The Senate is considering a standalone bill to subsidize domestic chip production. We’ll also look at the Fed’s stock market investigation, Treasury Secretary Janet Yellen’s latest inflation comments, and the upcoming weed decriminalization bill.

But first, the Secret Service is under fire for deleting some potentially important text messages.

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Schumer advances on semiconductor bill

Senate Majority Leader Charles Schumer (DN.Y.) plans to hold a vote soon on a bill that would provide $52 billion to $54 billion in aid to the nation’s semiconductor manufacturing industry and a tax credit for semiconductor makers. -drivers, according to Senate sources.

Schumer told senators to expect a floor vote as early as Tuesday of next week.

Streamlined Creating Advantageous Semiconductor Production Incentives (CHIPS) For America Bill Will At Minimum Include Emergency Funding For Semiconductor Makers And Tax Credit investment of the law facilitating American-made semiconductors.

  • The legislation would likely not include tough trade provisions on China included in larger China competition bills passed by both houses, a disappointing outcome for Democrats and some Republicans.
  • Senate Minority Leader Mitch McConnell (R-Ky.) has threatened to block China’s competition bills that include funding for semiconductors, but he signaled that a bill more narrow on chip subsidies could be adopted.
  • The big question is whether the legislation can get more than 10 Republican votes to overcome a filibuster.

The background: Congress is running out of time to reach agreement on a larger China competition bill, and manufacturers are warning they won’t build chip facilities unless lawmakers give the go-ahead soon. funding. A slimmed-down bill to subsidize U.S. chip production is one potential solution, but it’s already drawing backlash from progressives who see it as corporate welfare.

Alexander Bolton has more here.

LEADING THE DAY

Powell and Clarida cleared in Fed financial transactions probe

Federal Reserve Chairman Jerome Powell and former Vice Chairman Richard Clarida have been cleared as part of an internal probe into their financial dealings, according to a memo from the Fed’s internal watchdog released Thursday. .

The Fed’s Office of Inspector General (IG), an independent internal watchdog, investigated several financial transactions conducted by the bank’s two most senior officials in 2019 and 2020, but “found no evidence “that they” have violated any laws, rules, regulations or policies related to trading activities as investigated by our office.

  • The Fed’s Board of Governors asked the IG in October to investigate financial dealings conducted by Clarida, former Federal Reserve Bank of Dallas President Robert Kaplan, and former Fed Chairman of Boston, Eric Rosengren.
  • Clarida came under fire after disclosing — and then revising — several investment fund purchases and sales as the Fed prepared its initial response to the COVID-19 pandemic in February 2020. The transactions raised questions about whether Clarida has moved his money according to his knowledge. Fed plans.
  • Kaplan and Rosengren invested and traded millions of dollars in stocks and bonds throughout 2020, while the Fed actively supported financial markets with unprecedented support.

All three have since resigned from their positions, although Clarida’s tenure at the Fed was due to end this year anyway. The Fed IG also reviewed Powell’s financial dealings in December 2019 after some media outlets raised questions about his conduct.

In a Wednesday memo to Powell, Fed Inspector General Mark Bialek said the oversight office had not yet completed its investigation of Kaplan and Rosengren. But Bialek said investigations into Powell and Clarida revealed no evidence of gross misconduct.

Sylvan has more here.

‘UNACCEPTABLY HIGH’

Treasury Secretary Janet Yellen on Thursday called the U.S. inflation rate “unacceptably high,” adding that it is the Biden administration’s “top economic priority to bring it down.”

Consumer price data released by the Labor Department on Wednesday showed inflation hit new highs last month.

  • The consumer price index (CPI), a benchmark for measuring inflation, rose
    1.3% in June and 9.1% annually, according to the report. Economists expected a smaller increase, but annual inflation hit its highest rate since 1981.
  • Yellen in particular pointed to rising prices in areas like energy, which economists say has traditionally been volatile and has spiked in recent months amid the ongoing war between Russia and Ukraine: ” This was reflected in yesterday’s CPI data, which showed almost half of the increase ahead in higher energy prices.

Aris has more here.

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GO OUT

Senate Democrats to introduce weed decriminalization bill next week

Senate Democrats plan to roll out long-awaited legislation to decriminalize marijuana next week, despite expected resistance from Republicans.

Sen. Cory Booker (DN.J.), who led the legislative push with Senate Majority Leader Charles Schumer (DN.Y.) and Sen. Ron Wyden (D-Ore.), confirmed the reports according to which senators are about to unveil the Cannabis Administration and Opportunity Act in the coming week.

  • “We’re introducing it soon,” Booker told The Hill later Thursday, adding that the legislation will be “very similar” to a draft plan released by senators last year, but with “very significant changes” made. .
  • The bill seeks to remove cannabis from the federal list of controlled substances and is expected to include measures to reform criminal justice. The news comes months after the House voted to pass legislation to legalize marijuana nationwide, dubbed the Marijuana Opportunity Reinvestment and Expungement Act.

Aris has more here.

Good to know

The state of the national housing crisis changed dramatically in the mid-2000s, going from a primarily coastal problem to one scattered across the United States, according to a new report.

A report by Up For Growth shows that the United States failed to meet the housing needs across the country of more than three million households in 2019, compared to 1.6 million
in 2012.

These are the 10 states with the worst housing shortages.

Here’s what else we’ve got our eyes on:

  • AP: “Wholesale inflation climbed 11.3% in June from a year earlier, the latest painful reminder that inflation is escalating in the US economy.”
  • A new survey released Wednesday found that the senses. Alex Padilla (California), Mazie Hirono (Hawaii) and Cory Booker (NJ) have the most diverse staff in Senate Democrats’ personal offices — though a separate study found racial pay disparity is rampant. all Capitol Hill offices.
  • GOP Sen. James Lankford (Okla.) on Thursday blocked a Democratic demand to unanimously pass a bill to protect interstate travel for abortion.
  • A tech trade organization is pushing the Department of Justice (DOJ) to reevaluate its stance on privacy of electronic communications to protect women seeking abortions.

That’s all for today. Thanks for reading and check out The Hill’s Finances page for the latest news and coverage. Well see you tomorrow.

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