Taking On the China Challenge with Congressman Kevin Hern

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On February 29, the Republican Study Committee, chaired by Congressman Kevin Hern (OK-1), introduced the Counter Communist China Act. The bill would regulate Chinese investment in American business and sanction the Chinese Communist Party’s political activities in the United States. 

Join Congressman Hern and Senior Fellow Rebeccah Heinrichs for a conversation on how Congress can restore America’s advantage over the People’s Republic of China in the new cold war.

Event Transcript

This transcription is automatically generated and edited lightly for accuracy. Please excuse any errors.

Rebeccah Heinrichs:

Good morning. Welcome to Hudson Institute. My name is Rebeccah Heinrichs. I’m a senior fellow here at Hudson and I’m the director of our Keystone Defense Initiative. We here at Hudson are committed to American leadership abroad and to encourage freedom and prosperity here at home and among our allies. It is a real privilege to welcome you all here to Hudson in person and online. It’s a great honor to have Congressman Hern here with us this morning. I’m going to just introduce, give a little bit of background of Congressman Hern so we can get to know him. Then we’re going to have a conversation about the threat that the Chinese Communist Party poses to the United States and how he’s really leading the Congress in taking this really complex issue head-on in a way that really makes some progress here. Congressman Kevin Hern represents Oklahoma’s First District. Kevin was born... Kevin, can I call you Kevin? Sorry, I’m going to just call you Congressman Hern.

Kevin Hern:

No, Kevin’s fine.

Rebeccah Heinrichs:

My mom will give me a hard time if I do that. But Kevin was born on an Air Force base and he gained an early appreciation for the sacrifices that military families make. He really has a quintessentially American background here. He earned an architectural drafting certificate at a career technology school, which he used to work and pay for his engineering degree. The later in life, he earned his MBA. After undergrad, Kevin went on to work as an aerospace engineer for Rockwell International. When the space shuttle Challenger disaster rocked the aerospace industry, Kevin was out of work. He began saving to purchase his first McDonald’s restaurant by starting and operating small business ventures, writing computer programs to automate tasks for businesses, real estate, and even hog farming.

In ’97, Kevin literally sold the farm and bought his first McDonald’s restaurant in North Little Rock, Arkansas, and then he purchased two McDonald’s restaurants, moving his family to the Sooner State. He grew that organization over the next decade, eventually owning 24 McDonald’s restaurants that employed thousands of people in Northeastern Oklahoma. Congressman Hern has worked across every aisle, serving in various leadership positions within the McDonald’s system, what he dubs the most grassroots business in the world. He served 13 years on the national leadership team that represented all 3,500 plus US franchises eight years as the... You’re going to have to tell me because I don’t have it here.

Kevin Hern:

In charge of franchise relations.

Rebeccah Heinrichs:

Great. In addition to McDonald’s, Kevin has been a very successful entrepreneur in the areas of banking, manufacturing, real estate, development, multiple technology companies, and sports publishing. This is so important, really, for our topic today because the congressman really has, no kidding, some first-hand experiences in all of these different ways that small businesses operate and the importance of the United States having really strong and sound institutions for, man, for technology, aerospace, our ability to produce and make our own food, and for the prosperity of the American people. So really has some really interesting and good and diverse background. He currently serves on The Ways and Means committee and he, of course, is the chairman of the Republican Study Committee where members of Congress agree on some basic principles and then work together to collaborate with some initiatives for the Congress. Last I checked, there are 173 members of the Republican Study Committee.

Kevin Hern:

180 now.

Rebeccah Heinrichs:

180. So it’s incredible. It’s a really important conservative, principled group within the Republican Congress and the House of Representatives. Sir, I’m just going to turn it over, and let’s begin with talking about this TikTok bill, because you are a co-sponsor of it. It’s something that everyone’s thinking about right now in this town. So can you tell us a little bit about this bipartisan TikTok bill?

Kevin Hern:

Well, I think first, we should dispel... First of all, thanks for having me. The Huston Institute, it’s been around since I was born, so it’s great what you all have done, really smart people. We’ve had folks from your institution come speak to RSC as recently as just two weeks ago. Dr. Yu came by and talked to us about China.

Rebeccah Heinrichs:

Yeah.

Kevin Hern:

Obviously, very smart in that space. As it relates to TikTok, I think first thing we needed to dispel is we’re not here to ban TikTok. That’s not what we do in America. What we’re trying to do is protect America and Americans from sometimes their own selves. As we saw last year when the CEO of ByteDance came and testified to Congress, I think one of the most poignant questions that was asked of him was, “Do you allow the same data gathering or the same techniques to be used in China as you do in the United States?” His response was stuttering and saying, “No.” Then the follow-up question to that was, “So you have the algorithms in place to turn this off or leave it on.” Certainly, he didn’t either acknowledge or deny, but we know he did. So what we’re seeing with TikTok is is China, by statute of Congress in 2020, China is one of the five adversarial nations.

If China, who owns directly ByteDance, or indirectly, however you want to call it, pretty much own every company in China, is going to use that medium, TikTok, to collect data on American citizens and companies. We’re not going to have a part of that. That’s what this bill is about. It’s a bipartisan bill. I want to give a big shout-out to the former speaker. Speaker McCarthy tried to get this China task force put together in 2019, and then Speaker Pelosi would not do it. So when he became Speaker of the House last year, he put this together and it’s very bipartisan, led by Mike Gallagher, and the work they’re doing is really good.

Rebeccah Heinrichs:

Just so we’re clear just on the facts, so TikTok, it’s owned by ByteDance, which is then controlled by the CCP. So the legislation just requires ByteDance to divest of its control from the CCP and it can go to any other as long as it’s a non-adversary entity controlling the app.

Kevin Hern:

Well, what we’re looking at is a 20% threshold, so they can own 20%. Obviously, they lose control of the company at that point in time. So what you’re hearing from ByteDance is is that, their words, is essentially you’re wanting TikTok out the nation, out of the United States. Well, if that’s what you believe, then you must be doing something nefarious with the data that you’re getting because you are gathering data.

Rebeccah Heinrichs:

Right. Then interestingly, so the bill passed out of committee completely unanimously, I think 50 to zero, and then the TikTok app even used, through its algorithms and then had a button there for young people who were using the app to put in their area code and then it would give them the congressman to call to lobby against this particular legislation, which really shows how this could be used not just for economic benefit for China, but imagine in a case where China wants to invade Taiwan, really could push out information to young people saying it’s the United States that’s destabilizing the situation. It could really misinform and galvanize support against US interests.

Kevin Hern:

Well, certainly if you look at what they’re doing as far as some of the hashtags they have and the things they’re doing to mine data, and you look at their unbelievable growth in the last 10 years, I think they came out in 2012, you look at the unbelievable growth that they’ve had as compared to our domestic companies, and with the power they have... We are not here to try to bring parity between the platforms. What we’re saying is if you’re going to be an adversarial nation, and it’s just one component of the bill as you’re going to talk about today, small component, but it is a data collection device, one of many that they have in our ports and in our electric vehicles that they’re putting forth. We’re going to do everything to address each one of these.

Rebeccah Heinrichs:

Great, all right. It’s an encouraging development to see the bipartisan support for it and then really just see TikTok’s efforts to lobby against it may have backfired and had the effect of actually increasing and solidifying support, bipartisan support. So really encouraging. The other thing I’d like to move on then to the Republican Study Committee’s China bill, that was just introduced. Kind of surprised some people how comprehensive it is.

Kevin Hern:

Here it is.

Rebeccah Heinrichs:

Here it is.

Kevin Hern:

357 pages right there.

Rebeccah Heinrichs:

So it’s really interesting I think not even just for the legislation itself, which is really important, but as a teaching guide to go through and see where China is trying to harm the United States and then what are some practical things we can get busy, roll up our sleeves, and try to unwind some of it. So Congressman, I went through it. I did not get all the way through it, but I was trying to understand the approaches and really I had two themes came to focus for me and that’s that it looks like it’s trying to shore up America’s own strength, and then you can maybe talk to us about that in technology advanced tech. So it’s trying to protect that so that we can grow stronger and innovative, and then it also then tries to stop what China’s doing in some of its nefarious behavior in entire sectors. Is that fair, those two pillars?

Kevin Hern:

It is. I think what’s so different about China versus one of the reasons that the Hudson Institute was founded was to go after the USSR, the Cold War, bring conservative ideas and principles forward. We looked at that more as a space race or a nuclear arms race than more physical, blunt force, troops on the ground. Then we also had spying around it, throwing a little spying here and there. Today, this is a different approach. I’ve often said in my time as RSC chair is that China wants to destroy us economically and control us militarily, and they’re moving very rapidly to do so. If we think about this, they’ve only been really on the world stage since 2001 when they were brought into the WTO, when we thought that we could democratize, if you will, China. I’m sure, at that time, we had an idea that we could use their economy, and their economy is important to the United States and our producers just as our people are important to their producers.

But when we look at outbound investments from the United States and we look at the tremendous growth in certain sectors, especially when it comes to national defense areas, areas of technology, whether it be aerospace or 5G, or chip development, all of these things, nuclear proliferation or even in looking at our genetics and some of this stuff there, look at the development of drugs. All of these things, we have to look at. So what we’re focusing on is, first of all, are we doing what we need to do at home? TikTok is an example, one example. We could talk about 80% of the cranes in our ports are Chinese-developed and we found cellular modems on them where they’re tracking ships, inbound traffic and what’s happening at our ports. But then you look outbound as what are we doing to report and have transparency to outbound investments? We have some of our largest investment firms that have funds that are completely focused on China technology so that you can invest your money directly in a Chinese support of their aerospace programs.

Then when you look at just an article today in the paper, in their Document 79 that they’ve had around now for a few years, six or seven years, that they want to basically, in their words, the slang is is, “Delete A, Delete America from all the technologies.” So we’re, US investments and other investments in the Western world, funding the growth of their technology platforms, their ability to steal IP from our greatest technology companies, and then turn around and say, “We’re going to push you out through regulatory action, not choose you as our supplier,” whether it be mainframes or our software for our government. One of our largest companies in the world went from about a 50% market share in China down to four or 5% now in just about five or six years. So they’re moving very quickly, stealing our IP, using the data they have, and we’re funding that through our outbound investments.

Rebeccah Heinrichs:

So if I can say, there was a public debate or discussion then about how do we, I’ve heard people use the term, it’s like economic mutually assured destruction between the US and China for exactly the reason that you laid out that ever since we welcomed China and the WHO or WTO that we thought, Republicans and Democrats thought that...

Kevin Hern:

Oh, they own the WHO.

Rebeccah Heinrichs:

Yeah, they are. That’s exactly right. That’s a different problem we got to solve. That we’ve now really enriched China, but rather than liberalizing, they’re still Marxist-Leninist, so now they’ve hid their hand and bid their time and now they’re wealthy and they’ve poured this into their military. So now, that’s when we’re seeing the more aggressive behavior. So the challenge now is how do we unwind some of this? So that’s why I think it’s really important that you’re actually not advocating for a complete decoupling from China, second-largest economy in the world, $14.14 trillion. So now, the challenge is how do we look at those specific technologies and make sure that we are not continuing to empower the country that is trying to supplant the United States.

Kevin Hern:

Yeah, I think it is really about bringing transparency. You and I were talking before we started this interview about making people aware that China, we’re at an economic war. I don’t mean that bad. I mean, that’s what we do. That’s what we did as we rose as a nation. We were competing against Europe and the Asian continental Pacific as we grew. We did this because we wanted to create better products. We wanted to treat our people well. We wanted to have good human rights. Everything that I just mentioned, China is a bad example of all of those.

Rebeccah Heinrichs:

Right.

Kevin Hern:

We need to expose those. What this bill does is bring all of the topics together that we’ve talked about as members of leadership, legislative creators, if you will, over the years, bring those together to point out that when you bring all these together collectively, I’m sure we’re going to talk about the border and what’s happening there, we’re going to talk about Belt and Road, we’re going to talk about education. All these components together, when you bake that cake, it doesn’t look very pretty.

Rebeccah Heinrichs:

Right. The last one, before I move on here too, because I think it’s really important that the Republican Study Committee is tracking this concept is really a key part of how China thinks about technology is this civil-military fusion. That’s why your bill goes at these entire sectors. These sectors, so you’re not buying this, “That’s okay, it’s commercial or it’s used for commercial purposes,” but actually it’s directly applicable to their military. That distinction in China between private and civil versus military is not there.

Kevin Hern:

Yeah, I think it’s really important for people to understand what that means because, in the United States, we have a complete delineation by our constitution that our commander in chief is a civilian, that we have a delineation that our military is our military. When we develop, we develop products, technology for our military and for our civilian use. In China, it’s completely different. They are one and the same. Anytime they develop something for civilians, it’s with the military in mind. If it’s the other way around for the military, maybe the civilians get to use it.

But a perfect example of this is there’s a lot made about how difficult it is for us to get cybersecurity, people in our military, in cybercom, and we’ve had many briefings on this. In China, the everyday Chinese person is recruited. They don’t have to be in the military. They’re recruited to test our systems to do hacking attempts, and they get paid a penance to do that, but they’re not in the military. So their whole society, if they want to be unified, works in unification to come after the United States America because we are in the lead.

Rebeccah Heinrichs:

Great. Let’s talk. You mentioned already, and I appreciated that you mentioned that Hudson’s role really during the Cold War, the work that, wasn’t me, I wasn’t here yet, but that I was on the scene pretty soon after there, the forefront of conservative efforts to combat USSR during the Cold War. So now, let’s talk about that tanks in the United States now, in Washington. That’s not necessarily the case that they are objectively speaking, beginning from a pro-America perspective and trying to do what we can to make the United States stronger and combat our enemies. So a really interesting thing in the bill is about requirements for transparency for where you’re getting your money, your influence, and your support. So that is another big aspect that China has been very, very successful at influencing not just think tanks, but in retired members of Congress and lobbying efforts. Then also, things like the Confucius, Institutes, et cetera, other educational efforts. So can you talk about how you all thought about that particular challenge?

Kevin Hern:

Well, certainly, and you just alluded to it a minute ago. After the bill passed 50 to zero yesterday, we had people call us, call our offices that were of the conservative scene on many other issues. We’ve had some of our most conservative think tanks, people who are industry lobbyists reach out to us because they...

Rebeccah Heinrichs:

The TikTok bill, opposing the bill to...

Kevin Hern:

Oh, yes. Absolutely. These are people that should be and would be, in any other normal situation, strong Americans, but because it was TikTok and because they were getting pinged or maybe getting compensated, and these include former members that are now lobbying for the CCP. I think it’s important also, you’ve alluded this, China is very smart. We’ve been very open about our representative republic and our freedoms around the world. That’s why people are coming here en masse. There’s nobody stealing their way into China. People will look at Xi Jinping and he’s been very savvy in this, calling himself the president of China.

That’s his unofficial title. His official title is the General Secretary of the Communist Chinese People. People need to realize what we’re dealing with here, persons that are in China that are coming after us in this way. We want to know who is lobbying in the United States on their behalf. Again, if it’s an adversarial nation as defined by Congress, one of five is China, the others are Iran, Russia, North Korea, and Venezuela. If they’re lobbying on behalf of those nations and we’ve defined them as such, then we want to know who they are. If they want to do this because they think that China needs to have representation, they can do it free of charge.

Rebeccah Heinrichs:

Excellent. This is another thing I think is really remarkable. You are leading this and leading the Republican Study Committee to push on this because it takes some political courage to come out and say, “We’re not going to do this anymore. This used to be a colleague of mine, this congressman or that congressman, but here they are, lobbying on behalf of these entities and organizations that we know are being pushed by the Chinese Communist Party. So it’s time we really stop it,” because I have found it is odd that every time there’s an effort, it seems like there’s bipartisan support to end things like DJ drones or that are governed by the CCP or TikTok, just when you think it’s going to happen, there’s this overwhelming lobbying effort and then it stops and goes away for a while. So that, I think, is a very, very good and useful aspect of the bill.

Kevin Hern:

Well, many of our Fortune 100 companies have massive presence in China. It’s a big economy. You want them to do that. You want them to take advantage of that because the more they can grow and have more production, the less cost we pay here in the United States as consumers, and we demand high value, low cost. That’s what we do in a free market. But I also, when I look at what’s happening there, I’m reminded often about what China is trying to do, and they wanted to suck us in. To your point, when this bill goes by the wayside, a singular bill, you don’t hear from these folks anymore. What I always tell every one of these folks, and I’ll say it to your audience today, I don’t hate China, I just love America. So I think if we had that narrative that America is first, I know that makes some people feel a little uncomfortable, but we have to look at it that way because I can assure you China is. They’re looking at China first.

Rebeccah Heinrichs:

Yeah. Well, and then you brought up, Congressman, the point that I think sometimes has been missing in the discourse, which is understanding the ideological motivation from China. So if this was a country who shared our ideas about free and open international waters, reciprocity and trade and technology, those are the principles that the US led order since the Cold War based our ideas about how we’re going to conduct ourselves in the world, then that could continue. It’s just that they’re not motivated by those things. So we are at a... They are trying to push the United States out and supplant us to be the most powerful power. That means, very practically, an infringement on American freedoms.

Kevin Hern:

Well, chaos around the world also benefits China because they can come in and be the white horse to rescue these other four nations, and they’re doing just that. If you look, we just had General Jack Keane speak to us at the RSC a few months ago regarding the unrest in the Middle East, what’s happening in Ukraine. You have to love the guy and the knowledge he has about what... He’s seen this firsthand. He said, “The mistake we should not make as Americans in the free and Western worlds is that we should not make the mistake to think that Iran is not in the center of all this. Furthermore, we should not make the mistake to not understand that China is the one that’s bankrolling all of this.” So you have a person, a proxy in Iran who’s using proxies, the Houthis, the Syrians, the Palestinian authority, the Hamas, and the list goes on to put that money out there. Then you have China backing them. China’s backing Russia, China’s backing North Korea, China’s in Venezuela, China is, through their economic power, creating the unrest in pretty much every continent.

Rebeccah Heinrichs:

Congressman, you went... This is right... I could talk about this for an hour with you. So this is right back to my next question, which is how this ties together because things are not going well on the world stage. We’ve got crises, as you mentioned, in the Red Sea, and then you got crisis, Russia’s invasion of Ukraine still ongoing. Then you have Chinese provocative, dangerous, reckless behavior in the Pacific, really threatening, using water cannons, et cetera, against the Philippines. So really dangerous behavior, all these things going on. You just raised this great point that they’re actually not unrelated, they’re related. I want to just get back, just to make the finer point on what’s going on in the Red Sea with Iran driving all of this. These Iranian proxies are actually declared the Houthis, so they’re not even going to hit a Chinese flagship. So the Chinese flagships can go through the Red Sea and the Russian flagships can go through the Red Sea unscathed, but the Houthis are going to continue hitting these pro-democracy, Western-flagged commercial shipping in the Red Sea.

Kevin Hern:

Think about that for a second. I mean, think about how many days that stops ships having to go all around Southern Africa to bring products to the United States or to bring oil, gas products coming from certainly China. If you knew that your ships would never be sunk, you have no problem going through there.

Rebeccah Heinrichs:

Right.

Kevin Hern:

So you’re always going to have the lower-cost goods from anybody else that’s moving stuff out of India or Southeast Asia or Australia or anywhere coming through that way. So if you’re European, you’re concerned about this, what’s happening coming through the canals. Then when you look at the Chinese, what they’re doing to bring South Africa closer to South America, and I was just at the Sixth Fleet in Sigonella just a few months ago, and talking to people in AFRICOM and Eurocom and, on the western seaboard of Africa, China’s building ports because that’s the closest connection on ships between South Africa and South America, straight to Venezuela. Just recently, talking with the government in Lima, Peru. Same thing in Peru, 50 miles north of Lima, building a huge super port, three-and-a-half billion dollar port. China says, “We’ll build this port with this caveat. You can’t have customs there, you can’t have security customs there. We cannot be boarded.” So that’s the closest to China to come into South America. So while we’ve lived in comfort with the Pacific and Atlantic as our big moats...

Rebeccah Heinrichs:

Right.

Kevin Hern:

... China’s moving through South America and through Mexico, into the United States.

Rebeccah Heinrichs:

So then that’s incredibly informative, Congressman. Let’s talk specifically then, get back over to the Middle East since that’s a hot button issue right now. China, let’s think about the Biden Administration’s strategy for handling all these problems and why it’s not going so well in its policy towards Iran versus its policy towards China, and if you don’t understand that China’s actually the one bankrolling the Iranians, you can’t really come up with a coherent strategy.

If you don’t understand it’s the IRGC that’s sending drones to the Russian war effort against Ukraine, you can’t come up with a coherent strategy to get the Russians back in their own country and to stop Iran. So if you wouldn’t mind, I know this is, it’s important though because I think, I mean, we’re here to talk about your specific, your China bill, but to understand why it’s so important to take on China in this way and its effect on these other countries. So can you talk about, I mean, China’s buying Iranian oil in defiance of US sanctions, how you’re thinking about that and how the RSC is trying to tackle the Iran problem in the context of China?

Kevin Hern:

Well, we spent a lot of time a few months ago talking about the $6 billion that was released out of Qatar and the President saying it was only going to be used and Blinken saying it was going to be used for humanitarian aid in Iran, and you had the clerics in Iran saying, “It’s our money. We’ll do what we want to with it,” and nobody pushing back on that. As it turns out, the six billion that was coming out of Qatar, that was Iranian money that would’ve been frozen, that actually ends up being the smallest amount of all the amounts that have been coming back and forth. Iraq was allowed to buy $10 billion worth of energy from Iran, China, $60 billion worth of energy from Iran. Before Mike Pompeo and President Trump left in 2020, their reserve currencies were down to $10 billion or so, and now they’re back up approaching 100 billion plus because they’re having an influx of money and they’re turning around to put this out to create unrest in the Middle East and economic uncertainty.

That’s what they do. 700,000 barrels a day, China’s buying from Iran and it’s denominated in Chinese dollars. On the world stage, a barrel of oil is denominated in US dollars. That’s how it’s traded, except for the relationship between China and Iran, which has been bought by the Chinese dollar, the Yuan. Then when you also look at what’s happening, in August, it’s believed, based on all the outside people looking in, that 91% of Iranians’ oil production was bought by China. Then you turn around and see China’s supplying Iran with the chips for their drones that are going to Russia. So to your point, it’s all one big happy family here, and you can’t, until you solve these and start going after the people who are creating the baddest, the worst areas, the bad people like Iran, and start actually going after those sanctions, you’re not going to ever stop it.

Rebeccah Heinrichs:

So then would it be fair to say, so this idea that Republicans and conservatives specifically are, as a party and as a movement, just turning inward and neglecting American leadership on the world stage, just putting it very bluntly, it sounds to me like everything you said here, it would doom us actually that a lot of what you’re saying is a very smart US intentionality, energy policy, for instance, but on technology, and then collaborating with allies because everything you just said here, I don’t know how we do all that as a country without the collaboration of like-minded allies who are also really in peril because of shared adversaries in China, Russia, Iran, North Korea.

Kevin Hern:

Yeah, you mentioned my background when I started out how I came to Congress six years ago and never been in politics. So my whole life has been about solving problems. It’s not about politics. I absolutely hate politics. I think politics of America are getting in the way of our security, our national security. Look at our southern border, which is driven by Chinese and fentanyl, but that’s the same thing that’s happening around the world. For political statements, we’re not going after good policy. We need to rule with the iron fist in some of these areas.

I was just speaking with the German finance minister about this, and the reference there is, what we’ve seen with Russian oil and energy coming to Europe and how that’s decimated our energy supply, we can’t allow that to happen when China ultimately invades Taiwan and does for chip production. We’ve got to figure out how to turn back to the United States, turn back to people who are of peace, in harmony, if you will, and want a stable environment. So I think our Western allies are starting to wake up to this, that it’s not about, they’re not being a hoodwink about what China’s trying to deliver.

Rebeccah Heinrichs:

No, and it’s a really interesting phenomenon. So as these authoritarian countries are more clearly collaborating and more brazenly collaborating to undermine the United States and our allies, you’re actually seeing some maybe surprising for some, increasing collaboration among like-minded, pro-democracy countries that aren’t even in the same neighborhoods. Lithuania really demonstrating solidarity with Taiwan. Taiwan, solidarity with Ukraine. I mean really interesting different theaters of the world. So you can see that I think it’s going to be necessary, moving forward, to get some of this stuff done. You mentioned the border now a couple of different times. So let’s just talk about that because I think this is, again, its focus is on China, but Chinese national is the largest growing demographic of people coming illegally across the southern border. So talk about how you see border security as related to this general problem that we have with instability abroad.

Kevin Hern:

Well, unlike our president, I’ve actually been to the border where there’s actually people crossing the border, and I’ve seen it. I was just in Tucson just a few weeks ago, and those folks coming across there, they don’t want to have asylum. They’re coming across in camouflage and there are a lot of Chinese nationals coming through there. But when you look at the fentanyl crisis we have, the only place in the world there’s a fentanyl crisis is in the United States of America. I’ve talked with Interpol and DEA, FBI that are in Europe. They don’t have a fentanyl problem. The Mexican cartel are trying to get a fentanyl problem there, but there’s just no money in it. So one would have to ask when an average pill is probably $1 to $2, what’s the real purpose of sending in fentanyl in the United States to kill 350 million Americans, basically, the entire population on an annual basis?

It’s really about trying to basically kill us from the inside out. We’re killing 100,000 people a year with fentanyl and we’re not doing anything about it. That’s what this bill is about. It’s trying to expose every single aspect of China’s influence negatively on the United States of America. When you look at two ports in Mexico where most of the precursors are coming in and the factories to make fentanyl are only in Mexico, I was just in Panama, just in Colombia, just in Peru. None of those countries have a fentanyl problem. The fentanyl is not flowing south, it’s not flowing east to west. It’s only flowing north into the United States of America.

Rebeccah Heinrichs:

I want to give a time to take some questions from the audience, but here at Hudson Institute, we’ve been working really hard at grappling with Russia’s war against Ukraine and really coming up with an education effort and also clear sound recommendations to try to end the war, how the United States can support Ukraine to end the war on terms favorable to us, to the American people, to NATO, and Ukraine. If I may, there’s this, talk about an issue that’s very complicated and confused, the Republican Study Committee has really, I encourage you all to go look it up. They put out a budget every year, I think you do, and it really lays out what the Republican Study Committee would do and recommend on a variety of complex issues.

On page 44 of the bill, you really lay out the causes of the war. Putin’s regime was not deterred and seeks to destroy Ukraine, subjugate Ukraine, and continue his push towards NATO to break up and undermine US influence and our alliance structure in Europe. The RSC’s recommendations are, you give Ukraine, you have a strategy and you give Ukraine the weapons it needs to execute a strategy, and that’s how you get to the end of the war rather than a long, protracted war and dithering on weapons. Is that still the view of you, sir and largely the Republican Study Committee?

Kevin Hern:

It is. The Republican Study Committee is made up from our most hardest right to our most moderate Republicans. So I respect the views that all of them have, but I think one common theme is everybody believes Putin is a bad adversary. I mean, this guy, what he has done in Ukraine is terrible, but we can’t keep sending American taxpayer dollars there with no accountability on humanitarian aid, no accountability on what the strategy is to end this war. It’s just, “Send us another 50 billion, send us another 60 billion.” We’ve spent 113 billion so far at the two-year mark, which is basically equivalent to about what we were spending on a per-year basis in Afghanistan, and at least we had a strategy there, what we were trying to do. Here, we don’t really have a strategy. Nobody, nobody believes that we’re going to push Putin out of Ukraine. Nobody believes that.

So there’s going to have to be some kind of brokered piece, but Putin doesn’t want that. He wants to continue fighting and he’s lost hundreds of thousands of people. So more of our folks are going there. We’re continuing to push back on the administration, give us oversight. We’ve had IGs from state, from DOD, from USAID come. Many of us have talked to the respective people in charge of strategy and haven’t believed we’ve gotten any kind of a satisfactory, you haven’t seen it in the press what the strategy is. So we’ve got to continue to work on this. But we also know, given humanitarian aid, going and propping up the Ukrainian pensions is not something we’re going to be approving.

Rebeccah Heinrichs:

So the focus, if I just understand you then accurately, Congressman, the focus though for you and for conservative members of Congress is if there’s a strategy to empower Ukraine to victory and get them the weapons they need, and not necessarily this more fungible economic aid, or perhaps we could do like a loan, that’s been floated, but certainly, the focus should be on weapons backed by a strategy or to implement a strategy.

Kevin Hern:

If you look at the very first funding, it was a huge number of Republicans. I’ll stop sure of saying all, but the Lend Lease program we had, I actually voted for that. But then you started this progressive, “Okay, tell us the strategy. We don’t want to have another endless war. Tell us the strategy.” Then you lost 87 or 97 Republicans. Then, “Tell us the strategy.” Another few months went by, 117 Republicans. Now, you can’t even get the bill on the floor on the House side. You’re going to have to, at some point in time as Commander in Chief, tell us what your accountability is going to be for the US taxpayer dollar and what is the strategy, and I believe you’ll have, we will crush Putin once and for all.

Rebeccah Heinrichs:

Appreciate that, Congressman. Then a lot of the weapons too that were developed, the reason I think it’s really smart focus on weapons, just as a policy matter, a lot of the investments actually does help the American taxpayer because it’s actually increasing and improving our own defense industrial base.

Kevin Hern:

By the way, I mentioned that was in Germany and France, talking with finance ministers. The people of Europe are about the same approval rating of helping Ukraine, probably for a different reason because they see a dollar given to Ukraine as something less in their social programs. Here, we just go borrow more money. So it’s not like that’s a big deal. That’s a joke. But to your point, all their military industrial complex is in the United States, and so we’ll make weapons and we’ll send them to Ukraine, but again, we need a strategy.

Rebeccah Heinrichs:

Then having that ability to increase, bringing back to your own bill, increase American innovation, adapt our weapons, and so that they can be up to par for the really, essentially, the new Cold War that we’re in, not just in the Russia context, but you have to be able to produce these weapons at scale so that we can deter not just Russia, but also China.

Kevin Hern:

Well, we have friends, we have Taiwan who’s actually paid for weapons they’re still waiting on after five years.

Rebeccah Heinrichs:

Yeah, and that’s a political decision. I mean, some of it, there’s a manufacturing issue, but they’ve got four military sales that have been approved, and many of them are different weapons than what we’re sending to Europe, and this administration has chosen not to deliver them. So thank you, Congressman. I’m not going to close this out yet because I do want to take at least a couple of questions from the audience. If you can just state your name, please, and keep your question very brief. I might actually take a couple back to back so that the congressman can just...

Kevin Hern:

Sure.

Rebeccah Heinrichs:

... hit both of those out of the park here.

Speaker 3:

Good morning. My question, Congressman, I haven’t read your bill yet, but I’m looking forward to tucking into it. One of the issues that you mentioned earlier is about restrictions on US investment in China. Outbound investment restrictions have been a point of lots of debate, and I’m wondering where you think the RSC is on coming to some actual agreement on outbound investment.

Rebeccah Heinrichs:

Then take one more question over here and then, yep, and then we will get a microphone to you, sir.

Neil Keegan:

Good morning. Thank you very much for being here. I’m Neil Keegan. I’m the general partner for Marlin Spike. We’re a defense technology venture capital firm. Thank you very much for leading the charge on this bill and everything else you’re doing. I’d like to just understand a little bit more about your thoughts on the probability of success and how large you think the bill will ultimately be and when it’ll get into place because I’m with you. We have a serious problem here. China’s behind everything that’s going on here. Then the second part is, do you think we can afford to wait on the strategy to get the arms to Ukraine, because I just feel like we’re dithering and it’s not a good situation for us as a country. Thank you.

Kevin Hern:

Sure. So the outbound investment issue, the Chips Act, as you know, was a ban on basically communists exporting to China certain chips and stuff, and the repercussions of that coming back where China says, “We have Western companies that are supplying certain products to China, and you’ve been, this US particular chip company has been the sole supplier or at least an 80 to 90% supplier of those chips for decades, and so now that we’re going to go find it.” So there’s this technology war going on also. It is not in a silo, as you’re certainly aware, and we’ve got to figure out how we deal with that. But the first thing is transparency, to find out who’s doing what to support some of these areas that China’s using basically as a weapon against our own technology companies. Again, there’s a great article in one of the papers today talking about just what that looks like and it’s pretty emboldened what they’ve done just in six years to really come after our technology companies.

Regarding the... I’d like to think this administration, we didn’t get a whole lot of direction last night on what the strategies are, and I can’t speak to what I’ve seen in classified settings, but I think it’s safe to say that nobody wants Putin to be successful. So what does that look like? We’re seeing, obviously, the EU step up quite a lot and offsetting some of the humanitarian side. Honestly, they can’t really supply a lot of military products, as you know, because they don’t make anything. Maybe France a little bit, a little bit in England, but as far as the huge supplier of the things that really matter that have been very effective against both ships, tanks, and aircraft and drones have come from the United States. So I think we have to look how this balances out and we’ll see what comes forward from the Speaker in the next few weeks.

Rebeccah Heinrichs:

Great.

Kevin Hern:

I think we have one more...

Rebeccah Heinrichs:

Yeah, let’s do one more back here.

Dr. Myrtle Alexander:

Thank you very much. Dr. Myrtle Alexander, candidate for Congress here in the district. My question as it pertains to China is that it’s almost as if they’ve monopolized everything for the US. When we look at the great numbers that you mentioned regarding migrants that are coming into the US and the numbers, when it comes to a military stance, the numbers that are entering the US are greater than our own military numbers that we have active and reservists right now. How are we dealing with that?

Kevin Hern:

Well, not very well, honestly. When you look at certainly the numbers... I’ll give you an example of this. I was visiting with the Chief Deputy CBP agent in Tucson just three weeks ago, and he says, “Everybody sees the optics of Texas and it’s really bad. People are coming across, they’re basically coming and finding a CBP agent saying, ‘I want to claim asylum.’” He said, “Here, it’s completely different. We have 256 miles Tucson sector.” He is telling me this. He said, “And by the way, when we crested the hill, I think every Republican that was there was pleased to see that, of the 22 miles of wall you could see, 20 of that was President Obama’s.” Most people in America would believe the President Obama never built a single foot of wall. He built a wall because he knew it worked. The next two miles was President Trump’s. It was 10 feet taller. I know politically, it sounds funny, but they actually did a psychological survey because people were coming over the 20-foot wall and people get to the top and say, “20 feet’s not too far to fall, but 30 feet’s going to hurt.”

Then you get to the top of the ridge of the mountain, 9,000-foot mountain, and there’s a plowed, paved road, and the fence that’s supposed to go there is laying on the ground, and that was President Biden’s wall. There is no wall. The CBP agents said, “In 2017, 2018, we had 70,000 people we caught in 256 miles. Today, by the end of this fiscal year, in September 30th, it’ll be close to 800,000.” By the way, there were no agents on this wall for 22 miles, zero. He said, “We’ll show you the camera footage. They’re coming around, coming through the mountains, they’re camouflaged, they’re with backpacks, they’re with guns, they have carpet shoes on.” By the way, mainstream media now is actually reporting on this. That’s something they wouldn’t have done five years ago. So we know it’s a bad deal. That’s why you’re seeing a lot of push on, “Give us the border, secure our nation, and we’ll worry more about securing Ukraine.” There’s been a very...

I mean, I think Americans need to get their mind around just as you said, and so I really appreciate you stating that because it is of grave danger. I want to say one other thing around the military issue. This actually was a pretty prominent person in the Peruvian government said this. He says, “You know, we’re sitting and talking with folks at the embassy, and they said this, ‘When China comes into a country, they don’t ask whether they’re going to make any money or not. They just go spend the money because they’re doing it for strategic purposes, to be somewhere.’ Because of our free market, because of our separation between our companies and our government, when our companies come in, they have to ask, ‘Can I make money doing that?’ I can’t just go in and lose money. That’s not what my stakeholders are going to allow.” So it’s a different dynamic. We’re competing with one large company called the Chinese Communist People who want to destroy our way of life.

Rebeccah Heinrichs:

Congressman, just appreciate once again you coming here to talk with us specifically about your co-sponsoring the bill to protect American young people from the influence of a Chinese-governed social media app, that is TikTok. Thank you, Congressman, for this. Really, it’s a teaching tool. Really, really wonderful, I think, to guide us through to find some bipartisan solutions, the multifaceted China threat, walking us through the Russia threat that’s chronic and acute to the United States and our allies, the threat from Iran, certainly North Korea, we could keep going on. So it takes some guts and a willingness to get some work done across the aisle. So Congressman, thank you for being here. Thank you all for being here. Thank you for joining us here at Hudson Institute.

Kevin Hern:

Thank you.