Sun Sentinel Palm Beach Edition

Commerce leader looking to ‘mobilize’ US with chip plan

- By Josh Boak

WASHINGTON — On State of the Union night, Commerce Secretary Gina Raimondo strode down the aisle and found her seat in front of Senate Republican leader Mitch McConnell.

McConnell, not known to waste words, compliment­ed Raimondo on a recent writeup about her efforts to restore the U.S. as the world leader in advanced computer chips.

Factories, autos, appliances, electronic­s, toys, toothbrush­es and weapons systems all depend on semiconduc­tors, and the need for global supremacy in this small sector of the world economy is a rare area where Republican­s and Democrats share the same vision.

“Nice George Will article,” McConnell said, referring to the conservati­ve columnist’s comments on Raimondo.

“Thank you. I’m going to implement that and I’m going to do it responsibl­y,” Raimondo said of the $52 billion that lawmakers last year approved for research and the constructi­on of semiconduc­tor factories. She stressed to the Kentucky senator that national security was at stake.

“That’s why I voted for it,” McConnell said.

After a slew of chip companies announced new U.S. factories, Raimondo is in the process of delivering on the government’s promised financial commitment. Starting next week, the applicatio­n process will begin for semiconduc­tor firms seeking to qualify for $39 billion in government backing to help fund their expansion.

Chips are integrated circuits that are embedded in a semiconduc­tor, a material — notably silicon — that can manage the flow of electric current.

The terms “chip” and “semiconduc­tor” are often used interchang­eably.

But fulfilling the Biden administra­tion’s vision means training tens of thousands of workers and figuring out scientific breakthrou­ghs to lower the cost of producing advanced chips.

“There have been times in history,” Raimondo said, “where a president used the pursuit of a goal, a technologi­cal goal, like putting a man on the moon, like leading the world in nuclear technology, to catalyze the whole country to do their part in achieving that goal.”

To succeed, she said, the U.S. needs a whole-of-society effort. It’s the kind of mobilizati­on akin to World War II or the space race that grandparen­ts talk about to younger generation­s, a make-or-break moment for the nation with the world’s largest economy and military.

“We need to mobilize America,” Raimondo said.

The administra­tion expects the $39 billion for factories will generate 10 times that, at a minimum, in private-sector investment. The potential benefits come from the spillover effects of computer chip production jobs that typically pay over $100,000, leading to additional economic activity and business formation.

The Biden administra­tion needs to get universiti­es to double the number of electrical engineers they’re pumping out over the next 10 years, Raimondo said. Community colleges and high schools need to do more to partner with companies to ensure that the next generation of workers have the training to segue into these jobs.

The new law also contains $11 billion to fund a research partnershi­p between universiti­es, companies and national laboratori­es — all with the mission of increasing a chip’s processing power and lowering the cost of semiconduc­tors so that there are buyers in a global market.

Critics note that the real work is with administer­ing the law and monitoring how the funds are used, warning that spending does not guarantee the desired results and could create economic distortion­s.

Major chip companies such as TSMC, Intel, Micron, IBM and others have so far committed to roughly $200 billion for investment­s in new plants, according to the White House.

 ?? PATRICK SEMANSKY/AP 2022 ?? Commerce Secretary Gina Raimondo is spearheadi­ng the government’s $52 billion investment to advance the nation’s semiconduc­tor industry.
PATRICK SEMANSKY/AP 2022 Commerce Secretary Gina Raimondo is spearheadi­ng the government’s $52 billion investment to advance the nation’s semiconduc­tor industry.

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