Today, Chairman Thornberry (R-TX), of the House Armed Services Committee, made the following remarks, as prepared for delivery, on the Committee's hearing titled "Military Technology Transfers: Threats, Impacts, and Solutions for the Department of Defense. For testimony and to watch the hearing click here.
"In his January 19, 2018, remarks on the National Defense Strategy, Secretary Mattis warned that 'our competitive edge has eroded in every domain of warfare, air, land, sea, space and cyberspace, and it is continuing to erode.'
Much of that erosion has been caused by things we have done to ourselves – sequestration and continuing resolutions come to mind.
But part of the erosion in our competitive edge is the result of adversaries and competitors obtaining American technology and intellectual property by legal and often illegal means.
In its January 2018 report, 'China's Technology Transfer Strategy,' DIUX found that the People's Republic of China, for example, uses a variety of methods to obtain U.S. technology, including:
Industrial espionage, where China is by far the most aggressive country operating in the U.S.;
Cyber theft on a massive scale deploying hundreds of thousands of Chinese
army professionals;
Academia, since 25% of U.S. STEM graduate students are Chinese foreign nationals;
China's use of open source information cataloguing foreign innovation on a large scale;
Chinese-based technology transfer organizations;
U.S.-based associations sponsored by the Chinese government to recruit talent; and
Technical expertise on how to do deals learned from U.S. firms.
The report noted that the 'cost of stolen intellectual property has been estimated at $300 billion per year.'
Most alarming, DIUX found that, '[t]he U.S. does not have a comprehensive policy or the tools to address this massive technology transfer to China' and '[t]he U.S. government does not have a holistic view of how fast this technology transfer is occurring, the level of Chinese investment in U.S. technology, or what technologies we should be protecting.'
That is just one report but based on everything that the committee has heard this year, it sounds right and it should be alarming.
There are several provisions in the upcoming NDAA conference which relate to this issue, including the modernization of the CIFUS and Export Control regime. This hearing will better equip us to make important decisions in the days ahead."
