Democrats must protect US competitiveness
Over the past year, Democrats in Washington, D.C., have scored legislative wins that boost American competitiveness on the world stage. President Joe Biden and leaders in Congress have navigated razor-thin majorities in the House and Senate to pass landmark bills ramping up American manufacturing and infrastructure, investing in critical semiconductor production and scientific research and development, and funding innovative clean energy projects.
However, while Congress has steadily worked to help American companies contend with competitors in China, India and Vietnam, one federal agency, the International Trade Commission, is threatening to undermine Democrats’ efforts to strengthen American competitiveness.
Ironically, the ITC was created with competition in mind. The commission was able to ban products produced abroad from U.S. markets, a powerful tool meant to dissuade foreign companies from stealing American intellectual property or engaging in unfair trade practices. However, it has lost sight of its original goal. Now, the commission spends more time harassing American companies on behalf of businesses that abuse patent and intellectual property laws than protecting U.S. businesses. The ITC’S actions often run counter to Democratic priorities in Washington.
On Aug. 9, Biden signed the hardfought CHIPS and Science Act, a bill that increases American competitiveness with semiconductor-producing countries like China and Malaysia and provides relief to American manufacturers struggling with the chip shortage. However, while Democrats were working to rally support behind the bill, the ITC allowed a foreign company owned by Atlantic IP Services, which advertises itself as a leader in the “patent monetization” market, to file a lawsuit that would have blocked the importation of semiconductors used in GM and Ford’s electric vehicle lineups, a move that would have severely hurt two top American automakers trying to compete with companies from Asia and Europe in the crowded U.S. auto market.
Fortunately, the ITC rejected those claims. However, that hasn’t stopped bad actors from using the commission to undermine American businesses in highly competitive industries.
For example, one ITC case between Alivecor and Apple threatens to hamstring U.S. companies’ ability to compete with countries like China and Russia in scientific and medical research. Democrats carefully crafted the bipartisan infrastructure law, CHIPS and Science Act, and the recently signed Inflation Reduction Act to include manufacturing and medical research funding.
However, in the case between Alivecor and Apple, the ITC might ban from U.S. markets the Apple Watch, a product frequently used by National Institutes of Health grantees, top research universities and leading hospitals to detect, understand and treat heart ailments.
If the ITC hands down a decision to ban the Apple Watch, or any other product frequently used by American researchers, it would not only have immediate preventive health implications for millions but also deliver a major blow to U.S. research and development, and endanger the same projects the government is working to promote.
Democrats have fought hard to deliver major policy wins to boost American competitiveness, but if they continue to allow the ITC to issue orders hurting U.S. businesses, they risk losing that progress. Fortunately, they have the power to do something about it.
While Biden can veto ITC decisions, he and Congress need to direct the commission to take a more productive approach to uphold its responsibilities to protect American industries’ interests. Sen. Ron Wyden, D-ore., and Rep. Richard Neal, D-mass., chair committees with oversight over the ITC, and there’s legislation in Congress that would take the first steps toward reforming the commission.
If leaders in Washington are serious about pushing their competition agenda forward, they’ll take those steps — and more — to stop the ITC from hurting American competitiveness.