Biden poised for big wins in Congress

cigaretteman

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The first major prescription drug legislation in nearly 20 years. More than $50 billion to subsidize computer chip manufacturing and research. A bill that would enshrine protection for same-sex marriage.

After a turbulent stretch in which much of President Biden’s legislative agenda seemed to be foundering, the president and his party may be on the cusp of significant wins in Congress that the White House hopes will provide at least a modest political boost.
Most politically resonant is a bill to let Medicare negotiate drug prices, a hugely popular idea that Democrats have been pursuing for more than 20 years. Even before that — possibly within days — Congress is likely to pass a bill providing $52 billion to the U.S. semiconductor industry, intended to bolster the U.S. economy and cut China’s influence. “We’re close, so let’s get it done,” Biden said of the bill on Monday. “So much depends on it.”


Democrats hope these measures earn a bigger political payoff than, say, Biden’s infrastructure law, which seemed to make little impression on voters.
“Democrats now seem to be hitting a stride where they’re about to rattle off three meaningful victories in a short amount of time, and for really the first time have an open field to politically gain from that,” said Kurt Bardella, a former Republican who now consults for Democrats. “On the health-care bill, this is stuff everybody generally understands. This is not a complex, nuanced policy situation where you may not feel the benefit for 5 to 10 years.”
The legislative wins come at a precarious time for the president and congressional Democrats, who have struggled to overcome poor public views of the economy due to persistent inflation as well as Biden’s low approval ratings. While several recent polls have shown congressional Democrats slightly improving their standing against Republicans, they remain at serious risk of losing their House and Senate majorities in November.



Last-minute glitches could still disrupt the upcoming bills, not least a coronavirus outbreak in the Senate that has temporarily sidelined such key figures as Sens. Joe Manchin III (D-W.Va.) and Lisa Murkowski (R-Alaska). And the semiconductor bill is a whittled-down version of a broader bill intended to boost U.S. competitiveness against China that some Republicans opposed.
The Medicare drug bill is especially notable, despite only covering some medications, since it marks the most significant drug pricing legislation since 2003. Polls show that health care, and the cost of prescription drugs in particular, consistently rank as a top voter concern. The bill would also provide a two-year extension of enhanced Affordable Care Act subsidies that would prevent health insurance premiums from rising significantly for many people.
Rep. Spanberger joins Biden to talk prescription drugs
The prescription drug legislation has enormous bipartisan support, with more than 90 percent of Americans saying in a March 2022 Kaiser Family Foundation poll that letting the government negotiate with drug companies to get a lower price on Medicare prescription drugs should be an “important priority” or a “top priority” for Congress.



The semiconductor bill would also provide tens of billions of dollars for the National Science Foundation and regional tech start-ups. Semiconductors are vital to an array of technological products, and China has been investing billions to make itself the leader in the field. While strategists said the bill would be harder for Democrats to message given its impact will be felt over years, not months, the legislation could eventually help address rising car prices that have in part been fueled by a chip shortage.
Semiconductor shortage hammers automakers
Biden, who is still in isolation after testing positive for the coronavirus last week, appeared during a virtual event on Monday with CEOs and labor leaders to urge Congress to pass the bill. “China is moving ahead of us in producing these sophisticated chips,” Biden said. “It’s no wonder China is watching this bill so carefully, and actively lobbying U.S. businesses against this bill.”
Meanwhile, a bill that Democrats offered to codify same-sex marriage recently attracted 47 Republican votes in the House, surprising leaders of both parties and igniting a push by Senate Democrats to pass the legislation in their chamber as well.



Biden advisers said the bills, if they all pass, will help the president draw a contrast between Democrats’ agenda and what they portray as an increasingly extreme GOP that is out of step with most Americans on issues ranging from abortion to same-sex marriage to gun control. But those advisers said they are not yet assuming the bills will become law, and caution there is work ahead.
“Middle class families need breathing room, and the deficit reduction [the health-care bill] accomplishes that and will also help fight inflation," said Andrew Bates, White House deputy press secretary.
On the chips and same-sex marriage bills, he added, "Passing a landmark China competitiveness bill that will create manufacturing jobs across the country and standing up for the fundamental right of every American to marry who they love would be profound bipartisan wins for the county.”



Still, the various pieces of legislation could help boost Biden’s public standing, which has suffered as he has faced one crisis after another over the last year-and-a-half. Biden took office as the coronavirus pandemic was raging and killing thousands of people a day, and he saw much of his coronavirus agenda struck down by the Supreme Court.
Since then, he has dealt with record inflation, a baby formula shortage, numerous mass shootings, increasingly transmissible coronavirus variants, Russia’s invasion of Ukraine and a highly conservative Supreme Court that overturned the constitutional right to abortion, curbed the power of the Environmental Protection Agency and rolled back states’ ability to implement gun control measures.
The legislative victories that Biden has secured so far — a coronavirus relief package, a $1.2 trillion infrastructure bill that he signed in November and a modest gun control package that broke a 30-year logjam on the issue — have quickly been overtaken by events, or have been dismissed by many liberals as too small to meet the moment. The gun legislation, for instance, came amid a series of mass shootings, including a July 4 massacre at a parade in Highland Park, Ill., and as the Supreme Court struck down a New York law limiting residents’ ability to carry a weapon.







 
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luvmyhawks

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And the semiconductor bill is a whittled-down version of a broader bill intended to boost U.S. competitiveness against China that some Republicans opposed.

Of course they do. I mean, I would hate to do anything to be more competitive with china. Unless, of course, they are opposing it because we need MORE funds. Then I would agree with them.

I support all of these bills. Get er done.
 

ihhawk

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Um, probably to support smaller companies to become more competitive and less reliant on china. Help meet the high demand. It’s a no brainer.
I’ve been looking for additional details. Curious how the money will be used. I assume the manufacturing will be done by large Fortune 500 companies. I doubt small mom and pops will make semiconductors
 

Hawki97

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With the high demand for semi-conductors in the USA, why do we need to subsidize the industry?

Because you want to pay the absolute least amount possible for your new iPhone.

And while it was fine to outsource to China for a while because you could get that cheap iPhone as people were jumping out of windows at the chip factory, it's become a growing national security threat to continue to leave China in the lead. So, if you care about China's position in the industry vs. building our autonomy in the space, we need to take some lumps on this one - either through subsidies or a higher priced iPhone.

Sorry you're being asked to pitch in to make America better broseph.
 

luvmyhawks

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I’ve been looking for additional details. Curious how the money will be used. I assume the manufacturing will be done by large Fortune 500 companies. I doubt small mom and pops will make semiconductors

Doing a quick search and sorting through the 50 articles I found in 6 seconds, it appears 39b will go towards infrastructure subsidies to build plants for increased production. The rest will give 25% tax credits to any company that research and develops semiconductors. The bottom line is **** china. I have been clamoring for years for the us to offer subsidies and bring back any and all business from china. This would be a good start.

People have been wondering what Biden is doing to help inflation. Well, here you go.
 

ihhawk

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Overall I think it’s something that has to happen. It will be a lot of dollars flowing to large companies.

I wonder if Musk will enter the game and get some additional govt money
 
Nov 28, 2010
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Unless they've fixed it, the chips bill is a huge giveaway to Intel and others with few protections against them using the money to raise CEO salaries, buy back stocks or invest overseas.

The idea is great - to increase US capacity and avoid supply chain disruptions. But it's not at all clear that the money will produce that result. And it's a lot of money.
 

Hawki97

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Doing a quick search and sorting through the 50 articles I found in 6 seconds, it appears 39b will go towards infrastructure subsidies to build plants for increased production. The rest will give 25% tax credits to any company that research and develops semiconductors. The bottom line is **** china. I have been clamoring for years for the us to offer subsidies and bring back any and all business from china. This would be a good start.

People have been wondering what Biden is doing to help inflation. Well, here you go.

This is so bigly important. "Chips" are going to be (actually I'd argue they already are) the next oil. The last thing we need is a Saudi Arabia problem in nanotechnology. Bring it back home. Hell, spin it as it's bringing back jobs and manufacturing for the people that can't see implications beyond the nose on their face. I'd love to see the USA be THE leader in the world and China relegated to "junk" status at some point. That won't happen because they're just too far ahead and they play by an entirely different set of rules when it comes to ethics/norality, but we can't just throw our hands up and ignore it.

They're absolutely right though on the risks of this bill from the (clueless and self-absorbed) general public's perspective. It's not a quick fix bill. The benefits are years away and it will actually likely result in higher consumer prices at some point (oh, boo f'ing hoo my new phone cost me $25 more dollars!). But being in the lead isn't easy.
 
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Intel Begs For A Bailout


Company CEO Pat Gelsinger says semiconductor firms need subsidies to invest domestically — but there’s little guarantee the giveaway will actually help.

Intel CEO Pat Gelsinger tried to strong-arm Congress last week, telling CNBC that the semiconductor industry needs $52 billion in subsidies to remain competitive, or else major microchip companies won’t invest resources in the United States. But at the same time, Gelsinger’s company and its well-connected lobbyists are pushing Congress to allow it to potentially use the subsidies to put more money into its factories outside of the country.

Plus, there is nothing in the massive subsidy bill, which also includes a major tax break for chip manufacturers and could face a Senate vote as soon as Tuesday, that would require companies like Intel to actually use the money on domestic research and development. That means the companies could instead give the money to shareholders via dividends and stock buybacks. Just last week, Intel announced a quarterly stock dividend for its investors.

There is a good case to be made for federal support for more domestic semiconductor research and manufacturing — especially as most advanced chip manufacturing is centered overseas, thanks to offshoring by firms like Intel and foreign government support for the industry. Plus, global chip shortages have contributed to high inflation. But what is left of this particular legislation, known as the CHIPS Act, amounts to billions of dollars in giveaways to major corporations like Intel — with little guarantee that the subsidies will deliver the promised semiconductor manufacturing boom here in the U.S.

“Do not go home for August recess until you have passed the CHIPS Act,” Gelsinger warned lawmakers on CNBC’s Squawk Box on Friday, “because I and others in the industry will make investment decisions. Do you want those investments in the U.S., or are we simply not competitive enough to do them here and we need to go Europe or Asia?”

Intel has been one of the bill’s staunchest supporters — and Gelsinger was even invited to President Joe Biden’s state of the union address to show his support for the subsidies. In that speech, Biden said that Intel was prepared to increase its investment in a new chip factory in Ohio from $20 billion to $100 billion, if only Congress passed the CHIPS Act.

Intel is now holding that factory hostage. Last month, Intel canceled a groundbreaking ceremony for the Ohio plant, saying it was delaying construction due to Congress’s failure to pass the subsidies.

Gelsinger told The Washington Post last week that he "will make a decision to delay our project in Ohio” if Congress doesn’t pass the CHIPS Act.

In addition to the $52 billion in direct subsidies for chip companies, a separate 25 percent tax break for chip manufacturing is also included in the current CHIPS Act.

The second tax provision could deliver $24 billion to the microchip industry over the next five years, according to the Congressional Budget Office. A version of this tax credit was included in the House-passed Build Back Better bill that died in the Senate last December, and it would have required tax credit recipients to pay a prevailing wage to workers building their facilities.

According to a Lever review of the current bill language for the CHIPS Act, which has been stripped down due to Republicans’ refusal to support a broader China competitiveness bill, the prevailing wage requirement is not included in the manufacturing tax credit.

The legislation, which will cost $76 billion in total, will not be offset by any new taxes.

[continued below]
 
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Intel Doesn’t Want “Guardrails”​

While Senate Majority Leader Chuck Schumer (D-N.Y.) has tried to sell the CHIPS Act as an investment in the United States’ semiconductor manufacturing capacity in the face of a global chip shortage, the bill as it exists is essentially a bailout to large chip manufacturers — namely, Intel.

Today’s semiconductor shortages can in part be attributed to U.S. chip companies offshoring manufacturing, and spending their profits on returning dividends to shareholders and buying back their own stocks instead of investing in research and development.

In the past decade, the four largest chip companies in the U.S., including Intel, spent nearly a quarter trillion dollars — over 70 percent of their combined profits — on manipulating their stock price and delivering cash to shareholders via stock buybacks.

Intel has continued to pay dividends to its shareholders even as Gelsinger has said publicly that the company needs government subsidies to invest in manufacturing. Gelsinger, who became CEO last year, has halted buybacks — although the company technically could, under a 2005 authorization from its board of directors, move “to repurchase up to $110 billion [of stock], of which $7.2 billion remained available” as of this spring.

Yet, Schumer has repeatedly declined to hold votes on amendments put forward by Sen. Bernie Sanders (Ind.-Vt.) to restrict companies that receive the subsidies from buying back their own stocks, as The Lever previously reported.

And even if Sanders’ buyback ban was added to the bill, the restriction would not stop companies from returning the same money to their shareholders via larger dividends.

Meanwhile, former aides to Schumer and Sen. John Cornyn (R-Texas), two of the bill’s staunchest advocates, have been lobbying the Senate on behalf of Intel to pass the legislation.

Last year, Intel retained the firm Klein/Johnson Group — which was established by former Schumer aide Israel Klein and former Cornyn aide Matthew Johnson in 2020 — to lobby on the legislation. A second former Schumer aide, Brian Greer, is also lobbying for Klein/Johnson on behalf of Intel, according to federal lobbying records

Intel and other chip companies have warned that Europe and China have been much more willing to subsidize semiconductor manufacturing than the United States, which will influence their plans about where to build and expand.

But it’s not at all clear that the massive CHIPS Act subsidies would spur domestic investment. Not only has the industry wasted its profits on returning money to shareholders, rather than research and development, but Intel is also lobbying against a provision in the bill that would prevent companies that receive the subsidies from using them to invest in factories overseas.

“Intel and the Semiconductor Industry Association, a sector interest group, have lobbied to weaken so-called ‘guardrails’ in the CHIPS Act that could limit their operations in the world’s second-largest economy, according to three Capitol Hill sources with knowledge,” Politico reported Monday. “The rules, which are still being negotiated, could prevent companies that receive funding from the bill from building or expanding advanced semiconductor facilities in China.”

Meanwhile, smaller chip companies that design but do not manufacture chips fear they could be crowded out by the handful of large companies that already dominate the market, including Intel and Texas Instruments.

Reuters reported on Monday that “a rift had emerged last week within the chip industry itself, with some players concerned the final language of the legislation would provide disproportionate support to manufacturers like Intel while doing little to support chip designers like Advanced Micro Devices Inc., Qualcomm Inc., and Nvidia Corp.”

 
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Hawki97

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Unless they've fixed it, the chips bill is a huge giveaway to Intel and others with few protections against them using the money to raise CEO salaries, buy back stocks or invest overseas.

The idea is great - to increase US capacity and avoid supply chain disruptions. But it's not at all clear that the money will produce that result. And it's a lot of money.

All just the grease that smooths the gears of how our country (and the world) has worked for forever.

You've got huge players involved here. Politically. Commercially. Globally. Financially. With tentacles that you or I could never fully grasp. All with their own self interests. If it results in us strengthening our position - both in production and innovation / research - on what I believe is the world's next most valuable resource...well, I'm willing to deal with the consequences of an imperfect bill. The perfect bill doesn't exist and sitting on our hands nitpicking just means we're getting farther and farther behind.

But I'm looking at it from the lens of "Is this good for America?" Not "Can I blame Brandon/Orange Man for something and own my meme sharing Uncle?" Rare in the world today, I know.
 
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Hawki97

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I don't have time to read the entire bill, but this article from this morning is promising:

Commerce Secretary Gina Raimondo on "Face the Nation" Sunday said she's confident the bill will pass.

"This will be a big bipartisan vote in the House and the Senate," she said.

She also pushed back against criticism from both the left and the right. Senator Bernie Sanders has called the bill a blank check for the the microchip industry. Raimondo said the bill clearly has bipartisan support.

"I fully dispute Senator Sanders' characterization of this. It isn't a blank check," Raimondo said on Sunday. "There are many strings attached. Strings attached — companies can't use this money to build facilities in other countries. Companies who accept this money can't then turn around and be building facilities in China for leading edge technology. There's a lot of strings attached around the quality of jobs that have to be created, working with small contractors and minority-owned contractors. There are labor protections. So to say it's a blank check is just dead wrong."

 
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pepsicock

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Cracking Up Lol GIF
 
Nov 28, 2010
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I don't have time to read the entire bill, but this article from this morning is promising:

Commerce Secretary Gina Raimondo on "Face the Nation" Sunday said she's confident the bill will pass.

"This will be a big bipartisan vote in the House and the Senate," she said.

She also pushed back against criticism from both the left and the right. Senator Bernie Sanders has called the bill a blank check for the the microchip industry. Raimondo said the bill clearly has bipartisan support.

"I fully dispute Senator Sanders' characterization of this. It isn't a blank check," Raimondo said on Sunday. "There are many strings attached. Strings attached — companies can't use this money to build facilities in other countries. Companies who accept this money can't then turn around and be building facilities in China for leading edge technology. There's a lot of strings attached around the quality of jobs that have to be created, working with small contractors and minority-owned contractors. There are labor protections. So to say it's a blank check is just dead wrong."

Who you gonna believe?

I'll take Bernie over Raimondo, Schumer and the rest.
 

Hawki97

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Who you gonna believe?

I'll take Bernie over Raimondo, Schumer and the rest.

I already explained my position in my posts above. I’m hopeful this moves the needle and I’m not expecting perfection. We can’t wait to make every person chirping from the cheap seats like yourself happy with every single piece of the bill. The Chinese have already lapped us multiple times - we can’t let them continue to ring the bell while we’re arguing amongst ourselves. This is too important to worry about the Average Joe’s feelings / theories. This is THE race of our (actually my kid’s) generation.
 
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Hawk and Awe

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This is the same thing China would do except they would also have control of the company they’re giving money to. It'd be easier if Congress just gave it directly to the investors since it’s going to end up there anyways.

But “free market” amiright?

This is probably the right thing to do, but I have little faith anytime the dumb guys we elect are helping the smart guys with all the money
 

Hawki97

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This is the same thing China would do except they would also have control of the company they’re giving money to. It'd be easier if Congress just gave it directly to the investors since it’s going to end up there anyways.

But “free market” amiright?

This is probably the right thing to do, but I have little faith anytime the dumb guys we elect are helping the smart guys with all the money

I’m just not ready to give up.

In general, I think I value nanotechnology (which goes way beyond “chips” so that’s why I love the R&A requirement on this bill) more than most of the old fogies. The leader in nanotechnology will rule the world in the future - and we’re uniquely positioned especially with all of our built in advantages.
 
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Hawk and Awe

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I’m just not ready to give up.

In general, I think I value nanotechnology (which goes way beyond “chips” so that’s why I love the R&A requirement on this bill) more than most of you old fogies. The leader in nanotechnology will rule the world in the future - especially with all of our built in advantages.

I get the need. Completely behind the cause. The NSF money is especially great.

But why does it have to be cash? It just seems painfully simple. If it’s so important and a national security concern maybe we take a couple hundred billion out of the defense budget, raid the patent office, and make the damn things ourselves
 

Hawki97

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I get the need. Completely behind the cause. The NSF money is especially great.

But why does it have to be cash? It just seems painfully simple. If it’s so important and a national security concern maybe we take a couple hundred billion out of the defense budget, raid the patent office, and make the damn things ourselves

As I said earlier, this is more complex than your or my feeble minds could potentially comprehend because there are sooooo many factors in play at this point. This isn’t a “new” thing. The (Chinese) horse (that we funded bigly) left the barn a long time ago and we’re in catch up mode. Let’s let this bill go to get the USA chip train out of the station and we’ll work on the things you’re worried about on the next round. We gotta start. Yesterday.
 
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BioHawk

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With the high demand for semi-conductors in the USA, why do we need to subsidize the industry?
Because we can't compete with Chinese companies that produce them right now where working conditions are so bad they have to put nets on the outside of the building to catch the workers who jump off the top of the building.

I don't like this solution either, but not being able to produce our own microchips is a national security risk and I haven't heard any better ideas to fix the problem.
 
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Rifler

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Um, probably to support smaller companies to become more competitive and less reliant on china. Help meet the high demand. It’s a no brainer.

Probably right,.. The bill appears to have been developed by politicians without brains, and I'm quite certain that after passage the program will be managed by bureaucrats without brains.
 

BioHawk

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One other thing about the microchip deal. This is corporate welfare at it's finest. Given that it is a national security issue, then I think I can deal with it (although an argument can be made that this should be included as part of the defense budget). The problem is, the second funding for this ends the companies will close the factories, even if they are still making money with them. They just won't be making as much money.
 

HawkRCID

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It will be very interesting. I’m much more optimistic than I was…overturning Roe may be one of the biggest political blunders in modern American history. Over the last week I personally have talked to a number of life long Republicans I know, and they shocked me…said they’re either voting Dem or staying away this year. Said they’re about sick with the Roe ruling, and the mounting 1/6 evidence…

I thought Dems were done, we will see…
 
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StormHawk42

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It will be very interesting. I’m much more optimistic than I was…overturning Roe may be one of the biggest political blunders in modern American history. Over the last week I personally have talked to a number of life long Republicans I know, and they shocked me…said they’re either voting Dem or staying away this year. Said they’re about sick with the Roe ruling, and the mounting 1/6 evidence…

I thought Dems were done, we will see…
The R’s torpedoing the PACT Act yesterday didn’t get anywhere near the media attention it should have but I have a feeling it will get plenty of air time on ads for midterms.

That was a bad look for R’s.