'PCBetter Act' would require defense contractors to tell Pentagon if they use foreign IT parts
Sen. Josh Hawley (R-MO) introduces bill requiring notification to DoD if China, Russia, Iran or North Korea provides printed circuit boards for U.S. defense systems
Sen. Josh Hawley (R-MO) introduced a piece of legislation titled the “PCBetter Act” that would require defense contractors to notify the Pentagon if any adversarial nations, particularly China, provides any printed circuit boards o other electronic parts for U.S. defense systems. (Photo: Drew Angerer/Getty Images
Defense contractors would be required to tell the Pentagon if China, Russia, Iran and North Korea made any of the printed circuit boards in systems they were supplying, under legislation Sen. Josh Hawley (R-MO, introduced on Wednesday.
The PCBetter Act would also establish a 10-year electronics supply chain fund of an unspecified size aimed at strengthening U.S. manufacturing of electronics and supporting implementation of supply chain security initiatives, according to a fact sheet.
That step would likely be seen as a boon to the American electronics industry, which says the number of U.S. companies that make circuit boards has atrophied from 1,500 in 2000 to fewer than 200 today, with most manufactured in China.
The coronavirus pandemic woke up Washington to how many of the country’s supply chains moved overseas, sparking Joe Biden to order his administration to submit reports on supply chain risks.
“Chinese printed circuit boards pose a serious threat to the integrity of America’s defense systems,” Hawley, a member of the Senate Armed Services Committee, said in a statement Wednesday. “It is imperative that we give the Department of Defense the tools it needs to secure its printed circuit board supply chains, so that our warfighters can have full confidence in the weapons they rely on to protect our nation.”
The idea behind a spate of new laws to target the use of Chinese technologies by defense contractors has been to lessen U.S. dependence on electronics from China, which is seen as a strategic rival that could use sabotage or hack American systems. However, those same laws have saddled the defense industry with a raft of requirements it sees as costly and cumbersome.
The new bill would require contractors, when they supply the DoD with an IT system, to provide a list of each printed circuit board, attesting to whether it was made in a covered country or not ― or if the provider could not make a determination.
It would also establish a testing, remediation and prevention regime to address vulnerabilities in IT systems that contain or may contain printed circuit boards made in those countries.
It would mandate implementation standards for several laws from recent years that target Chinese-made technology. Those include a ban on Chinese telecommunications and video surveillance gear (Section 889); limits on the DoD acquiring printed circuit boards from China and others (Section 841); and requirements that defense microelectronics meet trusted supply chain standards (Section 224).
The need for this legislation should be obvious, but in 2014, the Obama administration — of which Joe Biden was a major part — waived a long-standing ban on Chinese parts in U.S. defense systems. Among the biggest concerns expressed by critics of the waivers at the time was the fact that Chinese manufacturers — much of the economy, including “business,” is owned and controlled by the barbaric regime — have developed an international reputation for providing poor quality products.
Multiple reports over the last several years regarding printed circuits and other IT or electonic parts supplied by China indicate those parts are highly likely to fail. (Photo: Dan Ferris/America’s Conxervative Voice)
Indeed, official investigations have revealed that military hardware components made in China have a tendency to fail. A recent Congressional report, for example, found that there could be over a million counterfeit Chinese electronic parts on U.S. military aircraft currently in service.
The annual “Industrial Capabilities” report from two years ago, released by the Defense Department’s Office of Manufacturing and Industrial Base Policy, found that despite total dollars spent by the Department on weapons and ammunition increasing year over year since 2016, the number of vendors supplying them has decreased.
In addition, while the report found generally positive trends for the U.S. defense sector, it did warn that in certain areas, foreign weapon sales are decreasing.
For instance, the U.S. saw its market share of global naval weapon exports go from 63 percent in 2007 to just 17 percent in 2017. And from 2008-2017, two reliable buyers of U.S. defense goods — Pakistan and South Korea — saw their U.S. procurement percentages drop. Pakistan went from 31 percent to 12 percent, while South Korea went from 78 percent to 53 percent.
This was the last Industrial Capabilities report to be published since the October 2018 release of a White House-mandated study on the defense-industrial base. That study concluded, in part, that the government needs to increase use of its Defense Production Act Title III authorities, which allows the government to expend funds to support key production lines that might now otherwise survive.
The National Defense Industrial Association’s policy chief, Wes Hallman, said Thursday that industry is “broadly supportive” of the aims of “well-meaning” legislation to ensure defense systems aren’t corrupted by an adversary. However, he said, defaulting to a static, compliance-based mode won’t be effective against ever-changing threats.
What industry does favor is fostering safer alternative suppliers domestically, as Hawley’s bill intends to do.
“Nobody wants to be dependent on single source, especially a single source that’s problematic,” Hallman said. “The defense-industrial base and NDIA has been highly supportive of making investments in domestic capabilities in microelectronics.”
Meanwhile, the electronics trade group IPC has been lobbying Washington for a lifeline and measures to strengthen the defense electronics-industrial base. The trade group has encouraged the Pentagon to continue making strides to understand the complex supply chain for the electronics it uses.
“I would suggest to you that DoD does not yet have the full visibility that it wants or needs into that supply chain,” said IPC’s government relations lead, Chris Mitchell.
The conversation comes on the heels of the House Armed Services Committee establishing a defense supply chain task force expected to tee up fast legislative fixes for inclusion in the next defense policy bill later this year. The Pentagon has launched an assessment of fragilities in its supply chains in response to Biden’s recent order.