The American Prospect - Intel’s $3.5 Billion Boondoggle

Reporter Austin Ahlman focuses on chip giant Intel’s ‘secure enclave’ project will take nearly 10 percent of a CHIPS Act manufacturing fund that is already stretched thin.

With Congress hurtling toward an end-of-week deadline to avert a partial government shutdown, lawmakers are racing to pass appropriations to keep the government open. The House passed its “minibus” legislation containing half of fiscal year 2024’s appropriations Wednesday, and the Senate is set to follow suit today. Another minibus is expected by March 22, the second partial shutdown deadline.

The rushed appropriations package, which was only released last Sunday night, has led to a familiar scenario on Capitol Hill: lawmakers rushing to review and vote on hundreds of pages of bill text riddled with obscure and often unexpected provisions. The scramble has created an opportunity for committee heads and appropriators to stash a number of controversial policies in the legislation. As the Prospect reported earlier this week, one such provision would slash a fifth of the funding for the Department of Justice’s Antitrust Division as the agency prepares to take on several major cases in the coming year.

But the cut to antitrust enforcement is not the only threat the appropriations package poses to President Biden’s pro-competition agenda. As Bloomberg first reported Wednesday, the package also includes $3.5 billion over three years for microchip giant Intel to create a “secure enclave” facility that would exclusively produce highly sensitive microchips for the U.S. military. Instead of providing new funding for the facility, the bill pulls the money from the $39 billion allocated for manufacturing grants by the 2022 CHIPS and Science Act (commonly referred to as the CHIPS Act). Experts and congressional sources say the move threatens to further strain a fund that is already much too small to meet the needs of U.S. semiconductor manufacturers.

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