"Semiconductor Law Repeal" Sparks Bipartisan Backlash in Beneficiary Regions Against Trump

Schumer: "Essential for U.S. Leadership in AI and High-Wage Jobs"
Republicans Also Say "Revisions Possible, But Oppose Repeal"

Amid calls from U.S. President Donald Trump to repeal the CHIPS Act, key lawmakers from both parties have expressed opposition.

According to Bloomberg News on the 5th (local time), Senate Majority Leader Chuck Schumer, a Democrat, stated in an interview that the CHIPS Act is "essential for the U.S. to lead the world in technology and artificial intelligence (AI) and to bring high-wage manufacturing jobs back to America."

Donald Trump, President of the United States. Photo by Getty Images Yonhap News

The CHIPS Act, considered a hallmark achievement of former President Joe Biden, was passed with bipartisan support in the U.S. Congress in 2022. It provides a total of $52.7 billion in support over five years to companies building semiconductor manufacturing facilities in the U.S., attracting investments not only from domestic firms like Intel but also from foreign companies such as TSMC, Samsung Electronics, and SK Hynix.

However, President Trump argued in a joint session of Congress the day before that "the CHIPS Act and everything left must be eliminated." He claimed that even without subsidies, imposing tariffs would encourage companies to produce semiconductors in the U.S.

Leader Schumer said that many factories currently under construction with CHIPS Act support are benefiting, and if the Trump administration withdraws funding, these projects could be halted. He added, "In the Senate, there will overwhelmingly be many who want to maintain it regardless of party."

In fact, some Republicans also hold negative views on repealing the CHIPS Act. Senator Mike Crapo (Republican-Idaho), chairman of the Senate Finance Committee, said he is open to some adjustments to the CHIPS Act but opposes a full repeal.

Regarding the proposal to include the repeal of the CHIPS Act in the tax adjustment package currently being negotiated to fulfill President Trump's tax cut promises, he said, "We are not considering that."

Senator Todd Young (Republican-Indiana) expressed surprise at President Trump's speech and said he expects the Trump administration to continue operating the CHIPS Act. He revealed that he decided to support the confirmation of Trump cabinet nominees after receiving formal and informal commitments from them to implement the CHIPS Act. He also said he contacted the White House after Trump's speech the previous night to express willingness to improve the CHIPS Act.

Senator Young said, "I expect the administration to continue supporting this initiative for supply chain resilience and national security," adding, "If over time we need to transition to a different model, I am open to that."

Indiana is the region where SK Hynix has committed to invest $3.87 billion to build a next-generation high-bandwidth memory (HBM) production facility in exchange for receiving CHIPS Act subsidies.

Currently, since the Republican Party holds the majority in both the House and Senate, theoretically, repealing the CHIPS Act is possible. However, Bloomberg forecasts that politically it will be difficult because the Republicans have only a narrow seat margin in the House compared to the Democrats, and in the Senate, they fall short of the 60 seats needed to overcome a filibuster (a legal procedure to block legislative progress through unlimited debate). Additionally, states with strong Republican support such as Ohio and Texas are also benefiting from the CHIPS Act. Some Republicans have previously suggested removing certain worker- and environment-friendly provisions.