United states

Senate passes $280 billion industrial policy bill to counter China

The effort marks a foray into industrial policy unprecedented in recent American history, raising countless questions about how the Biden administration and Congress would implement and oversee a major initiative involving hundreds of billions of taxpayer dollars.

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The passage of the legislation was the culmination of years of effort, which Mr. Schumer said began in the Senate gym in 2019, when he approached Senator Todd Young, Republican of Indiana, with the idea. Mr. Young, a fellow China hawk, has previously collaborated with Democrats on foreign policy.

In the end, Senate support was made possible only by an unlikely confluence of factors: a pandemic that exposed the cost of a global semiconductor shortage, heavy lobbying by the chip industry, Mr. Young’s persistence in urging his colleagues to break with the party orthodoxy and support for the bill, as well as Mr. Schumer’s elevation to the top job in the Senate.

Many senators, including Republicans, saw the legislation as a critical step to bolster America’s semiconductor manufacturing capabilities as the nation has become dangerously dependent on foreign countries — especially an increasingly vulnerable Taiwan — for advanced chips.

Mr. Schumer said it was not too difficult to pick up votes from Democrats, who are generally less opposed to government spending. But he also nodded to Republicans, including Sen. Mitch McConnell of Kentucky, the minority leader: “To their credit, 17 Republicans, including McConnell, came forward and said, ‘This is one expense we have to do.’

The legislation, which was known in Washington for its ever-changing carousel of high-sounding names, is not easy to define. At more than 1,000 pages, it is simultaneously a research and development bill, a short-term and long-term jobs bill, a manufacturing bill, and a semiconductor bill.