The relevant parties in this case include California Governor Gavin Newsom and Senator Alex Padilla, both Democrats who have issued a statement to the Biden administration asking to reconsider its decision to terminate the semiconductor research and development subsidy program. The U.S. Commerce Department lamented the tsunami of demands for funds among the chip production subsidizing applicants as the reason why this program was no longer part of the $52.7 billion Chips and Science Act which was a partial blueprint.
President Joe Biden, aiming to decrease global metal output and change things to one’s benefit, seeks to increase the United States’ own chips production. Nevertheless, they claim that severing commercial research and advancement (R&D) in the US will spur outside countries to sprint ahead of the United States in the semiconductor industry, therefore downgrading the US’s role in the semiconductor industry.
The demand is to turn the agency’s decision around and stress the necessity of enacting the CHIPS Act to support and encourage the industry further and help the comeback of the domestic chip manufacturers. The TBD that efforts keep on re-prioritizing projects to make more of the CHIPS funds given.
While the exact amount for R&D funding has not been disclosed yet, some sources quoted it to be around USD 2.5 billion or even ”above” it. Newson and Padilla have suggested that the two billion dollars earmarked for research and development cannot substitute private businesses’ commercial investments.
The interest in the reinstatement of the subsidy is proportional to the need to maintain the competitiveness of the semiconductor industry, taking into account the strategic aspects of national security and the country’s economic growth. California’s putting chips maker is a clear sign of the state`s concern across the semiconductor industry.
