Pelosi presents chips bill that passed Senate almost a year ago as top agenda item for Democrats

While vehicle prices continue to rise, the legislation is currently in conference between the House and Senate

House Speaker Nancy Pelosi is promising a China competition bill with billions in funding for chip makers that passed the Senate almost a year ago as a top agenda item for President Joe Biden and his party heading into the midterm elections.

The rest of the Biden agenda appears to be on the back burner after the president's signature spending bill, the Build Back Better Act, failed to advance in the Democrat-led 50-50 Senate. 

"This COMPETES Act is so important because of chips, chips, chips, chips, and semiconductors," Pelosi said on Friday at a news conference. "You all know that it takes 1,000 chips to make a car; 2,000 to make an electric car, for example.

"Many other products are dependent on the use of chips, and we have to be making them at home, that's $52 billion in our bill and over $40 billion for supply chain issues." 

In January, Virginia Democratic Sen. Mark Warner, a cosponsor of the bill, said Biden and House Democrats were focused on other issues after the House failed to move on the bill following its passage in the Senate in a bipartisan vote on June 8, 2021.

The Democrats in Congress were debating the contents of the Build Back Better Act, a spending package that could have passed with unanimous Democratic Caucus support in the 50-50 Senate through the budget reconciliation process. The $2 trillion bill passed the House in November 2021 but didn't advance in the Senate. The spending package ultimately stalled after West Virginia Democratic Sen. Joe Manchin announced he would oppose the bill, citing record inflation. 

Warner emphasized that passage of the China competition bill with $52 billion for chip manufactures would help lower the average price of vehicles.

The chip shortage has resulted in rising auto prices since late 2020. According to Kelly Blue Book, the average price Americans paid for a new vehicle on average went up by $6,220 in 2021. 

In late January, the House Democratic majority rolled out its own version of the China competition bill, called the America COMPETES Act. It passed the House in early February. Pelosi named members to the conference committee earlier this month. 

"I think everybody knows that we need chips," Pelosi said on Friday. "We can't ignore any of it. We can't ignore inflation. We have to pay attention to and watch those numbers and see what feeds into it. Is it the trade issue or what? The supply chain? How do we address that? Chips is an answer to a number of those."