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Senate passes sweeping China competition bill in rare bipartisan vote

The Senate voted 68-32 on Tuesday to approve a sweeping China-focused global competition bill, overcoming Republican objections that had threatened to derail the $200 billion+ bipartisan package.

Why it matters: The bill's supporters cite the measure as evidence that the deeply divided Senate can still function on a bipartisan basis, despite the last-minute chaos that forced Majority Leader Chuck Schumer (D-N.Y.) to delay final passage for weeks.

  • It's also a sign of the widespread consensus that has emerged around the need to outcompete China on the world stage, including by revitalizing U.S. manufacturing and research and cracking down on Beijing's economic abuses.
  • Schumer hailed the bill as one of the most significant bipartisan achievements in years, calling its passage "a moment in history that future generations look back on as a turning point for American leadership in the ... 21st century."

How we got here: The foundation of the U.S. Innovation and Competition Act is a wide-ranging bipartisan proposal from Schumer and Sen. Todd Young (R-Ind.) that would authorize new funding for the National Science Foundation (NSF) and establish a new technology directorate.

  • In February, Schumer asked both Democratic committee chairs and their ranking Republicans to work on other measures that could be included in a broader package to bolster U.S. tech, manufacturing and research to better compete with China.
  • The resulting $250 billion proposal had input from half a dozen committees, and the Senate voted on dozens of Republican, Democratic and bipartisan amendments over the course of the past several weeks.
  • The bill has the backing of President Biden, whose administration has made curbing China's influence through a coalition of allies one of its top priorities.

Details: The centerpiece of the legislation is $50 billion in emergency funding for the Commerce Department to boost domestic semiconductor production, in light of the global chip shortage.

  • It also includes billions in extra funding for research and development at the Energy Department, the Pentagon and NASA, including in the areas of artificial intelligence, quantum computing, robotics and 5G.
  • The bill would provide $10 billion over five years to Commerce Department to create regional tech hub programs, and require federally funded infrastructure projects to use certain materials manufactured in the U.S.

What they're saying: “Around the globe, authoritarian governments smell blood in the water,” Schumer said in a speech on the Senate floor.

  • "They believe that squabbling democracies like ours can’t come together and invest in national priorities the way a top-down, centralized and authoritarian government can," he continued. "They are rooting for us to fail so they can grab the mantle of global economic leadership and own the innovations."

What's next: It's unclear what the bill's path will be in the House, where Foreign Affairs Committee Chairman Gregory Meeks (D-N.Y.) has introduced his own China competition bill.

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