Bloomberg Television8 min
Allen Says US Needs Stronger Export-Control Enforcement
Allen, Joe Mathieu, Kailey Leinz
Interview, Fireside Chat
- Congress is expected to direct inquiries regarding delays in export control regulations to the Department of Commerce and National Security Council staff.
- Senior U.S. leadership was aware of Chinese efforts to obtain chips through smuggling and remote access, a circumstance that should have accelerated regulatory action.
- The Department of Commerce is projected to require expansion to facilitate increased export enforcement, oversight, and investigations.
- Identified intermediaries facilitating smuggling or remote access should be targeted, with potential internal spy usage treated as a hedge.
- An aggressive internal investigator, possibly within the National Security Council, should be appointed to determine if regulatory stalling resulted from bureaucracy, staffing shortages, or intentional delay.
- If an investigation reveals a "successful diversion operation," it may result in the appointment of a special prosecutor and special investigator.
- The current administration is expected to lack the capability to blacklist companies with sufficient speed and frequency despite existing entity listing mechanisms.
- Congressional investigation is anticipated regardless of the administration's party, with scrutiny expected to increase under a Democratic administration.
- China is predicted to suffer long-term losses due to global awareness of its rapacious nature, history of cyber intrusions, and technology smuggling capabilities.
- Efforts to expose Chinese smuggling and intermediary breaches aim to make the global community less willing to engage with China.
- The President is expected to proceed with his upcoming trip to maintain pageantry and the projection of stability, even if the political context reduces its productivity.
- The President may raise illegal smuggling activity with Xi Jinping to deter retaliation, violations of the Busan truce, or U.S. inability to secure critical minerals.
- U.S. policy is expected to be insulated from blame by attributing any Congressional actions against China directly to Chinese activities.
- The new Democratic Congress is likely to hold hearings with Howard Lutnick that are anticipated to be revelatory and feature combativeness typical of Trump administration witnesses.
- Kinetic force is predicted to be required by the President in the short term or "next couple of weeks."
- The President's strategy involves avoiding a rushed deal with Iran while Iranian leadership perceives Republican midterm election losses.