A bipartisan, bicameral group of lawmakers is calling on the U.S. Department of Agriculture to tighten restrictions on Chinese telecommunications providers and manufacturers accused of spying on behalf of President Xi Jinping’s communist party.
In a letter sent Monday to USDA Secretary Sonny Perdue, 19 lawmakers urged the department to prohibit carriers from using money from the department’s Rural Utility Service (RUS) program to purchase equipment from Chinese companies deemed to pose a national security threat, including Huawei and ZTE. The multi-million dollar government fund subsidizes broadband service to rural communities, among other things.
The letter, spearheaded by Sen. Tom Cotton (R., Ark.) and Rep. Mike Turner (R., Ohio), comes on the heels of a similar bipartisan appeal to the Federal Communications Commission. The FCC will vote Tuesday on a rule to prevent rural carriers from drawing on federal funds to buy gear from foreign companies considered a national security risk.
“We write today concerning the national security threat Chinese telecommunications providers and manufacturers, such as Huawei and ZTE, pose to the United States and U.S. interests,” the lawmakers wrote.
“An issue that we wish to bring to your attention is the use and potential use of grants and loans issued by the USDA’s Rural Utility Service (RUS) to purchase items and services from these very same providers and manufacturers, which FCC seeks to bar.”
The lawmakers urged USDA to request security briefings from the FBI, National Security Agency, and CIA and “consider remedies similar to that of the FCC.”
The letter’s Senate signatories include Sens. Roy Blunt (R., Mo.), Richard Burr (R., N.C.), Susan Collins (R., Maine), John Cornyn (R., Texas), Dianne Feinstein (D., Calif.), Angus King (I., Maine), James Lankford (R., Okla.), James Risch (R., Idaho), and Marco Rubio (R., Fla.).
On the House side, the signatories include Reps. Rick Crawford (R., Ark.), Matt Gaetz (R., Fla.), Mike Gallagher (R., Wis.), Vicky Hartzler (R., Mo.), Peter King (R., N.Y.), Ileana Ros-Lehtinen (R., Fla.), Frank LoBiondo (R., N.J.), and Elise Stefanik (R., N.Y.).
The lawmakers also pressed Perdue to ensure USDA has a rule in place ensuring that Huawei and ZTE technology cannot be acquired through RUS loans or grants through “white labeling,” in which a product or service is made by one company then rebranded and sold by another. Huawei often gains access to U.S. markets by white labeling products for telecom carriers that put their own logos on the back.
Defense Secretary Jim Mattis raised concerns of this last week, telling the House Armed Services Committee that the Pentagon needs better procedures to detect white labeling of Huawei and ZTE gear.
“This is an area of needed attention to include saying we will not deal with white labels, we need to know who we’re buying from,” Mattis testified.
The Washington Free Beacon reported on Thursday that USDA grants may have helped Huawei gain access to U.S. military bases. At least two telecoms companies that received USDA grants and purchased equipment from Huawei operate services areas within 100 miles of American military posts.
One of the USDA-backed companies, Pine Telephone Company, maintains a service area in southeastern Oklahoma that encompasses the McAlester Army Ammunition Plant, potentially enabling Huawei to completely surround the Pentagon’s chief provider of bombs, missiles, and ammunition for the U.S. armed forces.
Though it is unclear whether the USDA grants were used directly to purchase the Huawei equipment, the agency does not currently bar carriers from using RUS funds to buy Huawei or ZTE equipment.
USDA has not responded to multiple requests for comment.
AT&T, Verizon, and other large carriers have avoided Huawei amid pressure from lawmakers and intelligence officials who warn that Beijing could use its equipment to conduct espionage or carryout cyber attacks given its close links to the ruling Chinese Communist Party—a charge the company denies.
But many small or rural carriers have turned to Huawei for what they say are cheaper prices and better customer services than competitors.
The FCC is the latest agency to join the Trump administration and Congress in targeting this collaboration. FCC Chairman Ajit Pai took action against foreign telecoms companies in response to a letter sent in December by members of the House Permanent Select Committee on Intelligence (HPSCI) and the Senate Select Committee on Intelligence (SSCI) warning of Huawei’s role in Chinese espionage.
Members in both the House and Senate have introduced legislation to block the U.S. government from buying or leasing gear from Huawei or ZTE. Rep. Liz Cheney (R., Wyo.), a co-sponsor of the House bill, has warned specifically of the Chinese government using companies like Huawei to exploit U.S. communications networks, including military bases.
“The Chinese government continues to attempt to access our networks in order to steal U.S. commercial and government secrets,” Cheney told the Free Beacon on Thursday. “This puts our security at risk. The bill I have introduced with [Rep. Mike] Conaway is an important step towards preventing this, protecting these networks, and shining a spotlight on the danger posed by the efforts of Chinese entities like Huawei and ZTE.”