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Washington — Ending trade with foreign competitors to protect U.S. technology is not a path forward, National Security Advisor Jake Sullivan said Wednesday, underscoring the need for more nuanced and targeted export controls.
“It doesn’t make sense to allow companies to sell advanced technology to countries that could use them to gain military advantage over the United States,” Sullivan said in remarks at the Brookings Institution. “Now, it would be a mistake to attempt to return to the Cold War paradigm of almost no trade, including technological trade among geopolitical rivals.”
He said a system of nuanced and targeted export control should continue instead, “de-risking” trade with China rather than “decoupling” with the country.
“Yes, the fence is high, as it should be, and … the yard is small, and we’re not looking to expand it needlessly,” he said, using an Obama administration trope where the yard refers to the pool of the exported items controlled and the fence stands for the control itself.
The U.S. must consider four distinct questions when examining how to continue with the export control system of limited items under tight restrictions, Sullivan said. These questions include examining which sensitive technologies are most likely to become foundational to national security, as well as identifying where competitors will be exerting maximum effort.
Some experts say this statement is a turn from Sullivan’s previous remarks, moving from a more absolutist, idealistic tone to a more practical approach.
“I think that that set of four questions suggested a more moderate tone, a more kind of realistic, updated understanding of the limitations on what we can do,” said Martin Chorzempa, a Senior Fellow at the Petersen Institute of International Economics, comparing Sullivan’s remarks from two years ago.
But targeted export controls of this nature aren’t new.
Former President Barack Obama instituted the Export Control Reform Initiative (ECR) in his first term, creating new, more nuanced rules around working with foreign trade partners. The ECR liberalized trade in general, but put tighter controls on a select group of specific technologies, according to Robert Shaw, the program director for the Export Control and Nonproliferation Program at the Middlebury Institute of International Studies.
The system maintained its path throughout Donald Trump’s presidency and was picked up by the Biden administration.
“With respect to China in particular, [it’s] continued, essentially on a similar vector from the Obama administration and all the way to the present,” he said.
Still, Biden introduced some new policies into the system–-such as for semiconductors.
In 2022, the administration’s Chips and Science Act put roughly $52 billion into domestic research and development for these critical pieces, which are used in many electrical devices from medical equipment to smartphones. Around that time, the U.S. also introduced enhanced export controls focused on limiting China from accessing US-originating semiconductor technology.
“Export controls on semiconductors were new,” said Mary E. Lovely, Anthony M. Solomon Senior Fellow at the Peterson Institute. “It is, in some sense, echoing things we saw before, but also amplifying them and increasing their use,” comparing the initiative to export controls from the Trump administration.
Shaw said the export controls’ design under Biden sets them apart, particularly the way they allow for quick tweaks as needed.
“They can be easily adjusted to where they could be fairly quickly calibrated to either be tightened further or loosened,” Shaw said.
Sullivan ended his remarks by doubling-down on the need to utilize secure trade policy, not only for America’s interests now, but also for its future in the global economy.
“Our task ahead is to harness that power to take on the realities of today’s geopolitical moment in a way that will not only preserve America’s endurance strengths, but extend them for generations to come,” Sullivan said.
Here’s what experts say is keeping Biden from making a decision on Ukraine
WASHINGTON – The Biden administration is still hesitant to take a definitive stance on whether to lift restrictions preventing Kyiv from using U.S.-made long-range missiles to strike military targets deep inside Russia, despite months of pleading from Ukrainian President Volodymyr Zelensky.
U.S. President Joe Biden is under increasing pressure as Kyiv struggles to hold Moscow’s forces back in eastern Ukraine. Yesterday, the country’s soldiers were forced to withdraw from Vuhledar, a town in the Donetsk region viewed as a critical stronghold at the intersection of Ukraine’s eastern and southern fronts, putting an end to two years of fighting and underscoring Ukraine’s need for assistance as the war is nearing its third anniversary.
A potential decision seemed imminent in recent weeks, with Secretary of State Antony Blinken visiting Kyiv and Zelensky meeting with leaders in Washington within a span of a month.
But despite the time pressure and the extensive diplomatic efforts, Biden’s decision on whether to lift the restriction has yet to come.
“There is hope that, rather than a public announcement that Ukraine’s permissions have changed, we would learn this just from seeing a strike into Russia, which is actually how some of the other weapons deliveries have played out, but right now, he has not made that decision,” said Shelby Magid, a deputy director at the Atlantic Council’s Eurasia Center.
Experts say the reason Biden hasn’t made a decision boils down to Russia’s nuclear threats, the imminent presidential election and the risk that lifting restrictions may still not be enough to boost Ukraine’s military position.
Threats of nuclear escalation
Russian President Vladimir Putin’s continuous nuclear threats are among the reasons behind Biden’s hesitation to lift the restrictions. Moscow could view the move as proof that “the West is inching into directly going to war with Russia” and show its teeth in response, according to Richard Betts, a senior national security fellow at the U.S.-based think tank Council on Foreign Relations.
“At the low end, it might be a nuclear test, a symbolic warning that there could be more to come,” he said. “Or worse than that, [it might be] the use of five or ten tactical nuclear weapons in Ukraine.”
Feeding into the theory, Putin said last Wednesday that Moscow could use nuclear arms if it was struck with conventional missiles under newly proposed amendments to Russia’s nuclear doctrine. He added, “aggression against Russia by any non-nuclear state, but with the participation or support of a nuclear state, be considered as their joint attack.” The statement came amid Zelensky’s visit to the U.S. and appeared to be a straight-forward warning referencing the scenario if Kyiv’s request is granted.
But some say the threats are exaggerated.
“Other countries and some of our European leaders have the same access to information and the same analysis, and they don’t have these concerns,” Magid said. “I think the U.S., we’re getting in our own way.”
Fears of sabotaging Harris’ campaign
The main reason behind Biden’s hesitation to lift the restrictions is the upcoming elections, according to Dan Whitman, a senior fellow at the U.S.-based Foreign Policy Research Institute.
“We’ve seen these red lines don’t really exist,” he said. “President Biden just doesn’t want to do anything that would compromise the victory of Kamala Harris.”
According to the Pew Research Center, foreign policy is among the top issues in the upcoming election, with 62% of registered voters saying it is “very important” to their vote. With that, more registered voters express confidence in former President Donald Trump’s foreign policy than in that of Vice President Kamala Harris.
“If Harris had a clear lead, Biden would have more freedom to make global strategic decisions,” Whitman said. “He doesn’t have much freedom until November 5 – maybe on November 6, he lifts all the restrictions.”
Uncertainty whether the risk is worth the outcome
Another factor in Biden’s decision-making—or lack thereof—on the matter is that green-lighting the use of U.S.-based missiles might not be enough to significantly change Ukraine’s military position.
“It’s not clear that using the longer-range weapons will make a huge difference in the war: the United States doesn’t have many of them to give, and this is a war of attrition in which Russia has a natural advantage,” Betts, an expert in military strategy and intelligence, said. “In a strictly military sense, it would help in the short term for Ukraine, but it’s not likely to be a radical change that’s going to tilt the balance.”
Still, others argue that Ukraine’s ability to strike deeper into Russian territory could have significant tactical advantages.
“No one decision or one system will completely change the course of the war immediately and end the war,” Magid said. “But the ability to hit more into Russia and hit where the military sites actually are – the airfields, the ammo and logistics sites – would immediately lessen how many strikes are coming against Ukraine.”
Deepfakes pose threats to upcoming US Presidential Elections
WASHINGTON — As the Presidential elections are approaching, Sen. Richard Blumenthal, D-Conn., chairman of the Judiciary Subcommittee on Privacy, Technology, and the Law, stated that a bipartisan bill is necessary to safeguard the upcoming elections since artificial intelligence (AI) is already being used to interfere with them.
During a Tuesday hearing, he called for big tech and social media companies to be held accountable for election effects and other AI-driven campaigns.
“It’s not science fiction that artificial intelligence will somehow interfere with our elections in the future, possibly, or hypothetically. It’s already being used to sow lies about candidates and suppress the vote,” he said.
He added that deepfakes pose threats to politics and the integrity of American democracy by highlighting recent examples of both domestic and foreign disinformation, such as the call that thousands of residents of New Hampshire received in January from someone posing as President Joe Biden telling them not to cast their votes in the state’s primary election.
Another incident is when Microsoft revealed that social media accounts linked to the Chinese Communist Party were using artificial intelligence to influence American politics earlier this month.
According to David Scanlan, New Hampshire Secretary of State, any message intended for voters that contains content generated by AI should include a disclosure so that voters are aware of its origin.
“To mitigate the impact on voters and election outcomes, it is important to have the temper to promptly address misinformation,” he said.
He added that there is a need to strengthen voter education in order for people to find reliable and accurate election-related information, as well as to be able to identify misleading information.
Rijul Gupta, Founder and CEO of DeepMedia, Inc., a leading deepfake detection and AI security company, defined deepfakes as images, audio, or videos that have been generated or manipulated by AI in a manner that may harm or mislead the public.
He stated that as technology advances, it poses a threat to the shared reality that underpins our society by instilling uncertainty in the minds of people, making them doubt the accuracy of any information they come across.
“In a world where the very nature of truth is called into question, the foundations of our democratic institutions, which rely on an informed and engaged citizenry, are at risk,” he said.
He added that deepfakes represent a market failure, an abuse of a public good that has detrimental effects and undermines trust in the information era.
“We can accelerate the growth of the Generative AI market while ensuring its safety and integrity by internalizing these negative outcomes through smart regulation and industry collaboration,” he said.
Sen. Josh Hawley, R-Mo., called for the passage of multiple bipartisan bills that are ready, and said it is time that these bills get a vote.
“Let’s not allow companies that control the news in this country to use AI to further their hammer hold on the United States of America and our political process. The leadership of both parties and the Senate need to support an effort to get a vote.” he said.
Lawmakers urge investigation into Pakistan’s election irregularities
WASHINGTON — Chairman Michael McCaul, R-Texas, called on the members of the Committee on Foreign Affairs on Wednesday to investigate electoral irregularities and violence that took place in the recent election in Pakistan on February 8, 2024.
The United States and international election monitors have raised concerns about pre-election and election-day irregularities, including disproportionate limitations on freedom of expression and assembly, attacks on journalists and limitations on internet and telecom services.
“In addition to promoting democratic values, supporting Pakistan’s economy is a key strategic goal of our bilateral relationship,” said Rep. Dean Phillips, D-Minn.
Donald Lu, Assistant Secretary of State, Bureau for South and Central Asian Affairs, testified in front of Congress, stating that after the day of the elections, the State Department issued a clear statement condemning electoral violence, human rights violations, media attacks, internet and telecommunication restrictions and allegations of interference in the electoral process, urging a full investigation.
“Second, We’re very focused on economic stability for Pakistan and for Pakistan to deal with its social terrorism and political issues,” said Lu.
Chairman Joe Wilson cross-examined the accusations against Imran Khan, claiming that the U.S. government was involved in removing Khan from power. Lu stated that there was no such involvement from the U.S. and that it was just a conspiracy theory. “The then-ambassador of Pakistan to the United States has testified to his government that there was no conspiracy. We respect the sovereignty of Pakistan,” said Lu.
During the hearing, observers shouted “liar” and “free Iman Khan, the only democratic prime minister,” and seemed dissatisfied with Donald Lu’s testimony. Capitol Police escorted the protestors from the hearing room.
Rep. Brad Sherman, D-Calif., questioned the impartiality of the Pakistani judicial system. He raised concerns about the treatment of American citizens, including Dr. Aafia Siddiqui, who has been jailed for over 14 years without charge. Emphasizing the importance of prioritizing human rights in Pakistan, he called for the American ambassador to visit and the president to take action.
“That’s the same judicial system with Dr. Afridi in jail for 14 years. For getting bin Laden. Do we have faith that Imran Khan has not been the victim of selective prosecution?” Sherman said.
McCaul stated that Pakistan is experiencing substantial economic issues, such as record inflation and foreign debt, and its domestic condition is catastrophic. He also maintained human rights in Pakistan must be protected for democracy to flourish. He says the United States and Pakistan must continue to work together to combat terrorism and promote regional stability.
“We also know that if the United States falls away from our relationship with Pakistan, the Chinese Communist Party will gain even more influence,” said McCaul. “CCP is only interested in a one-way relationship of debt trap diplomacy and Pakistan [is] the ground zero for the Belt and Road Initiative.”
The ranking members of the committee urged Pakistan’s government and Election Commission to investigate interference and fraud in the recent election with complete transparency and hold those responsible accountable.
Investment Firms Step Away from Chinese Tech Companies After Scrutiny
WASHINGTON – For years, US venture capital firms have invested in Chinese technology companies linked to China’s military and persecution of the Uyghur people. Now, the recent glare of the spotlight from Congress and declining public opinion of China has prompted these firms to step back from involvement in the country.
A bipartisan investigation released last month, co-sponsored by Reps. Mike Gallagher (R-WI) and Raja Krishnamoorthi (D-IL), alleges that several prominent Silicon Valley firms invested at least $3 billion over the last 20 years in Chinese companies. The report contends that these firms contributed to China’s military and surveillance of the Uyghur people, a predominantly Muslim ethnic group native to Northwest China.
The venture capital firms cited – Sequoia Capital China, Walden International, Qualcomm Ventures, GSR Ventures and GGV Capital – invested in China’s AI and semiconductor sectors. The list includes $1.9 billion in AI companies, and over $1.2 billion in 150 semiconductor companies – a “dual-use” technology that is used for both civilian and military purposes. Several of the companies are blacklisted by the US government.
“We need to understand that a dollar given to a Chinese AI company, semiconductor company, or any other advanced dual-use technology company is a dollar that can be given to support the CCP [Chinese Communist Party] and the PLA [People’s Liberation Army],” Rep. Gallagher said in a statement to the Medill News Service. “We need to cut off the flow of funds. We can’t afford to keep funding our own destruction.”
In the report, the lawmakers warned that because the committee examined only five venture capital firms, the investigation greatly understates the total US investment in China’s AI and semiconductor sectors. According to the Office of the United States Trade Representative, the total US foreign direct investment in China was $126.1 billion in 2022.
Reps. Gallagher and Krishnamoorthi, who lead the House Select Committee on the Chinese Communist Party, launched the investigation in July 2023. The lawmakers sent letters to venture capital firms requesting information about the firms’ investments in Chinese entities.
Taking aim at Artificial Intelligence
The report investigated AI companies that primarily develop technology used for facial recognition and surveillance for the Chinese military. According to the report, this technology has been used to identify and track Uyghurs living in China.
For instance, Megvii, developer of the Face++ facial recognition software, is one of the primary companies investigated, receiving over $15 million from GGV Capital since 2019. Roughly two-thirds of Megvii’s revenue came from CCP surveillance projects in the year GGV invested in Megvii, the report stated.
After GGV Capital made its investment, Megvii was placed on “multiple US government red flag lists over its involvement in surveilling and tracking Uyghurs in Xinjiang,” according to the report.
A GGV Capital spokesperson told the Medill News Service that the company is “actively seeking exit” from investments with Megvii. The committee’s report noted that the firm has faced challenges with the separation due to “limited market appetite for purchasing the shares.”
GGV Capital is also splitting into two separate entities, GGV Capital U.S. and GGV Capital Asia, a transition the firm expects to complete by the end of March. According to a statement provided to the Medill News Service, the split will be a “separation of all business and operational processes to function as separate and independent firms.”
GGV Capital US “will not invest in China,” the statement said.
While the committee’s report called efforts to split off from China “a step in the right direction,” Reps. Gallagher and Krishnamoorthi specified that legislative action is still needed to stop “future flows of American capital to problematic PRC companies.”
When Megvii filed for an initial public offering in Hong Kong’s stock market in late 2019, the company issued a now-archived report stating that agreements with customers require its technology to be used only for “civil purposes,” not for military use or human rights violations.
GGV Capital told the Medill News Service that the firm “was not aware of any potential (or actual) abuse of Megvii’s technology as an investment risk and only became aware when certain details became known publicly.”
According to the 2019 Megvii report, other major US finance firms were co-sponsors of Megvii’s IPO, including Goldman-Sachs, Citigroup, and J.P. Morgan. After Megvii’s 2019 IPO application lapsed, Megvii filed for a new IPO in Shanghai in 2021, and the major U.S. finance firms were no longer listed as co-sponsors. However, GGV Capital hasn’t ended its relationship with Megvii completely despite attempting separation.
Worries over China’s domination in microchips
According to the committee’s report, China also plans to dominate the semiconductor industry by 2030 by increasing domestic production and collaborating with foreign firms. Semiconductors are essential parts of electronic devices, used in a variety of products from smartphones to weapons.
The investigation found that Walden International, a venture capital firm headquartered in California, is one of the largest investors in the Chinese semiconductor industry. The firm may have invested as much as $2.2 billion in China’s semiconductor sector. This includes a combined $125 million investment in Semiconductor Manufacturing International Corporation, or SMIC, and its affiliated entities, which is now on multiple U.S. blacklists because it supplies the Chinese military.
Walden International did not respond to a request for comment.
Albert Keidel, an economist and professor at George Washington University specializing in East Asia, said he is skeptical of the report’s findings. He argued that the investigation misinterprets the firms’ investments as dangerous, when in reality the investments are common among growing economies.
Keidel noted that the report emphasized the firms’ investments in dual-use technologies. He said the report had “logical issues,” pointing out that foreign investment in US companies like Boeing could be interpreted as beneficial to the US military.
“Is investing in portfolio investments in large Chinese firms that have a dual purpose really going to stop the Chinese from advancing their technologies?” Keidel said. “I really doubt it.”
Several of the firms responded similarly to the investigation’s findings. According to the report, the firms made their investments “during an era of optimism.”
“We need to face the fact that China is a competent government that is trying to increase its standard of living,” Keidel claimed. “We’re pointing the finger at others that are becoming successful and good competitors.”
Rep. Krishnamoorthi’s perspective on dual-use technology differed from Keidel’s. According to a statement from Krishnamoorthi, the report shows investments in “sensitive sectors,” sometimes through blacklisted companies.
“Dual-use technologies pose inherent dangers in the wrong hands through their military applications,” Rep. Krishnamoorthi said in the statement. “Through its military buildup, ongoing genocide, and other human rights abuses, the CCP has shown that it does not deserve the benefit of the doubt.”
Consulting and Intangible Involvement
Beyond financial investment, some venture capital and consulting firms have been identified as providing intangible expertise and advice to Chinese companies supporting the military. According to the report, these services include talent acquisition, consulting and job training.
According to the report, GGV Capital worked with Tsinghua University to launch a financial training program for companies in GGV’s ecosystem. Walden International reported that it “often assists its portfolio companies with identifying talent, suggesting or connecting with other investors, and corporate strategy matters.” The report notes that the firm provided these services for SMIC.
Some consulting firms have also recently been identified as having collaborated with Chinese companies. The Financial Times reported last month that Urban China Initiative, a think tank led by Mckinsey & Company, advised the CCP and provided research instrumental to China’s 2016-2020 Five Year Plan.
In response, Rep. Gallagher issued a statement condemning McKinsey.
“One is left to conclude that McKinsey’s true mission is to make money, even if that money comes from genocidal communists,” Rep. Gallagher said in the statement. “Companies like McKinsey that help the CCP in its quest to destroy individual dignity and American global leadership should be prohibited from receiving taxpayer dollars.”
In response to the allegations made by The Financial Times report, McKinsey issued a statement asserting that “the Urban China Initiative is not McKinsey, and it did not perform work on McKinsey’s behalf.”
McKinsey stated that UCI was co-founded in 2011 with Columbia University and Tsinghua University. The consulting firm denied working with China, stating its “client work in China is overwhelmingly for US, multinational and Chinese private sector entities.”
McKinsey shut down UCI in 2021, following recent trends of divestment in Chinese organizations and separation from branches in China.
Next Steps
Reps. Krishnamoorthi and Gallagher recommended that Congress pass legislation to prohibit investments in PRC companies on US sanctions and red flag lists, including the Uyghur Forced Labor Prevention Act Entity List. They also recommended that such lists be updated to include more companies with ties to China’s technology industries.
“The Committee’s findings suggest that there are billions of dollars beyond those captured in this report that have flowed into PRC companies that support the PRC’s military, digital authoritarianism, and efforts to develop technological supremacy and undermine American technological leadership,” the report said.
‘Putin will not stop at Ukraine’: Biden presses for more aid to Ukraine in State of the Union
WASHINGTON — President Joe Biden didn’t waste any time mentioning his support for Ukraine during his State of the Union address on Thursday night, rallying Americans to move forward with aid.
“My message to President Putin is simple,” Biden said. “We will not walk away. We will not bow down. I will not bow down.”
Within minutes of starting his speech, Biden highlighted how freedom and democracy are under attack, not only within the United States but globally.
“Overseas, Putin of Russia is on the march, invading Ukraine and sowing chaos throughout Europe and beyond,” Biden remarked. “If anybody in this room thinks Putin will stop at Ukraine, I assure you, he will not.”
Biden told lawmakers that Ukraine could halt Putin if the country continued to receive the weapons and resources to defend itself. More money for Ukraine has been a controversial topic on Capitol Hill for months after House Republicans delayed any funding bills, making it nearly impossible for Biden to send any resources.
“Send me a bipartisan national security bill,” Biden said to lawmakers. “In a literal sense, history is watching.”
House Speaker Mike Johnson (R-La.), positioned behind Biden during the speech, shook his head as soon as the president mentioned the need to support Ukraine.
Other Republicans, especially hard-right members of the House Freedom Caucus, have strongly condemned the latest supplemental foreign aid bill, saying it lacks attention to the U.S.-Mexico border crisis. They are criticizing Biden’s decision to begin his State of the Union speech with a foreign policy issue like Ukraine instead of addressing American needs first.
“Joe Biden opened his State of the Union speech by talking about a foreign country, Ukraine. Americans are DYING every single day from Biden’s deadly open border policy,” Rep. Marjorie Taylor Greene (R-Ga.) wrote in a post on X minutes after Biden began his speech.
The president often brought up his “predecessor,” former President Donald Trump, without mentioning him by name. He asserted that Trump had bowed down to a Russian leader.
“It’s outrageous. It’s dangerous. It’s unacceptable,” Biden declared.
Trump, for his part, spent the night posting on his Truth Social account, hitting at Biden. He claimed it was Biden’s policies that allowed for the Russian invasion of Ukraine.
“He said I bowed down to the Russian Leader. He gave them everything, including Ukraine,” Trump wrote on Truth Social.
Explainer: What is the Uyghur Policy Act and who supports the bill?
WASHINGTON – The Uyghur Policy Act is one of Congress’s newest efforts aimed at fighting China’s oppression of the Uyghur people. The bill has passed in the House of Representatives, and activists are urging the Senate to act quickly on the legislation.
What is the bill?
The Uyghur Policy Act, introduced by Rep. Young Kim (D-Calif.), is aimed at responding to reports of detention, sterilization and cultural erasure of the Uyghur people, a predominantly Muslim ethnic group from northwest China.
“Chinese authorities have made use of the legal system as a tool of repression, including for the imposition of arbitrary detentions and for torture against members of the Uyghur and other populations,” the bill states.
What policy changes would it make?
The Uyghur Policy Act seeks to use U.S. resources and agencies to preserve Uyghur culture and pressure the Chinese government to end the persecution.
The bill would create a Special Coordinator for Uyghur Issues within the State Department “to ensure that department-wide resources are better coordinated to respond to the Uyghur genocide,” Kim said on the floor of the House earlier this month.
The Uyghur Policy Act would require the State Department to assign a Uyghur-fluent officer to a U.S. diplomatic or consular mission in China. This would allow greater access to Uyghur individuals in China and emphasize the U.S.’s dedication in the preservation of the Uyghur language.
The bill also encourages greater dissemination of information regarding allegations of Uyghur genocide, specifically to Islamic-majority countries. The legislation directs the U.S. Agency for Global Media to publicize information concerning Uyghurs.
“We must now act to leverage the U.S. soft power, garner international support for Uyghurs and other ethnic minorities in Xinjiang, and equip the State Department with the tools it needs to better respond to Xi Jinping’s genocidal campaign,” Kim said.
Who backs the bill?
The Uyghur Policy Act passed on Feb. 15 with overwhelming support in the House, with only six Republicans voting against the bill. Its success in the House triggered activists to urge lawmakers to push the bill forward in the Senate.
The Uyghur Human Rights Project sent letters signed by over 40 other advocacy groups to the leadership of the Senate Foreign Relations Committee – Sens. Ben Cardin (D-Md.) and James Risch (R-Idaho) – this week, urging them to schedule the bill’s markup quickly “given the urgency of the situation and the growing international concern regarding the plight of the Uyghur people.”
“Representative Kim’s bill includes valuable provisions to ensure the United States takes further steps to end atrocities faced by Uyghurs, and will push allies to do the same,” UHRP Executive Director Omer Kanat said in a press release. “Uyghurs are grateful for Congressional leadership to push for stronger U.S. policies, and we urge the Senate Foreign Relations Committee to act quickly to move this critical legislation forward.”
What’s next?
The Senate Foreign Relations Committee has not yet scheduled a hearing to review the bill, but the bill is likely to gain support because of bipartisan support in both chambers to demonstrate that the U.S. is standing up to China.
Congress hears about how Houthi militant attacks are forcing shippers to change course
WASHINGTON – Experts in the commercial shipping industries outlined the ever-increasing humanitarian and economic costs of recent Iran-backed Houthi militant strikes on American ships positioned in the Red Sea during a subcommittee hearing on Tuesday.
The continuing barrage of Houthi anti-ship ballistic missile strikes has targeted container and naval vessels registered to countries linked to Israel, such as the United States and the United Kingdom, following the breakout of the Israel-Hamas War on Oct. 7.
Earlier this month, two Navy SEALs were presumed dead during a raid on a naval ship containing weapons bound for Yemen. And on the commercial side, Houthi-controlled Yemen fired ballistic missiles at three commercial ships in the Red Sea in December of last year.
“The shooting has to stop,” said Bud Darr, the executive vice president of maritime policy and government affairs at Mediterranean Shipping Company, the world’s largest container shipping company. “It has to be safe enough for us to send our sons or daughters or people who have entrusted their lives with us into that region.”
Faced with the Houthi’s lasting presence in the Red Sea and the Gulf of Aden — two vital international shipping routes — several commercial companies have rerouted their vessels around the Cape of Good Hope to avoid potential targeting.
But crews that opt to sail around the tip of South Africa add an average of 10 days to two weeks to their journey each way.
“We understand that longer vessel times impact fuel, labor, energy and insurance costs,” said Jonathan Gold, the vice president of supply chain and customs policy at the National Retail Federation, the leading trade association representing stores and chains. “One employee has told me they’ve had carriers ask for an increase of $1,500 to $3,000 per container, representing a 38% to 73% cost increase for directly affected cargo.”
Gold said the retail industry is working closely with supply chain partners to mitigate disruptions. One retailer Gold works with is shifting timely and sensitive cargo to air travel, while another company is working with an overseas vendor to encourage early shipments to avoid disruptions.
Such examples of economic pivots display how the shipping industry learned from the massive supply chain disruptions during the early months of the COVID-19 pandemic when consumers confronted shortages of everything from toilet paper to prescription drugs.
“It taught us to expect the unexpected and not to think we can predict what’s coming next,” said Darr. “We have to be as nimble as possible, and it’s forced us to maintain some additional capacity at substantial cost to be able to respond.”
If shipping market conditions were in a worse condition, Darr said the industry would be in a more difficult position. “We’re making it work, and the goods are moving.”
Yet, as shipping companies figure out how to adjust strategies and absorb costs to remain profitable and maintain the stability of the global supply chain, the threat of militant attacks on commercial and naval vessels persists in the Middle East.
Darr also praised the “heroic seafarers who are keeping commerce moving, serving the needs of the global society and just trying to do their job every day.” He said that the Biden administration’s actions off the Yemeni coast are not just a commercial decision but a humanitarian one.
“Forget the supply chain for one second. For them to be shot at — as they were three times on our fleet, one of which was an hour-long firefight — is just unacceptable,” Darr said. “We can insure a ship or cargo, but you can never properly insure the impact of a loss of a human life.”
Pompeo and Panetta urge bipartisan action to deter China from collaborating with U.S. adversaries
WASHINGTON – Former Secretary of State Mike Pompeo and former Secretary of Defense Leon Panetta warned lawmakers on Tuesday that China is increasingly collaborating with nations hostile to the United States and urged lawmakers to provide more support to help Taiwan combat Chinese aggression.
“I have been critical of many of President Biden’s foreign policy actions, but I must say the work that they continue to do to confront the challenge in China, I have approved and appreciated,” Pompeo said at a hearing organized by the House Select Committee on the Chinese Communist Party.
China has undertaken one of the largest peacetime military expansions since World War II, according to committee Chair Mike Gallagher (R-Wis.). China’s increasing fondness of Russia, Iran and North Korea has heightened tensions on the international stage, acknowledged Gallagher.
Pompeo, a longtime China hawk who led the State Department in the Trump administration, also warned that such nations are acting in concert with China to the detriment of U.S. interests.
“China, Russia, Iran, North Korea and Venezuela represent a new axis of evil regimes that is pushing a dangerous model for the world,” Pompeo said in his written testimony.
To keep China in check, Panetta encouraged members of Congress to support Biden’s $106 billion national security supplemental package, which would provide aid to Ukraine, Israel and Taiwan to combat increasing aggression in these regions.
“To fail would send a terrible message of weakness to adversaries and allies alike,” said Panetta, who first served as CIA director and later Defense secretary under President Barack Obama. “You cannot be weak on Ukraine and tough on China.”
Pompeo testified that China and Russia have increased their military strength and aggression, leading the U.S. to lose its ability to deter foreign adversaries in many regions, including Europe and the Indo-Pacific. He also noted that Chinese President Xi Jinping has declared his intentions to absorb Taiwan, which he said is a serious security threat. He said he was dismayed that the U.S. did not do enough to prevent Russian President Vladimir Putin from invading Ukraine two years ago.
“I’m glad that Europeans stood up, but we should remember that we did not conduct American foreign policy with the diplomatic excellence and the military power to actually convince Putin not to invade Ukraine,” Pompeo said. “If we simply play defense economically, defense diplomatically, we allow a spy balloon to travel over our country for five days,” he said, referring to a much-watched saga last year where a balloon was tracked flying from Montana to South Carolina before being shot down.
Lawmakers agreed about the dangers of China’s aid for foreign enemies. Rep. Neal Dunn (R-Fla.) described China, Russia, Iran and North Korea as a “global alliance against democracy.”
Panetta added that lawmakers should split Biden’s request for supplemental funding into independent aid packages if they are unable to pass the full amount.
Lawmakers expressed bipartisan support for combating China’s collaboration with nations at odds with U.S., with Gallagher calling the committee “an oasis of bipartisanship.”
Rep. Shontel Brown (D-Ohio) agreed with Panetta, asserting that the U.S. must step up to protect democracies like Taiwan, South Korea and Japan.
“Congress needs to do more to provide the resources that are requested in [Biden’s] national security emergency supplemental,” Brown said. “Without these essential resources, our allies will be left in the cold.”
Panetta also urged lawmakers to invest in training Taiwanese soldiers and providing military aid in order to prepare Taiwan to defend itself in the case of a Chinese invasion or blockade. He stated that “strength” is the only way to deal with China, a sentiment that resonated with Republicans and Democrats at the hearing.
Pompeo also warned in his testimony that China was at “economic war with the United States for decades; we pretended it wasn’t so.” He said the United States needed to win such a war and urged stronger policies to keep China’s economic ambitions in check.
Senate Armed Services Committee Holds Confirmation Hearings for Key Defense Nominations
WASHINGTON – The Senate Armed Services Committee convened to scrutinize the nominations of three crucial roles within the Department of Defense on Tuesday. Melissa Griffin Dalton, nominated for Under Secretary of the Air Force, Douglas Craig Schmidt, nominated for Director of Operational Test and Evaluation, and Aprille Joy Ericsson, nominated for Assistant Secretary, faced a thorough examination. The hearing delved into their qualifications, experiences, and commitment to national security, providing a vital step in the confirmation process for these key positions.
The committee questioned them on a variety of critical topics, such as the cost-effectiveness of missile defense systems, the need for urgency in addressing hypersonics and directed energy weapons, like lasers and particle beam technology used in combat, and the importance of collaboration with small businesses.
Senator Angus King (D-Maine) underscored the critical challenges confronting the Air Force by highlighting the pressing issue of the U.S. lagging in hypersonics and directed energy, deeming it a “hair-on-fire” urgent priority.
“I’m always excited when I get my hypersonics,” Ericsson replied. “I’m hoping that perhaps we can leverage the technology developed at NASA, fostering collaboration between the Department of Defense and other agencies to advance this technology.”
Chairman Jack Reed (D-R.I.) addressed the crucial challenge of boosting the STEM workforce, emphasizing the significance of recruitment, training, and retention. Ericsson replied by highlighting the need to cast a wide net, including adding more women. She stressed the importance of being inclusive and focusing on historically black colleges and universities (HBCUs), which contribute significantly to African Americans in STEM disciplines.
“It is very important for us to consider these diverse spots because we have unique experiences from the environments we are in, and it will ultimately be very important to have in our workforce so we can deliver the best technology for our future,” Ericsson said.
Another key challenge addressed by Sen. Reed is the rapidly growing field of artificial intelligence. He voiced concerns about seamlessly integrating AI into security systems.
“I’ve worked with artificial intelligence for many years. It’s a very promising yet challenging technology,” Schmidt said. “If confirmed, I am committed to collaborating with various stakeholders to ensure the responsible and effective utilization of AI.”
While Schmidt and Ericsson confidently addressed the senators’ inquiries, Dalton came under more intense scrutiny as her work in her previous role left some lawmakers casting doubt about her suitability for the role of Under Secretary of the Air Force.
“I think you have a lot of work to do to create some confidence in a lot of the members of this committee,” said Senator Mike Rounds (R-S.D.).
Dalton, who had mentioned in her opening remarks how she was going to continue communicating with Congress promptly, was questioned by Roger Wicker (R-Miss.), Markwayne Mullin (R-Okla.), and Eric Schmidtt (R-Mo.), on why she hasn’t been communicating with them in a timely and responsible manner. Sen. Wicker used an example from a letter he sent on March 16th, to which Dalton replied on August 1st.
“I find your performance in your previous role so unsatisfactory that I have real doubts that it is going to get any better,” said Wicker.
Concerns were also raised about Dalton’s handling of the border wall and management of materials and associated costs. Senator Gary Peters (D-Mich.) questioned her about the materials’ substantial daily storage costs and the decision to sell them off, emphasizing the significant financial impact on taxpayers. Dalton’s response said the matter was outside her portfolio.
“Forget about your portfolio,” Peters replied. “We’ve established that you don’t take responsibility.”
Biden meets with congressional leaders over national security funding and seeks path forward on Ukraine
WASHINGTON — President Joe Biden convened key congressional leaders at the White House on Wednesday to catalyze support for the stalled $110 billion aid package for Ukraine, Israel, and other crucial U.S. allies.
Minutes before the meeting, National Security spokesperson John Kirby said that this opportunity will allow members of Congress to fully understand Ukraine’s desperate need for weapons and capabilities. The President along with the national security team stressed the need to send a security assistance package, which cannot be sent unless they get some funding.
“It’s not as if the war stopped because our aid stopped,” said Kirby. “Ukrainians continue to get attacked.”
In the meeting, President Biden emphasized the urgency for Congress to approve funding for Ukraine’s air defense capabilities, crucial for its safeguarding against Russia’s invasion. After the meeting, the White House statement highlighted the imperativeness of this action, noting that approval would “send a strong signal of U.S. resolve.”
“Congress, don’t delay. Pass my national security supplemental. The time to act is now,” the president wrote in a social media post after the meeting.
Speaker Mike Johnson (R-La.) seized the opportunity to urge President Biden to implement more robust border security measures. The speaker conveyed the House GOP’s demand for “substantive policy change,” emphasizing concerns that the White House’s executive actions on immigration had compromised border strength before focusing on issues outside the U.S.
“We understand that there’s concern about the safety, security, sovereignty of Ukraine, but the American people have those same concerns about our own domestic sovereignty and our own safety and security,” said Johnson when he addressed the press after the meeting.
Johnson insisted that the border crisis must be dealt with first.
“We understand that all these things are important, but we must insist, we must insist that the border be the top priority,” the speaker said. “I think we have some consensus around that table.”
The meeting also included Senate Majority Leader Chuck Schumer (D-N.Y.), Senate Minority Leader Mitch McConnell (R-Ky.), House Minority Leader Hakeem Jeffries (D-N.Y.) and several other lawmakers.
A bipartisan consensus emerged on the urgency of supporting Ukraine while simultaneously addressing border security. Schumer reiterated that the meeting indicated a consensus between Democrats and Republicans on the need for additional aid to Ukraine and enhanced U.S. border security.
“I am more optimistic than ever before that we come to an agreement,” Schumer said. “I put the chances a little bit greater than half.”
The White House statement stressed that failure to act would endanger the U.S. national security, the NATO Alliance and the rest of the world.
“It is urgently necessary that we continue to support the Ukrainian effort for the good of the free world,” said Jeffries. “For the good of democracy and for the good of America’s national security interests.”
Lawmakers hope to increase nuclear technology exports, compete with China and Russia
WASHINGTON – Members of Congress discussed the need for new legislation and additional financing and support for nuclear energy abroad on Wednesday in response to China and Russia’s exportation of nuclear reactors to foreign countries.
According to a memorandum submitted by the House Financial Services Committee majority staff, China and Russia have been constructing nuclear reactors in Europe, South Asia, Africa, Latin America and Eurasia. This practice has allowed the two countries to establish footholds in developing economies around the world, raising concerns among national security experts in the U.S.
As the global demand for nuclear energy increases, especially in developing countries, Russia and China have increased nuclear exports while U.S. exports have remained stagnant.
“The challenges to nuclear are largely economic,” Rep. Bill Foster (D-Ill.) said.
Maria Korsnick, President and Chief Executive Officer at the Nuclear Energy Institute, said on Wednesday that Russia and China’s global nuclear energy presence would give them national security advantages and primary access to the nuclear energy market.
“We operate the largest and highest performing fleet of reactors in the world. However, we are behind Russia and China when it comes to [nuclear] exports,” Korsnick said. “Therefore, it is Russia and China that are building strategic, 100-year partnerships and setting the standards for global nuclear safety.”
According to expert witnesses and the FSC’s memorandum, American nuclear technology is much safer than Chinese and Russian technology, meaning countries receiving Chinese and Russian reactors are at higher risk for unsafe conditions.
“It’s not whether or not nuclear plants are going to be built, it’s whether or not the United States is going to build them,” Korsnick said, urging lawmakers to push for greater exports of American nuclear technology to ensure safe nuclear activity.
Nuclear energy is a clean energy source that offers a more efficient alternative to solar and wind power. Nuclear power produces around 30% of the world’s low-carbon electricity, making it a critical source of energy, especially for developing economies.
China is currently responsible for over a third of nuclear reactors under construction globally, and Russia is constructing over 21 reactors beyond its borders.
“It is past due for the United States to get back in the game and compete,” said Rep. Blaine Luetkemeyer (R-Mo.), Chairman of the Subcommittee on National Security, Illicit Finance, and International Financial Institutions. “Nuclear power provides us with a unique opportunity to push for a positive national security agenda.”
Lawmakers at Wednesday’s hearing expressed bipartisan support for legislation to commit to nuclear energy development, including the International Nuclear Energy Financing Act of 2023, which was introduced in the House of Representatives last year. The bill calls for the government to use its “voice, vote, and influence” to support financing nuclear energy.
“The export of U.S. nuclear energy technology is important for our national security, our economic security, and for our climate,” Rep. Wiley Nickel (D-N.C.). “The U.S. just can’t fall behind.”
Nickel said he is drafting legislation to “jumpstart nuclear financing” at the Export-Import Bank of the United States.
Beyond improving energy exports and production capacity, lawmakers and expert witnesses argued that Russia and China are building their global influence through nuclear reactors.
Rep. Monica De La Cruz (R-Texas) said that China and Russia are seeking “world energy dominance” to force developing countries into dependent relationships.
“For the last 30 years, we’ve mostly abdicated our position in global exports of nuclear technology,” said Dr. Ben Reinke, Vice President of Global Business Development at X-energy. “Today, that means that they have relationships that exist between developing nations often, but also others that have been developed already, that exist now, they have for 20 years, with Russia or China. That puts us at a geopolitical and geostrategic disadvantage.”