Transcripts For CSPAN3 Hearing On Global Trade Online Censo

Senate committee on finance, subcommittee on International Trade customs and Global Competitiveness will come to order. I know this seems a little strange, with an empty room, except for three witnesses live in front of me and many of our colleagues are going to be joining us virtually. But i want to welcome all of you nonetheless, to this important hearing. This subcommittee continues to do its work in exploring the unfair trade practices, a foreign governments especially china and russia. The topic of censorship in china is a common one, because its growing effect on business in the United States. Is as well as culture. Last fall for example, the National Basketball association has its Market Access locked in china. Because an individual american citizen, using a media platform not even allowed in china, expressed a political opinion. Now the topic has become much more important, the lack of timely Accurate Information about the spread of covid19, due to chinese censorship has contributed to the havoc wreaked on our economy and health and indeed the pandemic. The story is nothing new, for some joining us today, chinese censorship has a long been growing, and long has a negative effect on people around the world. Such as those in tibet, where the years and china mixing chang province. First i want to set the scene for whats censure ship actually is. And a simple dictionary definition is a good place to start. The suppression of probe prohibition of any parts of media that are considered obscene, politically unacceptable, or threat to security. Today will focus on how the use of censorship has become a barrier to global trade, when the World Trade Organization was founded, two exceptions to the principles of national treatment, and most favor nations were created. Those are for public morals, and National Security. Notably, there is no exception for a country to restrict strayed because it deemed something politically unacceptable. The discussions over reforming the wto, multilateral talks on ecommerce, and the prospect of a phase two bilateral trade deal with china progressing. The subcommittee is uniquely positioned to inform congress, the public and the executive branch on the use of censorship as a non Tariff Barriers to trade. We will help determine if the suppression of information, data, goods and services via Digital Media by countries like china, constitute a trade barrier in violation of the wto. As well as multilateral and Bilateral Agreements and practices. If so, we will look to determine the economic damage caused as human, cultural business and political ramifications. And what remedies are currently available or should be created to combat this unfair trade practice. On a bilateral basis, what is clear is the lack of reciprocity from countries like china or russia and the United States. The Chinese Government spend billions of dollars to promote its propaganda overseas, a form of offensive censorship. For years, russia has broadcast state propaganda in the United States, unjustly ben designated as a foreign agent. The lack of reciprocity takes advantage of our system of free expression. To promote these countries that agenda online and media. Entertainment as well as our education system. Meanwhile, china and russia do not grant the United States the same access to its markets or media. Instead, china has been expelling our media, having kicked out three wall street journal and other reporters earlier this year over a chinese censorship of covid19. For centuries, countries blocked trade through physically restricting access to the reports. Today the same thing happens, but with firewalls, filters and outright restrictions to access. In fact, nearly a 100 of Global Internet traffic, travels to a crisscrossing network of undersea cables, that form the back bone of Global Digital trade. These cables are another front in the Global Technology race with Companies Like marine, rapidly moving to control the media by which content and trade is censored. In the era of information, where data is the new goal, the blocking the filtering of that traffic by nation states is growing. The censorship is fragmenting our markets, culture, and understanding of one another. The internet itself has become less global, countries like china and russia are not only rebuilding their own infrastructure to cut themselves off from the world. But exporting their authoritarian model to other nations states through efforts as a digital silk road. Its paired that congress and thats why im working together with all of our colleagues in the senate, and in the house to include parts of the chips for america act in the National Defense authorization bill, currently on the senate floor. If you are forced to rely on china, to build our networks and our technology, the world we know will be much less freer, and open to expression of opinions and do business. This bill will help us create our own Domestic Production capacity, for highend sentiment come that underpinned the technology we use in our daily lives. It would also let the United States, remain a Global Leader in promoting free trade of goods, information, and speech. Finally, i look forward to discussing what remedies are available to address the abuse of censorship as a non terror Tariff Barriers to trade. Last fall, the chinese american constituent of mine in texas, reported he was censored here on american soil by the Chinese Government. His america, his american wechat account was shut down for supporting protests in hong kong. His response was quote, if you have censorship in china fine, but in this country, im a republican but i suffer the same as a democrat. Were all censored. I look forward to exploring this topic in the same bar prior doesnt fashion, which we always hope to proceed. Its time for congress to ask hard questions, and thats why we called our panel for experts here today, to discuss this issue. Let me now recognize, Ranking Member casey. Mister chairman thanks very much for this hearing, i want to thank our witnesses here for being with us today. Missed mr. Chairman has noted, the third in the series of hearings held by the subcommittee, outlining Chinese Government Civil Military agenda, efforts to influence the economic and geopolitical order. In a manner that benefits this authoritarian, and competitive practices. Just yesterday, the Chinese National Peoples Congress passed the National Security law, from hong kong, that significantly reuters hong kongs special status, and based on available reporting will deny people of hong kong the right to protest. The right to assemble, or the right to criticize their government. The United States congress has been cleared time and again, the citizens of hong kong must enjoy certain rights that are distinct from mainland china. In efforts to undermine the status quo, as an affront to the people of hong kong and decades of international, regarding the status of hong kong. As ive said before when it comes to china you much work with our allies executing clear and coordinated strategies this applies to trade to the chinese, government most recent efforts to erode the rights of people in hong kong here in the United States at this time we know that we are in the midst of a Public Health and job crisis. So much suffering all across our country. We have seen it across the Board Alliance in the context of this pandemic, this Public Health crisis, our reliance on a Single Source supplier. And more to the point of reliance on production from a non market economy. Last year senator and i outlined the main interest in the market in china. Then we focused on specific initiatives and actions from the Chinese Government. Today we turn our attention to censorship. The actions undertaken by the Chinese Government include correct barriers of blocking movies entering their movies in the market, blocking internet firms, dictating content related to chinas territorial and economic claims. Hence the demanding action or inaction by business related to taiwan, hong kong, to bets and the ongoing human rights abuses them. The Chinese Government has been increasingly assertive been its demands within its borders and outside of. There mandates related to extra territorial censorship, particularly is troubling. The Chinese Governments response to the message of solidarity for hong kong but the general for one example brings to life the lengths the government will go to censor speech, no matter where it occurs, it is intended message set by beijing for disproportional responses. The Chinese Government is exerting command and control over any inter price operating in china, public or private. Simply stated Chinese Government is using its market power to stifle speech. Speech of our firms, speech over people. These actions are inconsistent with our principles, he consistent with our value, and those of our allies. The introduction of corporate social Credit System makes this activity to a new level. The actions by the Chinese Government are clearly restrictive and discriminatory. They are in cities in countered to the necessary traditions of affair and Global Economic system. Since this hearing was originated we, are originally scheduled i should say in march, we have seen all too clearly the cost of relying on china, and on market economy for production critical capabilities. Whether that is personal protective equipment or otherwise. We recently introduced a market economy act which will begin to right size the supply chain toward the United States. And another market oriented countries. But this is what one measure that must be adopted to refocus our trade rules of the Global Economic system. If we hope to sustain with market oriented principles for the next hundred years, we must take action now to ensure competition and market principles are not simply words of the textbook with a rather infused in the heart of government and governance. When it comes to trade we must be responsive and creative to address challenges and harness opportunities we. Theres no doubt that congress, the citizens, and businesses must support and defend the Economic Security of the usa. We i look forward to hearing today from our witnesses and discussing potential responses including the require disclosure of these types of requests to appropriate federal entities and trade rules that prevent free riding for non market economies. We thank you, mister chairman. We thank you senator casey. Now id like to take a few minutes to introduce our witnesses and we look forward to hearing from all of you today. I ask all witnesses to summarize your written testimony and try to abide by the five minute rule and we will come back and ask more questions, all of your written statements will be made part of the record without objection. Our first witness is richard here, chairman of the International Campaign for the bet headquartered in washington d. C. Of course he is an internationally known actor, social activist and philanthropist whose works for more than 25 years to advocate for human rights for the patent people and to preserve tibetan culture. He is also cofounder of the house u. S. And creator of the week gere foundation. He is corresponded five historic visits to the United States by the dolly llama. I thank you for being here, next i would like to welcome. Nigel cory associate director for trade policy in Information Technology and Innovation Foundation here in d. C. Mr. Cory is an expert on data and digital trade issues in the global time spent eight years working for australias department of Foreign Affairs and trade which include positions covering Global Economic and trade issues among g20 countries and the World Trade Organization. Hes also held diplomatic posts in malaysia and afghanistan. Third i like to welcome Clete Willems a fellow at the institute. Focuses on the monopoly power and trade and National Security. She previously served as democratic counsel for the house ways means trade subcommittee and spent six years as an associate general counsel with the United States trade representative where she participated in trade negotiations and litigated trade disputes. Ms. Baltzan has spent three years on the subcommittee on investigation. Finally id like to welcome Clete Willems was a partner at in washington d. C. Mr. Willems advises of writing clients and International Economic law and policy matters. Before he joined the firm mr. Willems served as the the White House Deputy assistant to the president for International Economics represented the United States is a key negotiator with foreign governments and his litigated more than 30 wto disputes. Mr. Willemss work on capitol hill on the House Budget Committee for the former speaker paul ryan. Thank you very much for being here. Mr. Willems and all of our witnesses and mr. Gere if you were there please proceed with your opening statement. I am here. Somewhere. We thank you for joining us. This is all a bit bizarre, i prefer this face to face but lets in gave each other, Ranking Member casey, members of the committee, thank you so much for your introduction and provided me to testify. We it has been 35 years since i first testified in congress and that was the half of our Central American brothers and sisters and of course on to pit last 30 years or so. To bed is certainly be my complicitous helped me navigate through the world of washington and all of my life. This is the first time ive testified before the senate since i met last with one of your great colleagues, john mccain. He was a good man and a good friend and a good friend of the dolly llama and the tibetan people. He certainly was the best of us and like john mccain, and many of you, im sure i hope that our government can deliver at its best for the American People will but for the million of people all over the world that look to us, to the United States and its democracy, and its freedoms and its openness as a source of inspiration and refuge will they live under oppression and violence. American leadership is at its best when it sets its view beyond the horizon, and looks with balanced confidence at the car challenges and opportunities that lie ahead. The rise of china in the world today is not something beyond our horizons, it is right here, it is right in front of us, it is in our face and effects our daily lives, our workplaces, our freedoms, our privacy, our health. Obviously we are finding that out. Our elections, and it will certainly shape the future of our world. Have to look at the committees work on the Chinese Governments plan since 1949 to replace the u. S. On the world stage in advance the condominiums authoritarian model everywhere in the world we im happy to win offer my experience. The conversation about the future of our relationship with the chinese is crucial, not only to the u. S. And frankly weve been tragically naive under both republican and democratic administrations. But its equally crucial for our democratic allies. Ive been involved in supporting tibetan people and the dolly llama peace will coexistence with the Chinese Government for most 40 years now. When it comes to china, to bet supporters have been in for the long haul. Lets just say. We knew that what was happening in to bet would not stop there. And that chinas authoritarianism would expands well be on tibet as we now see in june john and especially in hong kong and chinas borders. And we have no quarrel with the Chinese People, theyre the same as us, we wish them to enjoy developments and quality of life and opportunities and joy and happiness for themselves and their children. But what i fear is that the International Trade<\/a> customs and Global Competitiveness<\/a> will come to order. I know this seems a little strange, with an empty room, except for three witnesses live in front of me and many of our colleagues are going to be joining us virtually. But i want to welcome all of you nonetheless, to this important hearing. This subcommittee continues to do its work in exploring the unfair trade practices, a foreign governments especially china and russia. The topic of censorship in china is a common one, because its growing effect on business in the United States<\/a>. Is as well as culture. Last fall for example, the National Basketball<\/a> association has its Market Access<\/a> locked in china. Because an individual american citizen, using a media platform not even allowed in china, expressed a political opinion. Now the topic has become much more important, the lack of timely Accurate Information<\/a> about the spread of covid19, due to chinese censorship has contributed to the havoc wreaked on our economy and health and indeed the pandemic. The story is nothing new, for some joining us today, chinese censorship has a long been growing, and long has a negative effect on people around the world. Such as those in tibet, where the years and china mixing chang province. First i want to set the scene for whats censure ship actually is. And a simple dictionary definition is a good place to start. The suppression of probe prohibition of any parts of media that are considered obscene, politically unacceptable, or threat to security. Today will focus on how the use of censorship has become a barrier to global trade, when the World Trade Organization<\/a> was founded, two exceptions to the principles of national treatment, and most favor nations were created. Those are for public morals, and National Security<\/a>. Notably, there is no exception for a country to restrict strayed because it deemed something politically unacceptable. The discussions over reforming the wto, multilateral talks on ecommerce, and the prospect of a phase two bilateral trade deal with china progressing. The subcommittee is uniquely positioned to inform congress, the public and the executive branch on the use of censorship as a non Tariff Barriers<\/a> to trade. We will help determine if the suppression of information, data, goods and services via Digital Media<\/a> by countries like china, constitute a trade barrier in violation of the wto. As well as multilateral and Bilateral Agreements<\/a> and practices. If so, we will look to determine the economic damage caused as human, cultural business and political ramifications. And what remedies are currently available or should be created to combat this unfair trade practice. On a bilateral basis, what is clear is the lack of reciprocity from countries like china or russia and the United States<\/a>. The Chinese Government<\/a> spend billions of dollars to promote its propaganda overseas, a form of offensive censorship. For years, russia has broadcast state propaganda in the United States<\/a>, unjustly ben designated as a foreign agent. The lack of reciprocity takes advantage of our system of free expression. To promote these countries that agenda online and media. Entertainment as well as our education system. Meanwhile, china and russia do not grant the United States<\/a> the same access to its markets or media. Instead, china has been expelling our media, having kicked out three wall street journal and other reporters earlier this year over a chinese censorship of covid19. For centuries, countries blocked trade through physically restricting access to the reports. Today the same thing happens, but with firewalls, filters and outright restrictions to access. In fact, nearly a 100 of Global Internet<\/a> traffic, travels to a crisscrossing network of undersea cables, that form the back bone of Global Digital<\/a> trade. These cables are another front in the Global Technology<\/a> race with Companies Like<\/a> marine, rapidly moving to control the media by which content and trade is censored. In the era of information, where data is the new goal, the blocking the filtering of that traffic by nation states is growing. The censorship is fragmenting our markets, culture, and understanding of one another. The internet itself has become less global, countries like china and russia are not only rebuilding their own infrastructure to cut themselves off from the world. But exporting their authoritarian model to other nations states through efforts as a digital silk road. Its paired that congress and thats why im working together with all of our colleagues in the senate, and in the house to include parts of the chips for america act in the National Defense<\/a> authorization bill, currently on the senate floor. If you are forced to rely on china, to build our networks and our technology, the world we know will be much less freer, and open to expression of opinions and do business. This bill will help us create our own Domestic Production<\/a> capacity, for highend sentiment come that underpinned the technology we use in our daily lives. It would also let the United States<\/a>, remain a Global Leader<\/a> in promoting free trade of goods, information, and speech. Finally, i look forward to discussing what remedies are available to address the abuse of censorship as a non terror Tariff Barriers<\/a> to trade. Last fall, the chinese american constituent of mine in texas, reported he was censored here on american soil by the Chinese Government<\/a>. His america, his american wechat account was shut down for supporting protests in hong kong. His response was quote, if you have censorship in china fine, but in this country, im a republican but i suffer the same as a democrat. Were all censored. I look forward to exploring this topic in the same bar prior doesnt fashion, which we always hope to proceed. Its time for congress to ask hard questions, and thats why we called our panel for experts here today, to discuss this issue. Let me now recognize, Ranking Member<\/a> casey. Mister chairman thanks very much for this hearing, i want to thank our witnesses here for being with us today. Missed mr. Chairman has noted, the third in the series of hearings held by the subcommittee, outlining Chinese Government<\/a> Civil Military<\/a> agenda, efforts to influence the economic and geopolitical order. In a manner that benefits this authoritarian, and competitive practices. Just yesterday, the Chinese National<\/a> Peoples Congress<\/a> passed the National Security<\/a> law, from hong kong, that significantly reuters hong kongs special status, and based on available reporting will deny people of hong kong the right to protest. The right to assemble, or the right to criticize their government. The United States<\/a> congress has been cleared time and again, the citizens of hong kong must enjoy certain rights that are distinct from mainland china. In efforts to undermine the status quo, as an affront to the people of hong kong and decades of international, regarding the status of hong kong. As ive said before when it comes to china you much work with our allies executing clear and coordinated strategies this applies to trade to the chinese, government most recent efforts to erode the rights of people in hong kong here in the United States<\/a> at this time we know that we are in the midst of a Public Health<\/a> and job crisis. So much suffering all across our country. We have seen it across the Board Alliance<\/a> in the context of this pandemic, this Public Health<\/a> crisis, our reliance on a Single Source<\/a> supplier. And more to the point of reliance on production from a non market economy. Last year senator and i outlined the main interest in the market in china. Then we focused on specific initiatives and actions from the Chinese Government<\/a>. Today we turn our attention to censorship. The actions undertaken by the Chinese Government<\/a> include correct barriers of blocking movies entering their movies in the market, blocking internet firms, dictating content related to chinas territorial and economic claims. Hence the demanding action or inaction by business related to taiwan, hong kong, to bets and the ongoing human rights abuses them. The Chinese Government<\/a> has been increasingly assertive been its demands within its borders and outside of. There mandates related to extra territorial censorship, particularly is troubling. The Chinese Government<\/a>s response to the message of solidarity for hong kong but the general for one example brings to life the lengths the government will go to censor speech, no matter where it occurs, it is intended message set by beijing for disproportional responses. The Chinese Government<\/a> is exerting command and control over any inter price operating in china, public or private. Simply stated Chinese Government<\/a> is using its market power to stifle speech. Speech of our firms, speech over people. These actions are inconsistent with our principles, he consistent with our value, and those of our allies. The introduction of corporate social Credit System<\/a> makes this activity to a new level. The actions by the Chinese Government<\/a> are clearly restrictive and discriminatory. They are in cities in countered to the necessary traditions of affair and Global Economic<\/a> system. Since this hearing was originated we, are originally scheduled i should say in march, we have seen all too clearly the cost of relying on china, and on market economy for production critical capabilities. Whether that is personal protective equipment or otherwise. We recently introduced a market economy act which will begin to right size the supply chain toward the United States<\/a>. And another market oriented countries. But this is what one measure that must be adopted to refocus our trade rules of the Global Economic<\/a> system. If we hope to sustain with market oriented principles for the next hundred years, we must take action now to ensure competition and market principles are not simply words of the textbook with a rather infused in the heart of government and governance. When it comes to trade we must be responsive and creative to address challenges and harness opportunities we. Theres no doubt that congress, the citizens, and businesses must support and defend the Economic Security<\/a> of the usa. We i look forward to hearing today from our witnesses and discussing potential responses including the require disclosure of these types of requests to appropriate federal entities and trade rules that prevent free riding for non market economies. We thank you, mister chairman. We thank you senator casey. Now id like to take a few minutes to introduce our witnesses and we look forward to hearing from all of you today. I ask all witnesses to summarize your written testimony and try to abide by the five minute rule and we will come back and ask more questions, all of your written statements will be made part of the record without objection. Our first witness is richard here, chairman of the International Campaign<\/a> for the bet headquartered in washington d. C. Of course he is an internationally known actor, social activist and philanthropist whose works for more than 25 years to advocate for human rights for the patent people and to preserve tibetan culture. He is also cofounder of the house u. S. And creator of the week gere foundation. He is corresponded five historic visits to the United States<\/a> by the dolly llama. I thank you for being here, next i would like to welcome. Nigel cory associate director for trade policy in Information Technology<\/a> and Innovation Foundation<\/a> here in d. C. Mr. Cory is an expert on data and digital trade issues in the global time spent eight years working for australias department of Foreign Affairs<\/a> and trade which include positions covering Global Economic<\/a> and trade issues among g20 countries and the World Trade Organization<\/a>. Hes also held diplomatic posts in malaysia and afghanistan. Third i like to welcome Clete Willems<\/a> a fellow at the institute. Focuses on the monopoly power and trade and National Security<\/a>. She previously served as democratic counsel for the house ways means trade subcommittee and spent six years as an associate general counsel with the United States<\/a> trade representative where she participated in trade negotiations and litigated trade disputes. Ms. Baltzan has spent three years on the subcommittee on investigation. Finally id like to welcome Clete Willems<\/a> was a partner at in washington d. C. Mr. Willems advises of writing clients and International Economic<\/a> law and policy matters. Before he joined the firm mr. Willems served as the the White House Deputy<\/a> assistant to the president for International Economic<\/a>s represented the United States<\/a> is a key negotiator with foreign governments and his litigated more than 30 wto disputes. Mr. Willemss work on capitol hill on the House Budget Committee<\/a> for the former speaker paul ryan. Thank you very much for being here. Mr. Willems and all of our witnesses and mr. Gere if you were there please proceed with your opening statement. I am here. Somewhere. We thank you for joining us. This is all a bit bizarre, i prefer this face to face but lets in gave each other, Ranking Member<\/a> casey, members of the committee, thank you so much for your introduction and provided me to testify. We it has been 35 years since i first testified in congress and that was the half of our Central American<\/a> brothers and sisters and of course on to pit last 30 years or so. To bed is certainly be my complicitous helped me navigate through the world of washington and all of my life. This is the first time ive testified before the senate since i met last with one of your great colleagues, john mccain. He was a good man and a good friend and a good friend of the dolly llama and the tibetan people. He certainly was the best of us and like john mccain, and many of you, im sure i hope that our government can deliver at its best for the American People<\/a> will but for the million of people all over the world that look to us, to the United States<\/a> and its democracy, and its freedoms and its openness as a source of inspiration and refuge will they live under oppression and violence. American leadership is at its best when it sets its view beyond the horizon, and looks with balanced confidence at the car challenges and opportunities that lie ahead. The rise of china in the world today is not something beyond our horizons, it is right here, it is right in front of us, it is in our face and effects our daily lives, our workplaces, our freedoms, our privacy, our health. Obviously we are finding that out. Our elections, and it will certainly shape the future of our world. Have to look at the committees work on the Chinese Government<\/a>s plan since 1949 to replace the u. S. On the world stage in advance the condominiums authoritarian model everywhere in the world we im happy to win offer my experience. The conversation about the future of our relationship with the chinese is crucial, not only to the u. S. And frankly weve been tragically naive under both republican and democratic administrations. But its equally crucial for our democratic allies. Ive been involved in supporting tibetan people and the dolly llama peace will coexistence with the Chinese Government<\/a> for most 40 years now. When it comes to china, to bet supporters have been in for the long haul. Lets just say. We knew that what was happening in to bet would not stop there. And that chinas authoritarianism would expands well be on tibet as we now see in june john and especially in hong kong and chinas borders. And we have no quarrel with the Chinese People<\/a>, theyre the same as us, we wish them to enjoy developments and quality of life and opportunities and joy and happiness for themselves and their children. But what i fear is that the Chinese Communist<\/a> parties model of developments, that is predicated on control, dominants and violence. Chinese leaders quoted an old chinese proverb,,. ,. ,. ,,. ,,. ,. ,. Which spent large sums of money to enter the u. S. Market but as you know, china does not reciprocate. They did not allow American Media<\/a> to broadcast. Lack of reciprocity from an orwellian system of state censorship and powerful, powerfully restricts the Chinese People<\/a> access the information and american and foreign Media Companies<\/a> access to one of the Worlds Largest<\/a> markets. In fact its china has repeated ugly, with 1. 4 billion people. Another example is americans have a strong incest and appreciation for tibetan people. For their unique buddhist culture, and fragile and beautiful land. Its the roof of our world its the third its the greatest source of the worlds freshwater. Heres what happens into bet, the Chinese Government<\/a> highly restricts access to tibet for americans, including journalists and politicians. Like no other areas of china. While chinese citizens, face and no such limitations when they visit the u. S. To go where they want. Congress recently took action, to pass the reciprocal access to tibet act, which is a rational and systematic response, and the state department, will implemented soon as required by law now. As an actor, which is why im here im think. I know youre interested in my experience in the Entertainment Industry<\/a> and growing chinese influence there. I cant say my speaking up for human rights in china has due directly affected my career. Im probably unusual case, you can talk about that more. Theres no doubt that the accommodation of chinese censorship, american film studios, to access chinas market. Can lead to self censorship, and to avoiding social issues that Great American<\/a> films once addressed. Imagine, martin scorseses, the dolly llama or my own film was highly critical of the new chinese legal system. Imagine them being there today. It wouldnt happen. As i conclude my remarks, i would like to call your attention to two bills in the senate, the first is sponsored by senators cardin, casey, rubio and wyden and already passed the house was overwhelming support. The tibet policy and support act, u. S. Policy into bet while addressing one cree and overriding issue the selection of the next dollar llama. This cant be allowed to be controlled by the communist party, only by tibetan buddhist. Im sure that you support this basic principle, and i ask you to cosponsor this bill, and raised it with the Senate Leadership<\/a> and swift passage, by the Senate Foreign<\/a> relations committee. The second bill, is the mongolian third neighbor trade act, introduced by senators sullivan and cosponsored by Ranking Member<\/a> widen and majority whip. This bill would grab a democratic and independent mongolia, better access to u. S. Market for products manufactured in mongolia. We can go into this later, mongolias under extraordinary pressure and threat from china. This will greatly benefit mongolia, create jobs for mongolian women and reinforce Democratic Institutions<\/a> into concrete ways. Strong send democracy, and most critical time in the indopacific, and will help mongolia remain independent. I call on the senate to pass this bill, as well as soon as possible. Thank you very much for your attention. Thank you for joining us, well hear the other Opening Statements<\/a> and come back for some questions. Mr. Cory. Thank you, good afternoon senators i grid greatly appreciate the opportunity to. Let me start by saying, its important to acknowledge that china uses censorship as a disguise to offer protectionism. Let me start by saying, its important to acknowledge that china uses censorship as a disguise to offer protection. And censorship in the chinese context means, overly broad and discriminatory control on digital content, distribution platforms, infrastructure, and the firms involved. This disguise protectionism has already caused the u. S. Economy so dearly, this cost will only rise if china is able to export its model of digital governance to other markets around the world. The United States<\/a> need a stronger strategy to push back on the direct trade impact of censorship in china, but also to prevent it from moving to other markets. Stakes are high, if we fail to act, the u. S. Could lose its edge in the Global Digital<\/a> economy. This is especially the case given censorship along with other disputes over internet policy, are part of a bar broader troubling rise of socalled digital sovereignty. And while not alone, china is the world leader in using overly broad and restrictive and discriminatory rules around context it deems illegal. China is advocating for its own model, but other countries are also attracted to it. And theyre drawn to it for political reasons, because it provides them with control, but its also provides time with the protectionist tool. Because they like the economic impact. And while censorship is not the only restrictive tool that china has used, it is a central one that has led to a generation of chinese internet consumers having an internet experience that is completely different to most people in most countries around the world. It is known that china uses the great fire wall to block access to thousands of foreign websites. Which is obviously, a clear barrier to Market Access<\/a>. But its only one tool of many, it is less known that censorship is also a key factor that leads to u. S. Firms from being prohibited from operating in key Internet Service<\/a> sectors. And how it plays a parts the opaque, discriminatory, and destructive content review process. For video games, movies, and tv. And its also a key factor that limits or restrict their ability to connect to the Global Internet<\/a>, which essentially renders their ability to use cross board to access use or develops software on a cross border basis. While the primary motivation for censorship and china is regimes ability, it gets the economic benefit. And the economic benefits to china, and the cost to the United States<\/a> is already significant. And that over the last 20 years, a host of u. S. Industries and firms have lost hundreds of billions of dollars in revenue. And while its hard to calculate an exact cost, the Information Technology<\/a> and Innovation Foundation<\/a>, conservatively estimates that for example, google. Which grew from the Chinese Market<\/a> in 2010, has lost in excess of 32 billion dollars just over a fiveyear period, from 2013 to 2019. In contrast, amazon and microsoft cloud services, which are also severely restricted in china, are estimated to lost 1. 6 billion, just over twoyear period. From 2017 to 2018. And why should we care about this . Because, this lost revenue of billions of billions of dollars have otherwise supported innovation and employment here in the United States<\/a>. Some u. S. Policy makers want to exacerbate the impact of censorship in china, by calling for u. S. Firms to either leave china or stay out of china because they believe its a more to do business there. The fact is that, with or without u. S. Firms, chinas internet remain censored. Its been essentially censored since they connected to the internet. But there should be no doubt, that is an in americas Economic Security<\/a> interest, that im air Many American<\/a> firms as possible so goods and services to the Chinese Market<\/a>. Every dollars worth of digit code and its a dollar that chinese firms dont earn. And its a dollar that u. S. Firms can otherwise used to reinvest in research and development, and to support economic unemployment opportunities here in the United States<\/a>. Its also important to recognize, human rights and trade are not mutually exclusive. The united the United Government<\/a> should also lead the charge around the world and advocating for human rights and democracy, both in china and elsewhere. But it should also be able to develop, a more nuanced detailed understanding of how its playing out in developing a countering strategy to how china has deployed censorship in the way it has. To ensure that it doesnt spread any further. As a consequence, we recommend to congress that it asks the u. S. International trade commission for a detailed study into the impact to censorship. In the study could form the basis for new rules, for u. S. To use and future trade agreements, and also to be used by the department of congress. But it could also form the basis for a more holistic, global, Digital Economy<\/a> strategy that is needed to counteract chinas effort to advocate for its own moral. Because its a fierce debate underway at the moment, over which direction country should go. Which approach they should take and chinas is obviously based on censorship and protectionism. Again, i thank you for the opportunity to testify and i look forward to your questions. Thank you ms. Pulsing. Thank you so much. My name im a fellow at the open Market Institute<\/a> ive been a trade lawyer for nearly 25 years. As senator cornyn noted, i worked at usc or the the Senate Permanent<\/a> subcommittee on investigations in the house ways and means committee. All of these experiences and for my testimony today. In 1989, france as fukushima published an influential article called the end of history. He argued that the imminent dissolution of the soviet union reflected the triumph of economic and political liberalism. And the economic liberalism would pave the way for political liberalism globally. This view permeated as like ice when we designed the wto, and when we lead china into it. Developments and china have cider shattered that theory, rather than democratizing as a result of its integration into the global economy. The Chinese Communist<\/a> using its economic leverage to foreign citizens in their home countries. Economic liberalism has become the vector for political illiberalism. Fukushima has recognized his mistake, going for us to identify Chinese State<\/a> capitalism as the most salient threat to democracy. When we look at the actual rules of globalization, we see how this came to pass. In designing the rules in the 90s, we focused on liberalizing capital flows, believing that a less for a model would produce ideal economic and political outcomes. We even guard against a government that would exploit that system with a fundamentally anticompetitive, zerosum strategy. It is that anti competitive strategy, not natural comparative advantage, that has led us to be economically dependent on an authoritarian regime. Its wrong to say we couldnt have seen this coming, the founders of the multilateral trading system for told this outcome and sought to prevent it. They designed a regime rounded unfair competition, cheating through currency manipulation, liberate suppression or monopolistic behavior was prohibited. They presidency warned that without these rules, state trading governments, uber monopolistic, would destroy Free Enterprise<\/a> and democracy. These rules were memorialized in the havana charter, signed in 1940 by over 50 countries. But i never entered into force. Its popular lord that an isolation congress rejected it, but thats not accurate. The charter failed because the American Business<\/a> community rejected it. We managed to forestall the immediate threat to democracy and Free Enterprise<\/a> by keeping the soviet union out of the got. But we did allow the pr sea, a modern state trading government into the wto. And the prophesy now seems to be coming true. Its not too late to mitigate the risk, addressing the ccps ability to interfere in our Civil Liberties<\/a> requires us to over us. I offer five recommendations. First, we must address the supply chain dependency. So much has changed since early march when the steering was for scheduled, people now understand in very real terms what it means to have a supply chain dependency problem in on china. Fortunately, for the First Time Since<\/a> the seventies, the United States<\/a> is having a conversation about strategic industrial policy. We need to identify critical sectors, map out supply chains, and ensure we have diverse sources not just a finished would, but have components as well. Second, we much recognize that unless we reform the systemic Global Trading<\/a> incentive, it will be difficult for us to sustain supply chain diversification. As long as the rules tolerate anti competitive inducements to offshore, we must anticipate that any newly rebuilt supply chains will eventually end up back where they started. Therefore, we need the right slate of reforms are the wto, the narrow focus on subsidies is grossly insufficient to deal with a much more structural problem of the ccpc anticompetitive it poach to trade. Third and related to the question of sustaining supply chain diversification, we must keep an open mind about tariffs. Tariffs can be a useful tool for driving behavior, the United States<\/a> has the lowest bound rate at the wto, that low rate coupled with anticompetitive ccpc behavior, has made it particularly lucrative to our shore american production and offshore it back. Until weve achieved global reform, we much consider terrorist to be one way of incentivizing the source that we warned. Fourth, we should work with our allies but be realistic. Many of our ally simply do not yet see the ccpc as a threat to economic and political freedom. However, supply chain diversification is one area where we can cooperate with countries that share our values. Fifth, we must accept that to Market Access<\/a> and china is illusory. The ccpcs will give us exactly as much Market Access<\/a> as they want to, the more wed telegraph that we believe Market Access<\/a> is possible, the more leverage they have over. Us being a Market Access<\/a> demand or puts us in a position of weakness and increases their ability to interfere with our Civil Liberties<\/a>. Thank you for the opportunity to present these views. Thank you very much, Mister Mister<\/a> chairman, Ranking Member<\/a> and members of the committee. Thank you very much for the opportunity to testify today. China is expanding its use of censorship to promote national interest, with adverse consequences around the globe. This has been driven home for us by the suppression of information on the coronavirus and the impact this is have on the u. S. Well censorship is just one of the many tools that is used to promote the parties interest, we have talked about others already today, it is something that has not been prioritized in policy making. Including the phase one negotiations that i was a part of and therefore it is right by further exploration action. Chinas censorship activities manifest in many ways. One primary example is a great fire wall which was tricks free speech through website blocking and filtering. According to the u. S. , china currently blocks over 10,000 websites. As ive been getting ready for this hearing i have seen numbers like 20 and 30,000. They control domestic news outlets and direct some to write on favorable stories on issues to the economy and the converts itself. Chinas indirect efforts to censor speech is equally troubling. During last years nba twitter controversy, china retail tilted against a single tweet against a single individual by prohibiting on the broadcast of all teams in all games in china which was a clear effort to intimidate those abroad who tended to speak out and wanted to do business in china. This is just the tip of the iceberg are, chinas social credit scoring system will naval regulators to monitor and influence behavior in realtime. Overall, chinas spread propaganda and promote a Business Environment<\/a> where only its companies can compete. They have been encouraging other regimes to adapt similar policies and has yet to back down to the u. S. After beat china responded by expelling journalists from beijing. I find it particularly ironic that china wolf warrior diplomats have taken to twitter to influence Global Opinion<\/a> that oversight this band in china. At the wto, the u. S. Conceived a challenge to foreign Internet Service<\/a> providers on the however these rules were drafted before the internet and we not particularly specific when it comes to censorship. China could also kind of avail self, i believe that the u. S. Unbalanced has a strong case, given the time and resources it would take to bring a dispute and some of the uncertainty i mentioned, it is better to move in a different direction. How should we deal with this issue . Let me give you a couple of ideas at the outset. First, we must consistently highlight chinas nefarious policies and use the full power of government to seek change. Governments are better positioned than companies to push back against this behavior and we should not expect our companies to do it alone, and we cant always expect them to do what we think is the right thing on their own. They beat the government behind them. Seconds, we must work with key allies to do the same. China will find much more difficult to stir up anti u. S. Ensign meant an excuse its behaviors of others empire side. But those others must not hedge their bets. And they must not send the wrong signal to china by adopting similar policies. They used digitally sovereignty agenda and the discussion of the european fire wall is a case in point. Third, i would apply the same advice to us, as we seek to encounter the threat posed by china, we must be careful not to adopt the same policies that we are condemning. Policies that stifle free speech or increase Market Access<\/a> barriers, this will backfire economically and cause us to lose moral high ground that is so important building in initiatives of coalition. Fourth, we should pursue a broad wto of gentle with rules on censorship, forced Technology Transfer<\/a>, subsidies, intellectual property theft and some of the ideas that bat rays are worth considering. i lc h on the same obligations as. Misstates abandoning the system, that we, not china would be a mistake. China would like nothing more than to see the u. S. Created system collapse. Fifth, we should negotiate a broader range of trade agreements with strong censorship provisions, this includes a revamped anti lateral, at on digital trade chatters and adding fta existing partners, and a renegotiated tv tv. Putting politics aside, it provides a great opportunity to circle china with policies that stand in contrast to its economic model. There are legitimate concerns but it should be reformed just like nafta, which we will bring into force tomorrow. Lets do the same thing on tp. Six, we must pass newest to protect u. S. Companies so they can safely access a market over a billion consumers. Ideas like protecting employees for being terminated for forcing can opinions on foreign government, disclosing pressure from the Chinese Government<\/a> all deserve to be finally, we must not draw a false equivalence between the Chinese Government<\/a> and its people, many good chinese citizens are suffering with their voices muffled by the same policies of just been describing. A commentary that was briefly posted online in china earlier this year, before it was deleted by the censorship police, stated, the openness of information is the best vaccine. Blocked ears and eyes are also contagious disease, and no one can escape. Thank you. We thank you very much. We will proceed with a round of five minutes per senator of questions. Mr. Gere, lets start with you if i may. Your courage in confronting the Chinese Communist<\/a> party for its methods and tactics of since trading, we tell you aiding and punishing those who make disagrees with is commendable. I thank you for that. We as chinas economy has grown, we have seen more self censorship. There is a censorship that could be imposed by the government but theres also the practice of self censorship by companies and individuals that want to do business in china. Can you describe how chinese practices operate in the magnet towed it is changed in parallel with the growth it has has experienced. In my experience, and certainly in the government diplomatic world, the one weve seen over the last 40 years, china is not shy about letting everyone know that they dont like the dolly llama to be treated well and tibetans to be treated well. The three tees that they freak out about is, tiananmen square, tibet and taiwan. And certainly they do call everyone local, state and national, federal, all over the world when issues to come up. But ive seen it over last 30 or 40 years that countries and diplomats do so sensor now. That they take it upon themselves not put themselves in a position where they are going to be reprimanded by the chinese, or lack some kind of economic access. Norway went through a whole periods when someone was given the nobel prize, they were cut out completely from trade with china. We moving on to movies, i see the same thing happening, over these last few years especially. As i said before, you are not going to see any film that is made by a studio that is critical in china because of investment, money coming in from china, we but let me go back a little bit and understand in how the film system works in china. There are only 34 International Films<\/a> that are allowed to be shown a year in china. And 12 of those, one third, has to be in imax film or 3d film. At minimum. So what they wants is these high profile we movies now, digital cgi films, the marvel movies and etc. They are consumed at a very high level in china we. On trump earners can make a lot of money. The two biggest distributing companies in china are state owned. We the Film Industry<\/a> is owned by the states in china. So course theres a lot of self censorship. What wouldve been a villain, maybe a chinese villain, maybe there is now a north korean villain. Some of it is quite silly. We there was a movie, highprofile movie i think it was with tom cruz where he was walking through shanghai and he sees some underwear on a close line. A sensor objected to that because it made the city look less developed. And it was removed we. Christopher robin was not allowed to be screened in china because there was some kind of amusements that winning the poohpooh looks like an asian pig. So it was refused entry into china. I see this in studios, and it comes up even recently with me. There was a script that takes place partly in china. And the producers at first blocked at the idea of me being in the film. We and then they were talked to and they were supporters of the dolly llama and they took a deep breath and said, no were going to take a moral decision here. So we are talking about making a film there. But well never be of the film in shanghai. Im allowed in china. I asked pointblank a known chinese actress if i could work with them and they said absolutely not. Our careers would be over and i would never be allowed to work again. But other circumstances, very talented chinese directors one who was in tears happen to call me up and say he couldnt work with me that his career would be over in his family would not be of the travel. This is personal to a lot of people. My own career has not suffered at all because they dont make see gi kind of films. My films wouldnt naturally be shown in china anyhow, we may be underground or on the black market. When phil madam aides, red corner, many years ago we could not shoot it in asia. We could even get insurance because of me and the communist party. But when it was shown, i did go to hong kong after that, and it wasnt officially shown in china we are going up the elevator in a hotel and the elevator operator looked up at me and the camera that was watching us and as i passed him at my floor he said, with a cue for red corner. We there is that ubiquitous technical surveillance in a Police States<\/a> whereby which well, we know that the budget for surveillance in china is larger than the military budget. Thank you very much. Senator casey, do you have questions . Why i understand we have a bit of a technology issue. Senator casey . Let me turn to senator cassidy. Oh, there he is. Mister chairman, thank you very much and i want to thank for the hearing. I would like to start with mr. Gere, i would like to note for the record, because those who are members of the senate we not know this but you have strong pennsylvania routes personally and in your family, both of your parents, and i know that we want to know that for the records. We appreciate that. We always are welcoming people back that want to move back. What i want to thank you for that. I also want to thank you today for the great work that you have done calling attention to these issues over now decades. In a manner that sometimes is not the kind of sustained efforts that those of us and washington can undertake. It has to be a lot more focused than we have brought to bear on these issues that relates to china. And you have been sounding the alarm for years. They wanted to start with your observations with regards to the tactics and the strategy employed by the Chinese Government<\/a>. Especially over the last decade. To compel her to illicit actions of individuals or companies, in some cases governments. I guess its a two part question, your observations on both tactics and strategies, deployed by the Chinese Government<\/a>. And secondly, what is your advice for burrow terms here in the United States<\/a> as well as in congress . Who emiliano . You hear me . Hello. Well thank you for your kind words, i have to say yes my mother and father both came from county. Brooklyn, pennsylvania. Which i dont think theres any larger today than it was in the twenties when they were born. Farming community, dairy farms my father grew up milking cows. My hand early on so i still have family there, i consider that may be my spiritual home. The big overriding thing from my point of view, we have to understand, chinas playing the long game. Theyve been playing the long game, they do have a 100year plan, and they are way ahead. They were very clever, they realize they were coming from a very weak position. They decided they would be the chief this place in the world to make products. This was well thought out from that side, they werent looking to make profits, what they were looking to do is to own the markets. Which they do at this point, we get our medicines from china. We get most of our manufactured goods from china, we get almost everything you would buy from a store, made in china. They own us in many ways. Certainly, that to them is controlling a world, the world that we have bought into. Which is one of who is going to make the most money. Weve made some huge mistakes along the line, very shortsighted and naive. Theyre much martyr than us, theyre much more patient than us. They creep into power as we back off, as we pivot away from asia, and we leave a vacuum they feel it immediately. When we back off in the environmental world, they fill it in immediately. When we break up our alliances, they come in immediately. Theyre making alliances with italy right now. The balkan road is now as contest in italy, it should be the american its the chinese builtin road. Again, its long term sinking, especially know that theyve made him im prefer life, this 100year plan will be continuous. As we change administrations, we faith we change focus of what were doing, how we approach the world, there are spaces and vacuums that are created. And the chinese are taking them every single time, they creep into every open space. And ive talked to leaders all over europe, Central America<\/a>, and asia. I say please, do not take alone and build an airport or report, from the chinese. Because they will take that airport, they will take that railroad, they will take that port away. We see it in sri lanka, and will see it in italy. I think the strategy for us is to step back and understand, this Long Term Strategy<\/a> for world dominance that is coming from the Chinese Communist<\/a> party. Part of it is talking to each other, having these alliances, relying on tv to be relying on real honest relationships with the eu. This is a world of strong alliances, cant confront with the chinese are doing. Senator casey. I know you had a question maybe ill go on the second round. We doctor cassidy, senator cassidy. Thank you, mister you just said by the way thank you all for testifying, incredibly important hearing thank you very much. Mr. Garry just mentioned, creep into power. I kind of like that, as a kind of this is how to creep into the vacuum. Im trying to ask myself how do we stop. I am struck by your testimony, because it actually links their ability the chinese ability to do digital censorship to the economic power that they are proved. It suggests i like that whole exchange that you had in your thing about, if you have free trade by itself doesnt necessarily make things happen. It has to be otherwise with guardrails. I say that because, recently told, by Central American<\/a> countries. That they workers rights, the human rights, and the environmental requirements we placed upon them, in order to conduct trade. Has increased their cost of production, and put them out a pick competitive disadvantage for a Company Looking<\/a> for a low cost place to produce. Therefore, they go to china, which does not have the workers protections to say the least, environmental protections etc. And so it kind of slides that way, which if you will works against our interest in multiple fashions. Geo thought on that . Is that to me whos that to . Mrs. Balsam. Yes thank you very much i think this is something that, we see with mexico as well. I think the answer to stopping this race to the bottom, which is fundamentally based on anticompetitiveness. These are anti competitive bases for trade. Its to incorporate the standards at the wto, and its very surprising to me that in late not only of these issues and Central America<\/a> and other places. In light of has rain, the fire at cazarene in bangladesh. The collapse of montana the plaza in bangladesh. It surprises me that labor issues and environmental issues, i did point out in my testimony that there were labor rules in the havana charter. Which was supposed to be the document going back to 1948. If china were actually required to add here to those rules, like everyone else. Then you would have the opportunity to mitigate the race to the bottom that were seeing. But let me ask you for a second. If you will you you mentioned the problem with our supply chains going through china. But they are going to be the lower cost, as long as they are willing to sacrifice International Environmental<\/a> standards, liberals, human rights etc. Granted, vietnam may be lower costs and some places for labor. Nonetheless, even that is a fourth for the race to the bottom. If were talking about bringing supply chains to more secure places, and, decrease the economic vote to china which by the can coerced people into accepting their censorship. We really kind of have to take into accommodation now what you are describing now. Is that kind of the essence, im adding to it, but would you agree to that . I think we need a race to the top, im not a race to the bottom. Labor is probably section 3 01, so that could be on the table Section Three<\/a> oh on on labor with respect to our negotiations with china as well why dont. Okay. Thats very helpful, im sorry i dont have my notes in front of me. Im not used to working remotely, the gentleman who spoke at the very end. I think you spoke of kind of a need to confront this digital and censorship across the globe. But how tell me again how the u. S. Is to do that. How do we get for example, it will lead to not accept censorship when according to mr. Garrett, hollywood has accepted accepting censorship . Thank you for the question. What i was referring to, in general. I think we need a much more robust negotiation agenda, with a range of potential allies, that is more explicit on the censorship question. Weve made some progress, and some trade agreements, the usmca are. The japan digital trade agreement, where we talk about nondiscrimination and the free flow of information across borders. But i think we could go much further and deeper, and much more explicit on censorship. I think that doing so, would actually help address some of the concerns that i have about a wto dispute, and some of the uncertainty that could be put into place by some of chinas counter arguments. I think a much broader train negotiation agenda is the way to go. The other thing on italy, that i think mr. Gear was referring to, that italy has basically signed up for some belt and road money. It happened about two years ago while i was in the administration, and i was personally involved and calling italy and trying to get them to stop. The problem was, they were in an economic crisis, they wanted infrastructure and china was offering it cheaply. Its a huge problem, we need to have an american alternative. Weve tried to do that with the International Developed<\/a> finance corporation, i think its a very hopeful addition to the u. S. Wicket. I like to see as more money at that effort, and like i see this link up. With other trading partners and then have international standards. On Development Financing<\/a> standards about transparency and accountability, standards that we meet that europe meets, that the china cannot. That is another area i would like to go. Thank you, i yield back. Thank you very much. , senator . Thank you to all of our witnesses, the movie industry thirst for profits and access to chinas huge audiences makes a uniquely susceptible to the sort of self censorship of the Chinese Communist<\/a> party likes to incur. And they like to impose on themselves. One quarter of aquamans Global Box Office<\/a> came from china. Disney earned 600 Million Dollars<\/a> off of avengers and game in china. That is a lot of leverage. And the real peoples republic of chinas very clear that when it comes to movies it wants products that are not only entertaining but align with the partys worldview with. So mr. Gere, can films that are not ccp propaganda pieces really be have access to china given the Global Box Office<\/a>. What effects is china have on the movie industry overall . I dont think it is as dark as you are describing in this moment. There are certainly benign movies that are completely apolitical that have access. Those movies that you brought up or four appear entertainment and politically neutral one. Those will never have a problem having access to 1. 4 billion chinese viewers what. I do think that the challenging films along the lines of all the president s men, or red corner, that i made with, it is highly unlikely that these kind of films are going to be supported by chinese investors. And especially if they say in advance, which they often do, that there is no way that film will have access to the Chinese People<\/a>. Wow about but even in the case of and i get that those who are rather benign, but what about top gun, maverick whose producers removed with references to the taiwanese and japanese flags. China still has a lot of power to dictate the preferences. Is that fair to say . It is very fair to say. It is very well illustrative of their weakness. How silly is that . How completely ridiculous . We its the way that theyre hypersensitive about the dolly llama. The kindness, most generous man on the planet who is consumed and saturated with love and compassion and forgiveness. The mere mention of his name makes them crazy. The problem is that the communist parties everywhere lack legitimacy. When someone like the dolly mama for instance, is legitimate. People love him for deep and powerful reasons. You dont love the communist party. You abide by it because it is powerful and it controls you. But you dont love it. With the true legitimacy comes from the hearts. Thats really what they are afraid of, something that touches the hearts and through the hearts, a sense of right and wrong and decency. Anybody that has that that would challenge the idea of a communist party or to tell terrineism where the kind of surveillance faith that they have developed their. Anything that challenges that even in a poetic way is when making crazy. I agree with you. How small is it of them to be worried about japanese or taiwanese flags . But, but, even something as small as that is something that filmmakers are willing to submit to. Thats what worries. Me i agree with you above the dolly llama and i appreciated my other role we and you are able to have the recognition and freedom with a dolly llama. But this is what i am concerned about. We know what the chinese are and what they do. Im concerned about their influence over us. I look at the fact that the president has declared that every foreign movie to be shown in china must be vetted by the central propaganda department. Depending on the contents, the ministry a state security and public security, the Ethnic Affairs<\/a> committee and the bureau of religious affairs may also be involved. I dont think they are looking at lighting or cinematography or editing. I think they are looking to preempt themselves, and this is a challenge, i wonder does this influence filmmakers choices to preempt themselves from offending shiny sensors. What happens if the Creative Team<\/a> is unwilling to make those sorts of changes that china wants well you have different types of movies and certainly a top gun type of movie is not a art Film Festival<\/a> kind of movie. It is a mass market entertainment. I dont know that the changing of the flags on these uniforms his a major blow to the soul of the filmmakers. Its not that kind of film, im not worried about those kind of films. I am worried about the rabbit hole that one goes down at this point. If all over films become primarily financed by chinese money, then clearly you are going to see films that are there to glorify the chinese party. But that is a ways down the rabbit hole. I think still, serious filmmakers are going to make the kind of film that they want to make. The commercial movies that youre talking about, they want access to a mass market, i cant blame them for that. Minor changes along the way . It is hard for me to fault. We i am more concerned about the sole and storytelling and movies and entertainment which is beyond the kind of marble moviemaking. No clearly you are not would have chinese villains anymore, that is not going to happen, that is done. It is going to be north korean. It will probably be north korea in from now on. I always thought those were different tigers anyhow. I never felt comfortable that in any event. But as ive mentioned in my original talk, the inability for serious films looking at deeply and situational and profoundly, the situation in china. That will not happen now. Thank you. Mister chairman, i would like to make one last comment. And i understand what you are saying, but sometimes the soul is lost stepbystep and dollar by dollar. That is the rabbit hole but im afraid of, yes. Thank you senator. Senator cortez masto. We thank you, i appreciate the conversation today. Let me approach you from this perspective, let me turn to hong kong. American and European Companies<\/a> are being pressured we towards the National Security<\/a> team we know that. The pressure will almost certainly extend to other issues. But what we have also seen is the pressure for people that want to do business in china, to change some of their policies, principles. Some of their products in response to the pressure on china. My question to all the panelists, what can congress do to support American Companies<\/a> experiencing this ccp government pressure and propaganda. That is a challenge we have, i sit on banking on housing as well and we just had this discussion on how american countries are coming to the pressure by the Chinese Government<\/a>. What do we need to be aware of here in congress . What can we do to support our American Companies<\/a> who want to get into that market but at the same time stay true to our freedoms, our democracy and who we truly are. I just had one comment here. And that is to bring the attention of reciprocity, International Norms<\/a> of reciprocity. We have to demand. Weve given away way too much. We dont have to. The chinese are sitting back in their chairs and saying we, got what we wanted again. Again and again. Reciprocity. The norms of International Behavior<\/a>. Access to their markets. Access to information. Those are huge things to them. Huge. And we can demand that theres reciprocity. Reciprocity of movement. We dont get to xinjiang walk, no one gets to tibet. Its easiest for journalists. We should get into north korea than to bet. The norms of International Behavior<\/a> have to be demanded and we cant be drunk with those short term goals of money. Because weve seen what its done to us over the last 20 5 30 years. I appreciate that thank you. Let me ask you, let me open it up to the panel. Earlier you said that the u. S. Should ask the International Commission<\/a> for a study on signed china census and protections. So we have this study, then what do we do . Its let me put it in this perspective, once we have the study is there an opportunity to bring an organizations, or other countries, our allies are friends to really put pressure here and focus on this reciprocity. Or what we should be doing, to address the censorship and protection. I think this study is a simple first step at sends a plea signal that the United States<\/a> recognizes that this is new longer some minor trade irritant. That this is a such a part of the strategic calculation of china. Because what were seeing is, countries like my home country of australia, United States<\/a>, canada and the European Union<\/a> are all somewhere beyond the spectrum in waking up to what chinese china represents. To their trade interest, or economic interests, their home political interest and values there. So it sends that clear signal, and then it starts the process of outlining what are the corresponding steps that the United States<\/a> can take. Thats multifaceted, thats addressing the cases where Chinese Communist<\/a> party action is applied extra territorially outside of china. In the United States<\/a>, in australia and elsewhere. Documenting those, bringing the transparency to that. Its also setting up the mechanisms to talk with u. S. Firms and industries, who are in the impossible position of trying to stand up to the Chinese Communist<\/a> party. To get a better understanding of what exactly is going on, what are they asking for, how are they asking for, it was the legal basis . Because, only then does the United States<\/a> have the information it needs to respond. But also importantly, i think the study would reflect the strategy that it should lead to. The United States<\/a> cant do this alone, it most definitely need definitely needs to lead the charge and making the case and pushing back against what shine is doing, but the point is pause for the United States<\/a> can do this on its own. Whether that point was ten or 15 years ago, its a matter of fact now that the United States<\/a> really does need to work with its likeminded, value sharing partners. Especially, the European Union<\/a>, japan, australia and others. And combining a collective response. Thats really the best chance we have four affecting change in china, and its effect outside of china. Thank you, will now turn to senator why it. Thank you very much, mister chairman. I appreciate ranking democrat of the full committee i think a great interest in this. Good to see you again, welcome. I want to ask you, all about something john bolton wrote and his book, im just going to read it to you. At the opening dinner of the osaka g20 meeting in june of 2019, with only interpreters present. Che had explained to trump, why he was basically building concentration camps, in xinjiang. According to our interpreter, trump said that she should go ahead with building the camps. Which trump thought was exactly the right thing to do. The National Security<\/a> council tops asia staffer, matthew pottinger, told me that trump said something very similar during his november 2017 trip to china. So we have very knowledgeable witnesses on this panel. I would just like to see, if any of you believe, that encouraging foreign leaders, to build detention and forced labor facilities. For religious minorities, is anything but a repudiation of american values. Does anybody think that that is not the case . This is a repudiation of american values. I mean its i dont know what crazy movie were in all of a sudden. This is doctor strange, i cant imagine theres another person in the u. S. Government, or another person in american citizen. Who even remotely, would believe what the president said. Would feel that same way, the concentration camps are the white right way to go. Its appalling. Anybody want to add to that . I think that pretty much sums it up. It certainly does horrify me. Our family knows a lot about concentration camps as well. Okay thank you very much, mister chairman, incredibly important hearing. And i look forward to learning more about all that you have discussed. Thank you. I know that we moved to the next question, and you had your hands up. You wanted to make a comment on the earlier testimony or questions. Thank you very much, let me just comment quickly on the last two questions. First, on of this question about the osaka dinner. I was out of the administration by that time, i have no firsthand knowledge of that. I can tell you while i was in the administration, i did work closely with matt pottinger, and ambassador bolton and others. In trying to push back on the policies of pushing john, and i think that ultimately action has been taken there, as it should. Whats going on in that region is appalling. And the u. S. And allies around the world need to stand up against it. The comment i also just wanted to make, on a previous question. Was about what we can do to help our companies, i do think in particular, we need to play a robust role at the governmental level. A lot of this conversation has been about how its terrible that were trying to access chinas market, because that gives them more leverage. I might flip it another way, and say that by having that access to chinas market, we are getting a lot of money, that our companies kind and pump into research and development. To make sure they are an innovation leader ahead of china. Another way to put it is, china is subsidizing our innovation. I think if you look at our Semi Conductor<\/a> industry, which you have paid a lot of attention to, they get 30 , 40 ok \u00f7 of their sales and china. So thats an important source of revenue for them, i think we also need to do our part like the chips act. I think its important not to only look at this as to what the adverse consequences our, but also look at the positive ones. In terms of helping our companies, i like the idea, i mentioned this in my opening. Of disclosure, making our companies disclose when they pressured by the Chinese Government<\/a>. I think they should do that for forced Technology Transfer<\/a> as well, it puts the onus on the u. S. Law, instead of on the company. And therefore makes it much more difficult for china to retaliate, because the problem is not the u. S. Company, but as the u. S. Government. So bring it to us we can stand up. A similar thing, i would consider, is prohibiting u. S. Companies from complying with censorship requests. Certainly with respect to the activities that theyre conducting in our jurisdiction. What i like about this, it is reciprocal, as mr. Gear was talking about. This will be familiar with this with her times at the pc a abe, legislation with you all have been looking at, basically would say its unacceptable for china to refuse for Chinese Companies<\/a> to refuse access to our our auditors. Who want to regulate their financial records. What those companies tell our regulators, we cant do because of chinese law. So lets do the same thing, lets tell our companies they cant comply with censorship because of u. S. Law. And thats exactly what china is doing to us, so lets do it back to them. Just as its unacceptable for them to say, we cant access the audits, its also an its unacceptable for them to say they would censor our companies. Lets use a user robust response from the u. S. Government to help those companies. Thank you for mentioning the chips act, this is a major bipartisan effort to bring high and Semi Conductor<\/a> manufacturing back onshore. And to reduce, as miss pointed out in her testimony, the supply chains of Critical Technology<\/a> that can you imagine if we do not have access to that. And we didnt have the capacity to build it here in america. Obviously, that is huge vulnerability. The virus has taught us many lessons, most of them painful, but some of them have pointed to a much different path that we have traveled down before. We simply cant continue to depend on china because it is cheap. Especially in some of these sensitive areas. I think senator brown is next if he is with us. Well, i understand he is not able to be with us. Mr. Gere, let me ask you, how much money does the Chinese Government<\/a> invest in hollywood . Do you have any way of quantifying that . I am probably not the person to ask. I was looking through some material last night and there were some deals here in the 250 Million Dollar<\/a> range, some in the hundred million plus range. We can run those numbers down. Let me ask you this. Last year we i was very much involved in the effort to reform the committee on investment in the United States<\/a>. But we are focused mostly on Foreign Investment<\/a> and technology and startups. As you know, the Chinese Government<\/a> does not observe any distinction between the private and military. In fact or, the private sector is compelled to share anything they have that the military wants we and the communist party. Given the description of the self censorship and the influence that china has on the sorts of movies that hollywood makes, do you think that we ought to be looking more broadly beyond technology . Two other investments that china is making in the u. S. That helps facilitate the path they are on . I think they read us very well. Their hundredyear plan, was to step back and really look at the rest of the world. And they saw the trajectory that the u. S. Was on. And if they could money was the way. And they began by creating products that were created, manufactured, cheapest in the world. As we all know. That created the situation where they controls the markets. We are seeing that tragically now with medicines. They own or pharmaceuticals. This is going to permeate everything in our society as long as money is our prime motivator. It was not for them, it was power and control. They gave up the money part early on to create control understanding that control will pay off decades later, that is what they are reaping right now. I want to go back to something mr. Kerry said an emphasize it. The term that this Administration Made<\/a> that the u. S. Should go alone, go it alone, has been a huge mistake in terms of china. The only way we can Counter China<\/a> is if the u. S. And eu, our european friends and true allies, and japan and india will create a coalition one. That really understands what the chinese are trying to do. And we negotiate with them as a group, as a democracy. Free market democracy. Independents. It is the only way that you can make any changes in the u. S. Government and congress has done extraordinary things but u. S. Cannot do it alone. Especially in a situation where it is America First<\/a> and all those naive cliches. We are in a very interconnected world. And lets be interconnected with the best of the rural. The best of the world still exists, our european brothers and sisters, japan, india, great democracies of the world. We can do this together and create the world we want. We cannot do it with the Chinese Communist<\/a> party. We thank you, senator casey, do you have any other questions you would like to ask . I hope you can see and hear me. There we can. We can see you and hear you. That is great. I was hoping for at least audio, thank you so much for the hearing. I just had one question that i wanted to ask earlier about the havana charter, she gave some of the history of and the fact that it was signed by 54 countries but never went into force. There was opposition at the time from our business community. I guess i would ask you we, in addition to the history and the significance of it, what is still relevant today . In particular how it relates to conditions in terms of trade. Thank you so much for the question, senator casey. I think there has been this narrative that the foundation of the Global Trading<\/a> system was about tariff liberalization and nothing else. But that narrative is false and harmful. Some of the things that we were talking about the philosophy we had in the nineties in which the conditions that we created the wto and let china in. It is directly traceable to that history. If you look at what is motivating the founders of the system, we are talking about initially fdr and john meter teams and those who follow them. These are people who had lived through the gilded age, they had seen inequality, nationalism, authoritarianism, political instability. Particularly in europe, authoritarian governments have been able to deploy concentrated that Democratic Power<\/a> in the form of cartels interest to pursue an authoritarian agenda. They were not just thinking about italy and germany, they were looking ahead to the soviet union. But it was the same fundamental problem which is this relationship between authoritarian governments and concentrated industrial production. That is why so much of the charter is making sure that youre protecting competition itself. They believe that protecting competition was way of protecting democracy. Somehow that entire line of thinking has been lost. Lets look at what we are confronting today, the hurrah is the habana charter relevant . It is the seconds gilded age. You cant just keep suppressing labor rights and expect not to have authoritarianism and a revolt by the working people. If we want to deal with these structural issues and we have to have a set of rules that promote competition. It industrial concentration we are seeing this rise. And authoritarian government that is not only able to leverage Industrial Power<\/a> to pursue its ends but is actually able to use the multilateral trading system to execute that agenda. I want to point out something in your opening remarks that is important. This really isnt about publicly owned versus privately owned and predict havana charter cover that freedom i that we spent a lot of time talking about things in china when the pivotal variable isnt who owns what. If the relationship between the industry and the government. Thank you. Senator cassidy, do you have another question. We are kind of winding down here but i want everyone who has another question to give them the opportunity. I go back to your thesis. Economic power allows him to exert the censorship and again i find that valid. But it is a bit far fueled from this hearing but still you raised it at some point i want to ask you, i agree. We should not allow people to use environmental laws for worker rights, or human rights, using slave later etc in order to undercut the fragility of worker in the u. S. On the other hand theres attention there. We if we have environmental laws that we really need another nation does not, it would require everyone to have the same labor laws. Lets say conditions in Central America<\/a> are different than those in the u. S. In regards to what is the minimum wage, for example. If we are going to reexamine with our trade relationship, i think everyone would agree that if were going to demand a certain environmental standard in the air pollution for the u. S. And chinese air pollution blows over to yes, we should ask for the same environmental standard there. I get that. But going back to we did you say that wage rates would have kind of some equivalency . Otherwise our folks will be at a disadvantage. Im very supportive of what is in the new nafta, im supportive of the rules that have been enforceable in her trade agreement since 2007. That is court lever standards. It is not setting a specific set of rules every country must follow with, it is about sending a floor. That is what the founders of the system did in the havana charter. If we had that for as part of a trade agreement with china, that may be a remedy. But nonetheless, that could be a potential remedy . I would use the wto and section 3 01 to establish that. Although in your testimony you point out the Consensus Organization<\/a> it can be difficult to open a wto. I think that is true. I think we should ask for it. And if we fail there because undoubtedly we will fail, and what is a section 3 02 and anything else . I think there have been proposals, not any concrete terms, proposals about access to u. S. Markets and having a central standards as part of our just mystic gyms. I think those are worth considering. Thank you very much. Senator cortez masto, do you have any additional questions . Any other questions you would like to ask . Let me just say how much i appreciate it, we all do, your testimony here today. And for what it is worth, mr. Gere but, i think we need to sort of get to a place where we recognize that the administrations, whether republican or democrat, can have good ideas and some not so good ideas. And i know this administration seems to believe bilateral trade negotiations are optimal. I can understand why their argument is that if you do a multi lay overall trade agreement you will have to give up too much in order to get anything that but. There are benefits. I think you described one of them, particularly dealing with china. We do need to work with our allies. And we need to confront this challenge. One, because they are in the same situation we are in. They are being eviscerated economically and threatens militarily and it is important to work with people that share our values to counter this incredible aggressive economic and military threats. Let me thank you for raising that point, i think you will find a lot of people who share that view. With that, let me thank all of you for joining us here today on this very important topic. We are going to have a deadline of two weeks for additional questions that maybe the senators will have some additional written questions. We would like to ask and have the record open for two weeks if the witnesses would be so kind as to respond to those we. Would very much appreciate it. With that, the subcommittee on International Trade<\/a> and Global Competitiveness<\/a> stands adjourned. 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