Order Of Business

Floor Speech

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Ms. CANTWELL. 1562, as modified with the changes at the desk; and that following disposition of the Rubio amendment No. 1802, the Senate vote on amendment No. 1562 with 60 affirmative votes required for adoption.

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Ms. CANTWELL. Madam President, speaking against this amendment, I know the Senator from Florida probably, given his intelligence work, wants to be well-meaning, but this amendment is not ready for the focus that we need to give on issues of counterintelligence.

This amendment, as drafted, literally says that the Director of National Intelligence should look at and certify whether any of the entities given this money--including NASA, which would be given money under this bill--that they would have to certify for a 10-year period of time.

So, literally, every institution, every organization that gets money under this bill would have to certify for a 10-year period of time that they didn't have anything to do with a Chinese investment.

I am all for investigating theft and intellectual property. In fact, the Senator from Mississippi and I added several provisions to our legislation. Other people have added things to this legislation. But do I want the Director of National Intelligence calling every university in the United States that might get money from this program and asking them to verify for the last 10 years what did they ever take as far as Chinese investment?

I have news for you. I want the Director of National Intelligence to be focusing on cyber security. If somebody didn't see, we have just had a major pipeline incident. It is not the first incident; it is many incidents in which foreign governments have threatened our Nation, our sources of power, basically, by infiltrating our system.

I want the Director of National Intelligence to focus on Iran, to focus on Russia, to focus on North Korea, to focus on Syria, to focus on threats of terrorism. I want them to focus on monitoring our organizations nationwide. I do not want them spending their time calling university presidents and NASA officials asking them what they have done for the last 10 years and to verify before they can get the needed research dollars.

Now, I know the Senator is trying to be well-meaning, and I am happy to work with him on this issue. But I know this: The race is on in semiconductors. The race is on in quantum computing. The race is on in AI. The race is on in other areas of manufacturing. And we cannot afford to have our Director of National Intelligence spending his time calling up these people when we have already implemented the securities in this legislation.

I am happy to keep working with anybody on this issue. But, by God, I am telling you, we are going to be committed to doing more on our international threats on cyber security because, as you can see from this recent pipeline incident, that is where we should be spending our time and our focus, from a security perspective.

I ask my colleagues to table the Rubio amendment. Motion to Table

Madam President, I ask for the regular order. And I ask to table the Rubio amendment No. 1802 and ask for the yeas and nays.

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Ms. CANTWELL. Mr. President, I come to follow my colleague from Texas to talk about the very issue that he brought up, which is where is America going with semiconductor manufacturing, design, and development.

On this last point, I am pretty sure we see things differently. I am pretty sure that the majority--probably all of the Democrats would be enthusiastic about supporting both manufacturing in the United States as well as making sure that if Federal dollars are used, prevailing wage should be applied. I am sure we will differ on that point.

But I think that we are, at least on our side of the aisle, supportive of this concept that chip fabrication, chip manufacturing in the United States of America is an important sector and that we are facing a chip shortage and that we should do something about it.

If you think about it, semiconductors are like the oil of the 21st century. They have become an essential aspect. They can be found in children's toys, in appliances, computers, cell phones, our telecommunications networks, and advanced national security technology, as my colleague was mentioning. They enable healthcare, artificial intelligence applications, financial services, and certainly in the area of defense.

They have transformed how we communicate, how we learn, how we socialize. Yet they are so complex and manufacturing so expensive, it can cost anywhere from $5 to almost $20 billion--$20 billion is one number I have heard--just to build these facilities. This is why this issue has become so important.

The United States has had strong leadership in the semiconductor area, but massive investments from other nations put us at a disadvantage when it comes to manufacturing. They are subsidizing and getting tax benefits up to 40 percent to build in Korea than in the United States of America. The Endless Frontier Act tries to address that because it really is a national security and telecommunications policy

In the 1990s, the United States produced over 37 percent of the global chips supply. As you know, here in the United States, we have 48 percent of the world's aircraft production, but now with these challenges, as we look at the chip supply, they are down to 12 percent.

I noticed in the Wall Street Journal they said: Why do we care? Why do we care? They basically are saying that chips in fabrication have become a commodity and that we don't have to worry about it anymore. As long as we are winning on the design side, we don't care where it is manufactured.

Well, if you ask me, that is so 1980s--I mean, the idea that you could design a product here and then have it manufactured somewhere else. Maybe that works with shoes or outdoor clothing, but it doesn't work with something as sophisticated and changing as a high-tech innovation product like semiconductors. In fact, I would say, if you really think that type of thinking works, just look at what happened. It is really pro-COVID thinking. We thought we could have the design done here and, basically, some of these devices that we use here, like ventilators, we will just produce them overseas. What could possibly go wrong? Well, we figured out what could go wrong. If we are not manufacturing ventilators here in the United States, something could go wrong, and it did.

The question is, What is going to go wrong if we don't manufacture chips in the United States of America? The thing I don't think that the Wall Street Journal quite got right is that they don't understand that in today's innovation cycle, having a cluster of design, of manufacturing, of supply chain, of customers--everybody working together is the new way to have an economic advantage.

In fact, there is a recent study done by a Chicago research organization. I am going to read from this report. Basically, it is all about clusters and why clusters are so important:

An industry cluster is a group of firms, related stakeholders, and supportive institutions that gain productive advantages from close geographic proximity and related economies of scale. As groups of related industries grow and develop, clustering can help lower business costs and increase the extent of benefits of specialization. Deeper labor pools, better access to customers and suppliers, knowledge spillover--these and other advantages are derived from an environment of balanced competition and collaboration.

I could go on. I will submit it for the Record. That is what is happening with semiconductors.

The Asian market has, basically, now become the epicenter for this level of production, and the question is, Are we just going to forgo that and end up, basically, with not 12 percent of market share here but 6 percent of market share? Then our suppliers are going to continue to go where the investments and the energy and the ideas are.

That is why in the United States of America, where we still have clusters in various parts of the United States--my colleague from Texas knows this well because he has a cluster in Texas. My colleague from Oregon, who was out here earlier, knows because they have a cluster there. There are clusters in places like Arizona. This is about whether the United States of America is going to continue to make this investment ourselves.

Chips are essential to our national security and to telecommunications. In 1990, we produced over 37 percent of global chip supply, and we need to continue to make sure that we are going to be an investor in chip fabrication today.

Today, as I said, we are at an inflection point because of what is happening in a global basis. According to Goldman Sachs, 169 industries in the United States have products with embedded semiconductors, and there will be a 20-percent shortfall of components needed for those products.

Last month, Caterpillar, headquartered in Illinois, said it anticipated the chip shortage impairing its ability to meet growing demand of construction and mining equipment. We are not just talking about kids' gaming consoles or computers. We are talking about many sectors of our economy that depend on this.

National security experts argue that if there were a greater trade war or military conflict, the United States would not be able to fill its demand for chips for national security and critical infrastructure needs.

That means people like car manufacturers, appliance manufacturers--if you think about 5G and new technology--the post-pandemic economy won't be able to keep moving forward.

The shortage also forced the auto sector to cut 27,000 jobs in April alone. Earlier this year, General Motors temporarily shut down three North American plants due to the shortage. Ford cut back Michigan production of F-150s and the popular Explorer. And Dodge is reducing worker schedules in a Nevada plant producing the Jeep Grand Cherokee and Dodge Durango. These are having real-life impacts on us today.

The question is, We had a ripple of this just because of COVID. What if we had a ripple of this because somebody decided not to supply things to us? These are things we have to worry about just in a national security perspective. You have to worry about whether we are going to get a supply chain that we can depend on. We really are at an inflection point. We are at an inflection point where we need to do something about this sector.

One of the issues also is that chip fabrication and private R&D make huge investments. What we are talking about here represents a very small R&D investment partnership with the private sector as it relates to this. We are talking about trying to get more manufacturing jobs here in the United States.

My colleague was just discussing this sector, overall, and one of the things that people should think about--and I am pretty sure people at home won't be able to see this--but these jobs in production and in various aspects of design and even on some of the other aspects, even in management and computer, these are all well-paying jobs. These are jobs that, literally, are the types of jobs we want to be producing in the United States.

I heard this story about Idaho. Micron, a big company that used to be a major chip fabrication--they are still doing chip fabrication--but the number of jobs in Boise, ID, has fallen off, probably in the thousands, because this production has gone to other places. Now we are replacing them with call center jobs.

The question is whether we are going to make this investment in a key technology critical to our national security--critical to a lot of applications of the technology future, whether it is 5G or AI or various things--and whether we are going to be a competitor in this area of a supply chain and cluster that continues to innovate.

We know for a fact that semiconductor jobs in the production area are literally $94,000 a year. That is why we are fighting for this because it is a sector, in just the production end, that is high-paying jobs.

So are we going to spend time letting things go overseas and basically saying, ``OK, they will allow us to have call centers,'' or are we going to fight for these high-paying jobs in the semiconductor space that we know will help us maintain our expertise and skill in the United States?

I ask my colleagues to just think about the fact that this notion that we design something here and ship it overseas for cheap production does not fit this bill. That is not what we need to do to maintain competitiveness, in the information age, on something as important as semiconductors.

I think our history is rich with people like Thomas Edison and the Edison Park, which is what we established in New Jersey, or Menlo Park, or what now exists in Seattle or in various places. People get that innovation happens in clusters. So, if we are going to innovate, we have to make sure the United States is attracting this investment. We have to make sure that we are doing this here, on our shores, with the expertise and support.

A lot of my colleagues might say: Well, do you know what? Let's just have the private sector do this R&D.

As I said, the private sector spends a lot on R&D. In fact, we think the private sector spends about $377 billion a year on R&D. Yet, as we know, R&D isn't just done by the private sector for its specific interest. Basic science and lots of advanced research and applied science are done by the United States. That is why this bill is plussing up this number here from the National Science Foundation. We had discussions here about plussing up the number from the Department of Energy. Obviously, we had a vote in the Senate of even increasing the Defense Advanced Research Projects Agency and its dollars.

What works about the United States of America is that we are an ecosystem. We are not a top-down. It is not like we are basically the government, saying: This is what is going to be done. We create an ecosystem that is really based on American know-how--our ingenuity in how to get things done.

What we are asking for, as it relates to not only NSF funding in order to continue the work of R&D as it relates to semiconductors, is also to make sure that we are going to continue the focus of manufacturing and design and R&D and development and clustering and supply chain and companies working together.

I know how important this is because, in the Seattle area, in Washington State, we are a leader in aerospace technology. We are 49 percent, in the United States, of aerospace manufacturing. If you don't keep manufacturing, do you think the supply chain will stay in Seattle? Do you think the supply chain would stay in Seattle forever--all of those companies? We have hundreds of companies that make products for Boeing. Do you think they would stay there if it were not there? They will end up moving where the manufacturing is.

That is what the information age is about, and it is certainly about that when it comes to technology products. The technology products are developed faster, quicker, and with the innovation and the input from their customers. That is why, if you look at these centers around the United States, they are also the places at which you will find the biggest users of this technology. They are there, and they are there because they want to be close to their customers. They want to understand their customers' needs. They want to have interaction. They want to have collaboration.

That is what innovation is today. Innovation is doing design and manufacturing close together. That is how we win. That is why we need to pass this legislation as it relates to an investment in chip design and manufacturing R&D and so we continue to attract manufacturing in the United States.

Back to my colleague from Texas, who I know agrees with this principle in an underlying way, when the Federal Government wants to make an investment in actual construction, we say that we should apply prevailing wage. I have talked to many of these people in the semiconductor manufacturing-design space. They say: Do you see how expensive it is to do these plans? Do you see how expensive the equipment is? It is very expensive; so we need the best workforce. So guess what. We pay prevailing wage.

So we are saying, because we are putting Federal dollars on the table, we should pay prevailing wage. They think we should also pay prevailing wage. I am not speaking for them, but, in general, they feel like that is when they get their best product.

I know where my side of the aisle is. We are going to be here to make an investment in this particular sector. We are going to figure out how to be competitive against Asia in semiconductor manufacturing. We are going to continue, as Andy Grove said, to be paranoid because we know that this is a changing landscape, and we are going to follow our colleagues who have made these decisions and make an investment for the future.

I ask our colleagues to turn down the motion to strike the underlying bill, as the underlying bill already has this provision in it, and let's get about this business of waiving a budget point of order and deciding to make the investment that we need to make to be competitive in a key sector of the U.S. economy. If we do that, I guarantee you we will be well-positioned to continue to move forward, and our national security will be more secure because we will have made this decision.

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