Congress Pushes Efforts To Protect Small Business Programs From China

Congress Pushes Efforts to Protect Small Business Programs From China

China THREATENING US Businesses?! Congress Springs Into Action

( – An April 2021 report from the Department of Defense (DOD) uncovered US government funds allegedly going to startups that benefit China. The DOD noted how the Chinese government is taking advantage of the Small Business Innovation Research (SBIR) program. Lawmakers in Congress have been considering the report, which ends with a recommendation from the DOD for a better vetting process for the program.

Sneaky Approaches

The DOD noted that it appears people in the SBIR program will create a company under the requirements without any intentions of maintaining it. According to the report, these individuals will quickly move into programs within the Chinese government where they work for state-run institutions. Some program participants also work with and accept funding from the Chinese government, working with entities within the Chinese defense industry. The report stated this is a significant risk to national security and the US economy.

Congressional Response

Members of Congress agree with the DOD in its assertion that the SBIR program needs additional oversight. On May 4, Senator Joni Ernst (R-IA) announced the passage of her bill to stop China and Russia from using the SBIR program for their own gains. The measure creates additional security to prevent shell companies from accessing the funds or the technology that results from the program.

The Wall Street Journal reported Congress is currently considering the renewal of the SBIR program. They have also proposed replacing it with the Small Business Technology Transfer (STTR) program. The talks are part of a larger legislative effort to increase the competitiveness of the US against nations like China.

Not everyone is on board with making changes to the current program. The Wall Street Journal stated Representative Nydia Velazquez (D-NY) wanted to renew the SBIR without any modifications, although she was open to the idea of new security measures. She said any delays to the program would “hurt small businesses and stifle American innovation.”

The alleged misuse of the SBIR program by China is nothing new. The DOD report pointed out the Asian nation continually tries to access anything in the US that might give it an edge. It’s reportedly skilled at making ethically questionable moves without breaking any laws but could harm the US.

The Wall Street Journal reported the Chinese embassy spokesman, Liu Pengyu, responded to the accusations by saying China’s superior performance in technology and science is due to its own hard work rather than the theft of American innovations.

Still, US intelligence paints a very different picture, as the DOD report shows. But if China isn’t using nefarious tactics to steal from the US, then Beijing should have nothing to worry about if Congress changes the SBIR program.

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