Canada backed down from its threat to impose a 25% surcharge on electricity coming into the Unites States after President Donald Trump said he would double tariffs on Canada&#8217;s steel and aluminum products.
Ontario Premier Doug Ford said Tuesday that he had agreed to suspend the electricity import surcharge after speaking with Commerce Secretary Howard Lutnick, which the two called a &#8220;productive conversation&#8221; in a joint statement.
Ford and Lutnick said they plan to meet on Thursday to discuss renewing the trade deal between the United States, Canada, and Mexico that Trump signed during his first term ahead of April 2, when the United States plans to impose <a href="https://x.com/fordnation/status/1899531171622522925" target="_blank" rel="noopener">reciprocal tariffs</a> on almost every country.
Earlier on Tuesday, Trump ripped Canada in a post on Truth Social, saying new 50% tariffs on steel and aluminum would take effect Wednesday morning.
Ontario supplies electricity to Minnesota, New York, and Michigan. Trump said he would declare a national emergency for the areas Ontario is targeting with the electricity surcharge.
“Why would our Country allow another Country to supply us with electricity, even for a small area? Who made these decisions, and why? And can you imagine Canada stooping so low as to use ELECTRICITY, that so affects the life of innocent people, as a bargaining chip and threat? They will pay a financial price for this so big that it will be read about in History Books for many years to come!” Trump <a href="https://truthsocial.com/@realDonaldTrump/posts/114144501101999196">posted</a>.
He also threatened to “substantially increase” tariffs on Canadian cars next month unless Canada drops its “other egregious, long time Tariffs.” He demanded Canada drop its “Anti-American Farmer Tariff” on various U.S. dairy products, which he said has “long been considered outrageous.”
Trump said Canada pays “very little” for national security and relies on the United States for military protection.
“We are subsidizing Canada to the tune of more than 200 Billion Dollars a year. WHY??? This cannot continue,” Trump <a href="https://truthsocial.com/@realDonaldTrump/posts/114144217763824399">said</a>.
Trump said the &#8220;only thing that makes sense&#8221; is for Canada to become &#8220;our cherished Fifty First State.&#8221; The president added that the country&#8217;s &#8220;brilliant anthem, &#8216;O Canada'&#8221; can continue to play representing a &#8220;great and powerful state.&#8221;
Previously, Ford had vowed to maintain an aggressive approach.
“I will not hesitate to increase this charge. If the United States escalates, I will not hesitate to shut the electricity off completely,” Ford said at a news conference in Toronto.
Mark Carney, who was just elected on Sunday to replace Justin Trudeau as party leader and Canada’s prime minister also said Canada would keep tariffs in place until Americans “show us respect.”
“President Trump’s latest tariffs are an attack on Canadian workers, families, and businesses,” Carney posted on X.
“My government will ensure our response has maximum impact in the US and minimal impact here in Canada, while supporting the workers impacted. My government will keep our tariffs on until the Americans show us respect and make credible, reliable commitments to free and fair trade,” Carney said.
Trump has imposed tariffs on Canada, Mexico, and China to pressure them to stop the flow of deadly drugs like fentanyl into the United States.

President Trump Swears In Howard Lutnick As Commerce Secretary

Canada Backs Down On Electricity Surcharge After Trump Tariff Threats

Canada

Commerce Department

Donald Trump

Global Politics

Howard Lutnick

Ontario

Trump Administration

World

Two Chinese nationals have been accused by the Justice Department of attempting to illegally export American technology to China.
The two, 44-year-old Han Li and 64-year-old Lin Chen, are <a href="https://www.justice.gov/usao-ndca/pr/chinese-national-arrested-us-alleged-role-scheme-illegally-export-semiconductor" target="_blank" rel="noopener">charged</a> with crimes related to an alleged conspiracy to smuggle American-made technology related to semiconductor production to restricted Chinese companies. If convicted, the two could face decades in prison and millions of dollars in fines. 
“As alleged, the defendants sought to evade export controls to obtain U.S. semiconductor manufacturing technology for a prohibited Chinese company,” said Assistant Attorney General Matthew G. Olsen of the Justice Department’s National Security Division. “The Justice Department is committed to enforcing export controls and holding accountable those who seek to illicitly procure U.S.-developed technologies that puts our national security at risk.”
Chen was arrested in Chicago on Thursday while Li is believed to be in China. 
According to the DOJ, the two used a series of intermediary companies to evade Commerce Department restrictions from May 2015 to August 2018. The indictment says that they were attempting to illegally export a machine used to cut thin semiconductors, known as silicon wafers, which are used in a variety of electronic devices. 
The two allegedly set up a company called Jiangsu Hantang International to purchase the machines from the California based Dynatex International. Instead of using the technology, they then attempted to illegally export the machines to restricted companies in China, the indictment says. 
The restrictions were imposed to prevent certain American technology from falling into the hands of China&#8217;s military. 
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“The export restrictions at issue in this case were put in place to prevent the illicit procurement of commodities and technologies for unauthorized military end use in the People’s Republic of China,” said U.S. Attorney for the Northern District of California Ismail Ramsey. 
Investigators from the FBI, Homeland Security, and the Commerce Department all worked on the case. 
“Stopping the illegal export of U.S. technology to China is one of the FBI’s highest priorities. We will aggressively pursue anyone who violates export control laws designed to protect our national and economic security,” said FBI Agent Robert Tripp.
The United States&#8217;s national security agencies have warned for years about Chinese theft of American technology and intellectual property.

Close-up gloved hands holding detail microchip

Chinese Nationals Accused Of Conspiracy To Smuggle American Technology Into China

Chicago

China

Department of Justice

Smuggling

Over a dozen Republican attorneys general are challenging the Biden administration over a proposed policy that would push diversity, equity, and inclusion (DEI) principles in the private sector. 
The coalition of 19 states, led by Tennessee Attorney General Jonathan Skrmetti, Montana Attorney General Austin Knudsen, and Kansas Attorney General Kris Kobach, <a href="https://www.tn.gov/content/dam/tn/attorneygeneral/documents/pr/2024/pr24-01-comment.pdf" target="_blank" rel="noopener">argues</a> that the Commerce Department’s proposed “Business Diversity Principles” promote racial discrimination and anti-American principles. 
The <a href="https://www.federalregister.gov/documents/2023/11/29/2023-26254/business-diversity-principles" target="_blank" rel="noopener">proposed principles</a> from the Commerce Department would push the “best practices related to diversity, equity, inclusion, and accessibility (DEIA) in the private sector.” The AGs say that the principles promote race-based hiring, which is a violation of federal law. 
“The federal Department of Commerce needs to recognize it’s not legal to treat people differently because of the color of their skin,” Skrmetti said in a statement. “We’re warning the Department that its proposed ‘Business Diversity Principles’ guidance violates the law, promotes racial discrimination, and would lead our country backward.”
One of the principles would tell companies to track “demographic data across all levels and departments, company policies, practices, and workers&#8217; perception” in order to say how well it was following DEIA guidelines. 
It would also push corporations to pursue “clear strategies to increase diversity among the organization&#8217;s executive ranks” and make sure they have access to “DEIA professionals.” The proposal adds that corporations should maintain “DEIA councils” to oversee the implementation of DEIA principles. 
The Republican officials said in their letter that focusing on race was counterintuitive to true diversity. 
“We endorse the value of promoting meaningful diversity of experience, thought, and background among the public- and private-sector workforce. But race is both a poor and unlawful proxy for achieving that end,” they wrote. &#8220;We write to briefly reiterate the significant legal defects with the Department’s proposal to push race-based discrimination to advance the Department’s DEIA agenda.&#8221;
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The AGs of Alabama, Arkansas, Florida, Georgia, Idaho, Indiana, Iowa, Louisiana, Mississippi, Missouri, Nebraska, North Dakota, South Carolina, Texas, Virginia, and West Virginia also signed on to the letter. 
The proposal comes as part of the Biden administration’s put DEI policies in place throughout every area of the federal government. The push was started on Biden’s first day in office when he signed an executive order called “Advancing Racial Equity and Support for Underserved Communities Through the Federal Government.”

US-NEWS-WILL-ELECTION-CONSPIRACY-THEORIES-CAUSE-7-KC

Republican AGs Challenge Commerce Department’s DEI Proposal

Republican AGs Challenge Commerce Department's DEI Proposal

Biden Administration

Diversity Equity and Inclusion (DEI)

Kansas

Montana

Politics

Racial Discrimination

Tennessee

The <a href="https://www.dailywire.com/topic/biden-administration" target="_blank" rel="noopener">Biden administration</a> tightened restrictions on exporting advanced computing semiconductors and semiconductor manufacturing equipment to China on Tuesday to counter the Chinese government from producing military applications involving hypersonic missiles and artificial intelligence.
U.S. Commerce Secretary Gina Raimondo said in a <a href="https://www.bis.doc.gov/index.php/documents/about-bis/newsroom/press-releases/3355-2023-10-17-bis-press-release-acs-and-sme-rules-final-js/file" target="_blank" rel="noopener">news release</a> that the administration updated the export rules to further shut off pathways China uses to evade restrictions.
&#8220;These controls maintain our clear focus on military applications and confront the threats to our national security posed by the [People&#8217;s Republic of China] Government&#8217;s military-civil fusion strategy,&#8221; Raimondo said. &#8220;As we implement these restrictions, we will keep working to protect our national security by restricting access to critical technologies, vigilantly enforcing our rules, while minimizing any unintended impact on trade flows.&#8221;
The updated restrictions impose license requirements for companies from nearly two dozen countries under U.S. arms embargoes to prevent countries of concern from diverting access to restricted items to China.
Raimondo reportedly told members of the press on Monday that while AI has the potential for &#8220;huge societal benefits,&#8221; it could also invoke &#8220;tremendous and profound harm if in the wrong hands and in the wrong militaries.&#8221;
The move comes over a year after Biden officials announced they would revise China&#8217;s access to certain high-end chips critical for military advantage.
After visiting Beijing and Shanghai in August, The Hill <a href="https://thehill.com/policy/technology/4260804-biden-administration-china-ai-chip-export-restrictions/" target="_blank" rel="noopener">reported</a> Raimondo said that the Biden administration is &#8220;trying to choke&#8221; China&#8217;s military capacity.
&#8220;If they feel that, that means our strategy&#8217;s working,&#8221; she told NBC&#8217;s &#8220;Meet the Press&#8221; in early September. &#8220;Certainly, on my watch, we are not going to sell the most sophisticated American chip to China that they want for their military capacity.&#8221;
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But she <a href="https://www.axios.com/2023/10/17/biden-export-restrictions-ai-chips-china?utm_campaign=editorial&amp;utm_content=politics&amp;utm_source=twitter&amp;utm_medium=social" target="_blank" rel="noopener">reportedly</a> said the Biden administration&#8217;s &#8220;export controls are not designed to impair China&#8217;s economic growth.&#8221;
&#8220;We don&#8217;t want to be more restrictive than necessary,&#8221; Raimondo said, adding that the vast majority of semiconductors would remain unrestricted.
Mao Ning, a Chinese Foreign Ministry spokesperson, <a href="https://www.fmprc.gov.cn/mfa_eng/xwfw_665399/s2510_665401/2511_665403/202310/t20231016_11161588.html" target="_blank" rel="noopener">criticized</a> the U.S. for expanding export controls on Monday, accusing the U.S. of &#8220;politicizing and weaponizing trade and tech issues&#8221; and &#8220;destabilizing global industrial and supply chains.&#8221;
President Joe Biden <a href="https://www.whitehouse.gov/briefing-room/presidential-actions/2023/08/09/executive-order-on-addressing-united-states-investments-in-certain-national-security-technologies-and-products-in-countries-of-concern/" target="_blank" rel="noopener">signed</a> an executive order in August imposing restrictions on outbound 
investments in China&#8217;s industries ranging from artificial intelligence to semiconductor and quantum computing, but administration officials reportedly admitted that slowing down the Chinese military from gaining access to such technology without economic consequences could pose a challenge.
&#8220;Now I can&#8217;t say that there&#8217;s not going to be some slowdown in Chinese capability around artificial intelligence at that high level that could possibly be used for goodness,&#8221; a senior administration official, who spoke on the condition of anonymity in a briefing ahead of the announcement, <a href="https://www.washingtonpost.com/technology/2023/10/17/commerce-china-chip-sanctions/" target="_blank" rel="noopener">told</a> The Washington Post. &#8220;But we have to focus on the national security implications there. Large language model applications or military applications can be very risky for the United States and its allies.&#8221;

CHINA-US-TRADE-DIPLOMACY-RAIMONDO

Biden Admin Tightens Exporting AI Chip Restrictions To China

Artificial Intelligence

Communist China

Executive

Gina Raimondo

Sen. <a href="https://www.dailywire.com/topic/jd-vance" target="_blank" rel="noopener">J.D. Vance</a> (R-OH) confronted the Biden administration&#8217;s commerce secretary on Wednesday over so-called diversity mandates dictating the hiring practices for domestic semiconductor manufacturing companies seeking federal funding as the industry faces a shortfall of skilled workers.
Vance, who sits on the Senate Commerce Committee, tore into U.S. Commerce Secretary Gina Raimondo during a hearing that focused on the implementation and oversight of the $52.7 billion <a href="https://www.congress.gov/117/bills/hr4346/BILLS-117hr4346enr.pdf" target="_blank" rel="noopener">CHIPS and Science Act</a>, which provides grant support for new manufacturing sites and research and development while also including various provisions aimed at promoting diversity, equity, and inclusion.
Meanwhile, the Semiconductor Industry Association (SIA) and Oxford Economics published a <a href="https://www.semiconductors.org/wp-content/uploads/2023/08/SIA_State-of-Industry-Report_2023_Final_080323.pdf" target="_blank" rel="noopener">report</a> over the summer that showed semiconductor manufacturers face a shortfall of roughly 67,000 workers by 2030, painting a grim future for U.S. industries needing computer scientists, engineers, and technicians.
&#8220;I&#8217;m struggling to make sense of the fact that we apparently have a shortage of skilled labor to manufacture chips on the one hand, and yet the Secretary of Commerce is telling people that they can only hire the people who check the right diversity boxes,&#8221; Vance <a href="https://www.youtube.com/watch?v=hcSORWzpaSs" target="_blank" rel="noopener">said</a>. &#8220;That doesn&#8217;t make a ton of sense — and seems to be counterproductive to the goal of bringing this industry back to the United States in the first place.&#8221;
The Biden administration <a href="https://www.dailywire.com/news/biden-signs-52-billion-semiconductor-bill-in-latest-push-to-fight-inflation" target="_blank" rel="noopener">signed</a> the act into law last year as an effort to combat supply-driven inflationary pressures and bring American manufacturing industries back to the United States as multiple key Asian manufacturing economies enforced harsh lockdown measures two years ago in response to COVID, creating bottlenecks in the global semiconductor supply chain that persist to the present day.
The department is overseeing a $39 billion semiconductor subsidy program under the act to help create industry jobs. The department <a href="https://fortune.com/2023/10/03/commerce-secretary-gina-raimondo-china-semiconductor-ai-working-group/" target="_blank" rel="noopener">reportedly</a> has received over 500 statements of interest from companies to work on semiconductor manufacturing and over 100 applications.
But Vance&#8217;s concerns over the particular implementation criteria could sway a company to plant a chip fabrication facility in China rather than the U.S.
&#8220;From China, they get cheap labor, massive subsidies, and a government that seems to want to work with them,&#8221; he said. &#8220;From the United States, they get a little bit of money and a human resources statement that looks like it was written by a 22-year-old gender studies graduate of Harvard or Yale.&#8221;
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Raimondo acknowledged during the hearing the need for the U.S. to produce chips and said the federal government would use the legislation toward labor, training, and workforce, but denied companies are mandated to hire so-called diversity applicants.
&#8220;What would you call it when the Secretary of Commerce says you must do this in order to receive funding? If it&#8217;s not a mandate, what is it?&#8221; Vance asked. &#8220;They have to show us a workforce plan in order to receive money from the federal government &#8212; that is the definition of a mandate. You must do X in order to receive Y dollars.&#8221;
&#8220;Why would you locate your facility in the United States of America when you get a human resources lecture from us, but from China, you get a whole lot of money and a whole lot of facilitation for your business? What&#8217;s the market economy here? Is it the economy that makes it hard to do business or easier to do business?&#8221;
Raimondo contended her job is to &#8220;protect taxpayer money.&#8221;
&#8220;And in order to do that, these companies have to be able to meet their mission,&#8221; she <a href="https://www.commerce.senate.gov/2023/10/chips-and-science-implementation-and-oversight" target="_blank" rel="noopener">said</a>. &#8220;And in order to do that, they need to have a trained workforce, and I&#8217;m going to work with them to make sure that happens.&#8221;
Raimondo said during the hearing that her department hopes to award its first chips funding award from the government&#8217;s multi-billion dollar semiconductor subsidy program by the end of this year.
&#8220;I am moving as fast as I can, but it&#8217;s more important to get it right than move fast,&#8221; Raimondo said.
Ben Zeisloft contributed to this report.

J.D. Vance Sept 7

J.D. Vance Grills Commerce Sec Over ‘Diversity Mandates’ For Fed Funding In Semiconductor Industry

J.D. Vance Grills Commerce Sec. Over Unfriendly U.S. Business Policies

Congress

JD Vance

U.S. Senate

U.S. businesses are getting fed up with trying to deal with the unpredictability of <a href="https://www.dailywire.com/topic/china">China</a>, according to a top <a href="https://www.dailywire.com/topic/biden-administration">Biden administration</a> official.
Commerce Secretary <a href="https://www.dailywire.com/topic/gina-raimondo">Gina Raimondo</a>, who appeared for multiple interviews on Sunday to talk about her recent trip to China, told <a href="https://www.youtube.com/watch?v=yxtxW5uinas">CBS News&#8217; &#8220;Face the Nation&#8221;</a> that creating a fair and competitive environment was a pressing issue amid concerns about opaque regulations, <a href="https://www.ft.com/content/f956ab7c-7980-44e4-b2b4-5f101398e2b3">raids</a> by Chinese authorities, and preserving trade secrets.
&#8220;I&#8217;ll tell you, prior to going to China, I personally spoke with more than 100 U.S. business leaders and labor leaders. And what they tell me is that even the ones that have been doing business in China for decades, you know, these are sophisticated people used to dealing with the traditional concerns of, you know, IP theft or non-market practices,&#8221; Raimondo said.
&#8220;They say, it&#8217;s much harder now, right? Like China is making it more difficult because of the reasons you say the &#8212; raids, the counter-espionage law. They are going to make a business decision to do business in other countries unless that improves. And so I was very clear with China that we need to — patience is wearing thin among American business,&#8221; she added. &#8220;They need and deserve a predictable environment and a level playing field. And hopefully China will heed that message so we can have a stable [and] growing commercial relationship.&#8221;
Raimondo traveled to China last week to map out cooperation areas in the commercial sector and address &#8220;challenges&#8221; faced by U.S. businesses.
She met with Chinese Minister of Commerce Wang Wentao, who stressed that trade and economic relations between their countries are suitable for the world economy, according to a readout from China&#8217;s embassy in the United States. Wang also raised concerns about issues that are a priority for Beijing, such as tariffs, semiconductor policies, and investment restrictions, per the release.
The Biden administration recently sent another Cabinet official, <a href="https://www.dailywire.com/news/yellen-admits-to-eating-magic-mushrooms-in-china">Treasury Secretary Janet Yellen</a>, to China in a bid to improve relations at a time of <a href="https://apnews.com/article/yellen-china-tensions-spy-balloon-taiwan-russia-edcb0077d45a3ffabbe4b9dbbf9fe29c">rising tensions</a>.
Raimondo said she believes her visit amounted to a &#8220;great deal of progress,&#8221; including the opening of new lines of communication and an agreement to share information about export controls, though she noted that commercial interests need to be balanced with national security needs. The secretary claimed she confronted Chinese officials about a <a href="https://www.wsj.com/articles/chinese-hackers-spied-on-state-department-13a09f03">hacking campaign</a> that gained access to her emails, an incident she said &#8220;erodes&#8221; trust.
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Chinese officials gave &#8220;verbal assurances&#8221; that U.S. businesses would be treated &#8220;fairly, that they will not engage in non-market practices which hurt American workers,&#8221; Raimondo added. The secretary said she told her Chinese counterparts that she wanted to see them live up to their words.
&#8220;Time will tell whether they are going to really be as they say they want to be, you know, more market-oriented and open and reform-minded when it comes to their economy, their regulatory regime,&#8221; Raimondo said. &#8220;They need to be less arbitrary in the way they administer regulations to actually give American businesses a fair shot to compete.&#8221;

Biden’s Commerce Secretary Warns U.S. Businesses Getting Impatient With China

Biden's Commerce Secretary Warns U.S. Businesses Getting Impatient With China

Department of Commerce

House Republicans have opened a probe into suspected Chinese cyber-espionage campaigns targeting the <a href="https://www.dailywire.com/topic/state-department" target="_blank" rel="noopener">State Department</a> and the Commerce Department after hackers gained access to federal government communications. 
The <a href="https://oversight.house.gov/release/comer-mace-grothman-open-probe-into-data-breach-of-email-systems-at-u-s-federal-agencies/" target="_blank" rel="noopener">investigation</a> is being led by House Oversight and Accountability Chair James Comer (R-KY), Rep. Nancy Mace (R-SC), and Rep. Glenn Growthman (R-WI). In two letters sent Wednesday, the lawmakers requested further information from Secretary of State Antony Blinken and Commerce Secretary Gina Raimondo after <a href="https://www.wsj.com/articles/chinese-hackers-spied-on-state-department-13a09f03" target="_blank" rel="noopener">reports</a> last month that Chinese hackers had gained access to communications from both departments. 
“According to recent reports, as part of a ‘suspected cyber-espionage campaign to access data in sensitive computer networks’ by China, the breaches reportedly occurred at over two dozen organizations, including some U.S. government agencies. The Department discovered this alleged intrusion by China on June 16, 2023, yet, you left later that evening for a trip to Beijing,” the <a href="https://oversight.house.gov/wp-content/uploads/2023/08/State-Dept-Email-System-Breach-Letter.pdf" target="_blank" rel="noopener">letter</a> to Blinken said. 
The lawmakers want a briefing on the compromise by August 9, saying they believed the recent discovery of the hacking indicated that China’s cyberattacks were becoming more advanced. 
“The incident even raises the possibility that Chinese hackers may be able to access high-level computer networks and remain undetected for months if not years,” the letter says. 
Lawmakers also requested a briefing from Raimondo in a nearly identical letter to the one sent to Blinken. 
News of the hacking, which federal officials first discovered in June, was first made public in July. 
 “Microsoft notified the department of a compromise to Microsoft’s Office 365 system, and the department took immediate action to respond,” a spokesman for the Commerce Department said last month. “We are monitoring our systems and will respond promptly should any further activity be detected.”
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In March, the White House put out a <a href="https://www.whitehouse.gov/wp-content/uploads/2023/03/National-Cybersecurity-Strategy-2023.pdf" target="_blank" rel="noopener">framework</a> discussing the need for cybersecurity, warning that China, North Korea, Russia, and Iran were all working to increase their cyber capabilities.
According to the framework, China represents “the broadest, most active, and most persistent threat to both government and private sector networks and is the only country with both the intent to reshape the international order and, increasingly, the economic, diplomatic, military, and technological power to do so.”
It added that China was pursuing “digital authoritarianism” to “shape the global Internet” into its image.

FBI Briefs House Oversight Leaders In Biden Probe

House Republicans Open Probe Into ‘Suspected’ Chinese Cyber Espionage Targeting Federal Agencies

Antony Blinken

House Republicans

James Comer

Nancy Mace

State Department

The <a href="https://www.dailywire.com/topic/commerce-department" target="_blank" rel="noopener">Commerce Department</a> moved to prevent funds allocated by the CHIPS and Science Act from helping with the development of semiconductors in <a href="http://dailywire.com/topic/national-security" target="_blank" rel="noopener">adversarial</a> nations.
The CHIPS and Science Act, signed by President <a href="http://dailywire.com/topic/biden-administration" target="_blank" rel="noopener">Joe Biden</a> last year, provides $39 billion in manufacturing <a href="https://www.whitehouse.gov/briefing-room/statements-releases/2022/08/09/fact-sheet-chips-and-science-act-will-lower-costs-create-jobs-strengthen-supply-chains-and-counter-china/#:~:text=%20FACT%20SHEET%3A%20CHIPS%20and%20Science%20Act%20Will,for%20capital%20expenses%20for%20manufacturing%20of...%20More%20" target="_blank" rel="noopener">incentives</a> for semiconductors, as well as $13.2 billion for research and development, and a 25% investment tax credit for computer chip production. Proposed rules from the Commerce Department would limit entities which receive the funds to develop semiconductor production in China, Russia, Iran, or North Korea.
“The innovation and technology funded in the CHIPS Act is how we plan to expand the technological and national security advantages of America and our allies,” Commerce Secretary Gina Raimondo said in a <a href="https://www.commerce.gov/news/press-releases/2023/03/commerce-department-outlines-proposed-national-security-guardrails" target="_blank" rel="noopener">statement</a>. “CHIPS for America is fundamentally a national security initiative and these guardrails will help ensure malign actors do not have access to the cutting-edge technology that can be used against America and our allies.”
Recipients of the funds will be unable to use them overseas, expand existing semiconductor operations abroad by more than 10% for one decade after the award, or launch research initiatives with foreign entities of concern.
Wang Wenbin, a spokesman for the Chinese Foreign Ministry, remarked at a press briefing on Wednesday that his nation’s government issued a diplomatic complaint in response to the proposed restrictions. “The so-called guardrails claimed by the U.S. are an out-and-out sci-tech blockade and protectionism,” the official said, according to a <a href="https://www.bloomberg.com/news/articles/2023-03-21/us-tightens-china-rules-for-chipmakers-getting-federal-funding-from-chips-act" target="_blank" rel="noopener">report</a> from Bloomberg. “The hobbling and containment will not stop China from growing, and will only strengthen our decision to seek self-development.”
TSMC, a manufacturer based in Taiwan that maintains operations in China, has recently <a href="https://www.dailywire.com/news/chipmaker-triples-investment-in-new-arizona-plant-to-40-billion" target="_blank" rel="noopener">committed</a> $40 billion toward a new semiconductor facility in Arizona. Samsung and Intel, both of which are expected to receive semiconductor funds alongside TSMC, also operate in China.
Enactment of the CHIPS and Science Act occurred in response to the fact that China, South Korea, and Japan control nearly 80% of global semiconductor manufacturing capacity, according to <a href="https://www.brookings.edu/blog/order-from-chaos/2022/04/12/ensuring-a-stronger-us-taiwan-tech-supply-chain-partnership/" target="_blank" rel="noopener">data</a> from the Brookings Institution, while TSMC alone produces over 90% of the sophisticated chips used in cell phones and computers. A reliable supply of semiconductors is necessary to develop artificial intelligence and weapons technologies.
The restrictions on semiconductor investment in adversarial countries occur as American officials become suspicious of Chinese firms and their associations with the nation’s government. The Biden administration <a href="https://www.dailywire.com/news/white-house-quietly-probes-chinese-tech-firm-for-possibly-harvesting-data-from-military-bases-missile-silos" target="_blank" rel="noopener">investigated</a> Chinese telecommunications company Huawei last year over concerns that American cell towers using the company’s devices were transmitting data on military bases and missile silos to the Chinese Communist Party. A final rule <a href="https://www.dailywire.com/news/u-s-makes-historic-move-to-block-certain-chinese-tech-after-national-security-concerns" target="_blank" rel="noopener">published</a> by the Federal Communications Commission prohibits Huawei, ZTE, Hikvision, and Dahua from importing and selling certain products that the agency considers a threat to national security. The new rule does not apply to technology already within American borders.
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Lawmakers also commissioned an <a href="https://www.dailywire.com/news/defense-officials-worry-about-new-chinese-espionage-threat-report-says" target="_blank" rel="noopener">examination</a> of the port cranes and large steel structures manufactured by ZPMC since sensors on the towers could monitor the shipment of items transported to assist American military operations. Officials are also considering a ban or forced <a href="https://www.dailywire.com/news/tiktok-ceo-swears-company-is-not-an-agent-of-china" target="_blank" rel="noopener">divestiture</a> of TikTok, which is owned by Chinese technology firm ByteDance, since members of the Chinese Communist Party can reportedly access American user data through the platform.

White House Moves To Stop Semiconductor Funds From Helping China, Other Adversaries

White House Moves To Stop Semiconductor Funds From Helping China

National Security

Technology

The U.S. government has moved to sanction six <a href="https://www.dailywire.com/topic/china" target="_blank" rel="noopener">Chinese</a> aerospace companies over their purported involvement in the communist country’s spy balloon program. 
The <a href="https://www.dailywire.com/topic/commerce-department" target="_blank" rel="noopener">Commerce Department </a>announced the <a href="https://public-inspection.federalregister.gov/2023-03193.pdf" target="_blank" rel="noopener">sanctions</a> on Friday, less than a week after the <a href="https://www.dailywire.com/topic/u-s-air-force" target="_blank" rel="noopener">Air Force</a> shot down a Chinese surveillance balloon over the Atlantic Ocean that had traversed the continental U.S. 
“The PRC’s [People&#8217;s Republic of China] use of high-altitude balloons violates our sovereignty and threatens U.S. national security,” Alan Estevez, undersecretary of commerce for industry and security, <a href="https://www.cnbc.com/2023/02/10/us-sanctions-six-chinese-tech-companies-for-supporting-spy-balloon-programs.html" target="_blank" rel="noopener">said</a> in a statement. “Today’s action makes clear that entities that seek to harm U.S. national security and sovereignty will be cut off from accessing U.S. technologies.”
The six Chinese entities in question will be placed on the Entity List, where trade restrictions are placed on companies that have been determined to jeopardize national security by the Commerce Department. 
The Chinese entities in <a href="https://www.theepochtimes.com/us-imposes-sanctions-on-6-chinese-firms-over-spy-balloon-programs_5050940.html?ea_src=frontpage_A_topstory&amp;ea_med=lead" target="_blank" rel="noopener">question</a> are Beijing Nanjiang Aerospace Technology, China Electronics Technology Group Corporation 48th Research Institute, Dongguan Lingkong Remote Sensing Technology, Eagles Men Aviation Science and Technology Group, Shanxi Eagles Men Aviation Science and Technology Group, and Guangzhou Tian-Hai-Xiang Aviation Technology.
According to the Epoch Times, several of the companies have developed projects with the Chinese military, and one of them specifically creates stratospheric airships. 
“The Commerce Department will not hesitate to continue to use the Entity List and our other regulatory and enforcement tools to protect U.S. national security and sovereignty,” Deputy Secretary of Commerce Don Graves said.
According to Commerce Department official Matthew Axelrod, action against the companies was taken to stop the spread of the Chinese balloon surveillance program. 
“Today’s action demonstrates our concerted efforts to identify and disrupt the PRC’s use of surveillance balloons, which have violated the airspace of the United States and more than forty countries,” he said.
The sanctions come the same day as the Air Force <a href="https://www.dailywire.com/news/new-information-released-about-object-u-s-military-shot-down-over-alaska" target="_blank" rel="noopener">shot down</a> an unidentified object over Alaska, just a week after the Chinese balloon incident. It is unclear if the new object is of Chinese origin or not. 
The object was reportedly flying around 40,000 feet, making it a threat to civilian aircraft.
“We have no further details about the object at this time, including any description of its capabilities, purpose, or origin,” said Pentagon spokesperson Brig. Gen. Pat Ryder. “The object was about the size of a small car, so not similar in size or shape to the high-altitude surveillance balloon that was taken down off the coast of South Carolina.”

Chinese spy balloon flying above Charlotte

U.S. Takes Action Against Chinese Companies Linked To Spy Balloon Program

Foreign Policy

U.S.

U.S. Air Force

The United States alerted Seagate Technology Holdings that it may have broken the law by selling hard drive disks to a blacklisted Chinese company, according to a new <a href="https://www.reuters.com/technology/us-alleges-seagate-broke-export-rules-sell-huawei-hard-drives-source-2022-10-26/?taid=63592e26a534fc0001c34656&amp;utm_campaign=trueAnthem:+Trending+Content&amp;utm_medium=trueAnthem&amp;utm_source=twitter" target="_blank" rel="noopener">report</a>. 
A source informed Reuters that the company at issue is Huawei. It is on the U.S. Commerce Department’s Entity List and is prohibited from purchasing exports from the U.S., as well as specific foreign-manufactured products, without being approved first by the government. 
A filing with the U.S. Securities and Exchange Commission reportedly states that Seagate was cautioned about this in a “proposed charging letter” from the Commerce Department at the end of August. The document also notes that Seagate contends that the hard disk drives are not under the U.S. export rules and acted lawfully. 
Seagate has said it is working with the agency and trying to settle the issue. It is a data <a href="https://www.seagate.com/" target="_blank" rel="noopener">storage</a> business based in Dublin, Ireland, but it also works in California. 
The disclosure reportedly said that the items being discussed were given to the company and its partners from August 2020 to September 2021, but it didn’t name the customer, which Reuters&#8217; source identified as China’s Huawei. The source said Seagate stopped sending products to Huawei a year ago.
Seagate could be charged with civil penalties of up to $300,000 for each violation or double the value of the deal. The source also said Seagate hopes to argue its side in a scheduled meeting with the Commerce Department. 
The law at issue is the Foreign Direct Product Rule, which was updated in August 2020. It doesn’t allow businesses to send products created in a foreign country to Huawei if made from U.S. software or technology. The rule was <a href="https://www.mayerbrown.com/en/perspectives-events/publications/2020/08/tightening-the-screws-us-further-restricts-huaweis-access-to-us-technologies#_edn2" target="_blank" rel="noopener">intended</a> to “prevent Huawei’s attempts to circumvent U.S. export controls to obtain electronic components developed or produced using U.S. technology,” according to reporting on a Commerce Department press release. 
The source told Reuters that Seagate believes the products do not fall under the guidelines, but the Commerce Department is charging the company due to a broader interpretation of how a product falls under the rule. 
Last October, Republicans on the Senate Commerce Committee reported that Seagate had probably sent banned materials to Huawei for up to a year. 
Earlier this week, the Justice Department <a href="https://www.nytimes.com/2022/10/24/us/politics/justice-dept-huawei.html" target="_blank" rel="noopener">said</a> it had charged Chinese intelligence authorities with trying to spy on a federal investigation being carried out into Huawei. Top law enforcement authorities also announced other unconnected legal steps taken against Chinese agents in the U.S. 
“The government of China sought to interfere with the rights and freedoms of individuals in the United States and to undermine our judicial system that protects those rights,” Attorney General Merrick Garland told the press. “We will continue to fiercely protect the rights guaranteed to everyone in our country.”

5C914536-1776-4C75-93CB-25B6C48F20EA_1_201_a

Report: U.S. Claims Seagate Violated Export Regulations To Ship Product To Chinese Company

Report: U.S. Claims Seagate Violated Export Regulations To Ship Product To Chinese Company Huawei

Reuters

Securities and Exchange Commission

The U.S. Commerce Department blacklisted five <a href="https://www.dailywire.com/topic/china">Chinese firms</a> for allegedly supporting the <a href="https://www.dailywire.com/topic/russia">Russian</a> military this week.
The U.S. sanctions landed against the firms Tuesday, hitting Connec Electronic Ltd., King Pai Technology Co., Sinno Electronics Co., Winninc Electronic and World Jetta (H.K.) Logistics Ltd., according to <a href="https://www.wsj.com/articles/u-s-blacklists-five-chinese-firms-for-allegedly-helping-russias-military-11656538213?mod=e2tw">The Wall Street Journal</a>. The Commerce Department placed them on the “<a href="https://public-inspection.federalregister.gov/2022-14069.pdf">entity list</a>” forbidding U.S. companies from doing business with them.
The new restrictions, a result of the firms allegedly aiding Russia in its invasion of Ukraine, come as the Biden administration denies that China has offered support for Russia’s military. National Security Advisor Jake Sullivan <a href="https://www.whitehouse.gov/briefing-room/press-briefings/2022/06/28/press-gaggle-by-press-secretary-karine-jean-pierre-and-national-security-advisor-jake-sullivan-en-route-madrid-spain/">told</a> reporters Tuesday that despite overtures of cooperation between Beijing and Moscow, China has not acted to support Russia “at scale.”
“For us, the number-one priority with respect to China, when it comes to the war in Ukraine, is that China not become militarily supportive of Russia through the provision of equipment. Number two is that they not engage in wholesale or systematic undermining or evasion of U.S. sanctions,” Sullivan said.
“And on both of those, thus far, we have not seen China act in a way inconsistent with those two principles and certainly not at scale with respect to the economic relationship,” he continued.
The Commerce Department’s action is the first taken against Chinese firms over the Russia-Ukraine war since its beginning in February. A representative at the Chinese Embassy in Washington, D.C., claimed that Beijing has only sought to promote peace in Russia.
“China’s position on the Ukrainian issue is consistent and clear. We have been playing a constructive role in promoting peace talks and have not provided military assistance to the conflicting parties,” the representative told WSJ.
Western leaders are closely <a href="https://www.nytimes.com/2022/06/13/world/asia/china-taiwan-ukraine-military.html">watching</a> how China treats Russia’s invasion of Ukraine, worrying that Russia’s invasion may be a precursor to China’s own invasion of neighboring Taiwan. Chinese President Xi Jinping has long claimed that Taiwan is a part of China and should be brought under Beijing’s rule.
Concerns of China’s cooperation with Russia shot up after Xi and Russian President Vladimir Putin issued a 5,000-word <a href="https://www.airuniversity.af.edu/Portals/10/CASI/documents/Translations/2022-02-04%20China%20Russia%20joint%20statement%20International%20Relations%20Entering%20a%20New%20Era.pdf">joint-statement</a> in early February against the “further enlargement of NATO,” which Putin later cited as a reason for his invasion of Ukraine. Beijing also <a href="https://www.dailywire.com/news/report-russia-china-coordinated-on-timing-of-ukraine-invasion">reportedly</a> had advanced warning from Russia that it intended to launch a full-scale invasion of Ukraine, and the two countries coordinated the timing of the invasion to fall after the 2022 Winter Olympics, which China hosted.

Vladimir Putin, Xi Jinping

U.S. Blacklists Five Chinese Firms As Biden Admin Downplays China’s Commitment To Russia

Russia

Ukraine-Russia War

Congress took some heat on Wednesday after announcing that the House Energy and Commerce Committee would hold hearings on the baby formula shortage beginning on May 25.
&#8220;Baby formula supplies have dipped below 50% in a handful of states so naturally, as the crisis worsens without an immediate solution in sight, Democrats will take a look at it&#8230;in two weeks,&#8221; Townhall.com Managing Editor Spencer Brown tweeted, adding, &#8220;E&amp;C Chair Frank Pallone (D-NJ) said the &#8216;nationwide infant formula shortages are increasingly alarming and demand Congress’ immediate attention,&#8217; and then scheduled a hearing — not actual action — for May 25th.&#8221;
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E&amp;C Chair Frank Pallone (D-NJ) said the &quot;nationwide infant formula shortages are increasingly alarming and demand Congress’ immediate attention,&quot; and then scheduled a hearing — not actual action — for May 25th. <a href="https://t.co/vNf3szxoCb">https://t.co/vNf3szxoCb</a>
&mdash; Spencer Brown (@itsSpencerBrown) <a href="https://twitter.com/itsSpencerBrown/status/1524438880560328704?ref_src=twsrc%5Etfw">May 11, 2022</a></blockquote>
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The meeting, according to Politico&#8217;s David Lim, was set to be held in the Oversight and Investigations subcommittee.
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Meeting will be in the Oversight and Investigations Subcommittee.
&mdash; David Lim (@davidalim) <a href="https://twitter.com/davidalim/status/1524421500400398336?ref_src=twsrc%5Etfw">May 11, 2022</a></blockquote>
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The main complaint — voiced by a number on Twitter — was that Congress had managed to push through another <a href="https://dailywire.com/news/peanut-butter-and-anchovies-pelosi-goes-biblical-to-pass-40b-ukraine-package/">$40 billion in aid</a> to Ukraine on an emergency basis, but did not appear to feel the same <a href="https://dailywire.com/news/parents-face-terrifying-baby-formula-shortage-amid-bidens-supply-chain-crisis/">urgency</a> when it came to the <a href="https://dailywire.com/news/amid-baby-formula-shortages-republicans-introduce-legislation-strengthening-domestic-infant-formula-supply/">formula</a> that many families depend on to feed their babies.
&#8220;These hearings should’ve happened two months ago&#8230; Where’s @ChrisPappasNH and the rest of the Pelosi Congress?&#8221; New Hampshire Congressional candidate Matt Mowers <a href="https://twitter.com/mowers/status/1524459640049881096">asked</a>.
&#8220;Government can pass a $40 Billion spending package for Ukraine in under 6 hours, but have to wait two weeks before addressing baby formula shortage in America. Are you paying attention yet??&#8221; Nat Shupe <a href="https://twitter.com/NatShupe/status/1524486143181529088">asked</a>.
Tag Strategies VP Erin Perrine <a href="https://twitter.com/ErinMPerrine/status/1524452826168143872">added</a>, &#8220;It would have been good to have this hearing a couple of months ago and not in two weeks. Families are struggling RIGHT NOW to get baby formula. Democrats are failing to meet another crisis facing Americans. Classic.&#8221;
Independent journalist Glenn Greenwald referenced House Speaker Nancy Pelosi&#8217;s comments on Ukraine — &#8220;When you&#8217;re home thinking about [what $40 billion to Ukraine] is all about, just think about &#8216;when I was hungry, you fed me&#8217; from the Gospel of Matthew&#8221; — and argued that it might be perceived as tone deaf in the context of a nationwide baby formula shortage.
&#8220;The Gospels teach that Congress should send $40 billion more to Raytheon, Lockheed Martin, and CIA to fuel the war in Ukraine. The whole &#8216;you fed me&#8217; shtick seems particularly tone-deaf given the suffering of Americans with inflation, poverty, inability to buy baby formula, etc,&#8221; he said.
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The Gospels teach that Congress should send $40 billion more to Raytheon, Lockheed Martin, and CIA to fuel the war in Ukraine.
The whole &quot;you fed me&quot; shtick seems particularly tone-deaf given the suffering of Americans with inflation, poverty, inability to buy baby formula, etc. <a href="https://t.co/QZY69DiQQX">https://t.co/QZY69DiQQX</a>
&mdash; Glenn Greenwald (@ggreenwald) <a href="https://twitter.com/ggreenwald/status/1524482478802714625?ref_src=twsrc%5Etfw">May 11, 2022</a></blockquote>
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&#8220;If the reports of baby formula shortages in the United States are true, but Congress can find $40 billion to fund a foreign war, it’s not just quasi-criminal in the impeachable sense. It is outright criminal in the criminal negligence sense,&#8221; Viva Frei <a href="https://twitter.com/thevivafrei/status/1524365689657692162">tweeted</a>.
Former MMA fighter Jake Shields <a href="https://twitter.com/jakeshieldsajj/status/1524438822259462144">added</a>, &#8220;Your Baby might go hungry next week due to a formula shortage but thankful congress rushed through a spending bill to give Ukraine 40 billion in weapons.&#8221;

Baby Formula Display

‘Outright Criminal’: Congress Dragged For Rushing $40 Billion To Ukraine, Waiting 2 Weeks To Schedule Hearing On Formula Shortage

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