American Edge Project Responds To House Judiciary Committee Markup

Explains Five Ways China Would Win With House Package

Today, the American Edge Project responded to the U.S. House Judiciary Committee marking up a package of six anti-competition bills that could undermine the future of American innovation and cede our technological edge to foreign adversaries.

In response to the markup, American Edge Project National Security Advisory Board Co-Chair Frances Townsend said, “China wants to be the world’s dominant tech leader. In fact, President Biden stated that China believes it will ‘own America’ by 2035. This misguided legislation will only embolden China, paving the way for foreign adversaries to dominate the digital landscape, undermining a key national security advantage.”

Below are five ways the House bills would allow China to win over the United States:

  1. Handcuffs the U.S.’s most innovative tech companies, opening the door for foreign competitors to dominate.

This legislation gives more favorable treatment to foreign competitors, while undercutting America’s technological innovators. Not only will this package of bills stunt the growth of U.S. technology providers that played a key role in keeping Americans connected over the last 15 months during the pandemic, but it would hamper the ability of these job-creators, which accounted for 9 percent of U.S. Gross Domestic Product (GDP) or $1.85 trillion (in 2018 alone), creating millions of new jobs and supporting our economic recovery.

  1. Opens the door for state-owned enterprises to sue U.S. innovators.

What is being lost in this hurried debate is the potential harm this legislative package could inflict upon America’s tech innovators by essentially inviting state-owned enterprises to sue our domestic innovators. By creating opportunities for the Chinese Communist Party to easily abuse this provision and sue America’s innovators, lawmakers are putting America’s ability to continue leading the world in innovation in jeopardy.

  1. Empowers Chinese companies that pose a risk to U.S. national security.

By giving the Chinese Communist Party and other state-owned enterprises the ability to sue America’s tech innovators, the legislation could put U.S. national security at risk while resulting in slowed or halted innovations that are vital to advancing America’s national defense and cyber security strategy. Innovation is essential for the United States to maintain a competitive edge against foreign rivals and protect its national security and intellectual property.

  1. Exempts most foreign technology companies from oversight.

The House antitrust bills put China one step closer to becoming the world’s dominant tech leader by 2035 in their own estimate and weaken America’s ability to innovate in the face of aggressive foreign competitors. What’s more, companies including Alibaba, Tencent and Huawei, among others, would be exempt from oversight created in this set of legislation, essentially giving Chinese technology companies free reign for expansion, while stifling U.S. technology companies’ ability to compete.

  1. Provides China greater access to U.S. data.

The mandates created in this legislation would open up American data to foreign adversaries, namely China. According to the National Security Institute (NSI), “under the proposed legislative package, Chinese and Russian technology giants would remain unscathed – in fact, they would directly benefit from greater access to U.S. technology, as well as the data of U.S. citizens and businesses.”

Misguided reforms will only help foreign adversaries like China, while hampering the U.S. tech sector. Policymakers must look to smart solutions that also preserve America’s technological edge.