By Steve Coonen, CTT Special Advisor
China’s brazen violation of U.S. airspace to collect intelligence via a spy balloon has justifiably served as a clarion call for the American people to more closely scrutinize the threat to U.S. national security from the Chinese Communist Party (CCP). Now that the balloon is confirmed to have used commercially available American technologies, it’s clear that a China-focused national security strategy should begin with stopping American tech from supporting China’s military modernization efforts.
The news that the spy balloon had U.S. parts in it underscores the fact that the Chinese government has no qualms weaponizing American technology against the U.S. As Rep. Michael McCaul (R-TX), Chair of the House Foreign Affairs Committee, and Sen. Bill Hagerty (R-TN), former U.S. Ambassador to Japan, said in a joint statement, “This news heightens our concerns from the start that the CCP uses U.S. technology in its intelligence and military activities, including in the surveillance balloon. This incident has not been closed, and we look forward to viewing the full technology analysis of the surveillance balloon. Competitive actions, like export controls, must move forward to stand up to Communist China.”
Why are leaders like Rep. McCaul and Sen. Hagerty calling for more export controls? The answer lies in how China uses American technology. For decades, the U.S. has unabashedly transferred controlled dual-use technologies (those with both civil and military applications – like semiconductor manufacturing equipment) to the People’s Republic of China (PRC). Historically, the U.S. has approved well over 90 percent of requests to export controlled dual-use technologies to China – on par with many allies and a trend that, despite an increasingly hostile CCP, still continues to this day. According to the latest statistics from the Department of Commerce’s Bureau of Industry and Security, the U.S. continues to approve the vast majority of requests for controlled technology to the PRC, 88 percent in 2021.
The problem with letting dual-use technologies flow to China emanates from the Chinese Communist Party’s Military-Civil Fusion (MCF) strategy. When ordered, Chinese laws compel that imported controlled technologies be diverted to the People’s Liberation Army (PLA) or the Ministry of State Security (MSS). In essence, any technology transferred to China’s civil sector, to include intellectual property derived from business deals with U.S. companies, can be coopted by the military and state security apparatchik.
Furthermore, the U.S. has no means to verify the actual end-use of technologies transferred to the PRC after time limitations elapse. With other countries, U.S. export control officials can conduct post-shipment verifications with few restrictions. On the other hand, unique to China, U.S. officials have only 180 days after an item is shipped to submit a request to conduct a check, after that China can do as they please with American technologies. This rather restrictive verification arrangement is an open invitation for diversion, not only within China, but also between China and other states whose friendship has no limits.
For instance, did the excessive amounts of controlled carbon fiber filament actually go to making golf club shafts and brake pads, as indicated on the end-use statements for certain transfer requests? Or, since the same material is used in the manufacture of nose cones for intercontinental ballistic missiles (ICBM), was it diverted to the PLA for their ICBM program? Or, consider the thousands of controlled microelectronics approved for transfer under the auspices that their use is for telecommunications equipment. For example, the same field programable gate arrays (FPGA) and monolithic microwave integrated circuits, or MMICs, that are used in cell phones and wireless communication devices are also used in advance military radars and missiles. Did those components end up in cell phone towers or anti-aircraft missiles to be fired at U.S. pilots in some future conflict? Unlike with every other trading partner, the U.S. has no way to verify these disquieting questions with China.
In addition, Chinese entities have a long-standing record of diverting U.S. technologies, and when U.S. export control officials learn of these diversions, they add those firms or persons to the U.S. entity list, which imposes certain export restrictions. However, misplaced faith in this whack-a-mole approach fails to recognize the systemic nature of diversion under President Xi’s MCF strategy. Business names, individuals, and address are easily and quickly changed, or new businesses established, to maintain the flow of needed U.S. technologies.
What becomes readily obvious is that U.S. export control officials continue to ignore such important national security implications with each transfer of sensitive or useful military technology to China. Do these officials honestly believe the stated end-uses for these dual-use technologies coming from the same regime that openly pillages U.S. technology through cyber and corporate espionage, and has misled the world on so many other issues: from blatant human rights violations of ethnic minorities to hindering an understanding of the corona virus; from militarizing the South China Sea to most recently stating that the PLA surveillance balloon that loitered above a U.S. strategic missile site was an errant weather balloon?
Ironically, far from restricting key technologies, U.S. export control officials and their policies appear to be provisioning the PLA with the very capabilities that will give Chinese leaders the confidence to invade Taiwan tomorrow, or perhaps even fly a spy-balloon over the continental United States today. If further investigations into the components of the spy balloon reveal the existence of controlled technologies, then policymakers should have even more rationale to tighten the flow of American tech to China.
Steve Coonen joined CTT as a Special Advisor earlier this year. Prior to that, he spent more than two decades in uniform as a U.S. Army artillery and foreign affairs officer and then nearly fourteen years as an analyst at the Defense Technology Security Administration (DTSA), the Pentagon’s unit for developing export control and technology security policies.
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