July 31, 2018

Van Hollen Discusses DETER, ZTE on Senate Floor

Today, U.S. Senator Chris Van Hollen (D-Md.) spoke on the Senate floor on our national security. Senator Van Hollen urged action on the DETER Act – his bipartisan legislation introduced with Senator Marco Rubio (R-Fla.) aimed at preventing future foreign interference in U.S. elections. The DETER Act would impose immediate, harsh sanctions on foreign actors who interfere in future U.S. elections. Additionally, the Senator admonished the Administration and Republican National Defense Authorization Act (NDAA) conferees for their inaction on ZTE, specifically for removing a provision he worked to include in the Senate-passed NDAA to reinstate ZTE sanctions. Video of the Senator’s remarks is available here and a transcript is available below.   
“Thank you, Mr. President. The plan had been for me to join with the Senator from Florida, now the Presiding Officer, to address our concerns in two areas. One has to do with the Chinese telecommunications company ZTE and the threat that it poses to the national security of the United States. And second, the urgent need for this Senate to take action to protect the integrity of our democracy by passing the bipartisan DETER Act, which Senator Rubio and I have introduced. Since the Senator from Florida is now presiding in the Chair, I will do my best to cover this for both of us. And I know that you'll have an opportunity at some other point to cover these important issues as well.
“First, Mr. President, ZTE. ZTE is a Chinese telecommunications company. It's a telecommunications company that has been Exhibit A in the mix of Chinese companies that have stolen U.S. technology. In fact, when Secretary Pompeo was before the Senate a while ago talking about the relationships between the Chinese government and Chinese companies and talking about how they were stealing U.S. intellectual property secrets for their own purposes, ZTE would be on the top of that list. It's one of the most notorious thieves of intellectual property anywhere in the world. In the United States alone, they've been sued for patent infringement 126 times in the last five years. That's an astonishing figure, particularly as only a small subset of firms have the resources to even bring litigation before a federal court. ZTE has been reportedly sued for patent infringement at least a hundred times in other countries around the world. So this is a company that has developed by stealing high technology from U.S. companies and others around the world.
“Second, ZTE poses an espionage threat to the United States. Translated – spying on Americans. This past February, FBI Director Wray testified before the Senate Intelligence Committee saying quote, ‘We're deeply concerned about the risks allowing any company or entity that is beholden to foreign governments that don't share our values to gain positions of power inside our telecommunications networks. That provides the capacity to exert pressure or control over our telecommunications infrastructure. It provides the capacity to maliciously modify or steal information. And it provides the capacity to conduct undetected espionage…’
“So ZTE has stolen American technology. ZTE according to our national security officials – not just the Director of the FBI but also the head of NSA, the National Security Agency, and the DNI, the Director of National Intelligence and the head of CIA – ZTE poses an espionage threat.
“Now, on top of that, on top of that, ZTE was caught violating United States’ sanctions against North Korea and Iran. And it's not just that they got caught, but when they got caught, they tried to cover it up. They were warned not just once, but twice, and again. And despite that, they engaged in what the Secretary of Commerce Wilbur Ross called, a quote, ‘multi-year conspiracy to violate U.S. sanctions against North Korea and Iran, in an elaborate scheme of cover-up.’ That is why just a few months back, I think it was in June, Secretary Ross imposed very stiff sanctions on ZTE, including what's called a denial order, to stop them from getting advanced technology components from U.S. companies that ZTE could then use in their phones and their telecommunication system and then use that to conduct espionage against the United States. Secretary Ross did the exact right thing.
“Unfortunately, his decision to impose that denial order was reversed by the President of the United States. And when the President reversed that order, Senators here on a bipartisan basis, Senator from Florida, Senator Rubio, Senator from Arkansas Senator Cotton and others, Senator Warner, we thought it was important to protect the national security of the United States by re-imposing those important sanctions that the Secretary of Commerce had put in. And how did we do that? We added a provision to the National Defense Authorization bill which passed overwhelmingly in this body.
“That provision was first inserted in the Senate Banking Committee. It was then included in what’s called the CFIUS bill, and then it was passed by this body. And we urged the conferees in the Senate and the House on the defense bill to keep that provision in there and not let ZTE off the hook. And during that short period of time, while it was in conference a couple months, ZTE spent over $1.3 million to hire Washington lobbyists to help them pull that provision out of the defense authorization bill. And the sad and really shameful story here is that ZTE and their lobbyists succeeded. And succeeded in lifting that penalty on ZTE.
“So we have just sent the worst of all signals to China – whether ZTE or Huawei, or others – that we are not really serious when we say if we catch you violating our sanctions we will punish you. Or that we're not serious in defending our country from espionage. Or that we're not serious about defending our country from the theft of our intellectual property. And that is a terrible and very weak message to send. So I am going to keep fighting along with our colleagues on a bipartisan basis to keep the pressure on these issues, ZTE and Huawei because if we do not get serious about confronting these threats, they will continue to come back and bite us. So, very disappointed that the conferees did not include that provision. And it does raise serious questions about a bill that provides for our national defense – why it would have a big loophole in it, that creates an opportunity for China to harm our national security.
“Now there's another way that our adversaries can harm our national security and that's to interfere in our elections, to try to undermine our democracy.
“We know from the heads of all the intelligence agencies that that's exactly what happened in 2016. And our focus in this body should be on making sure that no country interferes in our elections again. And we all know suspect number one has been Russia. Russia was the country that interfered in 2016. And we know Russia is planning to interfere in the 2018 mid-term elections and beyond. How do we know that?
“First of all, the head of DNI, the Director of National Intelligence, Dan Coats, former member of this body, has said that all the lights are flashing red. A big warning that Russia plans to interfere in our midterm elections, which are 98 days away. We also learned just today that Facebook uncovered an ongoing effort by foreign social media entities to disrupt our 2018 elections. This is an ongoing process right now.
“Headline today, ‘Washington Post: Facebook says it has uncovered a coordinated disinformation operation ahead of the 2018 midterm elections,’ and they document what they're doing to try to prevent that disinformation campaign. So we have the testimony of DNI Director Coats and other intelligence agency heads – we have Facebook. And we also know that the Russians specifically, the same operation GRU that interfered in the 2016 elections has already attempted to interfere in three elections for 2018. We know one that's been made public – the Senator from Missouri, Senator McCaskill, where the Russians attempted to get into their system ahead of the 2018 elections.
“So we know all of this is happening. And it would be surrendering our obligation as members of the Senate, both Republicans and Democrats, for us not to take action to defend the integrity of our elections. The clock is ticking. 98 days to go until the elections.
“And we know from our intelligence agencies; we know from the evidence surfaced today from Facebook; we know that they attempted to interfere in three elections for 2018; we know that this Russian effort is coming. So for goodness sakes, don't we have an obligation to do everything we can to stop it? And that's exactly why Senator Rubio – who is presiding now – and I joined together to introduce the DETER Act – very straightforward, simple idea.
“You need to send a signal in advance to Vladimir Putin that if Russia gets caught again – it gets caught this time interfering in the 2018 elections – there will be automatic and harsh penalties imposed on Russia and that it will hurt Russia's economy. It will hit them where it hurts. And that's what the DETER Act does.
“And everything we've heard about Russian conduct and behavior is that it's important to try to send these signals early if you want to influence their behavior. And so what we need to do is establish a very credible threat – that if they interfere and they get caught again, they will face the penalty. And so what the DETER Act does, it says the Director of National Intelligence, on behalf of the intelligence community, will make an assessment about whether or not Russia interfered in the 2018 election. This is an assessment that will take place shortly after the 2018 elections. And if their finding is yes, then very harsh penalties take place.
“Now, we can talk about the details in the coming days and make sure that we get this exactly right, but where there should be no debate, there should be no debate about the need to do something along the lines of the DETER Act and to do it urgently. And as I said, the clock is ticking. We know how the Senate operates. There's not really that much time between now and the elections given all the other things that we've got to do. But I would hope the Senate would prioritize defending our democracy. I would hope the Senate would prioritize making sure that we have an election that the people of this country can have confidence in, that we would prioritize making sure we protect the integrity of our democratic system. Because what Putin wants to do is undermine the confidence in the democratic system. He wants to do that in the United States of America. He wants to do that to our allies around the world. And we can't let that happen.
“And so this is not a moment where the Senate should just have hearings or just talk about it. This is a moment for action. And I join the Presiding Officer -- and I'm sorry he wasn't able to join me here because of his duty in the Chair -- but I want to join him not as Republicans or Democrats but as Americans who want to defend our democracy. Let's get this job done now.
“Let's protect the integrity of our democratic process. And I yield back my time.”