Well, the U. S. Senate has passed legislation that includes fifty two billion dollars in grants and incentives for domestic semiconductor manufacturing, and the bill is expected to pass the House later this week. It will then move on to President Biden's desk for his signature. Joining us now to discuss this long path to getting it signed. As Eric Watson, who's Bloomberg congressional reporter, Well, I think first let's look
at doesn't make a difference. One semiconductor firm alone, t SMC is spending a hundred billion dollars over three years. This is fifty two billions spread out over five and it includes some money for things like five G wireless technology. Eric, is is it really big enough to move the dial for a whole nation's uh? Industry? Well, certainly the the supporters of the bailing in Congress as well as the industry,
I do say so. And it's got widespread praise everyone from the Business Roundtable too, industry groups saying this was really necessary. Uh. You know, I talked to Mark Kelly Arizona was involved in that investment you just mentioned out there in Arizona, and he said this was they probably weren't going to pull back on their investment, but they definitely wouldn't expand it. And he thinks it's going to make a difference attendance, housands of jobs in his state.
Uh you know, uh talk about the added you know, city two billions for the coming up the industry, but there are you know, everything else, the wireless that the three thousand dollars for science agencies. You know, ultimately it's about thirty nine billion dollars when you include a tax cred as well. Uh, you know, there's additional money that's been authorized but not appropriated. It's coming to you under an eighty billion dollars totals. It does seem like Wall
Street liked it. We saw Intel shares up by about three percent. What are we hearing from some of the big giants that were concerned that delays to this bill really thriatened plans for expanding manufacturing domestically. Well, you know, again, I think that they're just very relieved. Now there's a last minute wrinkle going on here because, as you also mentioned, Joe Mansion has changed his tune on the Climate Energy Package. And then now we we're learning the House Republicans are
gonna try to bring down this bill tomorrow. I talked to House Democrats, some of the progressives who are worried about what they call corporate welfare, and I think that in the end of the day they're going to rally and pass this bill. But it's not quite a done deal. You know, the Republicans were mostly going to be on board with this in the House, uh, you know, with some exceptions, but because they're trying to retali ns Democrats from moving forward on tax increases and climate change, it
could be actually an interesting vote tomorrow. Yeah, it's really interesting when you because if you look at it, you can find attractors that would say it's it's selective corporate welfare, and you know, you're picking winners. So the free market uh politicians probably don't like it. And and it hasn't been much pushback on why not other industries? What about mine? Well, certainly there's the Republicans and others want to see a larger permanent R and D tax credit that would be broader.
They're still talk of bringing that in potentially in a your end D allow That will depend on the election, but there will be a tax extender's package talked about in December, we may ce r and d uh you know revived there, you know, but certainly I think when we see that, you know, the shortage is going on from Detroit and other major renistchors who can't get some in conductors right now, and the effect they've had on
prices for consumers. Uh, you know, this is just the opportune time for for the chief industry to get this this helping hand, uh and get it through Congress. You talked about some of the opposition. I mean, a pretty strong tweet that we're quoting from Jim Banks on Bloomberg as well just took us through. I guess how these kind of messages that this money is going towards China could kind of, I guess, derail things in terms of
President Barden's approval. Well, I mean, there are restrictions in the bill actually that we're built in and on the assistance of of of progressives actually that restrict any company from using the money to invest in China or to do stock buy back. So I think, you know, I don't know what you're referring to, but there are guard rails in the bill that really are aimed at ensuring
it that creates a domestic job. So I think, you know, as far as when it helps UH buying approval rating, I think members of connerss are pretty honest about you know, even if Biden's whole agenda was passed, at the end of the day, it's inflation and gas prices that are really driving the approval rating, and we're not going to see a lot of near term movement on those from this bill, so you know, it may be a indirect
effect at best rating. Yeah, you talked about the guardrails no dividends and and no buy backs, and I guess companies will have to go through some sort of complicated application process for for these grants. How tight will that be or is that not yet written? You know, a lot that's gonna be developed by the Converse Department and you other you know branches of the government who are
gonna minister that. So that's something it will certainly be following up on Bloomberg as as industry looks to make sure that the seamless as possible. All Right, I'll just reiterate what I was saying. Sorry, I thought, apologies for not clarifying that it was representative Jim Banks of Indiana, the chairman of the Republican Study Committee. He tweeted the DEM's fake China bill allows your tax dollars to go to communist China. Brian talked earlier about some of the
external companies, the likes of t SMC. We heard from Samsung today as well in terms of how much they're developing. Just tell us about the U S share of semiconductor manufacturing and where we stand globally there well, certainly on the advance I was talking, you know, some of the advanced chips are talking to subsentators that we just don't make them at all. The chips are going to the
iPhone and the very best. So I think there's a real concern, especially from the Defense Department and others, that we have zero really ability to make these advanced chips, and it's doing a national security threat, especially if you look at Taiwan, which is a leader in manufacturing these and is under threat by China. Uh, you know, donder a lot of pressure that certainly opens up a national
security threat. So I think, you know, the main pitch and certainly one being clung to by McConnell and other Republicans who are normally wary of government spending is if this is a national security priority, So China is the main target. I think maybe finally, uh in our chat today, um are there? I mean what other countries really mostly the other ones like South Korea and Taiwan. Um, Taiwan not necessarily country. But I've seen as allies anybody else
out there that this targets. Well, certainly you know under Mark Warner, uh, you know, one of the big proponents of the Ship's Bill, and he said, you know, when we announced that we're going to go forward with this, you know, then there were moves by Germany, you know, Britain and others to provide provide similar levels of subseason attract investment there. So at that point, once it had been telegraphed, it was very necessary to follow so to not see you know, some of this these jobs go
to the EO. Okay, Eric, many thanks will push for a raise nine o'clock at night, and you're doing this for us. We really appreciate it. Big big hug from Juliette and me. And we've been chatting here with Eric Wasawson, Bloomberg Congressional reporter