(Bloomberg) — US lawmakers are playing politics with national security by delaying the passage of legislation that will liberate billions of dollars for chipmakers to build more manufacturing facilities in the US amid a global shortage, Commerce Secretary Gina Raimondo said.
“Yes, it will happen — it’s taking much too long,” Raimondo said in an interview with Guy Johnson and David Westin on Bloomberg Television Monday. “It isn’t right to play politics with national security, that’s what I think is happening.”
Raimondo said lawmakers have made “huge progress” in the past two weeks.
“Everyone just needs to come back today, get back to work and commit themselves to getting it done in the next few weeks,” she said, referring to lawmakers who have returned to Washington.
The Biden administration has for months sought the passage of the US Innovation and Competition Act that would appropriate $52 billion for domestic semiconductor manufacturing.
The legislation would provide billions of dollars to boost research and development with an eye toward creating new technologies to help the US stay ahead of a rising China.
Enactment of the semiconductor incentives is a top priority for the Biden administration as well as manufacturers such as Intel Corp. and companies that are heavy users of chips. While the global semiconductor shortage has eased somewhat, there is still limited production for certain chips used in cars and home appliances. The wrangling over the bill comes as semiconductor stocks took a beating, driven by concerns about demand cooling for chips as the US economy faces recession fears.
In late June, Senate Republican leader Mitch McConnell threatened to scuttle the legislation.
Separately, President Joe Biden’s team has been considering easing some Trump-era tariffs on consumer goods from China for some time amid divisions among his team. Senior US and Chinese officials discussed US economic sanctions and tariffs in recent weeks.
Raimondo said she thinks that Biden will announce a decision on whether to ease some of the tariffs on more than $300 billion of imports from China “very soon.”
A string of increasingly large Federal Reserve interest-rate increases has supercharged the dollar, with the Bloomberg Dollar Spot Index up 0.9% Monday to the strongest since March 2020.
Raimondo said she’s unconcerned about the strength of the US currency, she said in response to a question about the potential for American exporters to be hampered by exchange-rate appreciation.
“From where I sit and everything that I see, I am not concerned about the dollar being as strong as it is,” she said, adding that the real US economy is quite strong. “Inflation is our challenge — the Fed is appropriately taking action, the administration is doing all that we can do, and a strong dollar is as it is, which I am not worried about.”
(Updates with Raimondo’s comment on the dollar in penultimate paragraph.)
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