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President Biden’s second big bill may be China package pushed by top Senate Democrat

With fate of Biden infrastructure package unclear, Schumer pushes bill to curb China’s influence

Senate Majority Leader Charles E. Schumer (D-N.Y.) said on Feb. 23 that he directed lawmakers to draft a legislative package to "outcompete" China. (Video: The Washington Post, Photo: Salwan Georges/The Washington Post)

As the White House continues to work on another major spending bill to follow the $1.9 trillion stimulus, momentum is beginning to gather for what might become Congress’s second big piece of legislation in the Biden era: a bill aimed at countering China’s economic influence.

Senate Majority Leader Charles E. Schumer (D-N.Y.) has been working on legislation that seeks to counter China’s rising global power and proposes funding aimed at bolstering U.S. manufacturing and supply chains, among other measures.

After every Republican voted against the $1.9 trillion stimulus legislation the House is slated to approve Wednesday, the new proposal could fulfill the stated desire of both President Biden and centrist Senate Democrats to legislate across party lines.

Numerous Republican senators have co-sponsored bills with Democratic lawmakers on a range of measures related to China, from shoring up U.S. production of semiconductors to creating a nationwide 5G network. Schumer has said his coming legislative package would include proposals addressing these matters.

It is unclear how much support the China-related measures enjoy from the White House or Democratic caucus. Schumer previewed the measure in February, saying he wanted to have it ready by “this spring.” Key Democratic committees are accelerating work on the package to have it ready for a vote in April, according to five congressional officials who spoke on the condition of anonymity to discuss internal plans.

Rep. Peter A. DeFazio (D-Ore.), chair of the House Committee on Transportation and Infrastructure, has privately said that committee will aim to move the infrastructure package in May, according to two people who spoke on the condition of anonymity to share details of his remarks.

Transportation Committee Chairman Peter A. DeFazio (D-Ore.) on March 4 said he hoped the House would vote on a broad infrastructure package in the spring. (Video: The Washington Post)

The efforts come amid a lack of clarity from the White House on what Biden’s next major priority will be after passage of the stimulus. When Biden was inaugurated, White House officials planned to first quickly pass an emergency relief bill and then by February introduce a “Build Back Better” jobs package aimed at a longer-term economic recovery.

But February came and went without the White House introducing that second plan. Key decisions about this jobs package remained unresolved as of this week, according to four senior administration officials who spoke on the condition of anonymity to share details of private deliberations. The plan may still be weeks away from being released, the officials said. White House press secretary Jen Psaki has said the administration remains focused on approving the relief bill before deciding on the next legislative priority.

Mostly united over covid relief, Democrats face divisions over Biden’s massive second economic plan

Biden recently hosted a group of bipartisan lawmakers at the White House to discuss a shortage of semiconductors. The China package would also deal in part with infrastructure-related issues.

“This is literally the highest potential for bipartisanship of almost any policies you can think of. I think it makes a lot of sense,” said Douglas Holtz-Eakin, former director of the Congressional Budget Office and president of the American Action Forum, a right-leaning group. “Hating China is a big bipartisan thing, and Schumer has the opportunity to take ownership of being against China.”

But such a move could prove contentious. Other factions within the Democratic Party have clamored for legislative action on a range of other issues arguably viewed as important to the base, such as health care, immigration, climate change, voting reform and gun control. Time on the Senate’s legislative calendar is scarce.

Liberal Senate Democrats have been supportive of Biden pushing infrastructure after the relief bill in part because it has been expected to include hundreds of billions in clean energy investments aimed at combating climate change. Some liberal Democrats, such as Rep. Ro Khanna (D-Calif.), have also called for taking action related to countering China.

“We need an economic recovery and to get rid of the pandemic, and China has already done both. Why don’t we do those here first? That’s why people voted for Biden,” said Mark Weisbrot, co-director of the Center for Economic and Policy Research, a left-leaning think tank.

On Wednesday, Schumer reiterated his calls for the Biden administration to forgive up to $50,000 in student debt per borrower. He is also supportive of the administration’s infrastructure and jobs push. Democratic Senate committees are holding hearings and working on the infrastructure package, as well. Aides cautioned final decisions have not been made about what the Senate will take up after the House approves Biden’s stimulus package.

In February, Schumer said Democrats’ legislative package on China would aim to include measures to shore up U.S. supply chains, expand American production of semiconductors, create 5G networks nationwide and pour billions into investments into U.S. manufacturing companies and hubs, among other proposals.

“In addition to addressing the climate crisis, racial and economic inequities and immigration, passing legislation to enable the United States to out-compete China and create American jobs is a crucial part of Democrats’ efforts to Build Back Better,” Schumer said in a statement.

The new legislative package is likely to center on a bipartisan bill that Schumer introduced with Sen. Todd C. Young (R-Ind.) and other colleagues last year — the Endless Frontier Act.

That bill proposes $10 billion to establish regional tech hubs that would aim to create new companies and boost manufacturing. The measure also proposes expanding the National Science Foundation into a renamed National Science and Technology Foundation, and giving it $100 billion over five years to invest in everything from university research to small manufacturing sites for the testing of new products.

“We need to get a bill like this to the president’s desk quickly to protect America’s long-term economic and national security,” Schumer said in February.

Countering China’s rise is a cause that has united Republicans and Democrats like few other issues. China’s booming economy and growing variety of high-tech exports, from telecommunications equipment to drones, has alarmed U.S. officials and sparked bipartisan calls for greater investment in U.S. research and manufacturing to protect the nation’s position in the global economy. The urgency has even prompted Republicans to shed some of their free-market orthodoxy and embrace more government involvement in the economy.

The pandemic, meanwhile, has crystallized fears on Capitol Hill about U.S. reliance on Chinese-made goods. Widespread shortages of face masks and other medical supplies last year — partly caused by a scarcity of imports as China battled its own pandemic — convinced lawmakers on both sides of the aisle that the United States needs to make more essential goods at home.

Biden wants to create millions of clean-energy jobs. China and Europe are way ahead of him.

A current global shortage of semiconductors is sparking similar calls. The computer chips are the brains behind a wide range of goods, from consumer electronics to pickup trucks, and their scarcity caused Ford and General Motors to temporarily halt production at several auto plants.

Lawmakers and government officials have already adopted plenty of defensive measures relating to China, including import tariffs and limits on adopting technology from Huawei and other Chinese companies. But they haven’t done enough to invest in boosting innovation and competitiveness at home, Young said in an interview.

“We want to play offense with this legislation. We played defense, but the offense piece was lacking,” Young said.

The legislation is also likely to include measures to combat China’s anti-competitive behavior and to strengthen U.S. supply chains for critical industrial materials, Young said. The legislative package could also include appropriations to fund subsidies to companies building new semiconductor manufacturing facilities in the United States, Young said.

Many other lawmakers of both parties are pushing bills aimed at curbing China’s economic influence.

Sen. Marco Rubio (R-Fla.) on Tuesday touted legislation to coordinate a U.S. response to China’s hold on rare-earth materials critical to advanced U.S. manufacturing. Sen. John Cornyn (R-Tex.) has joined Rubio and several Senate Democrats, including Sen. Mark R. Warner (D-Va.), in introducing 5G legislation aimed at producing alternatives to Huawei, China’s leading 5G provider.

Reps. Mario Diaz-Balart (R-Fla.) and Ted Deutch (D-Fla.) are writing a bipartisan bill to make it easier for Uighurs — an ethnic minority group persecuted in China — to secure refugee applications to the United States, according to Reuters. Senate Banking Committee Chairman Sherrod Brown (D-Ohio) and Senate Finance Committee Chairman Ron Wyden (D-Ore.) have backed over $350 billion to “invest in American competitiveness” and expand American manufacturing, while mandating fuller sanctions on China related to allegations of currency manipulation.

Sean McElwee, founder of the left-leaning think tank Data for Progress, predicted the measure would be supported by liberal Democrats. “The China competition angle makes this popular, and it will also help create more diversified economic growth,” McElwee said. “This is the industrial policy popular in populist progressive circles.”

These bills may give Biden an opportunity to strike bipartisan compromises, given the steep hurdles for doing so over infrastructure.

As a presidential candidate, Biden called for trillions in new investments aimed at rebuilding the nation’s bridges, roads, ports and other critical infrastructure that has been consistently cited by experts as desperately in need of repair.

Centrist Senate Democrats, who grew skittish about the price tag of Biden’s relief package, are expected to be uneasy about adding another $3 trillion to the national debt. Yet Senate Republicans are expected to oppose the likely tax increases necessary to fund such a measure, complicating the path toward a bipartisan package.

On Jan. 14, Biden said he would in February lay out a recovery plan centered on infrastructure, manufacturing and clean energy. Biden said he would introduce that package before a joint session of Congress. That session has not yet been scheduled, and aides say it could get pushed into April.

“We are still part of a policy process internally on … what the next part of his agenda will look like — and what the order, the format, the form, will look like,” Psaki said Tuesday.

Psaki said it was unclear if infrastructure would make up the next stage of Biden’s legislative agenda, leaving open the door for alternatives.

Asked about the infrastructure and jobs package on Wednesday, Psaki said: “It’s only day 49 ... We’re about to pass the most progressive bill in American history.”