Source: Blog – Alliance for American Manufacturing
Coming soon to the Columbus, Ohio area: A semiconductor chip fabrication plant! | Getty Images
Competing bills will clash in Washington. Can the House and Senate reach agreement?
The last time I was in Columbus, Ohio, I bought a very good book at a very cool bookstore and ran in the annual Columbus marathon. And lemme tell you, brother, I came in a lot closer to last place than I did to first! I am not a fast runner.
Still, you see a lot of neat stuff running around Columbus very slowly. The winding Scioto River,the pleasant German Village neighborhood, the big ol’ horseshoe football stadium on the grounds of the Ohio State University. It’s a Central Ohio feast for the eyes.
But! if you were to go back in, say three to five years – and the race organizers were to drastically alter the course map so that you instead ran 15 miles out of the city center to the nearby town of New Albany – you might run by something not often seen in the United States these days: A new semiconductor chip fabrication plant under construction. A new Intel chip fab, where Intel will make chips not only for its own products but that it will sell to others, is coming to Ohio. It will employ at least 3,000 people making the tiny little computer chips required to make virtually every electronic gadget we use go, and it will cost $20 billion to build it.
This isn’t the only such factory in the United States. There are fabs in North Carolina, Idaho, and Oregon, among other locations. And there are other new fabs being built right now in Arizona and Texas. But this fab will be the first in the state of Ohio, and supply chains will have to shift toward it to supply this huge new plant, which means even more economic activity for the Columbus area. It takes incredibly expensive machinery, as this CNET article explains, to build these increasingly small and complex chips.
After the new fab was first reported last week by Time, The Intel CEO was in Washington where he and President Biden pressed House and Senate lawmakers to convene and pass industrial policy legislation – meant to bolster America’s competitive footing against the Chinese economy – that would pump hundreds of billions of dollars into chip production, as well as artificial intelligence research, quantum computing, and other next-generation technologies.
Where does AAM stand?
The Senate already passed its version of its bill last year, but it needs improvement on key areas like trade enforcement, so that this significant amount of money doesn’t end up funding foreign state-owned enterprises and subsidiaries; and it should also fund supply chain resiliency efforts with clearly defined rules – namely that the loans, guarantees, and grants it doles out go toward strengthening domestic industrial capacity. The Alliance for American Manufacturing (AAM) made this case back in October when we offered testimony to a House Energy & Commerce subcommittee.
The House version of this important legislation is expected very soon, and is rumored to include some of these measures – as well as a proposal to zap the de minimis threshold so that e-commerce giants can skirt paying import duties. AAM is on board with this proposal. We think it’s okay; Bezos can afford it.
We’ll be watching as the Intel fab project in Ohio moves forward, and we’ll be keeping an eye on the industrial policy debate on Capitol Hill. Stay tuned!
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