McCaul 'works to pass funding' for domestic semiconductor production

Rep. Michael McCaul (R-Houston) is leading the charge in pushing for federal resources aimed at increasing semiconductor production in the U.S.

"That’s why I introduced the CHIPS for America Act, to create programs to encourage manufacturers to produce semiconductors here in America,” McCaul tweeted. “With John Cornyn’s leadership, $52 billion was passed in the Senate, and I’m working to pass this funding through the House."

From phones, to military jets, to cars, semiconductor chips are part of the equation in the global economy everywhere, which has only been highlighted by the shortage brought on by the pandemic-driven shortage.

During a recent roundtable discussion at Tower Semiconductors, McCaul wasn’t shy about pressing his thoughts about how a movement toward more domestic production of the chips could go a long way in alleviating the problem.

One of the most impactful signs of the global shortage has been felt in the car market, where a shortage of chips needed for new vehicles has also affected the used car market.

“This is maybe just the leading edge of waking us up to the problem,” Cornyn said of the overall impact on the car market.

As it is, the U.S. only owns in the neighborhood of 12% of the world’s semiconductor manufacturing capacity, compared to about 37% three decades ago, according to the Semiconductor Industry Association.

With the vast majority of the most sophisticated chips already being manufactured in Taiwan, Cornyn reasoned “given China’s aggressive acts, rhetoric and actions in the South China Sea relative to Taiwan, that ought to concern all of us.”

In a bipartisan vote, the U.S. Senate moved earlier this summer to pass a $52 billion bill aimed at spurring more domestic semiconductor development and manufacturing. The bill now sits in the House of Representatives, where McCaul hopes to add refundable tax credits into the equation.

“It’s very cost intensive on the front end to build a fabrication plant,” he said. “This would help refund anywhere from 25% to 40% of that initial investment up front.”