Huawei, China Take Fresh Beating on the Hill Over 5G, Cyber Concerns

Senators and witnesses alike took turns criticizing Chinese tech and trade policy, and China-based network equipment maker Huawei, at a hearing on Thursday over the firm’s alleged potential to create security harms if its equipment was included in U.S. 5G wireless networks.

Opposition to Chinese policies and Huawei are not new themes on the Hill. The company and other Chinese firms including ZTE have drawn suspicion from members of Congress in recent years over their alleged close ties to the Chinese government and intelligence services, and last year Congress approved legislation that bars the Federal government from buying Huawei products and services.

At Thursday’s hearing of the Senate Commerce, Science, and Transportation Committee’s Subcommittee on Security, senators discussed a range of challenges that China poses to commerce with the U.S. including issues of trade, manufacturing competitiveness, intellectual property, data localization, standards-setting, and cybersecurity.

While each of those issues received their turn in the discussion, Huawei and the threats it could pose to U.S. networks took center stage for much of the hearing.

On the dais, Sen. Edward Markey, D-Mass., said China is pursuing a plan to “dominate” several key tech industries–including 5G wireless, artificial intelligence (AI), and advanced manufacturing–and is gearing its economic, trade, and foreign investments policies to meet that goal. Those plans, along with alleged theft of U.S. intellectual property by Chinese interests and foreign investment rules that make U.S. firms give the Chinese government access to U.S. technology, “pose a threat to this country’s economic welfare and national security,” the senator said.

To counter the Chinese thrust at tech-sector domination, Markey said the U.S. needs to take a number of steps including improving education, undertaking more research and development, funding infrastructure investments, making investments in U.S.-based factories and workers, and applying what he called “tailored” trade restrictions to China.

In a dig at the Trump administration’s current trade policies, Markey said that “tariffs and tweets alone are not sufficient to deal with this threat.”

Sen. Roger Wicker, R-Ala., chairman of the full committee, said it was “obvious that leadership in China does not expect to play by international rules” on issues such as data privacy and IP protection.

Sen. Dan Sullivan, R-Alaska, chairman of the subcommittee, said “we are trying to work” with the Trump administration to craft a bipartisan strategy on China trade issues, including on issues of trade and legal reciprocity.

Sen. Richard Blumenthal, D-Conn., went as far as to say “we are in a warlike setting” with China “given the conflicts going on in the cyber domain.”

Among several witnesses, Eric Rosenbach, who was Pentagon chief of staff from 2015 to 2017 and is now co-director of the Belfer Center for Science and International Affairs at Harvard University, put the hammer down on Huawei and the harms he said the company’s equipment is capable of causing to U.S. networks.

“There is no way I would allow Huawei gear into the 5G backbone,” said Rosenbach. “It’s a threat to our national security.” He said that Huawei in the normal course of business loads software updates into its network equipment, and that an initial inspection of Huawei equipment “on one day does not mean that there is not special sauce added” later on.

He said it would pose “grave national security concern” to allow Huawei equipment to be used in U.S. 5G networks, and while he did not offer precise evidence to back up that concern, he counted off a list of high-profile hacks of U.S. entities he said had Chinese involvement, including theft of data from the Office of Personnel Management, Equifax, and Marriott.

Rosenbach also speculated that the data stolen in those and other alleged hacks has been used by China to help develop AI technologies. He offered no specific evidence, but twice brought it up, saying, “they are using that data to build a new platform for AI,” and warning that “down the road it will have an even bigger impact.”

And, he said, telcos in the United Kingdom and Australia that did allow Huawei equipment into their network backbones “are now ripping it out.”

On the broader policy front, Rosenbach suggested that the U.S. would help its standing in the world tech arena by adopting a national data privacy law, and by making sure that U.S. policy on broadband technology, AI, and 5G supports American firms, rather than help Huawei. He also said the U.S. needs to better defend American interests in cyberspace, develop “precise and legal frameworks” for U.S. cyber operations, and publicly attribute cyber attacks to China. “Defense alone will not mitigate” the threat posed by China, he said.

Samm Sacks, cybersecurity policy fellow and China digital economy fellow at New America, said that the U.S. and China are “locked in growing conflict with technology and cybersecurity at its center.” She said the U.S. should make “targeted demands” of China in trade talks on issues such as encryption and the right to access U.S. company source code, and also work to put international economic pressure on the country.

And, she said the U.S. needs to “play offense” by investing more in its technology sector. “We must be able to compete in our own right,” she said.

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