Ranking Member Reed Discusses Cornyn Amendment to NDAA
Madam President, I rise to express my support for the Cornyn amendment, which would, among other things, authorize a Federal grant program to enable the leading global chip companies to manufacture in the United States. I want to commend a bipartisan group of Senators who have worked so hard on this issue: Senators Cotton, Cornyn, Schumer, and Warner.
The semiconductor manufacturing story is similar to many other industries in America. The United States invented the technology and still leads in research and development, but the manufacture of the product itself has steadily migrated to Asia. Over time, not just the manufacturing expertise and capacity are lost but also the science and engineering necessary to invent the next generation of products. While this has happened to too many industries, the impact is particularly acute in electronics because electronics power the modern economy, fueling all the critical technologies on which our future prosperity depend. Asian nations—and, in particular, China, Taiwan, and South Korea—have for decades pursued aggressive industrial policies to gain control of the electronics industry.
These policies directed large subsidies and protections for fledgling companies that have now become global giants. While South Korea is an ally, and Taiwan is a partner, the plants in those countries that make the world’s most advanced logic and memory semiconductors are highly vulnerable to disruption or destruction by China and/ or North Korea. In a confrontation in this region, China could threaten to bring the western economy to its knees by halting the flow of semiconductors. China itself is investing hundreds of billions of dollars in new semiconductor fabrication plants in a relentless bid to dominate this industry.
In 10 years, Chinese companies may dominate the production of the chips that power 5G wireless networks, artificial intelligence, cloud computing, the Internet of Things, and autonomous vehicles. In America, there is one remaining company that is globally competitive in logic chips—Intel Corporation—but Intel is at least a generation behind its main competitors and historically has designed and produced chips only for its own product line. Its major global competitors—the Taiwan Semiconductor Manufacturing Corporation, or TSMC, and Samsung—provide manufacturing services for chips designed by other companies.
These are typically so-called fabless chips companies, and they include the names of some of our most famous tech companies: Qualcomm, Xilinx, Nvidia, and Microsoft. TSMC and Samsung, together, have close to a monopoly on the manufacturing of leading-edge semiconductors for fabless chip companies. Recently, there was the good news that Intel announced in a letter to the Defense Department its intent to compete with its Asian rivals in manufacturing chips designed by fabless companies.
Again, these are companies that would design the chips and the electronic processor but would not produce the chips. That would be left to these other major companies. In addition, TSMC and the administration announced an agreement to bring TSMC to America to produce leading edge chips. It is suspected that Samsung can be persuaded to set up a major manufacturing facility in the United States, as well. The Defense Department has two major studies nearing completion, one by the Defense Science Board and one conducted in partnership with industry by the Under Secretary for Acquisition, Ellen Lord. They are both expected to plead for urgent and largescale action to revive U.S. semiconductor manufacturing, but none of this is going to happen without funding and without a plan. We did not lose chip manufacturing to Asia simply due to cheap labor, especially in the chip industry, which is not manpower intensive. We lost this market sector because the investments required are massive and constant and because foreign governments heavily subsidize them. We all prefer to let markets govern where competition is fair and mutually beneficial, but relentless actions by foreign governments to dominate specific industries regardless of economics and where they succeed, like in the semiconductor industry, must be countered by U.S. government action because of the threat to our national security and prosperity.
While this amendment does not include funding authorizations, it is an important first step. This amendment will serve notice that the U.S. Senate recognizes this very serious issue and intends to take corrective action. I urge my colleagues to support this amendment and to commit to finding funding solutions. Our economic wellbeing and our national security depend upon it.
Madam President, I would now also like to speak about Senator Shaheen’s amendment, which will be considered this afternoon, with your permission. I rise in support of Senator Shaheen’s amendment to increase fiscal year 2021 funding by $5 million for the ongoing CDC human health study on the effects of PFAS substances in drinking water sources. As most of you are aware, PFOS and PFOA are chemicals that are very effective for extinguishing fires and have been used in firefighting foam in the Defense Department since the 1970s. Unfortunately, the fluorine bonds never break, and environmental problems are presented, which are very dangerous to people. The lifetime health advisory for PFAS is the equivalent of one grain of sand in an Olympic-sized swimming pool. The WHO found that these chemicals are likely carcinogenic, especially in children and pregnant women, and that they can decrease the effectiveness of vaccines, and they are known to cause cancer in animals. PFAS has been found in the drinking water at over 650 military installations in almost every State in the United States and overseas. Thousands of Americans in many States across the United States have already found elevated levels of PFAS in their blood.
Beginning with the fiscal year 2018 National Defense Authorization Act, the Department of Defense has been authorized to transfer funds to the CDC for a human health study on the effects of all PFAS substances in drinking water sources for people. Specifically, it seeks to determine the exact types of cancers and other toxic effects drinking water with PFAS has on human beings. For example, years ago, the CDC determined precisely how much lead can be ingested before cognitive impacts can occur in children. They can and should do the same thing with respect to PFAS. The study should take 7 years to complete. So this fiscal year 2021 NDAA will fund year 4. The CDC study received $7 million in fiscal year 2018, $10 million in fiscal year 2019, $10 million in fiscal year 2020, and there is $10 million currently in the fiscal year 2021 NDAA amendment. Senator Shaheen’s amendment would increase it to $15 million. It would accelerate our ability to find these critical answers that affect the health and safety of the American people and are particularly associated with military bases all across the country, which means in every one of our States. We all recognize the urgent need for the CDC to better understand the toxic effects of PFAS chemicals on the human body, and supporting this amendment will accomplish just that. I urge my colleagues to support this amendment. Once again, I commend Senator Shaheen for her work in developing this amendment with respect to PFAS, and I commend Senator Cornyn and his colleagues for working very, very diligently and perceptively about building up our industrial base in order to produce microchips so we will be the leader in the world and not the follower. I suggest the absence of a quorum.