America Can’t Beat Beijing’s Tech Theft with Racial Profiling


The U.S. government has begun a long-overdue effort to halt China’s systematic theft of intellectual property and exploitation of Western scientific institutions, meant to support and sustain, among other things, Beijing’s drive to build a “world class” military. The most high-profile part of this effort is a joint initiative by the FBI and the National Institutes of Health to ensure that recipients of federal research grants are properly abiding by requirements that they report foreign ties. This initiative has led to investigations and, in some cases, resignations or firings of ethnically Chinese senior research personnel.

The threat to which the Trump administration is responding is real. Beijing’s growing military and surveillance prowess — both of which it is now exporting to other countries — relies heavily on successful expropriation and exploitation of Western technologies and expertise. But the cure, if improperly administered, has the potential to be as harmful as the disease. As Massachusetts Institute of Technology President L. Rafael Reif wrote in an open letter to the university’s community on June 25, the actions of the FBI and other federal agencies have caused some there to “feel unfairly scrutinized, stigmatized and on edge – because of their Chinese ethnicity alone” in their interactions with U.S. officials.

Threading this needle — countering China’s determined, norm-busting technology drive without creating a new wave of racial stigma — is one of the U.S. government’s thorniest policy problems, and a unique source of concern for the Chinese-American community. Addressing it means raising the “China literacy” of U.S. officials and American society, while being much more transparent about the enforcement actions currently underway.

Remarks last year by FBI Director Christopher Wray provide an example of how not to approach the conversation. At a congressional hearing, Wray said China poses a “whole-of-society threat” to the United States, adding that scientists, academics, and students from China were “taking advantage” of America’s “very open research and development environment” to steal scientific and technological know-how.

The message that Wray likely intended to convey is correct: the Chinese Communist Party wants to use all of its citizens  and the Chinese diaspora  as tools in its drive for global technological supremacy, and policy responses must account for this reality. The Chinese Communist Party has made it crystal clear that China’s national rejuvenation requires that the country become the world’s leader in strategic industries like artificial intelligence and semiconductors. To this end, Beijing has created an enormous bureaucratic ecosystem — run through government or Chinese Communist Party agencies like the State Administration for Foreign Expert Affairs, or the United Front Work Department — that is meant to facilitate the transfer of foreign technology and expertise to China, through both legal and illegal means, and that particularly targets members of the Chinese diaspora.

But even if the threat is real, Wray’s remarks were ill-couched and could easily convey the discriminatory, inaccurate impression that any person of Chinese descent is a potential threat, regardless of their citizenship, expressed beliefs, or actual behavior. This framing would be especially concerning in light of stray remarks by senior administration officials that the widening divide with China “has elements of Samuel Huntington’s clash of civilizations”, or that China is the United States’ first “great power competitor that is not Caucasian.” Wray’s statement was a particular flashpoint within the Asian-American community, where memories of the Clinton administration’s abortive prosecution of nuclear scientist Wen-Ho Lee remain vivid.

More recent examples of erroneous investigation, such as Temple University professor Xi Xiaoxing and National Weather Service hydrologist Sherry Chen, have only stirred fears that the U.S. government has not learned from past mistakes. A poll by The Guardian of 6,000 tech employees of Chinese or Asian descent suggests that community is already concerned about the effect of poorly targeted enforcement actions. The Guardian reported that, when asked “Do you predict that there will be negative consequences for people who are connected to China/perceived to be Chinese due to the growing tensions of the U.S.-China trade war and concerns over Huawei?” that “nearly two-thirds of respondents working for hardware or semiconductor firms responded ‘Yes’ or ‘It’s already happening.’”

Cases like those of Lee, Xi, and Chen provide anecdotal examples of the Chinese-American community’s genuine reasons for concern. A recent study of publicly available information on Department of Justice cases brought under the Economic Espionage Act underscored the point, suggesting that the department is “more likely to file charges prematurely, based on weak evidence, when the case involves an Asian-American defendant,” concluding that “some of [the] disparities may reflect legitimate concerns over the risk of flight, [but] may also reflect implicit biases with regard to the loyalty of Asian-Americans to the United States.”

America’s problematic history with enforcement actions directed at Asian-Americans means that we cannot simply give the benefit of the doubt to either the U.S. government or the universities and research institutes that investigate and administratively punish their accused researchers. All should do more to demonstrate publicly that the accusations and prosecutions currently coming to light are driven by evidence of genuine wrongdoing, rather than unfair racial profiling. Successfully doing so would be an opportunity to educate the American public as to how Chinese Communist Party tech acquisition efforts actually work, replacing generalized anxiety with knowledge of specific institutions and behaviors, and allowing for a more informed debate as to the costs and trade-offs of addressing the threat.

The first step is transparency, both about the threat and about the steps being taken to address it. Director Wray could have used the opportunity to provide concrete examples to back up his claims. Neither the FBI nor the Department of Justice have undertaken a coordinated outreach effort to justify and explain their actions to the broader public. In this respect, the National Institutes of Health is doing a somewhat better job communicating, as it works with other U.S. government agencies and U.S. research institutions to identify instances of inappropriate collaboration between federally-funded researchers and Chinese institutions. But even the outreach by the National Institutes of Health has not extended beyond the occasional interview with a niche publication, while articles accusing the government of racially-driven persecution are splashed across the covers of mainstream news magazines.

Security and counterintelligence sometimes require discretion — if not perfect quiet. But the U.S. government’s past investigative failures suggest that the routine, quiet approach needs to be recalibrated. Companies and research institutions also frequently prefer not to publicize the details of cases and punishments, to minimize public blowback and legal liability, and maximize opportunities to continue working in China (since the Chinese Communist Party has shown it will not hesitate to punish those who fail to toe its political line). While these habits can protect the interests of individual institutions and provide a shortcut to resolution of individual incidents, the broader lack of transparency harms the national interest by undermining public trust and support for efforts to address the larger problem.

Private institutions may prefer to keep information close, and the U.S. government cannot and should not compel them to do otherwise. But there is also much the U.S. government can do on its own. The intelligence community needs to do a better job of informing the public about the nature of the threat, by releasing more of what it knows into the public sphere. In a speech last month, Sen. Mark Warner, the vice chair of the Senate Intelligence Committee, spoke at length about the alarming picture painted of the intentions of the Chinese Communist Party in confidential briefings to the committee, and said “we are not doing our job if we don’t find ways to declassify more of this information and get it out to [the American public].”

The FBI and the Department of Justice can also do much more to make their case. Despite researchers’ reasonable doubts about potential racial bias, conviction rates in the dozens of economic espionage or export control trials with Chinese party-state links suggest that the FBI and the Department of Justice have a case to make about the threat posed. For example, the day after Massachusetts Institute of Technology President Reif’s letter to his university’s community, a federal jury in Los Angeles convicted Shih Yi-chi — a part-time professor at the University of California, Los Angeles — of conspiring to illegally export microchip technology for use by China’s defense industry. Court cases like these are a vital way for reliable data about espionage, intellectual property theft, and tech transfer to make it into the public sphere, but the FBI and the Department of Justice have not done a good job of either connecting the dots between the cases or explaining their significance, despite the fact that many implicate Chinese bureaucratic organs like the United Front Work Department. The FBI, the Department of Justice, and other organs of the state need to do a much better job of highlighting these and explaining what they mean, rather than falling back on unsatisfying, disconcerting, phrases like “whole-of-society.”

The U.S. government’s difficulties in telling a convincing story about the Chinese Communist Party point to a second important step: addressing a serious lack of “China literacy,” both within the enforcement portions of the federal bureaucracy, and in U.S. society as a whole. China expertise can be found in government offices around the country, but better institutional familiarity with China can make it easier for government investigators, administrators, and counterintelligence personnel to do their jobs while safeguarding the rights of American citizens.

If the United States truly is in a global contest of ideas with China, then the government should be properly funding programs meant to provide education on Chinese language and culture, both for government employees and for ordinary citizens. Ceding that ground to Beijing to do this with Confucius Institutes shows a lack of seriousness. Building American expertise on how Chinese society works could be one of the most effective long-term ways to help protect Chinese-Americans from the Chinese Communist Party. It could also help build respect and empathy for the Chinese-American community’s internal diversity, and the unique challenges it faces, rather than reducing the debate to simplistic notions of a particular group of people’s “loyalty.”

Widespread societal China literacy will help the U.S. government better articulate its response to the threat of the Chinese Communist Party. And it should do so frequently and publicly, even if such transparency is at odds with the normal functioning of the counterintelligence and security communities. Only by being clear in public about the actions and intentions of the Chinese party-state, and being publicly accountable for the actions the U.S. government takes in response, will the United States be able to address Beijing’s challenges while upholding our democratic commitment to fair, transparent justice for all Americans.


Peter Mattis works on Capitol Hill and was contributing editor to War on the Rocks. He is the co-author of Chinese Communist Espionage: An Intelligence Primer (Naval Institute Press, forthcoming). These views are his own and do not represent any member of Congress or any other part of the legislative branch.

Matt Schrader is a China analyst with the Alliance for Securing Democracy at GMF. Prior to joining GMF he was the editor of the Jamestown China Brief at the Jamestown Foundation.