Senate Report: Careless Elites Help China Steal Americans’ Technology

Top government leaders told NPR that federal agencies are years behind where they could have been if Chinese cybertheft had been openly addressed earlier. Bill Hinton Photography/Getty Images
Bill Hinton Photography/Getty Images

Careless elites in government and in universities help the Chinese government steal U.S. technology and get taxpayer funding for Chinese research, according to a bipartisan report by the Senate investigations committee.

“This report follows an eight-month investigation into how the American taxpayer has, in effect, unwittingly funded research that has contributed to China’s global rise over the past 20 years,” GOP Sen. Rob Portman said November 19. he continued:

Our investigation focused on China’s most prominent program called the Thousand Talents Plan. Launched in 2008, China designed the Thousand Talents Plan to recruit 2,000 high-quality overseas experts. By 2017, China dramatically exceeds its recruitment goal, recruiting more than 7,000 ‘high-end professionals.’  Our report also details how the Chinese Communist Party controls and administers these talent recruitment programs.

The FBI failed to see the problem for a decade, and universities are still downplaying the problem, Portman said, adding:

U.S. universities and U.S.-based researchers must take responsibility in addressing this threat. If 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.

The co-chair of the report, Sen. Tom Carper, described the problem in his short statement on November 19:

Due to our lax oversight of federal research grants and the ineffective and mixed messages agencies have been delivering to schools and researchers on this topic over the years, we’ve given the Chinese and likely other countries a running start. We can’t continue to allow this to happen!

But Carper also let the Democrat-allied research sector off the hook, saying:

I hope that the publication of this information will inspire a serious and urgent conversation on university campuses and among scientists and researchers about the growing threat that China’s talent recruitment efforts pose for our country. I hope it also leads to an appreciation of the consequences that come from giving a foreign government so much access to and control over the vital research we rely on to fuel our economic competitiveness and bolster our national defense.

Having said that, we should not be stepping back from international collaboration in science and technology. As China’s aggressive efforts show, our scientists, research institutions, and universities remain the best in the world and serve as a magnet for talented people looking to do meaningful, cutting edge work.

Portman’s report also did a favor for U.S. companies and universities by downplaying the visa programs that allow companies, universitie, and even the government to hire foreign graduates for critical research and development.

For example, universities employ roughly 100,000 visa workers via the H-1B, J-1, Optional Practical Training and other programs. This massive recruiting sidelines Americans and lower-risk Europeans at universities.

Overall, roughly 1.5 million foreign graduates hold U.S. jobs through visa programs, including many jobs giving them access to vital networks, healthcare data, and personal financial data. Legislators in the House and GOP Senators are trying to expand those visa programs via the H.R.1044 and S.386 bills.

The November 18 report is titled, “Threats to the U.S. Research Enterprise: China’s Talent Recruitment Plans.”

The report, which was released November 19 as media attention was focused on the House’s effort to impeach the President:

Launched in 2008, [China’s] 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 [Chinese provided] salaries, research funding, lab space, and other incentives.

The report whines that the Chinese government is being “unfair” because it is stealing technology to achieve its goal of political, military, and cultural dominance over the United States:

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.

But science-industry advocates pushed back against the report, arguing that the problem is just a few bad apples in the barrel, not a large-scale, organized, intelligent, government seeking global advantage over the United States.

“Foreign-born scientists contribute to improving health, fostering innovation, and advancing science,” said a statement from Michael Lauer, the deputy director of external research at the taxpayer-funded National Institutes of Health, which conducts medical research. He said:

Unfortunately, we are aware that a few foreign governments have initiated systematic programs to capitalize on the collaborative nature of biomedical research and unduly influence U.S.-based researchers … we acknowledge these concerns [but] the vast majority of Chinese scientists working in America are committed to the cause of expanding knowledge for the betterment of humankind, and to do so in a fair and honest way.

The individuals violating laws and policies represent a small proportion of scientists working in and with U.S. institutions

“Dating back to the Manhattan Project era, the United States has attracted the best and brightest scientists from around the world,” said a statement from Rebecca Keiser at the international office of the National Science Foundation, which funds engineering and hardware research throughout the United States. She downplayed China’s threat, saying:

NSF is committed to implementing all reasonable and necessary [BBN emphasis] steps to ensure the integrity of federally-funded research while protecting the ecosystem of innovation and discovery that has propelled the United States to global leadership in science and engineering.

Portman slammed the NSF’s no-problem-here response:

In July 2019, just a few months ago, the NSF prohibited its employees from joining [China’s] talent recruitment programs; but the policy does not apply to the more than 40,000 NSF-funded researchers who actually conduct the research and are the most likely to be members and targets of a talent recruitment program. And NSF doesn’t any employees dedicated to grant oversight.

The Department of State also sought to downplay the need for vigilance against the Chinese government’s program. “The strength of our global leadership in science and research rests on our openness,” said Edward Ramotowski, a deputy assistant secretary of state. He continued:

For decades, foreign scientists, including from China, have contributed substantially to scientific progress and innovations at research institutions across the United States.

We continue to welcome Chinese students who come here lawfully to study in the United States. We also recognize the inherent value of interpersonal exchange between our two countries.

Ramotowski admitted there is a problem — but said the department could do little to stop the Chinese campaign:

Unfortunately, the Chinese government is actively encouraging, and in many cases coercing, its citizens to abuse the goodwill and openness of our country for its own benefit.

Under the [nation’s immigration law], consular officers cannot currently deny a visa application on national security grounds if they have reason to believe that the visa applicant seeks to enter the United States to lawfully gain knowledge through work or study in a sensitive area of technology that is not export controlled – for example, certain technology related to robotics or artificial intelligence.

,…

the law as it is currently written restricts the discretion of consular officers to find visa applicants ineligible, even when there is reason to believe the applicant may intend to export technology many consider to be sensitive but which is not currently controlled.

An FBI official insisted that they would downplay China’s effort to recruit Chinese-Americans and legal-immigrant Chinese. “I cannot overstate that ethnicity plays no role in our investigations,” said John Brown, the assistant director of the FBI anti-spy division. He continued:

 We have never asked any university, company, or other entity to profile people based on ethnicity, and we would be appalled if they did. As is true for all FBI programs, we investigate specific individuals when we have specific evidence that they are engaged in unlawful activity or pose a threat to national security. Nor do we have any intention of chilling academic freedom or curtailing international exchange—quite the reverse. International collaboration plays a crucial role in the development of scientific breakthroughs throughout U.S. research institutions.

Brown’s insistence on color-blind political correctness contrasts with sharp testimony given to the committee by his own boss, FBI Director Christopher Wray:

[T]he use of nontraditional collectors, especially in the academic setting, whether it’s professors, scientists, students, we see in almost every field office that the FBI has around the country. It’s not just in major cities. It’s in small ones as well. It’s across basically every discipline. I think the level of naiveté on the part of the academic sector about this creates its own issues. They’re exploiting the very open research and development environment that we have, which we all revere, but they’re taking advantage of it.

The U.S. media have cataloged a variety of cases. In July 2018, for example, Business Insider reported:

Liu Ruopeng, known as China’s Elon Musk, is just 35 years old and is believed to be worth $2.7 billion, according to the “Today” show.

But before he created his money-making “Future Studio” in China, Liu studied at Duke University from 2006 to 2009 under David Smith, one of the world’s experts on metamaterials, or “some weird material that doesn’t exist in nature,” as the professor describes it.

Some observers, including a former assistant director of counterintelligence at the FBI, believe that Liu was sent to Smith’s lab by the Chinese government to steal intellectual property.

The case, however, was closed years later due to shortage of evidence.

The headlines in the Senate’s report sketch out the huge scale of the failure by government and elites to guard Americans’ technological base:

China’s Systematic Targeting of Critical Technologies … The NSF is Unprepared to Stop Foreign Talent Recruitment Plan Members From Misappropriating U.S.-Funded Research … Weaknesses in NIH’s Internal Controls for Monitoring and Permitting Foreign Access to Sensitive Data … Energy Did Not Implement Policies Prohibiting Involvement in Foreign Talent Recruitment Plans Until 2019 … Consular Affairs Has Limited Authority to Deny Visa Applicants on National Security Grounds Related to Intellectual Property Theft … Commerce Rarely Denies License Applications … The FBI Took Nearly Two Years to Disseminate Talent Recruitment Plan Information to Federal Grant-Making Agencies … The FBI Disbanded its National Security Higher Education Advisory Board

The report described a few of China’s brazen campaigns to steal technology:

According to the complaint, Liu operated the New York office of the China Association for International Exchange of Personnel (“CAIEP-NY”). CAIEP-NY is a Chinese government agency that, among other things, recruits scientists, academics, engineers and other experts in the United States to work in China. Liu worked with other Chinese government employees in the United States, including at Chinese consulates, to fraudulently procure J-1 Research Scholar visas for a CAIEP-NY employee and a prospective CAIEP-NY employee. In addition, Liu attempted to assist a CAIEP-NY hire to obtain a J-1 [visa] research scholar visa under false pretenses. Liu contacted multiple U.S. universities to try to arrange for a university to invite the CAIEP-NY hire to come as a J-1 Research Scholar. Liu was in communication with an individual affiliated with a U.S. university who explained that it would “be very easy for us to give him/her a J-1 [visa].”

Federal agencies do not even deny visas to researchers employed by China’s military universities, the report said:

[The Department of] Commerce issued licenses to individuals associated with one of the seven Chinese universities, known as the “Seven Sons” that are under “direct supervision” by China’s Military Commission. Two of these universities, Beihang University and Northwest Polytechnical University, are currently on Commerce’s Entity List. The other five institutions, Beijing Institute of Technology, Harbin Institute of Technology, Harbin Institute Engineering University, Nanjing University of Aeronautics and Astronautics, and Nanjing University of Science and Technology, are not on Commerce’s Entity List as of this report. Commerce granted more than 150 licenses to Chinese nationals linked to one of the seven defense universities. A sample of these license applications follow below.

In 2018, a U.S. company applied for a Chinese national to access semiconductor technology and converter integrated circuits. That same individual received a Bachelor’s of Electronic Information Engineering from Beihang University.

In 2017, a U.S. company applied for a Chinese national to work as a packaging engineer, providing packaging design, development, and support for semiconductor technology. That same individual received a Bachelor’s in Optical Information Science and Technology and a Masters in Optics from the Northwestern Polytechnical University.

The federal government also allows employees of Huawei — the government-run networking company — to get jobs at U.S. research centers.

According to information reviewed by the Subcommittee, Commerce issued at least 65 licenses to Chinese nationals who previously worked for or were supported by Huawei. Huawei is on Commerce’s Entity List as of this report. A sample of these license applications follow below.

In 2018, a U.S. company applied for a Chinese national to work on systems for telecommunications carriers, cable providers, and data center customers. This individual previously worked at Huawei as a software engineer.

In 2017, a U.S. company applied for a Chinse national that previously worked on machine learning and embedded software for Huawei and also graduated from Harbin Institute of Technology with a bachelor’s degree in engineering.

Breitbart News has extensively covered the H-1 and OPT visa worker programs which allow Chinese researchers and workers to take jobs from Americans throughout the U.S. economy.

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