At a hearing on Capitol Hill today, U.S. Rep. Chris Smith (NJ-04) blasted the Chinese Government for stealing U.S. jobs through deceitful policies and trading practices. Fake products and components made in China and sold in the U.S. put American consumers at risk, he said. Fake Chinese computer chips have even been found in U.S. defense systems.
"All of us know that economic growth and vigorous exports are vital to American prosperity, and now in these difficult times--economic recovery," said Smith at a full hearing of the House Foreign Affairs Committee entitled "Unfair Trading Practices against the U.S.: Intellectual Property Rights Infringement (IPR), Property Expropriation, and Other Barriers."
"American workers can out-compete anyone in the world, but theft of intellectual property -- the patents, copyrights, trademarks, industrial designs, and trade secrets of American companies -- robs them of a fair return on their innovation and their work," Smith added.
"The most egregious intellectual property rights thief in the world today is China," said Smith, a senior member of the Foreign Affairs Committee and the chairman of the U.S. Congressional-Executive China Commission.
"Chinese companies--protected by a ubiquitous dictatorship--are stealing, copying, and selling American software, music, and films. Chinese policies pry technology and trade secrets from American firms that invest there, and then abandon them. China is in the big leagues of industrial espionage, with cyber crime as a new tool.
"China seems to believe that unfettered access to American markets is its natural right, while they give Americans the stiff arm, especially when their companies steal American IPR and the accompanying jobs," he said.
Smith also focused on reports of many counterfeit products from China that have entered supply chains in the U.S.
"There are reports of Chinese counterfeits of medicines and drugs, even fake diabetic test strips," said Smith the chairman of the House subcommittee on global health. "Many of these illicit, inferior copies are sold with fake packaging that represents them as American products. These phony products not only steal American jobs and sales, they also endanger the health of Americans."
He also noted that American consumers are at great risk because of counterfeit auto parts like brake shoes reported to be entering the U.S. supply chain. "I've seen statistics that indicate that perhaps seven in ten of the bogus parts--with inferior materials, lower tolerances, lower tensile strengths, lower standards--come from China, though India is beginning to ship fakes to the U.S. also," he said.
"Finally," Smith said, "I have seen troubling reports that fake Chinese computer chips-- microprocessors, microchips--have even been found on our military aircraft. A Senate report recently provided alarming details. Is China endangering our national security when it produces counterfeit components for American computers? What are the dimensions of this trade?
"What is the Obama Administration doing about this threat?" Smith asked "As the Administration deals with China over these issues, has the fact that China now finances so much of our national budget deficit had a bearing on their willingness to negotiate, to investigate, and to close down violators?
"Tragically, we have seen this Administration, most famously Secretary Hillary Clinton, forfeit human rights issues for its priorities of global warming and peddling U.S. debt. Our hand is now weaker on trade, intellectual property rights, national security and American's health and safety as a result of our rising indebtedness to China."