It Isn't Just McConnell-- Is McCarthy Also Plotting With China To Become A Colonial Power Over the U.S.?

That's McCarthy with Stella Li and Wang Chuanfu

People who don't follow politics closely still don't know who California Rep. Kevin McCarthy is, even though he's the Republican House Leader and Trump's chief protagonist in Congress. The DCCC never runs a candidate against him-- even though CA-23 is now a minority-majority district-- and has been hostile towards local Democrats who have tried taking him on in the past. Around 38% of the people who live in the district are Hispanic and the DCCC hasn't done a voter registration drive there ever. Cheri Bustos plans to skip CA-23 again this cycle.

Yesterday, Scott Paul, president of the non-partisan Alliance For American Manufacturing, was considerably less complacent about McCarthy than Bustos is. He wrote that it is outrageous that "McCarthy went out of his way to stop a bipartisan effort to prevent China from dominating U.S. transit systems."

There are widespread national security concerns-- shared by bipartisan Members of Congress-- about China’s role in building U.S. rail cars and buses. But McCarthy used his leadership power to strip language from a recent spending bill that would have limited Chinese companies from building transit.

Fortunately, new bipartisan legislation aims to stop companies with ties to China’s government from building U.S. trains and buses.

I recently testified before Congress and exposed China’s government plan to take over the U.S. transit market by any means necessary.

Chinese government-owned companies severely underbid on U.S. transit contracts, like ones to build new subway cars or electric buses. But unlike companies that operate in a free market, these companies aren’t out to make money-- they’re merely the vehicle China is using to take over the system.

One of these companies is Build Your Dreams (BYD), which makes electric buses. But China has even grander ambitions for BYD-- it wants to use it to eventually dominate the global auto market.

Well, BYD contacted McCarthy about blocking language that would have prevented bus or rail manufacturers supported by the Chinese government from winning transit contracts.

And McCarthy complied.

There are 90,000 high-wage jobs up and down the U.S. transit supply chain. If China were to control the U.S. transit market, most of those jobs are likely to disappear-- all at the expense of U.S. taxpayers, who are footing the bill for transit projects.

And if BYD gets its way and does eventually dominate the auto industry, nearly 900,000 well-paying jobs are at risk.

That’s not the only concern, either.

Security experts warn that China could use facial-recognition technology or other means to spy on Americans. Giving China access to building high-tech railcars and buses also opens us up to being hacked, and even threatens the Defense Department, which relies on freight rail to move sensitive equipment.

Kevin McCarthy might not want to put a stop to this threat, but I do-- and I bet you do, too.

What China is attempting to do is a kind of economic colonialism. Michigan Republican Congressman Paul Mitchell told the Washington Post that three of BYD’s five board members are connected to the Chinese government in some form, and that the company has also raked in $338 million in grants from China. Zachary Kahn, BYD Motors lobbyist, lied to Congress on May 16 when he claimed China doesn't control the company.

BYD was savvy enough to start building a factory in Lancaster in McCarthy's district when the GOP still controlled the House. But, even in the minority, he has still been delivering for the Chinese Communist government project. On top of that, the president of BYD Motors, Stella Li, launders Chinese money into McCarthy's accounts (as well into Mike Pence's PAC, the Great America Committee).

McCarthy’s intervention was striking because the close ally of U.S. President Donald Trump sought to protect Chinese interests at a time when Trump and many lawmakers on Capitol Hill are attempting to curb Beijing’s access to US markets, particularly in industries deemed vital to national security.

Last week, Trump put Chinese telecoms giant Huawei on a trade blacklist that severely restricts its access to U.S. technology. The action leaves about 90 days for companies to do some business with Huawei.

McCarthy’s move to protect a Chinese company’s interests frustrated even some fellow Republicans because they have warned repeatedly that allowing Chinese-backed firms access to U.S. infrastructure systems could pose a national security risk.

Lawmakers of both major parties have complained that U.S. tax dollars should not be used to support projects that benefit foreign companies.

...Matt Sparks, a spokesman for McCarthy, defended the congressman’s actions. He said McCarthy has long advocated for companies in his district and denied any connection between McCarthy’s receipt of campaign contributions from BYD and his actions on Capitol Hill.

“McCarthy is proud to support job creation for his constituents and community,” Sparks said.

McCarthy’s work on the transit issue affecting BYD began last year and continued for several months, culminating in a February spending bill that omitted the ban on Chinese-backed companies getting federal transit contracts.

BYD officials initially contacted McCarthy’s office because the Senate had approved such a prohibition, which would have applied to bus or rail manufacturers supported by the Chinese government and would have prevented them from winning state or local contracts that use Federal Transit Administration dollars, as such contracts often do.

Sparks confirmed McCarthy’s aides listened to the issues BYD raised about the bill.

A House version of the bill, which McCarthy supported, exempted bus manufacturers from this prohibition, according to McCarthy’s office-- a key provision that would have protected BYD.

Senate negotiators wanted their broader, bipartisan restrictions pushed into the final law, but McCarthy objected, according to three officials, speaking on condition of anonymity to discuss the private talks.

Ultimately, all of the proposed restrictions were scrapped because the impasse threatened to cause another government shutdown. Supporters of the stricter Senate version said the goal was to protect U.S. national security and domestic manufacturing.

“I think we’re right to try to protect America’s national security interests but also protect our domestic producers against that sort of unfair competition,” said Senator John Cornyn, an author of the Senate provision.

Trump and his top aides have complained that China unfairly subsidises large companies in a way that puts US firms at a disadvantage, but there has never been a full accounting of how much U.S. government business those firms reap.

The enterprises are either partially owned by the Chinese government or receive financial support from it, and critics say those direct or indirect subsidies give them an unfair advantage over U.S. manufacturers.

The Trump administration has engaged in broad trade negotiations with China, which have soured in recent weeks-- in part over the issue of China’s extensive network of government-backed enterprises.

Beyond economic concerns, lawmakers from both parties have said it is dangerous for Chinese-linked firms to have access to U.S.an transit systems because of the potential for espionage or other threats to national security.

Among other things, they have argued that in time, China-backed companies could use facial recognition technology or other means to surveil unsuspecting Americans.

...Business magazine Fast Company last year called BYD “The Biggest Electric Vehicle Company You’ve Never Heard Of.” Forbes in 2017 listed BYD’s billionaire chairman and president, Wang Chuanfu, as one of the richest men in China.

The company has promoted its ties to McCarthy in the past.

At an October 2017 ribbon cutting to expand its Lancaster plant, McCarthy was seated on the stage next to the billionaire, according to a photograph posted on BYD’s website.

“I am proud that BYD has chosen to expand their facility here in Lancaster,” BYD’s website quotes McCarthy as saying.

“As BYD continues to develop cutting edge technology that helps transform the transportation industry here in the Antelope Valley and around the country, this investment will help create jobs in our community, keep Lancaster on the forefront of technological advancement, and put emission-free vehicles on our streets.”

One month before the event, BYD’s Li made several political donations that benefited groups tied to McCarthy, according to the Federal Election Commission. She gave US$1,350 to Kevin McCarthy for Congress, US$2,700 to California Victory 2018 and US$1,350 to the Great America Committee.

Li had never given McCarthy or either of the political action committees money before that time, according to the Federal Election Commission.

Frank Girardot, spokesman for BYD Motors, said the donations were made as part of a political fundraising event but disputed any impropriety.

“If you’re going to characterise this as being some kind of influence type thing, nothing could be further from the truth,” Girardot said.

...BYD has faced scrutiny for years. Some Democrats have accused BYD of manufacturing batteries for its vehicles in China and then shipping the unfinished products to the US, where they are put in a special casing and then labelled in a way that allows them to qualify under “Buy America” restrictions.

The Buy America designation is crucial in order for the company to qualify for certain contracts funded by US taxpayer dollars.

BYD officials have denied accusations that they are not properly adhering to the rules, insisting that the company’s buses meet or exceed Buy America requirements.

Back to Paul Mitchell, who represents blue collar suburbs north of Detroit (Macomb, St. Clair, Lapeer, Sanilac, Tuscola and Huron counties), said that "Whether this is technically state-owned or state-influenced, we have a problem here. What’s been made abundantly clear by the Chinese government is they plan to assume a dominant position in the world by 2025 in all aspects, including economic. This is a threat to the security of this nation, so let’s not dress this up and say that BYD is not state-owned."