Capping a year of increasing tension between Washington and Beijing over advanced chips used in everything from smartphones to weapons of mass destruction, China has initiated a trade dispute at the World Trade Organization (WTO) against the United States for imposing wide-ranging semiconductor export controls on China.

The U.S. Department of Commerce’s Bureau of Industry and Security announced an extensive set of regulations on October 7, which restricted chips made using American tools from being exported to China, in addition to any semiconductors designed for artificial intelligence applications.

The wide-reaching export controls have effectively hobbled China’s semiconductor industry, prompting Beijing to announce on December 12 that it would initiate the WTO dispute.

“China’s filing of a lawsuit at the WTO is to resolve China’s concerns through legal means and is a necessary way to defend its legitimate rights and interests,” the country’s Ministry of Commerce said in a statement.

Beijing’s statement added that the U.S. restrictions “threatened the stability of the global industrial supply chain.”

In response, the United States said the WTO was “not the appropriate forum” to settle national security concerns, the BBC reported.

“U.S. national security interests require that we act decisively to deny access to advanced technologies,” U.S. Assistant Secretary of Commerce for Export Administration Thea Kendler said.

The export controls — which are among the strictest Washington has imposed — aim to slow China’s ability to produce high-end semiconductors that have uses in commercial and military technology. Advanced chips are used in artificial intelligence, supercomputers and weapons.

The U.S. began restricting sales of American technology to Chinese companies such as Semiconductor Manufacturing International Corp. in 2020. In December 2021 the United States sanctioned nine Chinese technology companies over their ties to the surveillance of ethnic minorities such as Uyghurs.

In late August of this year, the Biden administration restricted technology companies like Nvidia and Advanced Micro Devices from selling graphics processing units to China.

China’s initiation of a WTO dispute over the export controls did not surprise Martijn Rasser, director of the technology and national security program at the Washington-based Center for New American Security.

The dispute “underscores just how few options Beijing has to really counter the U.S. moves,” he told VOA Mandarin in an interview. “It’s mostly a symbolic move by Beijing. I don’t expect that Chinese leaders are really expecting anything to come out of this in their favor. But it’s one of the few courses of action that they have, so they took it.”

Reported chip developments over the summer in China may have spurred the United States to launch these extensive restrictions, according to Gerard DiPippo, a senior fellow at the Washington think tank the Center for Strategic and International Studies.

“My feeling is that they are worried about China’s progress in chips related to supercomputing and artificial intelligence,” he told VOA Mandarin.

Among the restrictions is a ban on the supply of cutting-edge graphics processing units (GPUs), or any electronics containing GPUs, to China. GPU chips play an important role in developing artificial intelligence applications.

The ban on GPUs also applies to chips made outside the U.S. because they are covered by the foreign direct product rule, so any chip made directly from U.S. technology or even partly produced from U.S.-made semiconductor production equipment is subject to U.S. jurisdiction.

Since all semiconductor fabrication facilities use at least some U.S.-manufactured equipment, Washington has jurisdiction over every GPU in the world.

The United States imposed these GPU and other restrictions due to national security concerns, U.S. national security adviser Jake Sullivan said in an October 12 speech at Georgetown University. He added that Washington was implementing a “small yard, high fence” policy.

“Chokepoints for foundational technologies have to be inside that yard,” he said. “And the fence has to be high — because our strategic competitors should not be able to exploit American and allied technologies to undermine American and allied security.”

To Washington, national security concerns outweighed any administration goals to lessen tensions with Beijing, according to Chris Miller, a Tufts University professor and author of the book “Chip War: The Fight for the World’s Most Critical Technology.”

“The judgment made by the Biden administration is that this has created a risk that the United States is unwilling to tolerate,” he said. “For the United States, it is better to try to slow down China’s progress in chip manufacturing, even if it increases the tension between the two countries.”

When countries cite national security concerns, according to Rasser, the WTO typically lets that stand. Washington’s national security concerns about chips in this case “are ironclad,” Rasser said, so it’s extremely unlikely that the WTO will rule in favor of China.

Although the short-term effects of these restrictions are significant for China, Miller expects China will eventually be able to produce this technology on its own.

“China will eventually be able to find alternative sources, but I expect that it will not be very easy,” Miller said. “It’s going to be a long process and probably a pretty expensive one.”
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President Joe Biden on Thursday signed a $1.7 trillion spending bill that will keep the federal government of the United States operating through the end of the federal budget year in September 2023 and provide tens of billions of dollars in new aid to Ukraine for its fight against the Russian military.

Biden had until late Friday to sign the bill to avoid a partial government shutdown.

The Democratic-controlled House passed the bill 225-201, mostly along party lines, just before Christmas. The House vote came a day after the Senate, also led by Democrats, passed the bill 68-29 with significantly more Republican support.

Biden had said passage was proof that Republicans and Democrats can work together.

Representative Kevin McCarthy, the House Republican leader who hopes to become speaker when a new session of Congress opens January 3, argued during floor debate that the bill spends too much and does too little to curb illegal immigration and the flow of fentanyl into the U.S. from Mexico.

“This is a monstrosity that is one of the most shameful acts I’ve ever seen in this body,” McCarthy said of the legislation.

McCarthy is appealing for support from staunch conservatives in the GOP caucus, who have largely blasted the bill for its size and scope. Republicans will have a narrow House majority come January 3, and several conservative members have vowed not to vote for McCarthy to become speaker.

The funding bill includes a roughly 6% increase in spending for domestic initiatives, to $772.5 billion. Spending on defense programs will increase by about 10%, to $858 billion.

Last-minute passage

Passage was achieved hours before financing for federal agencies was set to expire. Lawmakers had approved two short-term spending measures to keep the government operating, and a third, funding the government through December 30, passed last Friday. Biden signed it to ensure services would continue until Congress sent him the full-year measure, called an omnibus bill.

The massive bill, which topped out at more than 4,000 pages, wraps together 12 appropriations bills, aid to Ukraine, and disaster relief for communities recovering from natural disasters. It also contains scores of policy changes that lawmakers worked to include in the final major bill considered by that session of Congress.

Lawmakers provided roughly $45 billion for Ukraine and NATO allies, even more even Biden requested, an acknowledgment that future rounds of funding are not guaranteed when Republicans take control of the House next week following the party’s gains in the midterm elections.

Though support for Ukraine aid has largely been bipartisan, some House Republicans have opposed the spending and argued that the money would be better spent on priorities in the U.S.

McCarthy has warned that Republicans will not write a “blank check” for Ukraine in the future.

Federal election law revised

The bill also includes about $40 billion in emergency spending, mostly to help communities across the U.S. as they recover from drought, hurricanes and other natural disasters.

Biden signed the bill Thursday in the U.S. Virgin Islands, where he is spending time with his wife, Jill, and other family members on the island of St. Croix. The Bidens are staying at the home of friends Bill and Connie Neville, the White House said. Bill Neville owns US Viking, maker of ENPS, a news production software system that is sold by The Associated Press.

Also in the bill are scores of policy changes that although largely unrelated to spending, lawmakers worked furiously behind the scenes to get them added to the bill, which was the final piece of legislation that came out of that session of Congress. Otherwise, lawmakers sponsoring these changes would have had to start from scratch next year in a politically divided Congress in which Republicans will return to the majority in the House and Democrats will continue to control the Senate.

One of the most notable examples was a historic revision to federal election law to prevent a future president or presidential candidate from trying to overturn an election.

The bipartisan overhaul of the Electoral Count Act is a direct response to then-President Donald Trump’s efforts to persuade Republican lawmakers and then-Vice President Mike Pence to object to the certification of Biden’s victory on January 6, 2021, the day of the Trump-inspired insurrection at the Capitol.

Among the spending increases Democrats emphasized: a $500 increase in the maximum size of Pell Grants for low-income college students, a $100 million increase in block grants to states for substance abuse prevention and treatment programs, a 22% increase in spending on veterans’ medical care, and $3.7 billion in emergency relief to farmers and ranchers hit by natural disasters.

The bill also provides roughly $15.3 billion for more than 7,200 projects that lawmakers sought for their home states and districts. Under revamped rules for community project funding, also referred to as earmarks, lawmakers must post their requests online and attest they have no financial interest in the projects. Still, many fiscal conservatives criticize the earmarking as leading to unnecessary spending.
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A Chinese military plane came within 3 meters of a U.S. Air Force aircraft in the contested South China Sea last week and forced it to take evasive maneuvers to avoid a collision in international airspace, the U.S. military said Thursday.

The close encounter followed what the United States has called a recent trend of increasingly dangerous behavior by Chinese military aircraft.

The incident, which involved a Chinese Navy J-11 fighter jet and a U.S. air force RC-135 aircraft, took place on December 21, the U.S. military said in a statement.

“We expect all countries in the Indo-Pacific region to use international airspace safely and in accordance with international law,” it added.

A U.S. military spokesperson said the Chinese jet came within 10 feet of the plane’s wing, but 20 feet from its nose, which caused the U.S. aircraft to take evasive maneuvers.

The U.S. has raised the issue with the Chinese government, a separate U.S. official said.

The Chinese embassy in Washington did not immediately respond to a request for comment.

In the past, China has said the U.S. sending ships and aircraft into the South China Sea is not good for peace.

U.S. military planes and ships routinely carry out surveillance operations and travel through the region.

China claims vast swathes of the South China Sea that overlap with the exclusive economic zones of Vietnam, Malaysia, Brunei, Indonesia and the Philippines.

Trillions of dollars in trade flow every year through the waterway, which also contains rich fishing grounds and gas fields.

In a meeting with his Chinese counterpart in November, U.S. Defense Secretary Lloyd Austin raised the need to improve crisis communications, and also noted what he called dangerous behavior by Chinese military planes.

Despite tensions between the U.S. and China, U.S. military officials have long sought to maintain open lines of communication with their Chinese counterparts to mitigate the risk of potential flare-ups or deal with any accidents.

Other countries report harassment 

Australia’s defense department said in June that a Chinese fighter aircraft dangerously intercepted an Australian military surveillance plane in the South China Sea region in May.

Australia said the Chinese jet flew close in front of the RAAF aircraft and released a “bundle of chaff” containing small pieces of aluminum that were ingested into the Australian aircraft’s engine.

In June, Canada’s military accused Chinese warplanes of harassing its patrol aircraft as they monitored North Korea sanction evasions, sometimes forcing Canadian planes to divert from their flight paths.

Friction between China and U.S.

Relations between China and the U.S. have been tense, with friction between the world’s two largest economies over everything from Taiwan and China’s human rights record to its military activity in the South China Sea.

U.S. House Speaker Nancy Pelosi’s trip to Taiwan in August infuriated China, which saw it as a U.S. attempt to interfere in its internal affairs. China subsequently launched military drills near the island.

The U.S. has no formal diplomatic relations with Taiwan but is bound by law to provide the island with the means to defend itself.
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The U.S. Justice Department is suing one of the largest U.S. drug distributors for failing to report suspicious orders of prescription opioids, saying the company’s “years of repeated violations” contributed to the deadly U.S. opioid epidemic. 

In a civil lawsuit filed Thursday, the department alleges that AmerisourceBergen and two subsidiaries violated the Controlled Substances Act by failing to report “at least hundreds of thousands” of suspicious orders for prescription painkillers to the Drug Enforcement Administration.

The department is seeking potentially billions of dollars in penalties.

“For years, AmerisourceBergen prioritized profits over its legal obligations and over Americans’ well-being,” Associate Attorney General Vanita Gupta said during a press call.

Under the Controlled Substances Act, distributors of controlled drugs are required to monitor and report suspicious orders to the drug agency.

The lawsuit alleges that AmerisourceBergen failed to report “numerous orders from pharmacies that AmerisourceBergen knew were likely facilitating diversion of prescription opioids.”

The complaint cites five such pharmacies.

A Florida pharmacy and a West Virginia pharmacy received opioids from AmerisourceBergen that the company allegedly knew “were likely being sold in parking lots for cash,” according to the complaint.

In Colorado, AmerisourceBergen distributed prescription painkillers to a pharmacy it allegedly knew was its largest purchaser of oxycodone 30mg tablets in the state.

AmerisourceBergen identified 11 patients at the pharmacy as potential “drug addicts.” Two of those patients later died of overdoses, according to the lawsuit.

In New Jersey, an online pharmacy that received opioids from AmerisourceBergen has pleaded guilty to illegally selling controlled substances, while the chief pharmacist at another pharmacy has been indicted for drug diversion.

“These incidents were part of the systematic failure by AmerisourceBergen, including dramatically understaffing and underfunding its compliance programs,” Philip Sellinger, U.S. attorney for the District of New Jersey, said during the press call. “In one year, AmerisourceBergen spent more on taxicabs and office supplies than on the Controlled Substances Act compliance budget.”

In a statement, AmerisourceBergen said the lawsuit represented an attempt to “shift the onus of interpreting and enforcing the law from the Department of Justice and Drug Enforcement Administration (DEA) to an industry they are tasked with regulating and policing.”

The five pharmacies were “cherrypicked” by the DOJ out of thousands the company serves, the statement said.

AmerisourceBergen is one of three major U.S. pharmaceutical distributors. The other two are McKesson and Cardinal Health.

In February the companies, along with pharmaceutical manufacturer Johnson & Johnson, agreed to pay $26 billion to settle thousands of civil lawsuits brought by state and local governments. Most of the money will go toward treatment and prevention.

The U.S. drug epidemic has killed more than 1 million people since 1999, according to the U.S. Centers for Disease Control and Prevention.

Opioids are the main driver of U.S. drug overdose deaths. Of an estimated 108,000 drug overdose deaths reported in the country last year, 81,000 involved opioids such as fentanyl, according to the CDC.  

 
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The U.S. State Department has approved the sale of an anti-tank mine-laying system to Taiwan amid the rising military threat from China.

The department on Wednesday said the Volcano system and all related equipment would cost an estimated $180 million.

It’s capable of scattering anti-tank and anti-personnel mines from either a ground vehicle or helicopter, the type of weapon some experts believe Taiwan needs more of to dissuade or repel a potential Chinese invasion.

To advertise that threat, China’s military sent 71 planes and seven ships toward Taiwan in a 24-hour display of force directed at the self-ruled island it claims is its own territory, Taiwan’s Defense Ministry said Monday.

China’s military harassment of Taiwan has intensified in recent years, along with rhetoric from top leaders that the island has no choice but to accept eventual Chinese rule.

That has seen the ruling Communist Party’s increasingly powerful military wing, the People’s Liberation Army, send planes or ships toward the island on a near-daily basis.

Between 6 a.m. Sunday and 6 a.m. Monday, 47 of the Chinese planes crossed the median of the Taiwan Strait, an unofficial boundary once tacitly accepted by both sides, according to the Defense Ministry.

That came after China expressed anger at Taiwan-related provisions in a U.S. annual defense spending bill in what has come to be a standard Chinese practice.

China conducted large-scale live-fire military exercises in August in response to U.S. House Speaker Nancy Pelosi’s visit to Taiwan. Beijing views visits from foreign governments to the island as de facto recognition of Taiwan as independent and a challenge to China’s claim of sovereignty.

While Washington has only unofficial ties with Taiwan in deference to Beijing, those include robust defense exchanges and military sales.

In its announcement, the State Department said the Volcano sale “serves U.S. national, economic, and security interests by supporting the recipient’s continuing efforts to modernize its armed forces and to maintain a credible defensive capability.”

It said Taiwan would have “no difficulty absorbing this equipment into its armed forces,” and that the sale would “not alter the basic military balance in the region.”

Analysts differ over what Taiwan’s defense priorities should be, with some calling for big-ticket items such as advanced fighter jets.

Others argue for a more flexible force, heavily armed with land-based missile systems to target enemy ships, planes and landing craft. China’s overwhelming numerical advantage in personnel and equipment give Taiwan little choice but to opt for that more “asymmetric” approach, they say.
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U.S. Representative-elect George Santos of New York was under investigation by Long Island prosecutors on Wednesday after revelations surfaced that the now-embattled Republican lied about his heritage, education and professional pedigree as he campaigned for office.

Despite intensifying doubt about his fitness to hold federal office, Santos has shown no signs of stepping aside — even as he publicly admitted to a long list of lies.

Nassau County District Attorney Anne T. Donnelly, a Republican, said the fabrications and inconsistencies were “nothing short of stunning.”

“The residents of Nassau County and other parts of the third district must have an honest and accountable representative in Congress,” she said. “If a crime was committed in this county, we will prosecute it.”

Santos’ campaign did not immediately respond to a request for comment on Wednesday.

He is scheduled to be sworn in next Tuesday, when the U.S. House reconvenes. If he assumes office, he could face investigations by the House Committee on Ethics and the Justice Department.

The Republican has admitted to lying about having Jewish ancestry, a Wall Street pedigree and a college degree, but he has yet to address other lingering questions — including the source of what appears to be a quickly amassed fortune despite recent financial problems, including evictions and owing thousands in back rent.

Fellow Long Island Republican Representative-elect Nick Lalota said he was troubled by the revelations.

“I believe a full investigation by the House Ethics Committee and, if necessary, law enforcement, is required,” Lalota said Tuesday.

The New York attorney general’s office has already said it’s looking into issues that have come to light.

Brendan Brosh, a spokesperson for the Nassau County DA’s office, said Wednesday, “We are looking into the matter.” The scope of the investigation was not immediately clear.

Other Republicans castigated Santos but stopped short of asking him to step aside.

“Congressman-elect George Santos has broken the public trust by making serious misstatements regarding his background, experience and education, among other issues,” said Joseph G. Cairo, chair of the Nassau County Republican Committee, which is within the 3rd Congressional District.

Questions intensified after The New York Times examined the narrative Santos, 34, presented to voters during his successful campaign for a congressional district that straddles the north shore suburbs of Long Island and a sliver of Queens.

The Times uncovered records in Brazil that show Santos was the subject of a criminal investigation there in 2008 over allegations that he used stolen checks to buy items at a clothing shop in the city of Niteroi. At the time, Santos would have been 19. The Times quoted local prosecutors as saying the case was dormant because Santos had never appeared in court.

Santos continued to deny he was being sought by authorities in South America.

Democrats pounced, calling Santos a serial fabulist and demanded he voluntarily not take office.

In an interview with the New York Post earlier this week, Santos apologized for his fabrications but downplayed them as “sins” over embellishing his resume, adding that “we do stupid things in life.”

He admitted to lying about working for Citigroup and Goldman Sachs, as well as having earned a degree in finance and economics from Baruch College in New York.

Beyond his resume, Santos invented a life story that has also come under question, including claims that his grandparents “fled Jewish persecution in Ukraine, settled in Belgium and again fled persecution during World War II.”

During his campaign, he referred to himself as “a proud American Jew.”

He backtracked on that claim, saying he never intended to claim Jewish heritage, which would have likely raised his appeal among his district’s significant ranks of Jewish voters.

“I am Catholic,” he told the Post. “Because I learned my maternal family had a Jewish background, I said I was ‘Jew-ish.'”

In a statement Tuesday, the Republican Jewish Coalition repudiated Santos.

“He deceived us and misrepresented his heritage. In public comments and to us personally, he previously claimed to be Jewish,” the coalition said. “He will not be welcome at any future RJC event.”

On Fox News Tuesday night, Santos came under withering questioning by former Hawaii Representative Tulsi Gabbard, who was sitting in for Tucker Carlson.

“You don’t really seem to be taking this seriously,” she told him.

“You’ve apologized. You’ve said you’ve made mistakes. But you’ve outright lied. A lie is not an embellishment on a resume,” she said.

“Look, I agree with what you’re saying,” Santos replied. “We can debate my resume and how I worked with firms such as —”

“Is it debatable?” Gabbard interjected. “Or is it just false?”

“No, it’s not false at all,” he said. “It’s debatable.”

Santos lost his first race for Congress in 2020 but successfully ran again this year.

In its opposition research on Santos, the Democratic Congressional Campaign Committee raised several red flags about the Republican’s record — but also accepted some of his assertions, including his educational record, as fact. The 87-page dossier sought to tie him to the January 6 insurrection at the U.S. Capitol and his support for baseless claims of widespread fraud in the 2020 presidential election.

The report also sought to depict him as a far-right candidate. But buried within its report, the DCCC had raised issues about his shaky financial standing and multiple evictions that left him thousands of dollars in debt.

Federal campaign records show that he loaned his campaign more than $700,000, but the source of that money has yet to be explained.

While his Democratic opponent, Robert Zimmerman, also tried to raise Santos’ misrepresentations during his losing campaign, it did not gain much traction.

Zimmerman has said that Santos is unfit for office and has called for him to step aside so a special election can be held.
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