Sherrod Brown Warns: China Built Their Military Capability ‘With The Help Of American Tax Dollars’

4 months ago

Earlier this month, Sen. Sherrod Brown (D-OH) delivered remarks on national and financial security during a Senate Banking Committee hearing.

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Transcript

00:00The Senate Committee on Banking, Housing and Foreign Affairs will come to order.

00:03Welcome to our witnesses. We face an uncertain world with many geopolitical

00:09challenges from Russia's continued brutal invasion of Ukraine to ongoing

00:16conflicts in the Middle East to an increasingly aggressive and capable

00:19Chinese military. We know that China's built that military capability with the

00:25help of some of America's biggest corporations and even American tax

00:29dollars. For too long our government was willfully blind to the threat China

00:34posed. Multinational corporations eager to move jobs wherever they could pay

00:39ever lower wages lobbied this body and presidents of both parties failed us for

00:46permanent normal trade relations with China. When corporations move products

00:50overseas they outsource the technology and the trade secrets along with it. We

00:55did nothing to stop it and now we're paying the price. We can't make the kinds

00:59of mistakes we have in the past. We have to be proactive about these threats and

01:02take action now to protect our national and economic security. We need to be

01:06clear those two issues are intimately connected. You can't separate the economy

01:11and our national security. Today hostile governments work together more and more

01:17to challenge the interests and the securities and the values of the United

01:19States, our allies and partners around the world. Increasingly hostile

01:24governments use our own technology to fuel their destructive efforts. We must

01:29lead efforts to stop it. It's the US government's job to police the flow of

01:32sensitive and so-called dual-use technologies. Technologies can be used

01:37for both military and civil and civilian purposes and Departments of Commerce and

01:42Treasury along with DOD, state and other agencies try to restrict the flow of

01:46sensitive technologies to our adversaries. We can't allow US

01:50innovation investments to be used against us. Against that backdrop NATO

01:54met earlier this month. They issued a statement addressing these threats.

01:58Specifically NATO leaders called on China to quote cease all material and

02:03political support to Russia's war effort including quote the transfer of dual-use

02:08tech you dual-use materials such as weapons components equipment and raw

02:13materials that serve as inputs for Russia's defense sector. That was the

02:17NATO statement. That followed last month's G7 summit in Italy where the

02:21United States and our allies reaffirmed our shared efforts to implement export

02:26controls to address risk to international security and quote to

02:30ensure the effectiveness of our respective foreign investment screening.

02:33The G7 leaders also noted that measures designed to address risks from outbound

02:38investments could be important to complement existing tools of targeted

02:43controls on exports and outbound investments. A core element of this

02:46committee's work has been to establish and conduct oversight over our export

02:51controls investment securities and Defense Production Act authorities.

02:55Treasury and Commerce have had active and growing caseloads since our hearing

03:00last year. They've expanded controls on semiconductors equipment and services

03:04that could support China's semiconductor ecosystem. They've taken steps to

03:09establish an outbound investment program that would enable us to better

03:12understand and to stop US investments that build up China's

03:17military. They recently issued a proposed rule that would significantly expand

03:21the committee on foreign investment in the US's ability to review foreign real

03:25estate investments near military bases like Wright-Patterson Air Force Base and

03:30Yars in Ohio. It's kind of action I and many from both parties have been

03:34pressing for here from farmers in Ohio near our military installations who are

03:39very concerned about this. As we use our export control and investment security

03:44policies to restrict China's ability to use US technology and investments to

03:49advance their military capabilities and human rights abuses, we must also

03:54bolster our own domestic capabilities. To that end, I was pleased to see Dr. Taylor

03:59Kale and her colleagues thank you released the Defense Department's first

04:03ever National Defense Industrial Strategy earlier this year. As a critical

04:08economic security tool, this committee has jurisdiction over the Defense

04:11Production Act which must play a vital role in advancing that strategy. In Ohio,

04:16we know the potential here to harness the talents and patriotism of America's

04:21workers to protect our country. For decades, the Air Force Research Lab at

04:26Wright-Patterson Air Force Base near Dayton has been the home of the DPA

04:30Title III program. Aside from the good work being done at AFRL, the Defense

04:35Production Act gives the administration the authority to allocate and prioritize

04:39critical materials and to increase domestic productive capacity to address

04:45industrial shortfalls. In other words, DPA allows the Defense Department and other

04:50agencies to invest in American manufacturing that can support U.S.

04:54national security as well as making us more prepared for emergencies. This work

04:58couldn't be more urgent for decades. Corporate offshoring and consolidation

05:02and restructuring, essentially just another elite business school term for

05:07finding new ways to screw workers to increase profits, all weakened our

05:12domestic manufacturing sector. Let me say that again, for decades, corporate

05:15offshoring, consolidation, and restructuring, all with the aid and

05:20assistance of too many members of this body, all weakened our domestic

05:24manufacturing sector. Ohioans know well what it's done to cities like where I

05:28grew up, Mansfield. Our families, our economy, increasingly people in this town

05:33finally are waking up to how it's weakened our national security. We know

05:37when companies outsource jobs, they outsource technological capabilities

05:41with them. There's not been enough appreciation for how much innovation

05:46happens on the production floor by workers. Over the past few years, we've

05:51finally taken steps to reverse that course, passing Chips and Science Act,

05:55passing the bipartisan infrastructure law. We've increased funding for

05:59strategic investments using the Defense Production Act. We can do more. As

06:03Congress prepares to reauthorize the Defense Production Act, we need

06:07to look at new ways that DPA can support American industrial capabilities

06:12and help us revitalize our domestic industrial base to meet current and

06:16future challenges. Today, we'll discuss how we're working with our partners to

06:20coordinate our export controls and investment security policies and what

06:24steps Congress can take to strengthen these authorities. We look forward to

06:28testimony from this panel, who can update the committee on their important work.

06:32Senator Scott.

Sherrod Brown Warns: China Built Their Military Capability ‘With The Help Of American Tax Dollars’

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