President Joe Biden on Wednesday signed an executive order that aims for reviews of supply chains for semiconductors and other critical goods.
Chips have been hard to come by for auto makers and consumers, causing difficulties in a range of industries. The cause looks like a combination of increased demand as people scoop up electronics during the COVID-19 pandemic, limited manufacturing capacity to meet that demand, and the U.S.-China trade war, reports MarketWatch’s Wallace Witkowski.
The new order directs “an immediate 100-day review across federal agencies to address vulnerabilities in the supply chains of four key products,” the White House said in a news release. Those four products are semiconductors, pharmaceuticals, critical minerals such as rare earths and large-capacity batteries such as those used in electric vehicles.
The order also calls for a “one-year review of a broader set of U.S. supply chains” covering six sectors, according to the White House. Those six sectors are defense, health care, information technology, energy, transportation and agriculture.
“We need to stop playing catch up after the supply-chain crisis hit,” Biden said in a short speech before signing the order. “We need to prevent the supply-chain crisis from hitting in the first place.”
The Alliance for American Manufacturing said in a statement that Wednesday’s order was “encouraging” but “policy must follow.”
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Ahead of the event at which he signed the order, Biden huddled on Wednesday about the ongoing semiconductor SOXX SMH shortage with Republican and Democratic lawmakers.
“We had a very good meeting with the president, the vice president,” said Republican Sen. John Cornyn of Texas afterward. “We all understand this is important not only to our economy, but also to the to our national security, because these cutting-edge, high-end semiconductors — they operate on everything from the F-35 fifth-generation stealth fighter plane to our cell phones. So, it was very, very positive.”
“It was the best meeting I think we’ve had so far, although we’ve only been here about five weeks,” Biden said. “It was like the old days — people actually are on the same page.”
Senate Majority Leader Chuck Schumer on Tuesday said he hoped to have a bill on the Senate floor “this spring” that would boost the country’s economic competitiveness with China, and the New York Democrat said he was looking at “emergency funding” as part of a plan to boost semiconductor production.
The White House had said two weeks ago that Biden would sign an executive order related to an ongoing semiconductor shortage in the “coming weeks.”