Chuck Schumer’s Cynical Play on China-Competition Bill

The multibillion-dollar China-competition legislative package is at a critical juncture this month: After more than a year of deliberations, the bill — which has had many names and is frequently called the U.S. Innovation and Competition Act (USICA) — is now with a bipartisan, bicameral conference committee charged with settling on a compromise text. Senate leadership wants to get it done by the summer.

For months, the administration and its congressional allies have hammered the message that this is an urgent, must-pass bill. It provides for $52 billion in semiconductor manufacturing subsidies, which Commerce Secretary Gina Raimondo and congressional leaders have said will determine the degree to which companies like Intel expand their operations in the U.S. In fact, Raimondo issued another statement reiterating the urgency of this bill earlier this week. For its part, Intel has said it may curtail its plans to open new chip-manufacturing sites in Ohio, depending on the outcome of the USICA legislative process.

Senate majority leader Chuck Schumer is reportedly even organizing a political-pressure campaign in tandem with private industry. This week he told Axios, “If we don’t act quickly we could lose tens of thousands of good-paying jobs to Europe.”

Now, though, there are reports that Schumer may try to use the Senate’s remaining time ahead of the midterm elections to enact a trimmed-down version of the Build Back Better Act. That prompted the following threat from Senate minority leader Mitch McConnell:

Some progressive pundits, such as the Washington Post’s Greg Sargent, seem to be wishcasting, suggesting that McConnell’s threat to kill a Chinese-competitiveness bill to block legislation making prescription drugs cheaper will backfire.

Schumer is hammering that point, with his spokesman telling CNN that McConnell is holding the bill “hostage” to protect the pharmaceutical industry.

But Schumer should be viewed as the one hobbling USICA’s chances, by gumming up the Senate with a push to reanimate Build Back Better. As Allahpundit noted at Hot Air, citing me, McConnell seems to be banking on that perception:

I think Jimmy Quinn is right about what McConnell’s play here is. Schumer and Manchin are suddenly close to a deal on a scaled-down BBB bill that would reduce prescription drug costs for seniors, with Democrats hoping to pass the bill by the end of July. The House and Senate, meanwhile, have each already passed their own versions of USICA, a bill which the public broadly understands is necessary to shore up America’s supply chain. As Quinn says, McConnell is essentially daring Schumer and Biden to choose their economic bill over the Chinese-competition bill and then explain to voters why more domestic spending in an age of high inflation is of greater urgency than catching up to China in the important economic niche of semiconductor production.

Either Schumer truly believes that the USICA text under discussion is an urgent national-security priority, or he doesn’t.

As I reported recently, there’s a non-zero chance that Republicans may just decide to walk away in the end, given their political prospects. That possibility will grow if Build Back Better’s chances of becoming law also increase:

Waiting a few months may result in a better, narrowly tailored bill devoid of the climate- and DEI-focused provisions with which House Democrats loaded it up. But, as Allahpundit concluded, that delay might, in turn, have ramifications for Intel’s plans in Ohio.