What to Know in Washington: McCormick–China Ties Come Into View

Senate candidate David McCormick led Bridgewater Associates as the hedge fund steered millions of dollars in investments into Chinese military companies, according to documents analyzed by Bloomberg Government.

These Chinese companies produced fighter jets, bombers, telecommunications and satellite equipment, aircraft equipped to jam enemy radars, and the country’s first domestically made aircraft carrier, according to the documents.

David McCormick in Pennsylvania in 2022. Julia Nikhinson/Bloomberg

McCormick — the GOP challenger in a key contest in Pennsylvania — has long faced attacks over Bridgewater’s holdings in China. But previously unreported disclosures show new details of investments tied to its military and could undercut his attempts to label himself as a China hawk in his bid to replace Sen. Bob Casey (D-Pa.).

As a candidate, McCormick called for barring US investments in Chinese companies that pose a threat. But over his years as Bridgewater’s co-CEO or CEO, its hedge funds held stock in at least 20 Chinese firms that were subsequently sanctioned by Presidents Donald Trump or Joe Biden for being part of Beijing’s military-industrial complex or surveillance efforts.

The sanctions barred Americans from buying or selling publicly traded securities in the targeted companies. Bridgewater’s investments with those companies — at one point worth at least $230 million — are outlined in filings with the Labor Department. Jonathan Tamari has more in a BGOV exclusive.

China Looms Over US Policy

Ferdinand Marcos Jr., Joe Biden, and Fumio Kishida at the White House yesterday. Photo by Andrew Harnik/Getty Images

Biden touted deeper security ties with JAPAN and the PHILIPPINES as he sought to assure allies worried about increasingly assertive Chinese actions in disputed waters in the South China Sea.

• US defense commitments to Japan and the Philippines are “ironclad,” Biden said as he met with Japan’s Fumio Kishida and the Philippines’ Ferdinand Marcos Jr. at the White House yesterday.
• “Any attack on Philippine aircraft, vessels or armed forces in the South China Sea would invoke our mutual defense treaty,” he said at the first trilateral summit among the nations. Read more.

BIDEN added more Chinese companies and individuals to an export blacklist than any US administration, as growing frictions between the world’s biggest economies continue to complicate global trade. Read more.

The US should ban Chinese-made ELECTRIC CARS, Senate Banking Chair Sherrod Brown (D-Ohio) said, citing economic and national security threats posed to the US auto industry. Read more.

SAMSUNG is preparing a $44 billion investment in US chipmaking as soon as next week, a signature project in Washington’s broader effort to counter the technological rise of China.

• The world’s biggest memory-chip maker plans to outline the project in Taylor, Texas, alongside Commerce Secretary Gina Raimondo.
• It’s secured over $6 billion of US government grants for an investment outlay that’s expanded significantly to a total of $44 billion over multiple years, the people said. Read more.

BIDEN’S AGENDA

• The president will give remarks at the National Action Network Convention before 3 p.m.

CONGRESS’ SCHEDULE

• The House is back at 8 a.m. to vote on reauthorizing spying powers.
• Senators return Monday.
• For the full, detailed agenda read BGOV’s Congress Tracker.

Privacy Battles in Congress

Mike Johnson at the Capitol on Wednesday. Photo by Julia Nikhinson/Bloomberg

The House will try to advance a two-year SPY POWERS extension today after an intraparty blowup led by the Donald Trump-aligned wing of the Republican Party over privacy concerns.

• The House plans to vote early on the rule, which would allow for debate and final passage of the two-year version of the bill.
• It’s unclear whether Speaker Mike Johnson’s (R-La.) plan will mollify critics on their privacy concerns. Read more.

CALIFORNIA’s congressional delegation is divided on a landmark privacy measure in Congress that would include preemption language some fear would undermine the Golden State’s privacy authority.

• The American Privacy Rights Act would be the first comprehensive federal privacy law if enacted. The 140-page bipartisan proposal marks a major breakthrough on a long-standing disagreement on preemption.
• Congress repeatedly failed to pass a federal data privacy standard, partly because California members fought what they viewed as weaker standards than their state protections. Read more.

Children’s ONLINE PRIVACY is the topic of two bills introduced this week. The measures would place legal responsibility on platform providers to reduce harm to minors. BGOV explains in a new OnPoint.

FEDERAL AGENCIES were ordered to reset emails and secure Microsoft accounts amid concerns a Russian hacking group may have accessed some correspondence. Read more.

Also Happening on the Hill

Steve Womack at the Capitol on March 20. Photo by Anna Moneymaker/Getty Images

Republicans expect to have NEW CHAIRS for the House panels that fund the Transportation and Treasury departments in an ongoing series of changes to powerful appropriations subcommittees.

• Reps. Steve Womack (R-Ark.) and David Joyce (R-Ohio) are set to lead the House Appropriations panels on Transportation-HUD and Financial Services.
• The changes reflect an unusual election-year shake-up for the leaders of appropriations panels, known as “cardinals,” ahead of talks over Ukraine aid and the Baltimore bridge collapse. Read more.

Lawmakers clashed over the 2017 GOP TAX LAW’s upcoming expiration during a House Ways and Means Committee hearing yesterday, setting the stage for the larger debate in 2025. Read more.

A Senate panel will hold a hearing on the FAA’s findings and recommendations on Boeing’s safety culture, according to a statement by panel Commerce Chair Maria Cantwell (D-Wash.). Read more.

Tactics used by PATENT OWNERS and bankrupt firms to get their cases in front of specific judges could be at risk from legislation by Senate Minority Leader Mitch McConnell (R-Ky.). Read more.

Junior enlisted members of the US MILITARY should receive a 15% pay raise to help address the military’s recruiting struggle, a House Armed Services Committee panel recommended. Read more.

A bill on STABLECOINS is being discussed by the bipartisan heads of the House Financial Services Committee and Senate Majority Leader Chuck Schumer (D-N.Y.), Punchbowl reports. Read more.

People, Power, and Politics

Sidney Powell in 2020. Photo by Al Drago/Bloomberg

TRUMP’s campaign and its former lawyer Sidney Powell failed to shed claims of defamation and intentional infliction of emotional distress by a Dominion Voting Systems employee.

• The employee alleges the Trump campaign, Powell, and others, recklessly spread unverifiable claims that he conspired with far-left activists to switch votes in Biden’s favor. Read more.
• Eastman Fight: Meanwhile, John Eastman’s bid to remain a working attorney as he appeals a court ruling recommending his disbarment is facing steep opposition in California. Read more.

The ARIZONA Supreme Court ruling this week reestablishing a Civil War-era abortion law shifts the fight for abortion rights in the state to a pending initiative on the ballot this fall. Read more.

What Else We’re Watching

The National Petroleum Reserve-Alaska. Photo by Bob Wick/Bureau of Land Management

The US set aside 23 million acres of ALASKA’s North Slope to serve as an emergency supply of oil a century ago. Now, Biden is moving to block oil and gas development across half of it.

• It marks one of the most sweeping efforts yet by Biden to limit oil and gas exploration on federal lands, and comes as he seeks to boost his climate credentials ahead of the election. Read more.

Defense Secretary LLOYD AUSTIN spoke with his Israeli counterpart to reiterate ironclad US support for Israel’s defense in the face of growing threats from Iran, according to a US readout. Read more.

BIDEN will forgive $7.4 billion in federal student debt in his latest push to provide relief to borrowers and deliver on a campaign promise to ease the cost of higher education as he seeks reelection. Read more.

To contact the reporter on this story: Brandon Lee in Washington at blee@bgov.com

To contact the editor responsible for this story: Giuseppe Macri at gmacri@bgov.com