Biden’s costly construction mandates
Opinion by Washington Examiner
One can make a case for billions of dollars in domestic manufacturing subsidies, especially for a sector of the economy dominated by China, the greatest threat to U.S. national security. But if the CHIPS and Science Act of 2022 is to build a semiconductor industry that can compete with China, the Biden administration will have to start making it easier to build new factories, not harder.
This week, the Commerce Department released regulations governing how it will distribute the $40 billion set aside by CHIPS to construct new semiconductor manufacturing plants. In addition to complying with the burdensome and costly National Environmental Planning Act, companies accessing subsidies from this fund will also have to comply with Davis Bacon pay regulations, buy American, buy a certain set-aside percentage of source materials from minority- or female-owned businesses, run their plants on low-emission energy, and provide free child care for all employees and construction workers.
You read that last part correctly. After failing to persuade Congress to pass a costly and heavily regulated national child care program, President Joe Biden is using domestic manufacturing subsidies to force companies to provide child care.
Asked why she included a child care mandate in the new CHIPS regulations, Commerce Secretary Gina Raimondo, who has never run a construction company or a semiconductor manufacturing firm, said, “I am kind of requiring them to pay attention to this because I know this is what they need to be successful.”
How does she know this if they don’t even know it? The answer is she doesn’t. She’s just applied a gloss of fake business savvy to a burdensome, anti-competitive left-wing agenda item.
There is nothing wrong with private companies deciding to attract good workers by providing daycare. Many successful companies do that. But many successful firms don’t. Sometimes it is easier to find the best workers by paying them higher salaries or more generous benefits instead of offering in-kind services.
There is nothing about manufacturing semiconductors or building semiconductor factories that suggests firms doing these things well are also good at providing child care. Mandating a new benefits program creates one more costly regulatory hoop that construction companies will have to jump through if they choose to take federal money.
The United States already has the highest construction costs in the world. To bring manufacturing back on shore — whether for semiconductors, cars, or televisions — the federal government must look for ways to lower costs, not raise them.
There is nothing in the CHIPS and Science Act that requires participating firms to provide child care. This requirement was created entirely by Biden administration bureaucrats, although it does appear that the legislation foolishly gave it the power to do so.
If the Biden administration does not rescind these costly new construction regulations, the House of Representatives should vote to repeal them, just as it recently did with the Labor Department’s environmental, social, and governance regulation. Congress has already appropriated the $40 billion, so let’s ensure it is spent wisely and efficiently to bring high-tech manufacturing back from China without wasting money on arbitrary mandates.
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