Biden Touted Science Funding, But Congress Hollowed Out His Promise

The bipartisan CHIPS and Science Act — a law President Joe Biden name checked in his State of the Union address — was designed to flood the microchip industry with cash and shore up America’s commitment to basic research.

Two years in, Congress has fully funded subsidies for chipmakers. The big boost in science, however, is way off target.

While nearly $53 billion is going into reviving a homegrown semiconductor industry, Congress has gnawed away at the law’s ambitions on fundamental research and development aimed at staying ahead of China and other rivals in competitive fields like artificial intelligence.

The reductions come even as Biden touted Thursday that the law has the U.S. “investing more in research and development than ever before.”

The latest example is the spending package lawmakers advanced over the past week: Biden's signature enacts deep cuts to the National Science Foundation and stalls key offices in the Commerce and Energy departments that are supposed to deploy CHIPS money, turning a promised cash infusion of $200 billion over a decade into a humiliating haircut. And while it’s hardly the first time Congress has reneged on promised funds, it threatens an important pillar of Biden’s industrial policy.

“These aren’t the numbers I’d like to see. I’m disappointed that we can’t provide funding to match what we authorized in CHIPS and Science,” House Science Chair Frank Lucas (R-Okla.) told POLITICO in an email. “Unfortunately, in our current fiscal environment we have to make difficult decisions and that’s reflected in the budgets for these agencies.”

By contrast, rival tech powers are doubling down: China, despite its slowing economy, just this week pledged to raise R&D spending by 10 percent, to $51.5 billion, this year.

Sudip Parikh, CEO of the American Association for the Advancement of Science, a Washington-based science nonprofit, said the global competition for advanced technologies like AI, quantum and fusion would have decades-long implications.

“Once you lose the lead in that kind of a race, the benefits accrue to whoever's in the lead, and they've been accruing to us for the last 75 years,” he said in an interview. “They will accrue somewhere else."

‘Failure to launch’

The National Science Foundation offers a window onto the broader challenge, as the agency that expected to gain the most from CHIPS. The law authorized NSF to receive $81 billion over a five-year period that would ultimately double the agency’s budget by 2027. This year, the NSF should have gotten $15.64 billion, according to the CHIPS Act.

Under the latest spending deal, lawmakers provided NSF with $9.06 billion — 42 percent short of the CHIPS target and an 8 percent cut to its current budget.

“There will be real impacts across the research enterprise with this reduction,” an NSF spokesperson told POLITICO. “It is difficult to place this in the context of rapid, large-scale science investments by our competitors such as China.”

CHIPS established an office for Technology, Innovation, and Partnerships (TIP) — the NSF’s first new directorate in more than three decades. TIP’s mission is to help critical discoveries in semiconductors, AI, quantum computing, biotechnology and other technologies make the leap into real-world applications.

In December, TIP announced it would channel $100 million over the next four years between 18 universities to turn more scientific breakthroughs into tech innovations. Erwin Gianchandani, who leads the directorate, told POLITICO he was not sure the program could expand to more universities.

“It's the future rounds that are going to be tied to future appropriations,” he said.

Another major NSF program awarded $15 million of seed money to each of ten teams across the country in the hopes of growing new regional hubs of tech R&D and innovation. There's potential for a $1.6 billion prize, split among the teams, which CHIPS authorized but Congress has not appropriated.

Without that funding, Parikh said, “it would be a pilot that's permanently a pilot. You have failure to launch.”

Asked about how Biden’s comments square with appropriations, the Office of Management and Budget pointed to its March 5 statement that said, “This bipartisan legislation represents a compromise and neither side got everything it wanted.”

You get what you pay for

Other agencies that CHIPS designated as critical to training future STEM workers, modernizing research facilities and setting up tech hubs also saw appropriations far short of their targets under the law.

CHIPS authorized $67 billion to the Department of Energy, largely its Office of Science, over five years to support basic research activities, upgrade national lab infrastructure and establish new clean energy tech programs. The law authorized this year’s budget for the office at $9.54 billion, but the spending deal appropriated $8.24 billion.

The law also authorized $10 billion over five years to the Commerce Department’s Economic Development Administration to invest “directly in burgeoning, high-potential U.S. regions” aspiring to become tech hubs away from centers like Silicon Valley. Last year, Congress appropriated $500 million to launch the program, which will award up to $70 million each to as many as eight hubs by summer. This year, Congress directed only $41 million to the program — likely cutting short the chance of running additional rounds for now.

“Congress can get what they pay for,” agency spokesperson Jonathan Lovitz said in an interview, noting he has “so much hope for funding being met where it needs to be.”

Also at the Commerce Department, CHIPS authorized $1.65 billion this year to the National Institute of Standards and Technology for its work with U.S. manufacturers, and to research and set standards for industries of the future like AI and cybersecurity. Instead, Congress cut NIST’s current budget by 11 percent, falling short of the CHIPS target.

The problem is not unique to CHIPS. Last summer’s debt limit deal flatlined all non-defense funding and “hit all agencies very hard,” said Sen. Jeanne Shaheen (D-N.H.), who chairs the Senate Appropriations subcommittee overseeing spending at the Commerce Department and federal science agencies.

“I think the work will go on. I would like to fund it at a higher level, but the House has not been willing to do that,” she said about NIST’s budget.

Science funding has seen some of this playbook before. Much of the 2007 America COMPETES Act, which also pledged funding for agencies like NSF, was never implemented. Still, this year has been particularly chaotic, with agencies relying on stopgap measures for months. Moreover, this year’s cuts compound shortfalls from last year’s appropriations.

“It’s hard to imagine Congress fully playing catch up in a couple of years after underfunding research investments now,” said Matt Hourihan, associate director of R&D and advanced industry at the Federation of American Scientists.

It’s not clear yet if Congress will have the appetite to bridge the gap in next year’s annual appropriations or provide additional funding through a supplemental.

Lucas said he will continue to push for strong R&D funding in future spending bills.

Rep. Ro Khanna (D-Calif.), who sponsored the House legislation that became the science section of CHIPS, said in an email that he would “try and make up the difference going forward.”

Mohar Chatterjee contributed to this report.