Congress Fighting Over How to Fix Computer Chip Shortage

In typical American trend, the federal government has determined that the easiest way to repair the current laptop chip scarcity is to throw more cash at it.

There’s a pc chip scarcity…?

Yup, and there are just a few totally different culprits behind it. It appears that the necessity for laptop chips started to rise in the course of the starting of the pandemic as droves of Americans started to do business from home, creating the necessity to setup dwelling workplaces.  At the identical time, some main laptop chip factories in Asia had been compelled to shut down attributable to Covid-19 lockdowns, threatening American imports from the area. Other components like severe winter weather, fires at factories, and even a neon scarcity fueled by the Ukrainian-Russian battle are all inflicting manufacturing points.

The scarcity is extremely problematic on a number of fronts. These chips are present in every little thing from cars, to smartphones, to washing machines, to totally different lifesaving medical units. In a report earlier this yr, the Department of Commerce discovered that the demand for laptop chips rose 17% from 2019 to 2021, and the present manufacturing and provide is solely not assembly this determine. “This is a major supply and demand mismatch,” the report reads, and that’s compounded by the truth that the United States solely produces 12% of the world’s supply of laptop chips.

The authorities is stepping in

There are at present two payments in Congress that the federal government hopes will reduce the impression of the present scarcity. Last yr, the Senate handed the U.S. Innovation and Competition Act whereas the America COMPETES Act handed within the House in February 2022. Both measures have some main similarities—notably some hefty funding for home chip manufacturing and analysis—however negotiations are nonetheless being hammered out earlier than any laws reaches President Biden’s desk for a signature.

The Associated Press is reporting that there are some main factors of rivalry between the payments. The House invoice is allocating $45 billion to enhance America’s provide chain points, whereas there isn’t any such provision within the Senate’s invoice. Both the House and the Senate might want to make some concessions so as to get some package deal out of Congress, and their incentive to take action could be to fire up no matter goodwill they will forward of the upcoming November midterm elections.