WASHINGTON, DC – On the Senate floor, U.S. Senator Rob Portman (R-OH), Ranking Member of the Senate Homeland Security and Governmental Affairs Committee, urged his colleagues to pass his bipartisan Safeguarding American Innovation Act as a part of the U.S. Innovation and Competition Act, which is under consideration in the Senate this week. The U.S. Innovation and Competition Act invests more than $100 billion of taxpayer funds to solidify the United States’ leadership in scientific and technological innovation critical to our national security and economic competitiveness. The bipartisan Safeguarding American Innovation Act, which passed the Senate Homeland Security and Governmental Affairs Committee earlier this month, will protect the taxpayer investment in American research and IP from theft from global competitors, like China.
Portman and U.S. Senator Tom Carper (D-DE), as then-Chairman and Ranking Member of the Permanent Subcommittee on Investigations (PSI), led a year-long investigation into this issue culminating in a bipartisan report and hearing that detailed how American taxpayers have been unwittingly funding the rise of China’s military and economy over the last two decades while federal agencies have done little to stop it. Starting in the late 1990s through its “talent recruitment programs,” China began recruiting U.S.-based scientists and researchers to transfer U.S. taxpayer-funded IP for China’s economic and military gain. This legislation will ensure that the federal government is taking decisive action to safeguard American innovation.
This legislation also addresses the findings of PSI’s February 2019 report, which highlighted the Department of Education’s lack of enforcement of foreign gift reporting at U.S. colleges and universities, which the department admitted was “historically lax.” This bill gives the department increased authority to enforce foreign gift reporting rules and lowers the reporting threshold to increase transparency and prevent foreign interference on U.S. campuses.
A transcript of the speech can be found below and a video can be found here.
“Madam President, I rise today in strong support of the Safeguarding American Innovation Act. This is legislation that has been included in the substitute amendment to the bill that we’re working on this week called the Endless Frontiers Act, or, as it’s now been called, the U.S. Innovation and Competition Act. If our goal is to increase U.S. competitiveness and encourage more U.S. innovation, we’ve got to not only invest in research and innovation, we’ve got to be sure that we’re keeping our investments in research and intellectual property from being taken by our competitors and used against us. That’s what this legislation does.
“By the way, that’s just common sense, or so you would think. But it’s not what we found during a bipartisan investigation of the Permanent Subcommittee on Investigations. Instead, during a year-long inquiry, we uncovered that our government and our research institutions over the past couple of decades have permitted China to take advantage of a lax U.S. approach to safeguarding our taxpayer-funded innovation, be it at our college campuses or in our research labs. Nor was law enforcement, principally the FBI, doing anything significant to combat this threat. In fact, at our hearing on the report about 18 months ago, the FBI admitted in sworn testimony that they’d been asleep at the switch, essentially. Our PSI investigation detailed the rampant theft of U.S. taxpayer-funded research and intellectual property by China by way of their so called talent recruitment programs, mainly the Thousand Talents Plan. China uses these plans to systematically find promising researchers and promising research that China is interested in, and they recruit those researchers. These programs have not been subtle. The Thousand Talents Plan is perhaps the best understood of these programs, although there are actually a couple hundred of them. Our PSI investigation documented how the Thousands Talents Plan was used to target and steal taxpayer-funded research and IP for at least two decades in this country and much of that research and innovation was taken from our labs, to China, and went directly into fueling the rise of the Chinese economy and the Chinese military.
“While this is what China has done and continues to do, this is really about us. We’ve got to get our own house in order. Specifically, we found that the Chinese government has targeted promising U.S.-based research and researchers. Often this research is funded by U.S. taxpayers. We spend about $150 billion a year on taxpayer-funded research at places like the National Institutes of Health, the National Science Foundation, and the Department of Energy for basic science research. And with this legislation, we’re talking about tonight on the floor, the Endless Frontiers Act, we’re talking about a huge increase in the amount of federal spending for this kind of research. The annual $150 billion that has gone out over the years has been a good investment of taxpayer dollars, I believe. Why? Because it has led to some amazing things. Cures for everything from viruses to particular kinds of cancer, to technologies that support our defense base, to manufacturing technology that’s made us more efficient as a country. But it’s not good if the U.S. taxpayer is paying for this good research and then China is taking it to fuel their own economic and military rise.
“China has not just stolen some of this research funded by U.S. taxpayers. China has actually paid these grant recipients to take their research over to China at Chinese universities – again, universities affiliated with the Chinese Communist Party. They’ve been very clever about it. They want to be sure that China is a stronger competitor against us, and they take the research delivered from the United States to what are referred to as shadow labs in China, where they replicate the research. Rather than pointing the finger at China, we ought to be looking at our own government and our own institutions and doing a better job with the things we can control. Again, let’s get our own house in order. We’ve made some progress in doing that. Following our November 2019 PSI investigation I talked about and the report we issued, in December of 2020, John Demers, the Assistant Attorney General for National Security and Head of the Justice Department’s China Initiative, announced that more than 1,000 researchers affiliated with China’s military left the United States following a crackdown on recipients of taxpayer-funded federal grants concealing their affiliation with China’s Thousand Talents Program. 1,000 researchers left the United States. That news followed multiple guilty pleas and a string of arrests of academics affiliated with America universities for alleged crimes related to concealing their participation in China’s talent recruitment programs while accepting American taxpayer funds and taking research to China. After two decades of allowing this activity to go on, over the past 18 months we’ve finally begun to crack down. In my own state of Ohio, in my home state, there have been some researchers who have been arrested.
“However, as our investigation found and law enforcement told us, the federal government is limited in the actions they can take under current law. It is our responsibility here in Congress to change that. All of the arrests in connection with the Thousand Talents Plan have been related to peripheral financial crimes, like wire-fraud and tax evasion, not the core issue of the conflict of commitment, the conflict of interest, the taking of American taxpayer-paid research and also taking money from China. Why? Because it’s not currently a crime to knowingly hide foreign research funding on a federal grant application, as an example. In other words, if you are performing research funded by the U.S. taxpayer and also being paid by China, doing the same research, there is no law stating you have to disclose that funding from China. That’s just wrong. Since our report, the National Institutes of Health has started to require that information be disclosed. The NIH is alone, so far, in requiring that. But even there, there’s still no law requiring disclosure. So the arrests made since our PSI report have not been about that core issue of researchers hiding foreign funding from China and stealing our research, so we need to change the laws so we can give our law enforcement community the tools they need to do the job that all of us expected was being done.
“The Safeguarding American Innovation Act goes directly to the root of this problem and makes it punishable by law to knowingly fail to disclose foreign funding on federal grant applications. While this is a criminal statute, it’s really about transparency, isn’t it, which is a core tenet of the U.S. research enterprise. Our bill also makes other important changes informed by our investigation. It requires the Office of Management and Budget, OMB, and the executive branch to streamline and coordinate grant-making between the federal agencies so there’s more continuity, accountability, and coordination when it comes to tracking the billions of dollars of taxpayer-funded grant money that’s being distributed. Again, the underlying legislation here on the chamber tonight is about more money going into research. Let’s be sure that there is transparency, and we know how it is being distributed.
“We found in our investigation that this kind of coordination and transparency was sorely lacking and long overdue. Our legislation also allows the Department of State to deny visas to foreign researchers coming to the United States who they know are going to exploit our openness, the openness of our research enterprise, to acquire sensitive and emerging technologies against the national security interests of the United States and to benefit an adversarial foreign government. This may surprise you, but the State Department can’t do that now. It’s a loophole in the law. In finalizing our language for the substitute, we worked very closely with career State Department employees who are desperate to get this authority to keep, say, members from the People’s Liberation Army, the Chinese military, from coming over here and attending conferences where sensitive export control technology is being talked about and distributed.
“Our bill also requires foreign institutions and universities to tell the State Department whether a foreign researcher will have access to export-controlled technologies, and also demonstrate to the State Department that they have a plan to prevent unauthorized access to any export-controlled technologies at this research institution. That’s really important. It seems like the basic information the State Department would get here would have been provided all along. But it hasn’t been. Providing this information as part of the visa process should also help streamline the process for the State Department and for these research institutions. I think it’s good for both to make sure that this is clear and we know what the rules are.
“We also require increased transparency in reporting foreign gifts and contracts at our colleges and our universities. Those schools are now going to need to report any foreign gift or contract worth $50,000 or more. The current threshold is $250,000. More transparency is a good thing. We also empower the Department of Education to work with these universities and research institutions to ensure that this can be complied with in a way that doesn’t create undue red tape and expenditures. That’s not the idea. The idea is to have transparency but have it be something that is efficient. But we also allow the Department of Education for the first time to fine universities that repeatedly fail to disclose these gifts. We actually found that about 70 percent of universities weren’t following the current law, partly because there was no fine, there was, really, no accountability.
All of the changes that I’ve outlined are necessary to help keep America on the cutting edge. In order to be globally competitive, we have to be more effective at pushing back against the specific threat from China and from other nations, like Russia, Iran, and North Korea, looking to steal our research and our intellectual property. Until we start to clean up our own house and take a firmer stance against foreign influences here in this country trying to take our research, we’re going to keep losing the innovations that we create here and we’ll be less competitive. That’s why the Safeguarding American Innovation Act is so important to be included in this bill.
“I’ll finish by noting that this has been truly a nonpartisan effort, not just bipartisan, but nonpartisan from the start. We wanted to ensure that in a thoughtful, smart, and effective way, we were responding to the very real threat that we identified from China and other foreign adversaries. I want to commend my partner in our PSI investigation and cosponsor of our legislation, Senator Tom Carper. I also want to thank the Presiding Officer tonight for her role in this, for her contributions and her support. I also want to say that I appreciate Senators Peters and Schumer and their staff for working with us to finalize the language, as well as the State Department and other officials from the Trump administration and the Biden administration who provided important assistance.
“Safeguarding American innovation is always a good idea, but it’s particularly important in the context of the legislation before us that provides exceptionally large amounts of federal money for research to make us more competitive. I support that research. But I don’t want the taxpayer funds to go in the front door and then to have the research go out the back door to China or other adversaries. That’s not what this should be about. And thanks to this legislation being included in this law, I feel confident it will not be about that.”
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