While the lack of consumer products is a big problem, it pales in 
comparison to the security risk created by the chip shortage. Simply 
put, semiconductors are vital to our critical infrastructure. Our grid 
keeps on the lights and makes it possible to heat our buildings during 
the cold of winter. They run our cell towers that enable us to talk on 
our cell phones or download data and do

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searches on the web. They are critical to our energy grid, our water 
treatment plants, and our agricultural sector. Semiconductor chips make 
it all possible.
  As I said, our national defense also depends on semiconductors. When 
we send our troops on any mission by air, sea, land, or cyber space, 
they need the best equipment available, and usually what that means is 
the most advanced technology available. Advanced fighters, quantum 
computing, missile defense--all rely on semiconductors.
  I asked my staff to research back when Israel was using the Iron Dome 
missile defense system to knock rockets out of the sky that were 
destined to hit population centers in Israel. I said: Find out for me 
how many semiconductors are in each one of those missile defense 
interceptors. They came back with a figure of 750 chips in each one of 
those missile defense interceptors.
  So it is not hard to imagine we would be in big trouble if a lack of 
supply crippled any of these functions, and unfortunately, it is a real 
possibility. Over the years, domestic chip production has steadily 
dropped as other countries have upped their manufacturing capabilities. 
As I said, 90 percent of that manufacturing is now in Asia.
  We had the idea--and it is not a crazy idea--that if somebody could 
make things cheaper overseas, then that is the most efficient way for 
that product to be made, but we didn't calculate these supply chain 
problems which COVID-19 exposed.
  But we know, as I said, that if there were another pandemic or let's 
say a natural disaster or a military conflict, the People's Republic of 
China has made no secret about its plan to unify with Taiwan. President 
Xi has explicitly said invasion of Taiwan will happen, and he has asked 
that his military be ready by the year 2027. But we don't actually know 
what his timetable may be, and if China follows through on its threats 
to invade Taiwan and interrupts that supply chain of critical 
semiconductors, it would be dramatically bad for the United States and 
the world. Our national security and critical infrastructure could be 
hobbled by a single decision made by the President of the People's 
Republic of China.
  I was reminded of Jimmy Carter's 1980 speech at the State of the 
Union when he spoke about instability in the Persian Gulf and Soviet 
threats to the movement of Middle East oil through the Strait of 
Hormuz. President Carter said at the time--when we were so dependent on 
imported oil from the Middle East--he said any attempt to gain control 
of the Persian Gulf and to block the Strait of Hormuz would be 
``regarded as an assault on the vital interests of the United States of 
America.''
  You could say the same about a blockade that prevented us from 
getting semiconductors from Asia. Just as the Soviets could have 
blocked the Strait of Hormuz and choked off the global supply, the 
People's Republic of China could seize Taiwan's supply of chips and its 
manufacturing facilities and hold the rest of the world at risk. The 
United States and our allies would be left fighting for the crumbs, 
what was left over.

  Our country isn't the only one, fortunately, that spotted this 
blinking red light. Other countries are pouring tens of billions of 
dollars into new semiconductor foundries. The European Union is now 
investing up to $35 billion. South Korea is investing $65 billion. The 
People's Republic of China is reportedly investing $150 billion in 
semiconductor manufacturing.
  The United States cannot be left behind, and we can't drag our feet. 
Unlike PPE--personal protective equipment--or hand sanitizer shortages, 
this one cannot be solved quickly. Companies that make other 
technologies can't just adjust to the lack of semiconductors. In order 
to build a single chip, you need very expensive, highly advanced 
equipment, you need very skilled workers, and you need a lot of time. 
It can take literally months to build a single chip, and that is 
assuming you have the facilities and the expertise to do so.
  So it is not hyperbole to say that there are life-or-death 
consequences to a reliable semiconductor supply chain, which is why 
this has been such a high-priority item on a bipartisan basis here in 
the Senate.
  The U.S. Innovation and Competition Act included $52 billion to fund 
this program and ensure that, once again, we could maintain a strong 
supply of advanced semiconductors. That legislation, which included an 
emergency appropriation, passed by a vote of 68 to 32, which is pretty 
impressive these days with the polarization that we are all dealing 
with--a strong, bipartisan vote.
  Unfortunately, the momentum that bill had ended when it got to the 
House of Representatives. The Speaker of the House had other 
priorities, and months and months went by. Our House colleagues said 
they wanted to pass their own version of this legislation, and they 
have every right to do so, but time is not on our side, and they need 
to act quickly. Every day that goes by is a day that China inches ahead 
of the United States and that we fall further behind.
  We need to get this funding out the door and to begin that 
construction of these fabs, which take a considerable amount of time to 
build, underway as soon as we can.
  In a year's time, Senator Warner and I introduced the CHIPS Act, it 
became law, and the Senate funded the program we created. We are not 
ordinarily known for our speed, and the quick timeline is indicative of 
how urgent this problem really is.
  I don't have any excuse for the House's failure to address this issue 
for 7 months, but now it sounds like they are beginning to think about 
addressing it.
  Well, I can understand why the process would take so long if the 
House was actually engaged in a bipartisan negotiation, but, 
unfortunately, it looks like they are going to pass a partisan bill 
with no Republican support because they were not included in the 
discussions. The Democratic committee chairmen refused to consult with 
the Republican ranking members, and it looks like they are going to 
produce a partisan bill.
  Well, that bill I do not believe would pass the U.S. Senate. The 
House bill contains $8 billion for an unaccountable U.N. climate slush 
fund, which has provided more than $100 million for the People's 
Republic of China.
  What we are talking about--what we should be talking about--is 
countering threats from China, not helping China.
  The partisan bill from the House has also added provisions related to 
immigration, from creating new types of visas to removing green card 
caps. Immigration is an important issue. We ought to be talking about 
it. We ought to be doing something about it, but not on a partisan 
basis.
  These changes should not be tacked on to this legislation at the last 
hour. They need to be debated and marked up by the appropriate 
committees and given the sort of careful consideration that they 
deserve.
  The House bill also includes additional handouts to favorite 
political constituencies, from massive slush funds to burdensome new 
labor requirements. Organized labor would be the big winner in the 
House bill, but not rank-and-file Americans.
  It is not just what is in this bill that is a problem. I am talking 
about the House bill, now. It is what was left out. The bill's trade 
title is completely inadequate. It extends and expands trade adjustment 
assistance, but it completely excludes trade promotion authority. We 
know that trade promotion authority is critical to negotiating strong 
trade agreements without lengthy delays.
  So I regret and I am very disappointed that the House has wasted 
available time, particularly when this vulnerability to the 
semiconductor supply chain is so grave and so urgent.
  We have a responsibility to secure our most critical supply chains 
while creating thousands of high-paying American jobs and boosting our 
global competitiveness. So I hope that once the House does pass a bill 
that we quickly form a formal conference committee in order to make the 
final product look a whole lot like the Senate bill that we passed with 
strong bipartisan majorities.
  Let me just comment in closing that I am a big fan of the Wall Street 
Journal. I read it or, at least, parts of it every day. But I was 
concerned that a treatment of this legislation in the

[[Page S514]]

Wall Street Journal editorial yesterday--actually, it was this 
morning--either was unclear or provided misinformation about the 
importance of these semiconductors.
  The title of the editorial was ``The Be More Like China Act.'' And 
suffice it to say, they were not fans of either the House or the Senate 
bill.
  But they made this statement. They said: ``[T]he Pentagon is already 
providing incentives to make advanced chips in the United States, and 
[Taiwan Semiconductor] is building a $12 billion plant in Arizona.''
  To the second issue, the reason why Taiwan Semiconductor 
Manufacturing Company is building a fab in Arizona is in the 
expectation that the Senate will pass this $52 billion incentive 
program, and through the Department of Commerce, grants will be made 
which will level the playing field. When it comes to the cost of 
building these fabs in the United States, it costs roughly 30 percent 
more to build a manufacturing facility, a fab, in the United States 
than it does in Asia, which is the reason why they are mainly there.
  But I think what the Wall Street Journal was talking about was 
something very different than what we are trying to do here with 
reshoring manufacturing of semiconductors.
  The Wall Street Journal, I believe, is talking about the Department 
of Defense's zero-trust semiconductor purchasing model. In other words, 
we needed a trusted foundry to build semiconductors for our most 
important weapon systems and aircraft, like the F-35, and so this is 
not a manufacturing facility that will supply the semiconductors that 
are needed by our growing economy and for national security. This is a 
very narrow, targeted program at the Department of Defense, and, like I 
said, the Department of Defense's secure foundry or trusted supplier 
program is not a substitute for what we are trying to do here.
  Finally, let me say that there is broad bipartisan agreement about 
how important it is that we get this CHIPS Act passed.
  Secretary Raimondo, the Secretary of Commerce, whom I have come to 
know and come to work with and respect, said to CNBC yesterday: ``The 
U.S. is dangerously dependent on Taiwan's semiconductor manufacturing, 
which is in a fragile situation, which I have tried to describe.''
  I agree with Secretary Raimondo. This is something that the President 
wants done. This is something the Senate has spoken to and passed on a 
broad bipartisan basis, and this is something that we need to do 
without further delay.
  So I hope the House will pass the bill if for no other reason than to 
give us a bill that we can conference the Senate bill with. But in the 
end, the Senate bill needs to be the template for what is ultimately 
done by the conference committee and what is ultimately passed by the 
U.S. Congress.
  The PRESIDING OFFICER. The Senator from Colorado.
  Mr. BENNET. Madam President, first I would like to congratulate the 
senior Senator from Texas for his leadership on this incredibly 
important issue with Senator Warner, the senior Senator from Virginia.
  It really is important that we get this passed. Our national security 
depends on it. I think the American economy depends on it.
  The Senator mentioned that there was a time in our country's history 
not long ago--I am going to use my words, not his, but I will 
paraphrase it--where I think we thought that making things as cheaply 
as possible was the same thing as making things as efficiently as 
possible. And I would argue that we privileged the people in our 
economy who wanted to make stuff as cheaply as possible in China when 
there are a lot of really other important values at work, including our 
national security, the supply chains that we rely on, making sure that 
communities in our country have jobs and wages being created.
  I think we have an incredible opportunity as a nation to come 
together and build an economy that, when it grows, grows for everybody 
once again. And in my mind, that is what this bill represents.
  So I just want to say to the Senator from Texas how grateful I am for 
his leadership, and I hope that it won't be long before we pass it.