In February, the House passed legislation aimed at bolstering America’s competitiveness with China and strengthening the country’s supply chain. A companion bill passed the Senate in June 2021 but is now caught up in a partisan divide and larger debate over how to handle America’s technology industry and the country’s economic policy toward China.
The America COMPETES Act (H.R. 4521) passed in a 222-210 vote, with one Republican voting in favor and one Democrat voting no. The bill includes $52 million to support the domestic manufacturing of semiconductors, the computer chips that are often used in cars and computers. The chips have experienced significant shortages throughout the pandemic, leading to increased costs for consumer products.
The bill also includes $45 billion to strengthen the supply chain as well as additional funding for the National Science Foundation. “The pandemic has magnified the need for us to have domestic supplies so that we are not vulnerable from a national security sense, or from an economic sense, to supply chains being interrupted as has happened now,” House Majority Leader Steny Hoyer (D-Md.) told reporters in support of the bill.
U.S. Commerce Secretary Gina Raimondo also backed the bill, calling it “the biggest investment in 50 years” to support American manufacturing and research and development. “The last 30 years, we’ve just seen a decline, a withering of semiconductor manufacturing in America, of manufacturing generally,” she told USA Today in an interview. “We don’t have time to go small or slow. We have to go bigger and go faster.”
In an interview with NPR, House Science Committee Chair Eddie Bernice Johnson (D-Texas) said the bill would also support talent development in the U.S. as well as government-sponsored innovation that private companies could utilize in product development. “We’ve just got to compete,” Johnson said. “And we’ve got to hopefully feel like we’re a little step ahead. And that’s really a big goal. Because as you know, our society is very different in the kind of freedom versus communism type of behaviors.”
Detractors of the legislation, however, argued that the nearly 3,000-page House bill was laden with Democratic-leaning priorities and did not go far enough to compete with China. Minority Leader Kevin McCarthy (R-Calif.) said that almost every page of the legislation “has a provision that helps China but hurts America.”
For example, he pointed to a provision allotting additional research funding to colleges and universities that host Confucius Institutes, Chinese-backed outposts that offer Mandarin language classes, cultural programming and community outreach. McCarthy called the institutes “Chinese Communist Party propaganda centers” and said supporting them could make the country more vulnerable to Chinese espionage. He also described the bill’s request from the Biden administration for a report on the origins of COVID-19 as “toothless.”
Many Republicans also took issue with several climate-related provisions that Democrats added to the bill, including approval for an $8 billion U.S. contribution to the United Nations’ Green Climate Fund. Rep. Stephanie Bice (R-Okla.) described it as a “Green New Deal slush fund for the U.N.”
Bice also stated in an interview with a local Tulsa TV news station that she was originally in support of the bill, but additions such as the U.N. contribution and other “Green New Deal initiatives” disrupted any bipartisanship that had originally been behind the bill.
Fellow Oklahoma Republican Rep. Tom Cole echoed Bice’s comments, stating that Democrats will likely need to remove some policy provisions to get a final version of the bill passed. “We’re not going to see anything remotely that looks like what the House passed coming to the floor of the House and the Senate as a final product, in my view,” he said.
A counterpart to the House bill, the United States Innovation and Competition Act of 2021 (S. 1260), passed the Senate last year. Both bills will need to be reconciled by a conference committee, after which a final bill will go back to both chambers for approval. President Joe Biden has voiced support for the bill and urged lawmakers to act quickly to pass a new version, which should prompt legislators to find a bipartisan solution.
For more background see the September 2016 issue of Congressional Digest on “U.S.–China Trade Relations.”
