National Security

EXCLUSIVE: Bipartisan Group Of Reps Propose Semiconductor Supply Chain Review

(Photo by JOHN THYS/BELGA MAG/AFP via Getty Images)

Michael Ginsberg Congressional Reporter
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A bipartisan group of lawmakers in the House of Representatives led by Republican Wisconsin Rep. Mike Gallagher is proposing a systematic review of semiconductor supply chains in light of a worldwide shortage.

Semiconductors, the chief component of electronic chips, are primarily produced in Taiwan, and the COVID-19 pandemic severely disrupted their production and distribution. Due to concerns of a Chinese invasion of the island, the federal government has urged tech companies to invest in semiconductor fabrication plants on U.S. soil. However, some observers expect the shortage to continue into 2023, and it is considered a key contributor to rising automobile, smartphone, and computer prices.

Gallagher, Republican New York Rep. Elise Stefanik, and Democratic Pennsylvania Rep. Chrissy Houlahan will propose the review on Wednesday in an amendment to the National Defense Authorization Act. In addition to the supply chain review, the amendment requires the Department of Defense (DOD) to submit a report to Congress detailing its semiconductor needs and any shortages in the event of a “conflict with a strategic competitor in the Indo-Pacific.” It also creates a program allowing the DOD to purchase materials necessary for the fabrication of semiconductors in order to combat the worldwide shortage.

“As we have seen in Ukraine, modern warfare will involve enormous quantities of highly complex weapons and systems. At the heart of many of these defense articles are semiconductors. In the event of a major war, we cannot afford to be unable to replenish our weapons inventory because of sole sources of supply or other supply chain constraints, particularly when it comes to critical items like semiconductors,” Gallagher said in a statement to the Daily Caller.

Read the amendment here:

Defense Semiconductor Stockpile Act by Michael Ginsberg on Scribd

“Semiconductor supply chain disruptions are affecting everything from families trying to buy a new car to servicemembers receiving the tools they need to serve our country. I am honored to join my colleagues in a bipartisan effort to better understand the semiconductor requirements and critical minerals supply chains that support the Department of Defense. We cannot stand by and allow a shortage of these semiconductors, or the materials required to produce them, to degrade our safety and our national security,” Houlahan added.

Congress has attempted to address the semiconductor and chips shortages in several pieces of legislation, although none have yet become law. The most prominent effort, the U.S. Innovation and Competition Act (USICA), is currently being negotiated in a conference committee. The Senate-passed version of USICA includes $52 billion in subsidies for domestic semiconductor fabrication. (RELATED: Over 100 CEOs Sign Letter Pushing Congress To Reach Agreement On Computer Chip Competitiveness)

President Joe Biden invoked the Defense Production Act in March as part of an effort to increase the mining of minerals that are critical in semiconductor fabrication. Some critics have argued that the federal government should restructure and streamline the mining permitting process to increase fabrication.

“Our reliance on foreign supply chains and our adversaries for critical components like semiconductors is a grave vulnerability that weakens both our economic and national security. As China and Russia show their willingness to conduct illegal wars, spread their malign influence, and engage in economic blackmail, this amendment puts the United States on the correct path to addressing this strategic vulnerability and ensuring we are adequately prepared to respond to any potential hostilities from our adversaries,” Stefanik said.