HomeBreaking NewsBiden Grants $1.5B to Chip Maker for NY, VT Expansion

Biden Grants $1.5B to Chip Maker for NY, VT Expansion

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On Monday, the Biden team announced that they’re giving $1.5 billion to the chip maker GlobalFoundries to help them make more chips in New York and Vermont.

This is the third time they’ve given money like this to a chip company, all thanks to the 2022 CHIPS and Science Act. This law lets the government put over $52 billion into making more computer chips in the U.S. and also into research and development.

“The chips that GlobalFoundries will make in these new facilities are essential,” Commerce Secretary Gina Raimondo explained during a chat with reporters. “They power sophisticated military equipment, electric vehicles. They assure smartphones have the latest features, enable faster Internet connections for Americans.”

Besides the direct cash, the government’s also offering loans up to $1.6 billion. All in all, we’re talking about a huge mix of government and private money hitting around $12.5 billion.

GlobalFoundries is planning to use this cash to build a fancy new chip factory in Malta, New York. They’re also gonna bump up what they’re making at their current Malta spot as they’ve got a deal with General Motors. Plus, they’re looking to give their Burlington, Vermont plant a bit of a makeover.

These projects are set to open up 1,500 jobs in manufacturing and 9,000 in construction over the next ten years. Plus, there’s $10 million set aside just for training folks. GlobalFoundries is also going to keep giving construction workers the same $1,000 a year for child care that their other employees get.

Senator Chuck Schumer from New York, who helped get this billion-dollar deal out there, was a big part of making the law that funds these chip factories. He says these chips are super important, just like food, for America’s economy and safety. These tiny chips are in so many things we use, like computers, cars, kitchen gadgets, and health devices.

Schumer shared with The Associated Press that the U.S. could get hit hard by disruptions like during the coronavirus pandemic when car factories didn’t have enough chips to keep building cars. This chip shortage cost the American economy a whopping $240 billion. It was a real wake-up call for lawmakers and industries about how much the U.S. relies on other countries for such important parts.

Right now, the U.S. makes just about 12% of the world’s chips. Most of the time, we depend on chips made in Asia, as CBS News pointed out during the global chip crisis. Currently, a big company in Taiwan, called the Taiwan Semiconductor Manufacturing Company (TSMC), makes 90% of the advanced processors that the whole world uses.

“The Democrats are going to do what it takes to see that other countries — China, Russia and others — don’t gain economic advantage over all of us,” Schumer said.

Major money matter 

With big elections this year deciding who’ll run the White House and Congress, everyone’s worried about the U.S. economy’s health. Republican politicians have been pointing out how the high inflation from 2022 has made things tougher for families, affecting how much they can buy and hitting President Joe Biden’s popularity.

But Democrats are highlighting their work to lower inflation and their long-term investments they believe will boost future growth, like putting money into computer chip production and building up the country’s infrastructure.

Schumer also mentioned that these investments, which some Republicans also agreed on, show the Democrats’ focus on putting money into America in ways that could bring big benefits in the years ahead. 

“People want to see we have a future,” said Schumer. “It makes a huge impression on the American people.” 

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