GOP nominee Ted Budd admits microchip bill he opposed is already helping North Carolina

North Carolina Republican Senate nominee Rep. Ted Budd admitted on Friday that his state is already seeing some economic benefit from a microchip manufacturing bill he voted against.

During an appearance on right-wing talk radio station WSIC in Statesville, North Carolina, on Oct. 14, Budd, who is running against Democratic former state Supreme Court Chief Justice Cheri Beasley for the open seat of retiring Sen. Richard Burr (R-NC) this November, was asked about the impact of the CHIPS and Science Act, which passed Congress in July with bipartisan support.

The $280 billion law — the name is an acronym for Creating Helpful Incentives to Produce Semiconductors — invests more than $50 billion in semiconductor research and manufacturing grants, aiming to make the domestic semiconductor industry more competitive with China’s. It bars companies receiving grants from building or moving plants to China for a decade.

Budd, who voted against the bill, acknowledged that it was bringing technology jobs to the voters he hopes to represent, but reiterated his opposition to it, claiming it would help China: “We want to make sure that we’re not letting chips be developed here and be shipped over to China, especially through what happened with the CHIPS Act, which originally, when it was in Republican hands, I supported. …. Look, we’ve got a new technology company coming to the Triangle area. We want them here. You know, they’re gonna get some benefit from the CHIPS Act, but there’s so much wrong with it that’s hard, that’s bad for our taxpayers and it’s good for China. … Now, did some company here in North Carolina get some benefit from it? Yes.”

A spokesperson for Budd did not immediately respond to an inquiry for this story.

Budd has objected to a provision in the bill that exempts a small number of grandfathered “legacy superconductor” manufacturers from the rule against moving operations to China. “The CHIPS Act’s China loophole was a fatal flaw that allowed taxpayer-backed semiconductor manufacturing to continue to move to Communist China. That is unacceptable,” he wrote in a Sept. 29 press release about his proposal to repeal that exception.

But the vast majority of lawmakers from both parties, including both Republican North Carolina Sens. Burr and Thom Tillis, voted yes. It passed 64-33 in the Senate.

A March 2021 Financial Times analysis found that the United States’ share of the world’s semiconductor manufacturing capacity dropped from 37% to 12% between 1990 and 2020. China’s rose from 0% to 15% over that time period and was projected to keep rising to 24% in the next decade.

The CHIPS bill was designed to reverse that trend.

According to the White House, its impact has already been positive. “Spurred by the passage of the CHIPS and Science Act of 2022, this week, companies have announced nearly $50 billion in additional investments in American semiconductor manufacturing,” it noted in an Aug. 9 fact sheet.

In October, Micron announced plans to invest up to $100 billion over 20-plus years in a new New York facility, creating 50,000 new jobs, expressly citing the legislation as making the investment possible.

And while Budd has suggested that the bill benefits China rather than Americans, China apparently disagrees.

Nikkei Asia reported in August that Chinese trade groups had panned the bill, claiming it “discriminates against some foreign companies, uses state power to forcibly change the international division of labor in the semiconductor industry and harms the interests of companies around the world, including in China and the U.S.” It also quoted Chinese Foreign Ministry spokesperson Wang Wenbin as calling the bill “economic coercion.”

After hearing about China’s lobbying efforts to defeat the bill, Commerce Secretary Gina Raimondo said in May: “It doesn’t surprise me at all. China doesn’t want us to pass this bill. They know that this bill will enable us to outcompete them. … The last thing they want is for us to invest $52 billion.”

Democratic nominee Beasley tweeted in August that she supported the bill. “The CHIPS Act is now law — and will bring investments in manufacturing, good-paying jobs, and lower costs to North Carolina. Congressman Ted Budd needs to explain to voters why he voted against it.”

Recent polling has shown the North Carolina Senate race to be virtually tied.

Published with permission of The American Independent Foundation.