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Rubio, Hawley Question Dangerous Chip Waivers for China

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The U.S. Department of Commerce’s Bureau of Industry and Security (BIS) is reportedly preparing to indefinitely extend waivers that allow Korean and Taiwanese chipmakers to operate high-end semiconductor factories in China.

U.S. Senators Marco Rubio (R-FL) and Josh Hawley (R-MO) sent a letter urging U.S. Secretary of Commerce Gina Raimondo to reject these waivers, which would undermine the country’s semiconductor export-control regime and unfairly treat the many firms that are complying with the rules instead of lobbying for special treatment that ultimately harms the United States.

  1. “If true, this report exposes BIS’s export-control rule as hollow, and provides further evidence that the Biden Administration’s talk of “competing” with the CCP is weakness masquerading as strength.”
  2. “BIS’s waivers are, at best, a slap in the face to those American, Dutch, and Japanese firms that have agreed to comply with the export controls… These waivers would divide our allies and partners when a united response is needed to confront the CCP.”
  3. “If the United States is serious about halting the CCP’s plans to dominate in the technologies of the future, we must get serious about keeping technology away from the PRC.”

 

 

The full text of the letter is below.

 

Dear Secretary Raimondo:

 

We write to express alarm that the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) is reportedly preparing to gut semiconductor export controls intended to restrict the People’s Republic of China’s (PRC) access to advanced computer chips. The report states that BIS will extend waivers that allow South Korean and Taiwanese chipmakers to operate as well as expand high-end semiconductor factories in the PRC. If true, this report exposes BIS’s export-control rule as hollow, and provides further evidence that the Biden Administration’s talk of “competing” with the CCP is weakness masquerading as strength.

 

Issued on October 7, 2022, the BIS interim final rule ostensibly restricted the export of high-end semiconductors and semiconductor equipment made with American technology to the PRC. This rule, at best, was a step in the right direction. It restricted cutting-edge technology, while imposing no limits on legacy chips, which make up the bulk of global sales and have dual-use applications that could support the People’s Liberation Army. Unfortunately, BIS weakened this modest rule by issuing one-year waivers to Taiwanese firm TSMC, as well as Korean firms SK Hynix and Samsung Electronics. These waivers were presented as a one-year grace period that would allow these chipmakers to end restricted transactions with the PRC. Now it seems this was actually spin, and that BIS will allow these foreign chipmakers to do business freely with the PRC. Undersecretary of Industry and Security Alan Estevez, the head of BIS, reportedly told the semiconductor industry’s lobbying group that those waivers will be extended for the foreseeable future. If this report is true, these waivers will deliver sensitive technology to Beijing on a silver platter.

 

The CCP is executing an all-out campaign of subsidies, threats, and technology theft to build its semiconductor industry, in keeping with General Secretary Xi Jinping’s boast that the CCP will be the “gravediggers of capitalism” in the twenty-first century. The PRC’s special interest in this sector is outlined in its Made in China 2025 industrial strategy and other guidelines and policies, such as its Military-Civil Fusion (MCF) strategy. According to the bipartisan U.S.-China Economic and Security Review Commission, “Beijing is attempting to establish a leading position in the next global ‘revolution in military affairs’ and is employing its [MCF] strategy to gain advantage in key emerging technologies.” Just this month, a former Samsung executive was arrested and charged by authorities in the Republic of Korea with stealing factory blueprints with the intent of duplicating a Samsung factory in the PRC. This example is one of hundreds. BIS is now making the CCP’s job easier by allowing some of the world’s biggest chipmakers to sell more chips to the PRC, helping Chinese engineers access, copy, and steal that technology.

 

BIS’s waivers are, at best, a slap in the face to those American, Dutch, and Japanese firms that have agreed to comply with the export controls. Korean and Taiwanese firms, some of the largest and best-connected in the industry, would stand to pick up market share from firms that comply with the export controls and did not lobby for an exemption. These waivers would divide our allies and partners when a united response is needed to confront the CCP. At worst, we fear BIS could point to the very harms caused by its waivers to try to reverse the interim rule entirely.

 

BIS’s export-control rule was presented as the centerpiece of the Biden Administration’s attempt to cut off Beijing’s access to cutting-edge technology, in keeping with its so-called “small yard, high fence” approach to export controls. That approach was always inadequate to the scale of the threat. Another round of waivers would make it laughable. If the Biden Administration’s goal is to restrict cutting-edge technology to the CCP, why is it contemplating giving indefinite licenses to foreign firms so they can continue offering dangerous technology in the PRC?

 

If this report is true, it fits with the overall trend of the Biden Administration’s broken export-control regime and weakness toward Beijing. In 2021, BIS approved 88 percent of applications for export licenses to the PRC; the previous year, 94 percent of applications were approved.5 If the United States is serious about halting the CCP’s plans to dominate in the technologies of the future, we must get serious about keeping technology away from the PRC. As such, we urge you to immediately reject these waivers.

 

Thank you for your attention to this important matter.

 

Sincerely,

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THE HOUSE WHITE: Vice President Kamala Harris to Return to Charlotte, NC June 12

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On Wednesday, June 12, Vice President Kamala Harris will return to Charlotte, NC for the fourth stop on her nationwide Economic Opportunity Tour. This will be her fifth visit to the state this year and her 13th since being sworn in.

During each stop of the Vice President’s Economic Opportunity Tour, she is highlighting how the Biden-Harris Administration has built economic opportunity, supported communities, and delivered historic investments for the American people. This includes making unprecedented investments in small businesses, creating a record number of jobs, and increasing access to capital for underserved communities. It also includes erasing medical debt, forgiving more student loan debt than any administration in history, boosting investments in education, making housing more affordable, lowering child care costs, and increasing the wealth of American families.

Vice President Harris launched her Economic Opportunity Tour in April with a moderated conversation in Atlanta, GA. She continued it last month with a speech in Detroit, MI and a moderated conversation in Milwaukee, WI. She is being joined along the way by Administration officials, members of Congress, local leaders, and small business owners.

The Vice President was last in Charlotte back in April to announce $20 billion in Greenhouse Gas Reduction Fund grants that will mobilize private capital and deliver clean energy and climate solutions. In March, she was in Raleigh with President Biden to highlight their ongoing work to lower prescription drug costs, protect Medicare and Medicaid, and fight for reproductive freedom. Vice President Harris also visited Black Wall Street in Durham to announce investments in strengthening entrepreneurship, increasing access to capital, and supporting small businesses. She began 2024 by visiting Eastway Middle School in Charlotte to announce $285 million in funding to help schools across the nation hire and train mental health counselors.

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US NATIONAL NEWS

RECORD AMOUNT RAISED FOR PRESIDENT TRUMP’S CAMPAIGN IN MAY ALONE – $141 MILLION IN SMALL DONATIONS, ALMOST $300 MILLION OVERALL!

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Today, President Trump’s Campaign, together with the RNC, announced a massive $141 million fundraising haul in May, a response of support for President Trump while facing the sham Biden trial and verdict that outraged and motivated Americans from every walk of life. This overwhelming financial success is the result of over 2 million donations, A RECORD, which came in at an average of $70.27. In addition to the staggering amount, 25% of May’s donors were brand new to the 2024 campaign, making the month the best ever recorded for any Campaign in History. Additionally, organizations supporting President Trump raised another $150 million in May. Taken together, the Campaign, and other Trump supporting organizations, raised almost $300 million during the month of May alone, ALSO A RECORD!

“We are moved by the outpouring of support for President Donald J. Trump. The American people saw right through Crooked Joe Biden’s rigged trial, and sent Biden and Democrats a powerful message – the REAL verdict will come on November 5th,” said Trump Campaign senior advisers Chris LaCivita and Susie Wiles. “President Trump raised $141 million in small donations alone this month because Americans remember the Roaring Economy, Secure Border, and Peace through Strength at home and abroad under President Donald J. Trump, and want us to return to prosperity and success when he is re-elected in November.”

This total comes after the Campaign raised $53 million online in the 24 hours - 37.6% OF THE TOTAL HAUL AND MORE THAN $2 MILLION PER HOUR – since Crooked Joe Biden and his New York henchmen secured their rigged verdict in hopes of swaying the election.

“The American people saw the Biden Trials for what they are, a Political Hoax and Election-Interfering attempt to keep President Trump away from voters and confined to a freezing courtroom, THE ICEBOX. Based on these record contribution numbers, and Polling, it didn’t work because voters understand the clear contrast between Donald J. Trump’s record of success, and Joe Biden’s failures,” said RNC Chairman Michael Whatley and Co-Chairman Lara Trump. “Unfortunately for Democrats, their rigged political operation has backfired in a historic way, and Republicans are in a stronger position than ever to FIRE Crooked Joe Biden and Make America Great Again by electing President Trump on November 5.”

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US NATIONAL NEWS

Chairman Williams: “Weaponizing Federal Resources: Exposing the SBA’s Voter Registration Efforts”

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WASHINGTON, D.C. – Today, the House Committee on Small Business is holding a full committee hearing titled Weaponizing Federal Resources: Exposing the SBA’s Voter Registration Efforts.”

Chairman Williams’ opening statement as prepared for delivery:

Good morning, and welcome to today’s hearing which will focus on the SBA’s Memorandum of Understanding with the State of Michigan to register voters.

I’d like to start off by thanking our witnesses for being here with us today. Your input on these important issues is greatly appreciated.

This Committee is charged with oversight of the Small Business Administration. This is a responsibility that we do not take lightly, and today we will look into how much this agency has deviated from the core mission of helping Main Street America. The SBA is tasked with aiding, counseling, and protecting the interests of small businesses across our great nation. Instead of fulfilling these goals, the SBA has entangled itself in electioneering activities that not only lack a constitutional basis, but also betray the trust and purpose for which the Agency was established.

This MOU with Michigan demonstrates a gross misalignment of the SBA’s priorities. Small businesses have been crushed the past few years with stubborn inflation, high interest rates, and a significant labor shortage. And while all of these issues have been hurting Main Street’s ability to thrive, the SBA has decided to dedicate their staff’s time and resources to register voters in a key swing seat ahead of the 2024 election.

Not only does this agreement turn its back on the entrepreneurs that are struggling, but it opens up a whole host of potential conflicts of interest.

If a president and their agencies were permitted to freely involve themselves in elections, they could misuse this influence to stay in power. The American people need to have confidence that Agencies are acting to carry out their duties without the fear of political interference. Unfortunately, this is no longer the case, and as the SBA is planning events around Michigan, the American people are going to be left wondering if the event is only being held to register President Biden’s target voting blocks.

Because of the potential to misuse this new power to register voters, the Committee immediately sent letters and started asking questions about how the SBA is carrying out these orders. And as we started asking questions, the lack of transparency was astounding. It took the SBA over 6 weeks to even show us the MOU after their initial press release announcing the new electioneering agreement. Additionally, after an SBA employee was caught on tape bragging about the Administrator’s campaign activities, they failed to make him available to speak with the Committee until we issued the first subpoenas in more than a decade.

This Committee will not stop calling out this misuse of power and will use every tool at our disposal to get the answers we need from the SBA.

I want to thank you all again for being here with us today, and I am looking forward to today’s important conversation.

With that I will yield to our distinguished Ranking Member from New York, Ms. Velázquez.

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