With 30-days left before the election perhaps it’s worthwhile remembering what all of this opposition is about….
Something 99% of American voters do not quite understand.
Congress doesn’t actually write legislation. The last item of legislation written by congress was sometime around the
mid 1990’s. Modern legislation is sub-contracted to a segment of DC operations known as K-Street. That’s where the
lobbyists reside.
Lobbyists write the laws; congress sells the laws; lobbyists then pay congress lucrative commissions for passing their
. That’s the modern legislative business in DC.
When we talk about paying-off politicians in third-world countries we call it bribery. However, when we undertake the
same process in the U.S. we call it “lobbying”.
CTH often describes the system with the phrase: “There are Trillions at Stake.” The process of creating legislation is
behind that phrase. DC politics is not quite based on the ideas that frame most voter’s reference points.
With people taking notice of DC politics for the first time; and with people not as familiar with the purpose of DC
politics; perhaps it is valuable to provide clarity.
Most people think when they vote for a federal politician -a House or Senate representative- they are voting for a
person who will go to Washington DC and write or enact legislation. This is the old-fashioned “schoolhouse rock”
perspective based on decades past. There is not a single person in congress writing legislation or laws.
In modern politics not a single member of the House of Representatives or Senator writes a law, or puts pen to paper
to write out a legislative construct. This simply doesn’t happen.
Over the past several decades a system of constructing legislation has taken over Washington DC that more
resembles a business operation than a legislative body. Here’s how it works right now.
Outside groups, often called “special interest groups”, are entities that represent their interests in legislative
constructs. These groups are often representing foreign governments, Wall Street multinational corporations, banks,
financial groups or businesses; or smaller groups of people with a similar connection who come together and form a
larger group under an umbrella of interest specific to their affiliation.
Sometimes the groups are social interest groups; activists, climate groups, environmental interests etc. The social
interest groups are usually non-profit constructs who depend on the expenditures of government to sustain their
cause or need.
The for-profit groups (mostly business) have a purpose in Washington DC to shape policy, legislation and laws
favorable to their interests. They have fully staffed offices just like any business would – only their ‘business‘ is
getting legislation for their unique interests.
These groups are filled with highly-paid lawyers who represent the interests of the entity and actually write laws and
legislation briefs.
In the modern era this is actually the origination of the laws that we eventually see passed by congress. Within the
walls of these buildings within Washington DC is where the ‘sausage’ is actually made.
Again, no elected official is usually part of this law origination process.
Almost all legislation created is not ‘high profile’, they are obscure changes to current laws, regulations or policies
that no-one pays attention to. The passage of the general bills within legislation is not covered in media. Ninety-nine
percent of legislative activity happens without anyone outside the system even paying any attention to it. Once the
corporation or representative organizational entity has written the law they want to see passed – they hand it off to
the lobbyists.
The lobbyists are people who have deep contacts within the political bodies of the legislative branch, usually former House/Senate staff or former House/Senate politicians themselves.
The lobbyist takes the written brief, the legislative construct, and it’s their job to go to congress and sell it.
“Selling it” means finding politicians who will accept the brief, sponsor their bill and eventually get it to a vote and
passage. The lobbyist does this by visiting the politician in their office, or, most currently familiar, by inviting the
politician to an event they are hosting. The event is called a junket when it involves travel.
Often the lobbying “event” might be a weekend trip to a ski resort, or a “conference” that takes place at a resort. The
actual sales pitch for the bill is usually not too long and the majority of the time is just like a mini vacation etc.
The size of the indulgence within the event, the amount of money the lobbyist is spending, is customarily related to
the scale of benefit within the bill the sponsoring business entity is pushing. If the sponsoring business or interest
group can gain a lot of financial benefit from the legislation they spend a lot on the indulgences.
Recap: Corporations, mostly modern multinationals (special interest group), write the legislation. The corporations
then contract the lobbyists. Lobbyists then take the law and go find politician(s) to support it. Politicians get support
from their peers using tenure and status etc. Eventually, if things go according to norm, the legislation gets a vote.
Within every step of the process there are expense account lunches, dinners, trips, venue tickets and a host of other
customary financial way-points to generate/leverage a successful outcome. The amount of money spent is
proportional to the benefit derived from the outcome.
The important part to remember is that the origination of the entire process is EXTERNAL to congress.
Congress does not write laws or legislation, special interest groups do. Lobbyists are paid, some very well paid, to
get politicians to go along with the need of the legislative group.
When you are voting for a Congressional Rep or a U.S. Senator you are not voting for a person who will write laws.
Your rep only votes on legislation to approve or disapprove of constructs that are written by outside groups and sold
to them through lobbyists who work for those outside groups.
While all of this is happening the same outside groups who write the laws are providing money for the campaigns of
the politicians they need to pass them. This construct sets up the quid-pro-quo of influence, although much of it is
fraught with plausible deniability.
This is the way legislation is created
If your frame of reference is not established in this basic understanding you can often fall into the trap of viewing a
politician, or political vote, through a false prism.
The modern origin of all legislative constructs is not within congress.
“We have to pass the bill to, well, find out what is in the bill” etc. ~ Nancy Pelosi 2009
“We rely upon the stupidity of the American voter” ~ Johnathan Gruber 2011, 2012.
"If Congress isn’t going to convene until the bill is ready to vote on… who the hell is writing the bill?” ~ Tom Massie,
Once you understand this process you can understand how politicians get rich.
When a House or Senate member becomes educated on the intent of the legislation, they have attended the sales
pitch; and when they find out the likelihood of support for that legislation; they can then position their own (or their
families) financial interests to benefit from the consequence of passage. It is a process similar to insider trading on
Wall Street, except the trading is based on knowing who will benefit from a legislative passage.
The legislative construct passes from K-Street into the halls of congress through congressional committees. The law
originates from the committee to the full House or Senate. Committee seats which vote on these bills are therefore
more valuable to the lobbyists. Chairs of these committees are exponentially more valuable.
Now, think about this reality against the backdrop of the 2016 Presidential Election. Legislation is passed based on
ideology. In the aftermath of the 2016 election the system within DC was not structurally set-up to receive a Donald
Trump presidency.
If Hillary Clinton had won the election, her Oval Office desk would be filled with legislation passed by congress which
she would have been signing. Heck, she’d have writer’s cramp from all of the special interest legislation, driven by
special interest groups that supported her campaign, that would be flowing to her desk.
Why?
Simply because the authors of the legislation, the originating special interest and lobbying groups, were spending
millions to fund her campaign. Hillary Clinton would be signing K-Street constructed special interest legislation to
repay all of those donors/investors.
Congress would be fast-tracking the passage because the same interest groups also fund the members of congress.
President Donald Trump winning the election threw a monkey wrench into the entire DC system…. In early 2017 the
modern legislative machine was frozen in place.
The “America First” policies represented by candidate Donald Trump were not within the legislative constructs coming
from the K-Street authors of the legislation. There were no MAGA lobbyists waiting on Trump ideology to advance
legislation based on America First objectives.
As a result of an empty feeder system, in early 2017 congress had no bills to advance because all of the myriad of
bills and briefs written were not in line with President Trump policy. There was simply no entity within DC writing
legislation that was in-line with President Trump’s America-First’ economic and foreign policy agenda.
Exactly the opposite was true. All of the DC legislative briefs and constructs were/are antithetical to Trump policy.
There were hundreds of file boxes filled with thousands of legislative constructs that became worthless when Donald
Trump won the election.
Those legislative constructs (briefs) representing tens of millions of dollars worth of time and influence were just
sitting there piled up in boxes under desks and in closets amid K-Street and the congressional offices. Legislation
needed to be in-line with an entire new political perspective, and there was no-one, no special interest or lobbying
group, currently occupying DC office space with any interest in synergy with Trump policy.
Think about the larger ramifications within that truism. That is also why there was/is so much opposition.
No legislation provided by outside interests means no work for lobbyists who sell it. No work means no money. No
money means no expense accounts. No expenses means politicians paying for their own indulgences etc.
Politicians were not happy without their indulgences, but the issue was actually bigger. No K-Street expenditures also
means no personal benefit; and no opportunity to advance financial benefit from the insider trading system.
Republicans and democrats hate the presidency of Donald Trump because it is hurting them financially.
President Trump is not figuratively hurting the financial livelihoods of DC politicians; he’s literally doing it. President
Trump is not an esoteric problem for them; his impact is very real, very direct, and hits almost every politician in the
most painful place imaginable, the bank account.
In the pre-Trump process there were millions upon millions, even billions that could be made by DC politicians and their families. Thousands of very indulgent and exclusive livelihoods attached to the DC business model. At the center of this operation is the lobbying and legislative purchase network. The Big Club.
Without the ability to position personal wealth and benefit from the system, why would a politician stay in office? It is
a fact the income of many long-term politicians on both wings of the un-iparty bird were completely disrupted by
Trump winning the 2016 election. That is one of the key reasons why so many politicians retired in 2018.
When we understand the business of DC, we understand the difference between legislation with a traditional purpose
and modern legislation with a financial and political agenda.
When we understand the business of DC we understand why the entire network hates President Donald Trump.
Lastly, this is why -when signing legislation- President Trump often says “they’ve been trying to get this through for a
long time” etc. Most of the legislation that is passed by congress, and signed by President Trump in his first term; is
older legislative proposals, with little indulgent value that were shelved in years past.
Example: Criminal justice reform did not carry a financial benefit to the legislative bodies, and there was no financial
interest funding the politicians to pass the bill. If you look at most of the bills President Trump has signed, with the
exception of a few economic bills, they stem from congressional construction many years, even decades, ago.
Think about it carefully and you’ll see it. The “First step act”, “Right to Try”, etc. were all shelved by Boehner, Pelosi,
Ryan, McConnell, Reid and others before them. When the value of legislation is measured by the financial underwriting
and payoffs behind it, what type of legislative calendar does that require?….
Repeal the 17th amendment and watch what happens.
+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
This also is very long so I am printing the title and the executive summary. Today's memo will be limited to these items.
It was sent to me by a dear neighbor friend and fellow memo reader who knows of my interest about such matters:
United States Senate
PERMANENT SUBCOMMITTEE ON INVESTIGATIONS
Committee on Homeland Security
and Governmental Affairs
Rob Portman, Chairman
Tom Carper, Ranking Member
Threats to the U.S. Research
Enterprise:
China’s Talent Recruitment Plans
STAFF REPORT
PERMANENT SUBCOMMITTEE ON
INVESTIGATIONS
UNITED STATES SENATE
EXECUTIVE SUMMARY
American taxpayers contribute over $150 billion each year to scientific
research in the United States. Through
entities like the National Science
Foundation, the National Institutes of Health and the Department of Energy’s
National Labs, taxpayers fund innovations that contribute to our national security
and profoundly change the way
we live. America built this successful research
enterprise on certain values: reciprocity, integrity, merit-based
competition, and
transparency. These values foster a free exchange of ideas, encourage the most
rigorous
research results to flourish, and ensure that researchers receive the benefit
of their intellectual capital. The open
nature of research in America is manifest; we
encourage our researchers and scientists to “stand on the shoulders
of giants.”
In
turn, America attracts the best and brightest. Foreign researchers and scholars
travel to the United
States just to participate in the advancement of science and
technology.
Some countries, however, seek to exploit
America’s openness to advance their
own national interests. The most aggressive of them has been China. China
primarily does this through its more than 200 talent recruitment plans—the most
prominent of which is the
Thousand Talents Plan. Launched in 2008, the Thousand
Talents Plan incentivizes individuals engaged in
research and development in the
United States to transmit the knowledge and research they gain here to China in
exchange for salaries, research funding, lab space, and other incentives. China
unfairly uses the American
research and expertise it obtains for its own economic
and military gain.
In recent years, federal agencies have discovered talent
recruitment plan members who downloaded sensitive
electronic research files before
leaving to return to China, submitted false information when applying for grant
funds, and willfully failed to disclose receiving money from the Chinese government
on U.S. grant applications.
This report exposes how American taxpayer funded research has contributed
to China’s global rise over the last
20 years. During that time, China openly recruited U.S.-based researchers, scientists, and experts in the public
and private
sector to provide China with knowledge and intellectual capital in exchange for
monetary gain and
other benefits. At the same time, the federal government’s
grant-making agencies did little to prevent this from
happening, nor did the FBI
and other federal agencies develop a coordinated response to mitigate the threat.
These failures continue to undermine the integrity of the American research
enterprise and endanger our national
security.
* * * *
China aims to be the world’s leader science and technology (“S&T”) by
2050. To achieve its S&T
goals, China has implemented a whole-of-government
campaign to recruit talent and foreign experts from around
the world. China’s
campaign is well financed.
According to an analysis by the FBI, China has pledged
2
to spend 15 percent of its gross domestic product on
improving human resources
from 2008 to 2020. That amounts to an investment of more than $2 trillion. For
the
Chinese government, international scientific collaboration is not about
advancing science, it is to advance China’s
national security interests.
China’s Talent Recruitment Plans. Foreign trained scientists and experts
provide China
access to know-how, expertise, and foreign technology—all necessary
for China’s economic development and
military modernization. While China has
created and manages more than 200 talent recruitment plans, this report
focuses on
the Thousand Talents Plan. China designed the Thousand Talents Plan to recruit
2,000 high-quality
overseas talents, including scientists, engineers, entrepreneurs,
and finance experts. The plan provides salaries,
research funding, lab space, and
other incentives to lure experts into researching for China.
According to one report,
by 2017, China dramatically exceeded its recruitment goal, having recruited more
than
7,000 “high-end professionals,” including several Nobel laureates.
The Chinese Communist Party (the “Party”)
plays a lead role in
administering the Thousand Talents Plan. The Party recognized the need to control
overseas
talent recruitment efforts to ensure the program served its priorities. The
Party created a “complex system of
administration and oversight to coordinate its
recruitment efforts.” The Party is able to “exert exceptional” levels of
control over
the Thousand Talents Plan and other talent recruitment plans. To ensure control,
Thousand Talents
Plan members sign legally binding contracts.
Contracting with the Chinese Government. Thousand Talent Plan
members
sign legally binding contracts with Chinese institutions, like universities and
research institutions. The
contracts can incentivize members to lie on grant
applications to U.S. grant-making agencies, set up “shadow
labs” in China working
on research identical to their U.S. research, and, in some cases, transfer U.S.
scientists’
hard-earned intellectual capital. Some of the contracts also contain
nondisclosure provisions and require the
Chinese government’s permission to
terminate the agreement, giving the Chinese government significant leverage
over
talent recruitment plan members.
These provisions are in stark contrast to the
U.S. research community’s basic norms, values, and principles.
Annexed to this
report are Chinese talent recruitment plan contracts that illustrate exactly what
talent recruitment
plan members agree to when they become members.
Case Examples. This report includes selected examples
from U.S. grantmaking agencies involving Chinese talent recruitment plan members. For example,
talent
recruitment plan members removed 30,000 electronic files before leaving for
China, submitted false information
when applying for grant funds, filed a patent
based on U.S. government-funded research, and hired other Chinese
recruitment plan members to work on U.S. national security topics. One Chinese
talent recruitment plan member
stole proprietary defense information related to
U.S. military jet engines, and others have contractually agreed to
give Chinese
institutions intellectual property rights that overlapped with research conducted at
3
U.S. institutions.
Annexed to this report are case examples provided by several
federal agencies.
Talent Plans Go Underground. Following public testimony and U.S.
government scrutiny, the Chinese government
started deleting online references to
the Thousand Talents Plan in October 2018. For example, China deleted
news
articles featuring Thousand Talents Plan members, Chinese universities stopped
promoting the program on
their websites, and the official Thousand Talent Plan site
deleted the names of scientists participating in the
program. The Chinese
government has also instructed talent recruitment organizations that “the phrase
‘Thousand
Talents Plan’ should not appear in written circulars/notices.” Despite
this censorship, China’s talent recruitment
plans continue.
* * * *
The Subcommittee reviewed seven federal agencies’ efforts to mitigate the
threat that
Chinese talent recruitment plans pose to the U.S. research enterprise,
including U.S.-funded research. While
China has a strategic plan to acquire
knowledge and intellectual property from researchers, scientists, and the U.S.
private sector, the U.S. government does not have a comprehensive strategy to
combat this threat.
The National Science Foundation (“NSF”) funds approximately 27
percent of all federally funded basic research at
U.S. colleges and universities,
leading to 12,000 annual awards to more than 40,000 recipients. In light of Chinese
recruitment plan members’ misappropriation of NSF funding, NSF has taken
several steps—albeit insufficient
ones—to mitigate this risk. As of July 2019, NSF
policy prohibits federal employees from participating in foreign
talent recruitment
plans, but the policy does not apply to NSF-funded researchers. These NSF-funded
researchers
are the individuals mostly likely to be members of foreign talent
recruitment plans. The NSF also does not vet
grantees before awarding them
funding. Instead, NSF relies on sponsoring institutions to vet and conduct due
diligence on potential grantees. NSF has no dedicated staff to ensure compliance
with NSF grant terms.
The National Institutes of Health (“NIH”) invests over $31 billion
annually in medical research through 50,000
competitive grants to more than
300,000 researchers. NIH has recently found instances of talent recruitment plan
members committing grant fraud and transferring intellectual capital and property.
It also found possible malign
foreign influence in its peer review process. NIH has
attempted to address these issues, but significant gaps in
NIH’s grant integrity
process remain. Much like the NSF, NIH relies on institutions to solicit and review
disclosures
of financial conflicts by its employees participating in NIH-funded
research. Unlike the NSF, the NIH has a Division
of Grants Compliance and
Oversight that conducts site visits at institutions to advance compliance and
provide
oversight. The number of oversight visits to institutions has fallen from 284
in 2012 to only three last year. NIH
officials remain concerned that China’s talent
recruitment plans are more pervasive than what they have uncovered
to date.
The Department of Energy (“Energy”) is the largest federal sponsor of basic
research in the physical
sciences. Energy awards $6.6 billion in grants and
contracts annually that support over 25,000 researchers at over
300 institutions
and National Labs. Energy’s research funding and prominent role in advanced
research and
development make it particularly attractive to the Chinese
government. Energy has recently identified Thousand
Talent Plan members
working on sensitive research at National Labs and Thousand Talent Plan
members with
security clearances. Energy has been slow to address vulnerabilities
surrounding the openness of its National Labs
and its scientific collaboration with
the 35,000 foreign nationals who conduct research at the National Labs each
year.
For example, in December 2018, Energy began requiring all foreign nationals’
curricula vitae be included in
Foreign Visits and Assignments requests to Energy
facilities as well as in the Foreign Access Central Tracking
System database.
Despite 30-year old federal regulations prohibiting U.S. government employees from
receiving
foreign compensation, Energy clarified only this year that employees and
contractors are prohibited from
participating in foreign talent recruitment plans.
The State Department (“State”) issues nonimmigrant visas (“NIV”) to
foreign nationals seeking to visit the United
States to study, work, or conduct
research. It is on the front line in U.S. government efforts to protect against
intellectual property theft and illicit technology transfers. While State has a
process to review NIV applicants
attempting to violate export control laws, State’s
authority to deny visas is limited. State’s review process leads to
less than five
percent of reviewed applicants being denied a visa. Nor does State systematically
track visa
applicants linked to China’s talent recruitment plans, even though some
applicants linked to Chinese talent
recruitment plans have engaged in intellectual
property theft.
The Department of Commerce’s (“Commerce”)
Bureau of Industry and
Security conducts assessments of defense-related technologies and “administers
export
controls of dual-use items which have both military and commercial
applications.” Commerce is also responsible
for issuing deemed export licenses to
firms that employ or host foreign nationals seeking to work on controlled
technology
projects.
The Subcommittee found that Commerce rarely denies an application for a
deemed export license. Commerce’s
denial rate in 2018 for deemed export licenses
was only 1.1 percent. Commerce officials told the Subcommittee
that it has not
revoked a deemed export license in the past five years, despite the recent listing of
new entities on
Commerce’s Entity List that require additional scrutiny. Commerce
issued deemed export licenses to Chinese
nationals who participated in talent
recruitment plans, had ties to Huawei, and were affiliated with other concerning
entities.
The Federal Bureau of Investigation (“FBI”) protects the United States
from foreign intelligence
operations and espionage. The FBI, however, has
recognized that it was “was slow to recognize the threat of the
Chinese Talent
Plans.” It was not until mid-2018, however, that FBI headquarters in Washington,
D.C. took control
of the FBI’s response to the threat. Moreover, after collecting
information on suspected talent plan participants, the
FBI waited nearly two years
to coordinate and provide those details to federal grant-making agencies. This
delay
likely prevented the federal government from identifying talent recruitment
plan members who engaged in illegal or
unethical grant practices or the
unauthorized transfer of technology. The FBI has yet to develop an effective,
nationwide strategy to warn universities, government laboratories, and the broader
public of the risks of foreign
talent recruitment plans.
The White House Office of Science and Technology Policy (“OSTP”) has
formal authority
to convene all research funding agencies on matters of policy
through the National Science and Technology
Council. OSTP formally established a
joint committee in May 2019 to begin a policy review to coordinate efforts to
adopt
best practices across the federal government to mitigate foreign exploitation of the
U.S. open innovation
system.
This review is intended to develop a longer-term
strategy for balancing engagement and risk without stifling
innovation. The U.S.
government’s vast and varied array of grant-making agencies complicates this
policy review.
* * * *
As American policy makers navigate an increasingly complicated relationship
with China, it is not in our
national security interest to fund China’s economic and
military development with taxpayer dollars. China’s talent
recruitment plans,
including the Thousand Talents Plan, undermine the integrity of our research
enterprise and
harm our economic and national security interests.
U.S. universities and U.S.-based researchers must take
responsibility in
addressing this threat. If U.S. universities can vet employees for scientific rigor or
allegations of
plagiarism, they also can vet for financial conflicts of interests and
foreign sources of funding. If U.S. researchers
can assess potential collaborators’
research aptitude and their past publications, they should know their
collaborators’
affiliations and their research intentions.
The U.S. academic community is in the crosshairs of not
only foreign
competitors contending for the best and brightest, but also of foreign nation states
that seek to transfer
valuable intellectual capital and steal intellectual property. As
the academic community looks to the federal
government for guidance and direction
on mitigating threats, the U.S. government must provide effective, useful,
timely,
and specific threat information and tools to counter the threats.
Based on this investigation, the
Subcommittee finds that the federal
government has failed to stop China from acquiring knowledge and intellectual
6
property from U.S. taxpayer funded researchers and scientists. Nor do federal
agencies have a comprehensive
strategy to combat this threat.
The Subcommittee’s Investigations
This investigation continues the Subcommittee’s examination of national
security issues involving China. During
the 115th Congress, the Subcommittee
highlighted China’s leading role in the opioid crisis by investigating how
illicit
opioids like fentanyl are shipped from China to the United States through
international mail. The
Subcommittee held an initial oversight hearing on May 25,
2017, titled Stopping the Shipment of Synthetic Opioids:
Oversight of U.S. Strategy
to Combat Illicit Drugs. On January 25, 2018, the Subcommittee held a second
hearing
and issued a bipartisan report titled Combatting the Opioid Crisis:
Exploiting Vulnerabilities in International Mail. On
October 24, 2018, the
President signed into law the Synthetic Trafficking & Overdose Prevention Act
(“STOP Act”), legislation designed to assist law enforcement in identifying and
stopping fentanyl being shipped into the United States.
In the
current 116th Congress, on February 28, 2019, the Subcommittee held
a hearing and issued a bipartisan report
titled China’s Impact on the U.S.
Education System. The Subcommittee examined China’s propaganda efforts at
U.S.
colleges and universities through Confucius Institutes. The Chinese government
funds Confucius Institutes
and hires Chinese teachers to teach language and
culture classes to students and non-student community
members. Confucius
Institute funding comes with strings that can compromise academic freedom.
The
Chinese government approves all teachers, events, and speakers. Some U.S.
schools contractually agree
that both Chinese and U.S. laws will apply. The
Chinese teachers sign contracts with the Chinese government
pledging they will not
damage Chinese national interests. The Subcommittee found that these limitations
export
China’s censorship of political debate to the United States and prevent the
academic community from discussing
topics that the Chinese government believes
are politically sensitive.
Next, the Subcommittee turned to China’s recruitment plans. The
Subcommittee focused specifically on China’s
most prominent plan, the Thousand
Talents Plan. The Subcommittee reviewed documents, received briefings, or
interviewed individuals from the following agencies: Office of Director of National
Intelligence; Central Intelligence
Agency; Department of State; Department Commerce; Department of Energy; Federal Bureau of Investigation;
Department of
Health and Human Services; National Science Foundation; and the White House
Office of Science
and Technology Policy. The Subcommittee also met with members
of the academic community, including the
American Public and Land Grant
Universities, Association of American Universities, the American Council on
Education, a Chinese American advocacy group,and the JASON independent
scientific advisory group.
!!. FINDINGS OF FACT AND RECOMMENDATIONS
Findings of Fact
1) China seeks to become a science and technology (“S&T”) world
leader by 2050. The Chinese
government elevated the importance of S&T
as a key national strategic goal in 2006. China seeks to become an
“innovative country” by 2020 and an S&T world leader by 2050. To
accomplish its goals, China systematically
targets critical technologies and
advanced S&T capabilities as a way to enhance national strength and achieve
Chairman Xi Jinping’s goal of “national rejuvenation.”
2) China prioritizes military-civilian fusion as a national goal.
In 2016,
Chairman Xi designated a policy known as Military-Civilian Fusion (“MCF”)
as a national strategy. MCF
seeks to pool talent and financial resources to
jointly develop technologies, conduct research, and attract talent
that
mutually reinforces both the military and civilian sectors. MCF blurs the
lines between China’s defense and
civilian sectors, enabling China to
continue international scientific collaboration while obfuscating that this
collaboration also assists in modernizing China’s military.
3) China aggressively recruits overseas researchers and scientists.
China has a coordinated global campaign to
recruit overseas S&T experts as
part of its S&T strategy. These experts provide access to know-how,
expertise,
and foreign technology—all necessary for China’s economic
development and military modernization. Chinese
recruitment efforts also
have begun to reverse China’s brain drain, as more Chinese students than
before are
returning to China after studying abroad.
4) The Thousand Talents Plan (“TTP”) is China’s most prominent talent
recruitment plan. Launched in 2008 and
controlled by the Chinese
Communist Party, the TTP recruits thousands of high-quality overseas
talents. As of
2017, China reportedly has recruited 7,000 researchers and
scientists. The TTP targets U.S.-based researchers
and scientists, regardless
of ethnicity or citizenship, who focus on or have access to cutting-edge
research and
technology.
The TTP is just one of over 200 Chinese talent
recruitment plans over which the Chinese Communist Party is able
“exert
exceptional” levels of control. In response to U.S. government scrutiny,
China has attempted to delete online
references to its talent recruitment
plans and reportedly instructed Chinese institutions on how to avoid
additional
U.S. scrutiny.
5) TTP employment contracts violate U.S. research values. TTP
members sign legally binding
contracts with Chinese institutions that
contain provisions that violate U.S. research values, including non-
disclosure
provisions related to their research and employment with Chinese
institutions. The contracts require
TTP members to undermine fundamental
U.S. scientific norms of transparency, reciprocity, merit-based
competition,
and integrity. Fundamentally, these contracts incentivize TTP members to
put China’s interests ahead
of U.S. institutions.
6) Chinese talent plans target unrestricted, basic research. China seeks
access to non-public
fundamental research to accelerate its technological
capabilities at the U.S. taxpayer’s expense. The U.S.
government may
restrict some research for proprietary or national security reasons but as
fundamental research is
generally designed to be openly shared, federal law
enforcement agencies have limited means to thwart China’s
extralegal
activities.
7) TTP members have willfully failed to disclose their TTP
membership. Some TTP members
willfully failed to disclose their affiliation
with China’s talent recruitment plans to U.S. institutions and U.S.
agencies. In some cases, TTP members received both U.S. grants and
Chinese grants for similar research,
established “shadow labs” in China to
conduct parallel research, and stole intellectual capital and property. U.S.
government agencies also discovered that some TTP members used their
access to research information to
provide their Chinese employer with
important information on early stage research.
8) Federal agencies are not prepared to prevent China from
transferring taxpayer funded research and stealing
intellectual
property.
The U.S.government was slow to address the threat of China’s
talent recruitment plans, leading to U.S.
government grant dollars and
private sector technologies being repurposed to support China’s economic and
military goals. Though some federal agencies have begun to take action, the
federal government lacks an effective
interagency strategy and continues to
have shortfalls in its processes to mitigate the threat that Chinese talent
recruitment plans pose.
9) Federal grant-making agencies lack standards and coordination.
U.S. grant-making
agencies, such as the National Science Foundation
(“NSF”) and the National Institutes of Health (“NIH”), each
require grant
applicants to use different forms and processes to apply for federally funded
research grants. This
increases administrative burdens on researchers
applying for grants from multiple federal agencies. It also
complicates
9
effective grant oversight of the more than $150 billion in U.S. funding
awarded annually for research
and development.
10) U.S. grant-making agencies’ policies on foreign talent recruitment
plans differ. For example,
the Department of Energy’s new policy
effectively bans both employee and contractor participation in foreign talent
recruitment plans. The NSF’s new policy, however, only applies to NSF
employees, but not researchers. These
differences can complicate the
research community’s understanding of the scope and scale of the problem.
11) The NSF does not have a compliance office to perform grant
oversight functions. Instead, the NSF relies on the
institutions submitting
grant applications and the NSF Inspector General to conduct due diligence,
vetting, and
oversight. The NSF’s policy on participation in foreign talent
recruitment plans does not extend to the more than
40,000 researchers and
scientists that receive U.S. funding for research and development.
12) The NIH awards over $31 billion annually in medical research in
50,000 competitive grants to more than
300,000 researchers. The NIH
has not issued new policies addressing talent recruitment programs. Instead,
it
relies on existing policies regarding conflict of interest, conflict of
commitment, and disclosure of outside support.
The NIH is conducting
additional oversight of potential links between federal funding and foreign
talent recruitment
plans. As part of that process, it identified at least 75
individuals potentially linked to foreign talent recruitment
plans that also
served as peer reviewers.
13) The Department of Energy (“Energy”) is the largest federal sponsor of basic research in the physical sciences,
$6.6 billion in
grants and contracts that support over 25,000 researchers at over 300
institutions and National Labs. Energy’s research funding and prominent
role in advanced research and development make it particularly attractive to
the
Chinese government. Despite 30-year old federal regulations prohibiting
U.S. government employees from
receiving foreign compensation that
conflicts with their official duties, Energy clarified only this year that
employees
and contractors are prohibited from participating in foreign talent
plans.
14) The Commerce Department (“Commerce”) granted deemed export
licenses to Chinese nationals associated
with talent recruitment
plans, Chinese military affiliated universities, and other entities on
Commerce’s entity list.
The entity list includes individuals and entities
“who have engaged in activities that could result in an increased
risk of the
diversion of exported, re-exported, and transferred items to weapons of mass
10
destruction programs.”
The list also includes “activities contrary to U.S.
national security and/or foreign policy interests.” Commerce is
responsible
for issuing deemed export licenses to U.S. firms that employ or host foreign
nationals seeking to work
on controlled technology projects. Commerce
rarely denies deemed export license applications, denying only 1.3
percent in
2018.
15) The FBI recognized that it and other federal agencies were “slow to
recognize the threat of the Chinese talent
recruitment] plans” until
recently. Despite the Chinese government publicly announcing in 2008 its
intent to recruit
overseas researchers with access to advanced research and
technology, FBI’s headquarters in Washington D.C.
take control of the
response to the threat until mid-2018. The FBI took nearly two years to
coordinate the
dissemination of information identifying potential talent
recruitment plan participants to federal grant-making
agencies. The FBI has
yet to develop an effective, nationwide strategy to warn universities,
government
laboratories, and the broader public of the risks of foreign talent
recruitment plans.
16) The State Department is on the frontline in the U.S. government
effort to protect against intellectual property
theft and illicit
technology transfers. While State has a process to screen for nonimmigrant visa applicants attempting
to steal sensitive technologies or
intellectual property, State’s authority to deny visas is limited. This results
in a
denial rate of less than five percent of all visa applicants reviewed. State
also does not make available visa applicant files and supporting
documentation to U.S. law enforcement in easily accessible formats to assist
national investigations
.
17) The White House’s OSTP launched an effort in May 2019 to
coordinate interagency work related to improving
the safety,
integrity, and productivity of research settings. Currently, federal
grant-making agencies’ policies and
processes are not standardized or
uniform. These differences complicate the grant process for applicants, stifle
.S. law enforcement’s ability to investigate grant-related crimes, and
frustrate the federal government’s ability to comprehensively understand
grant spending.
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