(Bloomberg) — The Pentagon is pushing for the passage of legislation aimed at boosting the US’s domestic semiconductor industry, telling lawmakers the components, which go into everything from vacuum cleaners to fighter jets, are needed for the war in Ukraine.
“The national security stakes for passing the Chips Act are high,” Deputy Secretary of Defense Kathleen Hicks said in a statement to Bloomberg News. “Microelectronics are fundamental to virtually every current and legacy military system.”
Hicks said the production of Javelin and Stinger missiles — “systems desperately needed by those in Ukraine” — are hampered by persistent semiconductor manufacturing delays and that having access to on-shore manufactured chips would help the US deter its adversaries and better assist its partners and allies. A Javelin missile system has about 200 chips.
The US’s share of semiconductor manufacturing has fallen to 12% from 37% since 1990 and the country currently produces none of the most advanced chips, which are made largely in Taiwan.
The Senate is considering a package of legislation that would funnel $52 billion in grants and subsidies to US semiconductor manufacturers as well as funding to 5G wireless networks. It would provide $3 billion for research. The bill contains a 25% tax credit for semiconductor manufacturing — the source of a projected $79 billion revenue loss.
Read more: Senate’s Bipartisan Chips Bill Would Add $79 Billion to Deficit
“This is a national security issue for us,” said Democratic Senator Mark Kelly of Arizona, a former fighter pilot and astronaut, following a recent briefing on Capitol Hill with Hicks, Director of National Intelligence Avril Haines and Commerce Secretary Gina Raimondo. “We need to get this bill done.”
“The next generation of technologies is bound up in our ability to make sure that we have a secure and resilient supply chain, and it means getting the kind of structures in place to get the most sophisticated kinds of chips to the United States,” Hicks said.
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