Sens. Young, Matsui Optimistic About China Bill Conference Plans

Senate Majority Leader Chuck Schumer, D-N.Y., filed cloture March 17 on the motion to proceed to the House-passed America Competes Act. He had attempted to hotline a time agreement in order to fast-track final passage, but Republicans objected, setting up a potentially weekslong series of procedural hurdles before moving to conference. He alluded to a “small band of Republicans” standing in the way of “quick action” last week on the floor.

The Senate passed the U.S. Innovation and Competition Act (USICA) in June 2021, but the bill was never officially received by the House. There are several provisions in the Senate bill that would trigger a blue slip in the House, allowing members of the lower chamber to enforce a rule that all revenue provisions must originate in the House. In order to go to conference, there needs to be an official Senate position. Schumer is expected to file a substitute amendment, and after final passage, the bill will go back to the House. Then the lower chamber can officially disagree with the Senate’s position and the sides can move to conference. Schumer has options for streamlining various cloture votes required to get the bill sent to the House this week. The Senate was scheduled to vote at 5:30 p.m. March 21 on cloture on the motion to proceed to the bill. The House returns on March 28.

Senate leadership has made clear it wants an initial agreement on the conference structure before the end of the month, Matsui said during a Commerce Department livestream: “That’s a good first step.” Young said he’s “excited” to move forward this week and be “in a position to start a formal conference negotiation with the House before the end of the work period.” The process should be open with input from all colleagues through regular order, he said: Bipartisan effort is the “only way” to pass legislation in the Senate. He alluded to Republican frustration about the process for passage in the House, which they say has been one-sided.

Commerce Secretary Gina Raimondo urged Congress to “move swiftly” and iron out areas of disagreement to get a law to President Joe Biden’s desk. The law is essential to national security and outcompeting China, she said, calling the chips shortage a “dire” situation. China leads the U.S. in chips production, which is unacceptable from an economic and national security standpoint, she said.

Most of the bill's language has agreement, but there’s still a fraction that requires “threading the needle,” Matsui said: There’s urgency because passing legislation gets more difficult the closer Congress gets to election. She highlighted the importance of starting a formal conference. There will need to be “principled concessions” in order to pass a new law, Young said.

Raimondo noted that her department is working with more than 30 countries on export controls and various methods for denying Russia access to chip supplies. The war in Ukraine has made clear the U.S. needs to reduce its reliance on China regarding chip supplies, former deputy administrator for the U.S. Agency for International Development Bonnie Glick said. The export controls are “working well” but not perfectly, she said. Bill reconciliation should focus on export controls to combat intellectual property theft, shoring up supply chains, screening of foreign investment and workforce training, former National Security Adviser H.R. McMaster said. This is about stopping China from holding the U.S. hostage through the export of chips, former deputy National Security Adviser Matthew Pottinger said.