[Congressional Record Volume 169, Number 49 (Thursday, March 16, 2023)]
[Senate]
[Pages S816-S818]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                             Semiconductors

  Mr. CORNYN. Mr. President, over the past few decades, the United 
States has experienced a steady drop in domestic semiconductor 
manufacturing. Now, I guess we all might be forgiven for not being 
experts in what advanced microcircuits are all about, but the truth is 
these microcircuits, or semiconductors, are part of our everyday lives 
in ways that perhaps we don't fully appreciate. Everything from your 
smartphone to the most advanced weapons that we are providing to 
Ukraine to defeat Russian aggression, to the Joint Strike Fighter, the 
F-35--all of these require a large number of these mini-circuit 
processors, or semiconductors.
  Well, over these last few decades, we have gone from producing 37 
percent of the world's chips in 1990 to just 12 percent today. In other 
words, we are more dependent than ever on supply chains of 
semiconductors in order to keep our economy going and to defend 
ourselves from a national security perspective.
  This, obviously, is a concerning trend, and one of the things we have 
learned about during COVID is this idea of globalization, that just 
because somebody can make something cheaper--in China, let's say--than 
in the United States, that that answered all the questions, that that 
checked all the boxes.
  Well, you might say the same thing about Europe's dependency on 
Russian oil and gas when, once Mr. Putin decided to invade Ukraine, 
they realized they were the captive of the Russian Federation when it 
came to their basic energy needs. Well, the same thing is happening in 
other places, including semiconductors.
  Thirty years ago, China manufactured none of the world's chips, but 
today it commands nearly a quarter of the global market. And just off 
the

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coast of mainland China, you will find a global powerhouse when it 
comes to chip making: Taiwan. Taiwan manufactures 92 percent of the 
most advanced semiconductors in the world, and given China's aggressive 
threats against Taiwan, that is a blinking red light.
  But just like the Europeans found that it is going to take a while 
for them to diversify their energy sources from Russia, it is going to 
take a while for us to get diversity in sources so that we don't only 
rely on imported chips from the Far East. For a long time, this has 
been recognized as a problem and, of course, people said: Well, 
something needs to be done. But that ``something'' wasn't at the top of 
everyone's priority list.
  But then, of course, the pandemic hit, as I said, and we found 
ourselves dependent on everything from masks, or personal protective 
equipment, which was all made in China, and we couldn't get it when we 
needed it when the pandemic hit. And now we have become more aware of 
our vulnerabilities when it comes to these supply chains.
  My constituents in Texas and, I am sure, those in Michigan and New 
Jersey and elsewhere were shocked to see empty car lots, for example, 
because of backorders of semiconductors. Because of the disrupted 
supply chain, they couldn't even make cars, which are, of course, more 
and more dependent upon these microelectronics. Suddenly, consumers who 
have never needed to know what a semiconductor was found themselves 
impacted by this global shortage.
  So, in many ways, this was a wake-up call that we didn't even know we 
needed, and it is not the last. If you start looking around at other 
things like rare Earth elements, things like the active ingredients in 
pharmaceuticals, we are dependent on China to produce those, and that 
is another vulnerability we need to address.
  But if China were to act on its threats to invade Taiwan and block 
the world's access to these advanced semiconductors, empty car lots 
would be the least of our worries.
  Without chips, we wouldn't be able to maintain the energy grid or 
communications systems. We can't build rocket interceptors, or, as I 
said, F-35s for our military. And our national security missions would 
take a hit, both on the ground and in cyber space. So, clearly, the 
time had come to make advanced chip manufacturing in America a top 
priority.
  In June of 2020, Senator Warner--the senior Senator from Virginia--
and I introduced the CHIPS for America Act to incentivize chipmakers to 
build or expand their operations here in America. Given the 
significance of this effort to our national security, the Senate 
adopted this bill as an amendment to the National Defense Authorization 
Act with overwhelming bipartisan support--a vote of 96 to 4. Six months 
after it was introduced, the CHIPS for America Act became law. And a 
year and a half later, it was fully funded by the bipartisan CHIPS and 
Science Act.
  So it took a little over 2 years from the time Senator Warner and I 
introduced the legislation until it was finally authorized. And it is 
going to take another couple of years before the funding that we 
provided is granted by the Commerce Department to incentivize that 
manufacturing here.
  But as in so many other areas--permitting snafus, bureaucratic 
delays--it is going to be a while before we can totally relieve our 
dependence on imported semiconductor supply chains. This ought to be a 
wakeup call, as I said, again, to our other dependencies, one that had 
been nurtured by the People's Republic of China and where they have 
actively undermined development of diverse alternatives in other parts 
of the world, from friendly countries and from the United States 
itself.
  Well, 2 years is a long time from a bill being filed until it becomes 
law. But that is actually not an unusual pace. It takes a while for 
this body to act. And we are not known for our speed. So the fact that 
we were able to stand up the CHIPS Program and fully fund it officially 
shows how critical this investment is and how a bipartisan consensus 
believed that time was not on our side, and we needed to act without 
delay.
  Well, despite bipartisan support for the CHIPS Program, it has not 
been immune from criticism. Some have criticized it as industrial 
policy, even comparing it to the Chinese Communist Party's intervention 
in the China economy. But there is a big difference between propping up 
favored industries in order to protect your domestic industries, as 
China does. There is a big difference between that and safeguarding an 
essential supply chain that is vital to our economy and our national 
security.
  One of Congress's most fundamental responsibilities is to provide for 
the common defense. Traditionally, it involves timely Defense bills and 
appropriations, but we no longer live in a world where those tasks 
alone can cut it.
  Authorizing the manufacture and purchase of new F-35s, the most 
advanced stealth Joint Strike Fighter in America's Air Force--
authorizing that or appropriating the money for that is meaningless if 
we don't have the electronics we need in order to manufacture them, 
including semiconductors. Supporting the development of artificial 
intelligence or quantum computing or 5G is useless if we can't get 
access to the technology we need.
  So we no longer have the luxury of endless supplies of chips. And we 
have to adjust accordingly. And the CHIPS Program is just one way that 
we have done that.
  From the beginning of this process, I have had the pleasure of 
working closely with Commerce Secretary Gina Raimondo to ensure 
Congress and the administration are on the same page. And by and large, 
we are. I congratulate Secretary Raimondo for the great work she and 
her team at the Commerce Department have done. And they have been good 
partners in the actual passage of the CHIPS and Science Act.
  But I am concerned--and I have communicated that to her--about some 
of the components of the application guidance the Commerce Department 
released last month. The Department outlined the application process 
from eligibility to timelines. It provided details about the types of 
incentives available and the way they could be used. And it laid out 
extensive information applicants must provide; for example, a detailed 
financial model for proposed projects and clear execution plans.
  So far so good. The Department needs to understand the viability and 
lasting impact of each of these projects before awarding these 
financial incentives--again, to bringing that manufacturing back to 
America's shores. That is how we ensure each project will benefit our 
national security, which was the main purpose of the legislation.
  But Commerce laid out additional requirements that have nothing to do 
with that goal or congressional intent. One example is the childcare 
mandate. So who could be against a childcare mandate? Well, my fear is 
that this is just the beginning of unauthorized additional requirements 
that the Biden administration is going to impose for people to be able 
to compete for the grant funding.
  The Department of Commerce said it requires applicants who request 
funding over specific amounts to provide a plan for access to 
childcare. These requirements were not in the statute. That wasn't even 
part of our congressional debate.
  And as a practical matter, I am pretty confident that these 
sophisticated companies are going to provide a generous package of 
incentives to their future workforce, including, probably, childcare.
  But even the New York Times, when they saw these extra requirements, 
described these strings as ``ambitious and unusual.'' If a company 
wants to offer childcare to its employees, if it needs to do so in 
order to compete for the kind of workforce that it wants, that is 
great, and many semiconductor companies already do so.
  The market for highly skilled employees is extremely competitive, and 
companies recognize that they need to offer benefits to attract the 
best candidates. That is the beauty of the free market.
  But if the Commerce Department wants to consider that information 
when we are reviewing applications, that is fine. But there is a big 
difference between taking it into consideration and mandating it.
  We know that some of the debate here on Capitol Hill about 
childcare--we have been down this road before--some in this Chamber 
would like to

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outlaw faith-based organizations from providing that childcare or 
require that if they are going to take the Federal money, that they are 
going to have to hire a workforce that doesn't believe in the same 
things they do.
  That is how we go from what seems to be a relatively innocuous 
requirement into big trouble and into the executive branch trying to 
legislate new requirements that are not part of the underlying 
legislation.
  Recent reporting indicates that companies of all types are preparing 
to make the play for CHIPS funding. This isn't limited to chips 
manufacturers. We are talking to every industry under the Sun--so-
called ecosystem built around these fabs or manufacturing facilities.

  The director of general economics at the Cato Institute explained why 
companies that don't make chips could be making a play for funding. 
Well, for one thing, I think it should be obvious that people are 
attracted to the opportunity of qualifying for these grants for this 
funding. But the director of general economics at Cato pointed to the 
Commerce Department's unrelated requirements as a suggestion that the 
administration isn't prioritizing national security. In other words, 
this should not be a Trojan horse to pass other policy priorities under 
the guise of protecting our national security.
  And we don't want other, perhaps even more concerning, requirements 
to be added which were not part of the legislation that Congress passed 
or part of legislative intent.
  Companies that do not manufacture chips now believe they have a shot 
at funding as long as they meet the other unrelated requirements. I 
want to be absolutely clear that that cannot be the case. In order for 
the CHIPS Program to succeed--in order to protect our economy and our 
national security--this needs to be a merit-based application process, 
with no additional requirements imposed as a condition to receive these 
grants that was certainly not part of legislative intent or even the 
debate here in Congress. It should not be used as a Trojan horse to get 
other policy priorities actually implemented when Congress had no such 
intent.
  So these decisions to make these grants should not depend on 
relationships with labor unions or any other unrelated factors. It 
should be based solely on how each project will strengthen our national 
security and shore up this vulnerable supply chain.
  We can't be in a situation where applicants that provide free 
childcare are favored over those who will do more to strengthen our 
national security. Again, that is fine if these companies want to do 
so. And I dare say many, if not all of them, will anyway. But it is a 
beginning that is concerning because this is a slippery slope to try to 
shoehorn other policy priorities into something which will actually 
distract the Commerce Department and the U.S. Government from doing 
what needs to be done when it comes to semiconductor manufacturing.
  The CHIPS Program received strong bipartisan support and should 
remain far above the political fray. The ultimate goal is to boost 
domestic chip manufacturing, and I am glad to say we are beginning to 
move in the right direction.
  Samsung from South Korea, Texas Instruments, and GlobiTech are 
expanding their footprint in Texas. Taiwanese Semiconductor 
Manufacturing Company is growing its presence in Arizona; Intel is 
putting down roots in Ohio; and Micron is expanding in New York. These 
are just a few of the announcements that have been made so far, and I 
expect more to come now that the CHIPS Program is up and running.
  Texas has already been a leader in the semiconductor industry. And we 
are cementing that reputation with the addition of new and expanded 
chip fabs.
  Gov. Greg Abbott is pushing to attract even more chip manufacturers 
to the Lone Star State. He has been working with leaders in the Texas 
Legislature this session, including Representative Greg Bonnen and 
Senator Joan Huffman, to help bring new semiconductor businesses to 
Texas.
  The Texas Legislature recently introduced the Texas CHIPS Act, which 
would support all chip-related activity in the State--from research and 
development to design and manufacturing.
  I appreciate their leadership on this front, and I am eager to see 
the positive impact of the chips on communities all across our State 
and, indeed, all across our Nation.
  These are just a few of the investments that will support jobs, our 
economy, and our national security. The CHIPS Program is key to that 
success, and I hope the administration will avoid attaching 
controversial and additional requirements that could imperil or impede 
its success.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from New Jersey.
  Mr. BOOKER. Mr. President, I would like to ask consent--I know we 
have an order to vote at 1:45--to speak for about 5 minutes.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The remarks of Mr. BOOKER pertaining to the introduction of S. 850 
and S. 851 are printed in today's Record under ``Statements on 
Introduced Bills and Joint Resolutions.'')