A report from Adam Savit and Royce Hood of the America First Policy Institute (AFPI) said that to better counter threats posed by China, the authority of the Committee on Foreign Investment in the U.S. (CFIUS) must be expanded. Savit and Hood released their report on September 18.
According to Savit, director of AFPI's China Policy Initiative, and Hood, a policy analyst, while foreign direct investment in the U.S. is an important source of capital for businesses, it also poses national security threats, particularly when China is involved. In 1975, CFIUS was created to address those risks, but they said that CFIUS is not equipped "to contend with the manifold threats to the United States resulting from the malign conduct of a great power adversary like the People’s Republic of China." The Chinese Communist Party's (CCP) investment into U.S. land, technology, and infrastructure presents economic and national security threats.
Savit and Hood suggested that CFIUS's authority should be modified in four ways to empower it to contend with the threats posed by China. First, they recommended that CFIUS create a "countries of concern" list, drawing from lists used by the Commerce and Defense Departments, to determine which nations present the greatest threats to the U.S. Countries on this list "should be required to undergo enhanced screening and have stricter controls on investment."
Second, according to Savit and Hood, "data and onshoring requirements should be aggressively enforced through mitigation measures." Any company that utilizes large quantities of commercial, personal, or generic data should be required to be housed fully in the U.S. "Access from overseas should be forbidden and aggressively policed, with severe financial and legal penalties for violations," they said.
Thirdly, foreign investors intending to purchase commercial assets in the U.S. "should not be entitled to comprehensive due process," they noted in their report. Fourthly, they argued that CFIUS should be "retooled to protect our sensitive infrastructure sites and military installations." Legislation should be enacted to implement screening processes for any adversarial nation looking to purchase land in the U.S., and the list of "sensitive sites," such as missile bases, should be expanded.
Before joining AFPI, Savit was China program coordinator at the Center for Security Policy and president of the Log Cabin Republicans of Washington D.C., according to AFPI's website. Additionally, he has held numerous national security research and communications roles. He is also a John Quincy Adams Fellow at the Common Sense Society.
