Biden says future of chip manufacturing will be in US

Politics

(NewsNation) — U.S. President Joe Biden said the future of chip manufacturing will be based in the United States during a speech at a new computer chip factory in Ohio.

Biden dubbed Ohio part of the “Silicon Heartland” during the speech as local leaders broke ground on a $20 billion chip factory set to be built there. Congress’ passing of the CHIPS Act, which gave grants and tax credits to semiconductor manufacturers, was key in drawing the factory to Ohio.

NewsNation business contributor Lydia Moynihan said this move was “absolutely” a smart one by the Biden administration because of how global supply chain issues incurred by the pandemic have damaged the supply of microchips to the U.S.

“The coronavirus pandemic showed we are obviously a global economy, a global society where illnesses are global, but we cannot rely on global supply chains,” Moynihan said on NewsNation “Rush Hour.” “There’s just too many variables.”

Biden steered clear of partisan politics at Friday’s groundbreaking celebration for a huge new computer chip facility — as a tough Senate contest in that state and a Democratic candidate seeking to distance himself from Biden reflected the challenge of translating White House policy wins into political gains.

Moynihan said Friday’s speech by Biden should still be considered a political win.

“For Biden this is politically a smart move if he wants to run in 2024, he is going to have to lean into some of those Midwestern states,” Moynihan said. “It’s a victory for him, he got Intel to invest $100 billion specifically into Ohio.”

Biden, a major force behind the legislation that helped lure Intel, went to suburban Columbus to take a victory lap just as voters in the state are starting to tune in to a closely contested Senate race between Democratic Rep. Tim Ryan and Republican author and venture capital executive JD Vance. They’re competing in a former swing state that has trended Republican over the last decade.

Ryan attended the event but raised questions in interviews about whether he thinks Biden should pursue re-election in 2024. Vance did not attend.

The president, in his speech, thanked Ryan for his leadership without mentioning his Senate candidacy, choosing instead to emphasize that the Intel plant serves as a model for a U.S. economy that revolves around technology, factories and the middle class.

“Folks, we need to make these chips right here in America to bring down everyday costs and create good jobs,” Biden said. “Industry leaders are choosing us, the United States, because they see America’s back and America’s leading the way.

Touring the construction site, the president chatted with unionized workers in hard hats and noted his own blue-collar credentials by saying, “These are my people, where I come from.”

Intel had delayed groundbreaking on the $20 billion plant until Congress passed the bipartisan CHIPS and Science Act. Both Ryan and Ohio Republican Gov. Mike DeWine, who is facing Democrat Nan Whaley in his reelection bid, planned to be at Friday’s groundbreaking.

In his State of the Union address last March, Biden envisioned the Intel plant as a model for a U.S. economy that revolves around technology, factories and the middle class. The plant speaks to how the president is trying to revive American manufacturing nationwide, including in states that are solidly Republican or political toss-ups.

Chipmaker Micron committed $15 billion for a factory in Idaho, Corning will build an optical fiber facility in Arizona and First Solar plans to construct its fourth solar panel plant in the Southeast, all announcements that stemmed from Biden administration initiatives.

As part of Biden’s visit, Intel announced that it’s providing $17.7 million to Ohio colleges and universities to develop education programs focused on the computer chips sector.

Factory work is one of the few issues going into November’s midterm elections that has crossover appeal at a time when issues such as abortion, inflation and the nature of democracy have dominated the contest to control Congress.

Ryan skipped the president’s July 6 visit to Cleveland to plug his administration’s efforts to shore up troubled pension programs for blue-collar workers. Biden nonetheless referred to him as the “future Sen. Tim Ryan” and thanked him for his “incredible work” on the legislation.

The Youngstown-area congressman committed to appearing with Biden this week because of the importance of the Intel facility in a state that has long defined itself through its factories, mills and working-class sensibilities.

Yet in a Thursday TV interview with Youngstown’s WFMJ on the eve of Biden’s visit, Ryan said he is “campaigning as an independent.” When asked if Biden should seek a second term, Ryan said, “My hunch is that we need new leadership across the board, Democrats, Republicans, I think it’s time for like a generational move.”

Ryan, pressed Friday by reporters about his comments in the TV interview, said that Biden himself has said he “was going to be a bridge to the next generation, which is basically what I was saying.” Pressed if Biden should run in 2024, Ryan offered a noncommittal, “That’s up to him.”

The open Senate seat in Ohio, currently held by the retiring Republican Sen. Rob Portman, is one of several hotly contested races that could determine whether Democrats can hold their slim majority in the chamber for the second half of Biden’s term.

Several Democrats in competitive races have at moments sought to maintain some distance from Biden, whose public approval ratings have ticked up in recent weeks but remain underwater.

A spokesman said DeWine also planned to attend the groundbreaking, making him among the few Republicans on the ballot this year who are willing to share a stage with the president. Biden has in recent weeks said that extremist Republican lawmakers who refuse to accept the results of the 2020 election are a threat to democracy, a charge that has only intensified partisan tensions with control of the House and the Senate on the line.

Vance, the Republican Senate candidate in Ohio, hailed the Intel plant in a statement as “a great bipartisan victory” for the state. He specifically applauded the “hard work” of GOP lawmakers including DeWine and Portman, but Vance pointedly made no mention of Biden.

The shortage of semiconductors has plagued the U.S. and global economies. It cut into production of autos, household appliances and other goods in ways that fueled high inflation while creating national security risks as the U.S. recognized its dependence on Asia for chip production.

President Joe Biden speaks with Intel CEO Pat Gelsinger as he arrives at the groundbreaking of the new Intel semiconductor manufacturing facility in New Albany, Ohio, Friday, Sep. 9, 2022. (AP Photo/Manuel Balce Ceneta)

The mix of high prices and long waits for basic goods has left many Americans feeling disgruntled about Biden’s economic leadership, a political weakness that has lessened somewhat as gasoline prices have fallen and many voters have grown concerned about the loss of abortion protections after the Supreme Court overturned Roe v. Wade.

The new law would provide $28 billion in incentives for semiconductor production, $10 billion for new manufacturing of chips and $11 billion for research and development. The funding follows similar efforts by Europe and China to accelerate chip production, which political leaders see as essential for competing economically and militarily.

Lawmakers crafted the semiconductor investments to favor areas outside the wealthier coastal cities where tech dominates. That means change will be coming to the Ohio city of New Albany, where the Intel plant is being constructed, as well as nearby Johnstown.

Don Harvey, a sporting goods store owner and longtime Johnstown resident, likes the idea of a company making things again in the United States, and also providing potentially high-paying jobs for his five grandchildren down the road. Intel has said pay will average $135,000 for its 3,000 Ohio workers.

“What an opportunity in my eyes for Ohio and the United States as a whole,” said the 63-year-old Harvey.

Elyse Priest lives in a subdivision just up the road from the plant, and received a firsthand taste of the construction recently as she watched a huge cloud of dust roll up from the 1,000-acre site currently being leveled. Priest, 38, also knows the road-widening and added traffic will affect her commute to downtown Columbus, where she works as a legal assistant.

“I’m concerned about losing the small town feel I’ve always had and loved about Johnstown,” Priest said. “But I know it’s going to be a greater good for the whole state.”

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