Here comes some creative thinking. 

We have a few issues here in the US that we let fall through the cracks way too often.  And, then when we address them, we don’t ensure that there’s a clear path to their total resolution.

Let’s consider three critical issues for the US. 

The first is the dearth of child care.  We need care for 11 million kids- but only have spots for  a bit  less than 8 million of them.  But,the situation is worse that than- because this is nationwide data-  the local issues make it more evident.

Micron plans to build a factory in Syracuse, New York (with a $100 billion investment).  And, the child care demand for that region is roughly 3X the current volume of slots available.   Then, there’s  Phoenix (AZ), where there are a slew of chip plants proposed,  In that region, child care absconds with about 18% of the worker’s salary- way higher than the national average.

Yes, the child care situation has been bad for a decade or so, but once the pandemic hit, many small- and larger- child care providers were unable to staff their units and they disappeared. (Some 58000 workers are no longer providing services in this sector, which is  roughly 5% of the total sector employment.)   Moreover, many units can’t make a profit if they pay their staff appropriate wages.  (Yes, that means that the US needs to find a way to subsidize these vital services.  Especially if we want folks to be able to work [and not stay at home to take care of their kids].)

Before you jump down my throat, we’ve done this before.  (Read this older post.)  And,yes, I know the pandemic will officially be declared over in 72 days (11 May), and unemployment is relatively low (except that is computed by examining how many folks are looking for work and not hiding on the sidelines), but we still need to provide such services to ensure folks who need money and/or want to work are able. 

Which brings up item two.  The special bills we passed this past year were designed to create jobs all across America.  Too often, we have promoted technology ventures that get build in Silicon Valley, the 128 corridor (MA), Metropolitan New York, and the DC area.  But, we have great knowledge and skill sets all across America and we need to ensure that gainful, satisfying, and permanent employment is available there, too.  (This has been one of the issues Simon Johnson and Jonathan Gruber have been promoting- as expounded in the book below.)

And, then, we have our chip shortage.  (Just one- but á big component- of our supply chain issues.)  Because we let so many manufacturers outsource their production to other countries.    (You do recall, we had relatively few new cars to sell last year, it was also tough to buy new computers, etc.)  But, more importantly, we left ourselves vulnerable to China, since no one thought through the consequences of not leading the world in chip design and production.That’s part of the driving force behind our massive new bill- the Chips and Science Act of 2022.  (You do know that there is a provision in this act that precludes the awardees from making an investment in China (or other “countries of concern”) for at least a decade post-award, right?)

Well, President Biden has done some thinking as to how these three vital issues can be easily addressed.  How, you ask?

Those semiconductor manufacturers looking to glom onto the $ 40 billion in federal subsidies for their chip production units are going to have to include provisions in their facilities to deliver affordable child care for workers. (There also will be limitations on stock buybacks and excess profits will be shared with the US government.)

So, today (when I am writing this), the applications for those seeking those funds are going to find a whole different set of requirements than they’ve seen for other programs. Since only 30% of those involved in chip design and manufacturing are women, this new requirement to provide child care will open a slew of new jobs for women who had a hard time entering the workplace without childcare.  If a firm hopes to get $ 150 million or more for a plant, they will also be guaranteeing affordable, high-quality child care for their workers.

This can be accomplished by paying local child care providers to add capacity, subsidize the worker’s costs, among other choices available.  And, as Johnson and Gruber had advocated, there will be funds for universities, companies, and others to augment the knowledge and skill set of workers.  Teaching them science, engineering, or work related skills like welding and fabricating.

Those getting the chip grants will have to produce detailed financial projections  as part of the application process.  So, if there are substantial upside profits, those funds will be split between the firm and the US,  It will also stop these firms from using the grant funds to line the pockets of their executives and or their shareholders.

By the way, firms that use other sources of funding (like private capital) to augment their project will be given preference for government aid. Also, firms that coordinate their efforts with state and local incentives (to promote communities or local workforce efforts- and not for tax abatements) will receive preference. 

It’s time for us to benefit all our citizens across America.