Source: United States House of Representatives – Congressman Jeff Fortenberry (1st District of Nebraska)
There is an extraordinarily important committee in Washington you might not have heard of: CFIUS, or The Committee on Foreign Investment in the United States. This high-level interagency panel assists the President in overseeing national security consequences of foreign direct investment (FDI) in the American economy. Since its inception, CFIUS has discreetly operated at the intersection of national security protection, technological advancement, and a globalized economic march––marked by the rise of China and outsourcing of America’s manufacturing base.
Historically, CFIUS has navigated a delicate balance between maintaining open and fair trade and protecting critical domestic assets. When properly monitored, foreign direct investment in the U.S. can produce multiple benefits for our country, giving American companies wider access to necessary capital, enabling them to expand operations and employ more American workers. When those benefits are outweighed by national security concerns, CFIUS steps in.
They have been busy. Since the 2007 housing and stock market crash, global investor interest in U.S. companies has risen considerably. CFIUS reviews of deals by Chinese firms alone have tripled. When, in 2013, Virginia-based Smithfield Foods––which has plants all around our area––was purchased by privately-owned Shuanghui Group, the largest meat processor in China, it was the biggest ever purchase of an American company by a Chinese concern. I remember the moment. It raised a lot of eyebrows. I distinctly recall speaking to my legislative director about it.
In my capacity as the Ranking Member of the House Appropriations Subcommittee on Agriculture, Rural Development, and Food and Drug Administration (FDA), I have long noted how our food security is inextricably tied to our national security. I have highlighted, in particular, how much of our American food production system has been sold to foreign operations. In 2016 alone, foreign investors acquired over 1.6 million acres of American farmland, the largest increase in more than a decade. Also, of note, four companies––two of which are foreign-owned––control over 80% of the meatpacking facilities in America.
Over the last several months, the consequences of this large-scale meatpacking concentration have played out before our eyes. Response to coronavirus outbreaks in meatpacking plants at first seemed to lack deliberateness, speed, and sensitivity to the virus spreading into local communities. While we have seen improvement in this regard, it’s important to remember that agriculture, perhaps more than any other economic sector, requires an intimate connection between the business corporation, their workers, and the local community. Because it’s about our food, our sustenance, our well-being.
For obvious reasons, CFIUS has ensured that most U.S. military equipment and sensitive technology essential to our national security are manufactured here at home. The coronavirus crisis, however, has clarified the need to expand our traditional definition of “national security interest” to other categories, including drugs, active drug ingredients, personal protective equipment, and now, from my perspective, our food.
I am cosponsoring the Agricultural Security Review Act to elevate the U.S. Secretary of Agriculture to Member status in CFIUS. The act will ensure that CFIUS is operating effectively and efficiently to determine if an agricultural transaction threatens the national security of The United States.
Food is security.