Senate-Passed Bill Encourages Tech Competition, Especially With China

RACHEL MARTIN, HOST:

So the Senate did something remarkable yesterday. It passed a bill with strong bipartisan support, and it's a big one. The Innovation and Competition Act of 2021 unlocks nearly $250 billion in funding for science and technology in the U.S. It's designed to counter China's growing strength in those areas. NPR China affairs correspondent John Ruwitch reports.

JOHN RUWITCH, BYLINE: The bill passed with more than two-thirds of the Senate in favor, which highlights the level of alarm over China's burgeoning tech prowess.

(SOUNDBITE OF ARCHIVED RECORDING)

CHUCK SCHUMER: The world is more competitive now than at any time since the end of the second world war.

RUWITCH: Senate Majority Leader Chuck Schumer was a key sponsor and led the charge to get it passed.

(SOUNDBITE OF ARCHVIED RECORDING)

SCHUMER: If we do nothing, our days as the dominant superpower may be ending. We don't mean to let those days end on our watch. We don't mean to see America becoming a middling nation in this century. We mean for America to lead it.

RUWITCH: The bill pours close to $200 billion into science and technology research and development through grants, scholarships and other channels. It also allocates $52 billion in emergency funding to boost semiconductor production in America. Michael Santoro, a business school professor at Santa Clara University, likes the basic research funding but says the money for semiconductors is misguided. The U.S. already leads in chip design, and most cutting-edge microchips are manufactured in Taiwan and South Korea, both U.S. friends.

MICHAEL SANTORO: We're zagging at the precise moment where we should be zigging. So what is it that makes America strong? Not industrial policy.

RUWITCH: He thinks China will probably see the bill as ineffectual. It also won't change Beijing's thinking.

SANTORO: Why would you change when your competitor, you know, has told you that they're afraid of you and they're starting to mimic your tactics?

RUWITCH: The White House put out a statement saying President Biden applauded the passage of the bill. Now it heads to the House for consideration.

John Ruwitch, NPR News.

(SOUNDBITE OF AMBINATE'S "DIVIDE") Transcript provided by NPR, Copyright NPR.