The Biden Administration Gives Up on Fighting Chinese Espionage at Home

I t’s the consensus view that China seeks to displace the United States as the world’s preeminent power, with the American Right, center-Right, and center-Left in agreement on this issue. Much of American higher education understands this, even as institutions enter into generous contracts with — and accept substantial gifts from — a China that seeks undue influence in the service of a global strategy harmful to the United States. Universities also know that engaging the Chinese government and its proxies poses a risk to academic freedom, provides opportunities for shameless propaganda, and threatens technological espionage.

Yet schools take the money. For years, institutions of higher education have eagerly accepted generous gifts from and contracts with China — often intermediaries of the Chinese Communist Party (“CCP”). Some universities have even contracted directly with the CCP’s Central Committee, such as one prestigious nonprofit that entered into a multimillion dollar contract with the CCP’s Central Committee in 2006. From 2015 to 2019, major American research institutions of higher education received more than $1 billion in funds from sources located in the PRC, with the Massachusetts Institute of Technology, Yale University, Harvard University, the University of Pennsylvania, and the University of Southern California the top recipients.

Despite the harm posed to the United States by a rising China, the Biden administration has recently made two troubling moves that demonstrate that it cares more for the higher-education lobby and overseas interests than it does American security. The first is the inexplicable decision by Merrick Garland’s Department of Justice to shut down the China Initiative, a Trump-era law-enforcement program that countered Chinese espionage in the United States, much of it occurring at American research universities. The second is the move by the Biden Education Department to pull back on its enforcement of a law ensuring that colleges and universities disclose the public gifts and contracts received from foreign sources such as the CCP. Each Biden-administration move is a marked departure from established policy.

Most alarming is the administration’s decision to shutter DOJ’s China Initiative, a program that led to the conviction last December of Charles Lieber, a prominent Harvard chemistry professor, for failing to disclose affiliations with and funding from a Chinese university and the PRC’s “Thousand Talents” plan. Thousand Talents is a Chinese-government scheme that pays academics to infiltrate American research universities and abscond with technology secrets for the benefit of the Chinese state.

The decision to terminate the China Initiative also creates a strange juxtaposition. Just last October, Attorney General Garland directed the FBI, the DOJ’s National Security Division, and other DOJ units to coordinate their investigative efforts into parents who publicly criticized the actions of their local school districts. Garland’s justification for the directive was that outraged parents might engage in domestic terrorism, though this claim was never substantiated. Garland has repeatedly refused to rescind that directive, at the same time that the China Initiative is being shuttered. The DOJ now appears to show greater interest in what parents might do at your local school-board meeting than in what Chinese espionage agents might do at your local research university.

One observes another curiosity in the demise of the China Initiative. In his announcement, Matthew Olsen, assistant attorney general for national security, expressed concerns that the China Initiative created the “harmful perception” that the DOJ “treated people with racial, ethnic or familial ties to China differently.” Given the manic embrace by Biden’s DOJ of university admissions policies that discriminate against Asian-American students, no words more hypocritical were ever spoken. The CCP is no doubt pleased to hear them.

Congress has understood for decades that foreign powers may seek to influence higher education and harm American interests through large gifts and contracts. In 1986, spurred by the efforts of Arab governments to influence U.S. educational institutions by way of large gifts to Middle East–studies programs, Congress required higher-ed institutions to report to the Education Department and to disclose to the public their foreign gifts and contracts.

Now codified as Section 117 of the Higher Education Act of 1965 (“Section 117”), this mandate requires nearly all colleges and universities to report, twice each year, foreign gifts and contracts valued at $250,000 or more (alone or in combination with other gifts or contracts with a foreign source).

In 2019, after years of negligent administration by the Education Department, Betsy DeVos, who was then the secretary of the department, directed a rigorous enforcement of Section 117. The higher-ed lobby fought this effort hard, feigning again and again to misunderstand what the law required, despite having the resources to hire the best legal minds in the United States to figure it out.

Among other things, the DeVos Section 117 initiative launched compliance investigations against 19 major universities, caused new disclosures totaling $6.5 billion in previously unreported foreign gifts and contracts, and created a new Section 117 information-reporting portal and a user-friendly, publicly searchable database. At the July 31, 2020, reporting period, this portal disclosed approximately $3.8 billion in foreign gifts and contracts that probably would never have been disclosed, including from 60 institutions that had never before filed disclosures.

The reporting portal and public database remain in place, at least for now, but the Biden administration has weakened two important aspects of enforcement. First, to public knowledge, the Education Department has yet to launch a Section 117 investigation against any institution of higher education since President Biden took office, giving up an important enforcement tool. Second, the Biden administration has delayed a regulation proposed by Secretary DeVos in late 2020 that would have required schools to submit more detailed information, such as the names of the individuals and organizations making gifts and entering contracts (rather than just the amount and the country of origin).

Originally scheduled for publication in November 2020, the proposed rule faced heavy lobbying from the higher-ed associations after the election, and OMB did not move the rule to publication. The Biden administration has now reclassified it as a “Long-Term Action” to be published in December 2023.  That’s bureaucrat-speak for “will never happen.” One can presume that, for now, this reg is dead.

The risk posed by China to America’s national security is self-evident and undisputed. The Biden administration must restore the China Initiative and implement vigorous enforcement of Section 117, including moving ahead immediately with the proposed 2020 rule. Storm clouds are gathering overseas. It’s time for us to take them seriously.