Republican senators are accusing the Biden administration of pursuing liberal social policies through the implementation of the CHIPS Act, the bipartisan bill enacted last year to boost domestic semiconductor production.
In a letter sent last week to Commerce Secretary Gina Raimondo, a group of 14 Republican senators, led by Ted Cruz (Texas), accused Raimondo of including onerous left-wing priorities in the requirements for companies to receive grants under the bill, thereby undermining the legislation's aim of making American companies more competitive with China.
"Many of the grant criteria … will have the opposite effect of Congress's intent with enactment of the CHIPS Act and instead make domestic chip production more expensive, less competitive, and reliant on taxpayer subsidies over private investment," the senators wrote in the letter.
The Commerce Department's Notice of Funding Opportunity (NOFO), which lists criteria for issuing grants to semiconductor companies, instructs companies to hire workers from groups that have been "subjected to racial or ethnic prejudice" and prioritizes companies that will advance the "environmental justice" agenda. Applicants requesting over $150 million must share excess profits with the government.
Raimondo in an interview with the Wall Street Journal pushed back on the senators' claims, saying "social policy" is not the objective of the NOFO.
"We have no desire to put requirements on companies that are bad for the companies," Raimondo said. She said the requirements would boost the U.S. semiconductor industry through addressing labor shortage issues by making the companies look more appealing to workers.
Congress passed the $53 billion CHIPS Act with bipartisan support to produce more semiconductors and maintain competitiveness with China's tech industry.
The letter follows other accusations that the administration is using CHIPS Act as a vehicle for liberal social and environmental policy. President Joe Biden's National Science Foundation, funded by the act, granted over $130,000 last year to a joint-effort climate change research project between the University of Virginia and the Chinese Communist Party-controlled Tsinghua University. The grant funds research into "the transition to a low-carbon economy."