Technology

Biden signs supply chain order after ‘positive’ meeting with lawmakers

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President Biden on Wednesday signed an executive order directing a review of supply chains for critical products across numerous sectors, including health, defense and communications.

The order directs a 100-day review across federal agencies to address vulnerabilities in supply chains of pharmaceuticals, critical minerals, semiconductors and large-capacity batteries like those used to power electric vehicles.

It also requires sector-specific reviews in six areas over the next year to address supply chain concerns, specifically the defense, information communications technology, energy, transportation, public health and food sectors.

The order is meant to support jobs, particularly in traditionally marginalized groups such as communities of color, through helping to rebuild manufacturing jobs.

Invoking the shortages of personal protective equipment experienced by healthcare workers during the coronavirus pandemic, Biden said in remarks Wednesday afternoon that it would help the United States confront crises and revitalize the U.S. manufacturing sector.

“This is about making sure the United States can meet every challenge we face in this new era — pandemics but also defense, cybersecurity, climate change, and so much more,” Biden said in the State Dining Room before signing the order. “The best way to do that is by protecting and sharpening America’s edge by investing here at home.”

It is also intended to address the ongoing shortage of semiconductors, or chips, for the auto industry, where they are used in many aspects of modern vehicles.

Biden met with a group of bipartisan members of Congress in the Oval Office earlier Wednesday afternoon to discuss the vulnerability of U.S. supply chains, prior to signing the order.

The meeting participants included Sens. Tammy Baldwin (D-Wis.), John Cornyn (R-Texas), Marsha Blackburn (R-Tenn.), Mike Braun (R-Ind.), Tammy Duckworth (D-Ill.), Maggie Hassan (D-N.H.), Rob Portman (R-Ohio) and Mark Warner (D-Va.), and Reps. John Joyce (R-Pa.), Doris Matsui (D-Calif.) and Michael McCaul (R-Texas).

McCaul, Matsui, Cornyn and Warner introduced the bipartisan CHIPS Act last year meant to bolster federal incentives for manufacturing semiconductors in the United States.

Cornyn and McCaul described the meeting as “positive” as they left the White House.

“The president was very receptive, as was the vice president,” Cornyn said. “He said, ‘we’re all in.’ We all understand this is important, not only to our economy, but to our national security, because these cutting edge, high-end semiconductors — they operate on everything from the F-35 fifth generation stealth fighter to our cell phones.”

“To come together as Americans on this issue I think is very refreshing,” McCaul, the ranking member of the House Foreign Affairs Committee, said. “We are all in on the House and Senate, both Republican and Democrat.”

Biden called it a “very productive meeting” in his remarks later Wednesday afternoon.

“It was like the old days, people were actually on the same page,” Biden said.

The meeting represented the latest effort by the president to work with lawmakers across the aisle to address issues of bipartisan concern, though Biden has been unable to convince Republican lawmakers to support his coronavirus relief proposal and Democrats have moved ahead to pass it without GOP support using budget reconciliation.

Talks are underway on Capitol Hill to introduce and move forward legislation in tandem with the executive order, particularly focused on technology challenges posed by China.

Senate Majority Leader Charles Schumer (D-N.Y.) on Tuesday announced that he had directed all Senate chairs of relevant committees to begin work on a legislative proposal in order to “outcompete China” on technological concerns.

Schumer said the bill will be bipartisan, with Sen. Todd Young (R-Ind.) already on board, and the goal to vote on the legislation sometime this spring.

The new package will be an expansion of the previous Endless Frontiers Act, which was introduced last year but failed to be signed into law. The legislation would provide $100 billion for research into emerging technologies like artificial intelligence and quantum computing, and provide funds for “regional technology hubs” nationwide.

“The new legislation must achieve three goals: enhance American competitiveness with China by investing in American innovation, American workers and American manufacturing; invest in strategic partners and alliances: NATO, Southeast Asia and India; and expose, curb, and end once and for all China’s predatory practices which have hurt so many American jobs,” Schumer said Tuesday.

He also announced an effort to roll out “emergency funding” to address the shortage in chips, noting that the funds were necessary to ensure the United States remained “No. 1” in areas like 5G networks and biomedical research. 

“We need to get a bill like this to the president’s desk quickly to protect America’s long term economic and national security,” Schumer said.

Funding could pose a sticking point for addressing supply chain concerns. Sameera Fazili, deputy director of the National Economic Council, discussed the new executive order during the White House press briefing Wednesday, hinting at efforts underway around funding.

“We are looking forward to talking with members of Congress about what more we can do in partnership with them to get at the funds we need,” Fazili told reporters.

The Semiconductor Industry Association (SIA), which represents groups including Intel, Qualcomm and Broadcom, said in a statement Wednesday that they “welcomed” the executive order, but urged Biden to remain focused on funding concerns.

“We urge the president and Congress to invest ambitiously in domestic chip manufacturing and research,” SIA said. “Doing so will ensure more of the chips our country needs are produced on U.S. shores, while also promoting sustained U.S. leadership in the technology at the heart of America’s economic strength and job creation, national security, and critical infrastructure.”

Other groups celebrated the executive order, particularly those in the auto industry, where production has been hit hard by the chip shortage and workers have been furloughed.

“As America’s No. 1 auto producer, we greatly appreciate President Biden’s swift actions to remedy the near-term semiconductor shortage and review longer-term actions to develop a more resilient and secure supply chain,” Ford Motor Company said in a statement provided to The Hill. “It is incredibly important for our labor force, our customers and our business that we have a commitment to end this shortage as soon as possible.”

Tags Charles Schumer Doris Matsui Joe Biden John Cornyn John Joyce Maggie Hassan Mark Warner Marsha Blackburn Michael McCaul Mike Braun pharmaceuticals Rob Portman supply chains Tammy Baldwin Tammy Duckworth Todd Young

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