Biden Signs CHIPS and Science Act: $52.7 Billion for U.S. Chips

President Joe Biden on August 9, 2022 signed the CHIPS and Science Act, a landmark bill providing $52.7 billion in subsidies for U.S. semiconductor production and research, plus a 25 percent investment tax credit for chip plants estimated to be worth $24 billion. The broader $280 billion package also authorizes roughly $200 billion over ten years for scientific research, aiming to keep the United States competitive with China.

"The future is going to be made in America," Biden said at the White House signing, calling it "a once-in-a-generation investment in America itself." The law requires companies receiving assistance to agree not to expand advanced chip manufacturing in China, a restriction championed by both parties. The signing drew the CEOs of Intel, Micron, AMD, Qualcomm and Lockheed Martin.

Even before the bill passed, the prospect of federal money was pulling in capital: Qualcomm committed an additional $4.2 billion in chip purchases from GlobalFoundries' New York fab, and Micron announced a $40 billion memory-chip investment that the White House said would lift the U.S. share of memory production from 2 percent to as much as 10 percent. The legislation directly responded to the pandemic-era chip shortage that had idled auto plants and raised prices across the economy — and set the stage for the largest U.S. industrial-policy program in decades.

Source: Reuters, August 9, 2022; Al Jazeera. Reference: Biden signs CHIPS Act — Al Jazeera