Senate Majority Leader Mitch McConnell threatened Thursday to sink Congress’ massive China competition bill, if Democrats keep pushing to revive President Biden’s long-stalled climate and social welfare spending program.
Senate, House negotiators remain deadlocked on the U.S. final passage. The Innovation and Competition Act (or USICA) is the marquee measure. It includes a $52 million incentive for semiconductor producers to set up production plants in the U.S. This landmark measure has been widely supported by both the House and Senate.
But, the Kentucky Republican has a problem with the Democrat’s spending bill.
” “There will not be a bipartisan USICA so long as Democrats pursue a partisan reconciliation act,” McConnell stated on Twitter.
The President Biden has repeatedly urged Congress to pass the broad legislation quickly, but negotiations for key differences have been stalled for several months.
Democrats work separately to reach a compromise on a reduced version of President Biden’s $1. 75 billion social-welfare legislation, which failed late last year.
Mr. McConnell’s warning signaled a difficult battle for Democrats looking to pass the bill quickly. It also puts President Trump in the awkward position of trying to strike a balance between his domestic spending goals and his tough-on China aims.
The shot across Democrats’ bow was met with swift response by Karine Jean Pierre, White House Press Secretary. She accused Karine JeanPierre of taking the China Competition Bill hostage to “protect the ability of large pharmaceutical companies price gouge .”
One element in the Democrats’ legislation would allow Medicare to have more power over pharmaceutical companies.
“Republicans literally choose to help China outcompete America in order to safeguard big drug companies,” Jean-Pierre stated.
“This raises loyalty to American workers to an entirely new level .”
” We aren’t going to give in to this terrifying threat,” she stated.
The Senate passed the $250 trillion USICA in June, with support from 18 Republicans as well as 50 Democrats.
The $335 trillion House counterpart, America COMPETES Act includes an assortment of spending, including $8 billion for developing countries to address climate change. It also funds the reduction in the U.S. dependence on Chinese solar technology. $45 Billions to strengthen U.S. supply chain.
Republicans blasted the bill that was passed 222 and 210 on February 2nd. They called it a “foreign failure” which funnels taxpayer money into an unaccountable U.N. Slush Fund “
For many Republicans, the $52 trillion boost to semiconductor manufacturing remains one of the most palatable provisions in both versions.
Industry executives say that the provision of semiconductors is essential for America to compete with foreign producers like China and India.
Lawmakers from both parties have used recent shortages of chips to show that Congress must act quickly.
Two major semiconductor producers, TSMC and Intel, have warned recently that they would reduce plans to manufacture semiconductors in America if Congress does not make a deal.
Countries in Asia and Europe already have incentives for semiconductor producers to open shops within their borders.