[House Hearing, 119 Congress]
[From the U.S. Government Publishing Office]
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PROTECTING OUR EDGE: TRADE SECRETS AND THE GLOBAL AI ARMS RACE
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HEARING
BEFORE THE
SUBCOMMITTEE ON COURTS, INTELLECTUAL
PROPERTY, ARTIFICIAL INTELLIGENCE, AND
THE INTERNET
OF THE
COMMITTEE ON THE JUDICIARY
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED NINETEENTH CONGRESS
FIRST SESSION
__________
WEDNESDAY, MAY 7, 2025
__________
Serial No. 119-19
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Printed for the use of the Committee on the Judiciary
GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT
Available via: http://judiciary.house.gov
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U.S. GOVERNMENT PUBLISHING OFFICE
60-318 WASHINGTON : 2025
COMMITTEE ON THE JUDICIARY
JIM JORDAN, Ohio, Chair
DARRELL ISSA, California JAMIE RASKIN, Maryland, Ranking
ANDY BIGGS, Arizona Member
TOM McCLINTOCK, California JERROLD NADLER, New York
THOMAS P. TIFFANY, Wisconsin ZOE LOFGREN, California
THOMAS MASSIE, Kentucky STEVE COHEN, Tennessee
CHIP ROY, Texas HENRY C. ``HANK'' JOHNSON, Jr.,
SCOTT FITZGERALD, Wisconsin Georgia
BEN CLINE, Virginia ERIC SWALWELL, California
LANCE GOODEN, Texas TED LIEU, California
JEFFERSON VAN DREW, New Jersey PRAMILA JAYAPAL, Washington
TROY E. NEHLS, Texas J. LUIS CORREA, California
BARRY MOORE, Alabama MARY GAY SCANLON, Pennsylvania
KEVIN KILEY, California JOE NEGUSE, Colorado
HARRIET M. HAGEMAN, Wyoming LUCY McBATH, Georgia
LAUREL M. LEE, Florida DEBORAH K. ROSS, North Carolina
WESLEY HUNT, Texas BECCA BALINT, Vermont
RUSSELL FRY, South Carolina JESUS G. ``CHUY'' GARCIA, Illinois
GLENN GROTHMAN, Wisconsin SYDNEY KAMLAGER-DOVE, California
BRAD KNOTT, North Carolina JARED MOSKOWITZ, Florida
MARK HARRIS, North Carolina DANIEL S. GOLDMAN, New York
ROBERT F. ONDER, Jr., Missouri JASMINE CROCKETT, Texas
DEREK SCHMIDT, Kansas
BRANDON GILL, Texas
MICHAEL BAUMGARTNER, Washington
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SUBCOMMITTEE ON COURTS, INTELLECTUAL PROPERTY,
ARTIFICIAL INTELLIGENCE, AND THE INTERNET
DARRELL ISSA, California, Chair
THOMAS MASSIE, Kentucky HENRY C. ``HANK'' JOHNSON, Jr.,
SCOTT FITZGERALD, Wisconsin Georgia, Ranking Member
BEN CLINE, Virginia ZOE LOFGREN, California
LANCE GOODEN, Texas TED LIEU, California
KEVIN KILEY, California JOE NEGUSE, Colorado
LAUREL LEE, Florida DEBORAH ROSS, North Carolina
RUSSELL FRY, South Carolina ERIC SWALWELL, California
MICHAEL BAUMGARTNER, Washington SYDNEY KAMLAGER-DOVE, California
CHRISTOPHER HIXON, Majority Staff Director
JULIE TAGEN, Minority Staff Director
C O N T E N T S
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Wednesday, May 7, 2025
OPENING STATEMENTS
Page
The Honorable Darrell Issa, Chair of the Subcommittee on Courts,
Intellectual Property, Artificial Intelligence, and the
Internet from the State of California.......................... 1
The Honorable Henry C. ``Hank'' Johnson, Ranking Member of the
Subcommittee on Courts, Intellectual Property, Artificial
Intelligence, and the Internet from the State of Georgia....... 2
The Honorable Jamie Raskin, Ranking Member of the Committee on
the Judiciary from the State of Maryland....................... 3
WITNESSES
Benjamin Jensen, Ph.D., Director, Senior Fellow, Center for
Strategic and International Studies Futures Lab
Oral Testimony................................................. 6
Prepared Testimony............................................. 9
John Villasenor, Professor of Electrical Engineering, Law, Public
Policy, and Management, University of California, Los Angeles
Oral Testimony................................................. 18
Prepared Testimony............................................. 20
Christopher A. Mohr, President, Software and Information Industry
Association
Oral Testimony................................................. 31
Prepared Testimony............................................. 33
Helen Toner, Director of Strategy and Foundational Research
Grants, Georgetown University Center for Security and Emerging
Technology, Georgetown University
Oral Testimony................................................. 47
Prepared Testimony............................................. 49
Nicholas Anderson, President, Chief Operating Officer, Invictus
International Consulting, LLC
Oral Testimony................................................. 57
Prepared Testimony............................................. 59
LETTERS, STATEMENTS, ETC. SUBMITTED FOR THE HEARING
All materials submitted for the record by the Subcommittee on
Courts, Intellectual Property, Artificial Intelligence, and the
Internet are listed below...................................... 82
A report entitled, ``AI Talent Report,'' Jan. 14, 2025, Council
of Economic Advisers (CEA), The White House, submitted by the
Honorable Sydney Kamlager-Dove, a Member of the Subcommittee on
Courts, Intellectual Property, Artificial Intelligence, and the
Internet from the State of California, for the record
QUESTIONS AND RESPONSES FOR THE RECORD
Questions from the Honorable Darrell Issa, Chair of the
Subcommittee on Courts, Intellectual Property, Artificial
Intelligence, and the Internet from the State of California,
for the record
Questions to Nicholas Anderson, President, Chief Operating
Officer, Invictus International Consulting, LLC
Response to questions from Nicholas Anderson, President,
Chief Operating Officer, Invictus International
Consulting, LLC
Questions to Benjamin Jensen, Ph.D., Director, Senior Fellow,
Center for Strategic and International Studies Futures Lab
Questions to Christopher A. Mohr, President, Software and
Information Industry Association
Response to questions from Christopher A. Mohr, President,
Software and Information Industry Association
Questions to John Villasenor, Professor of Electrical
Engineering, Law, Public Policy, and Management, University
of California, Los Angeles
Response to questions from John Villasenor, Professor of
Electrical Engineering, Law, Public Policy, and
Management, University of California, Los Angeles
PROTECTING OUR EDGE: TRADE SECRETS AND THE GLOBAL AI ARMS RACE
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Wednesday, May 7, 2025
House of Representatives
Subcommittee on Courts, Intellectual Property, and
Artificial Intelligence, and the Internet
Committee on the Judiciary
Washington, DC
The Committee met, pursuant to notice, at 10 a.m., in Room
2141, Rayburn House Office Building, the Hon. Darrell Issa
[Chair of the Subcommittee] presiding.
Members present: Representatives Issa, Massie, Fitzgerald,
Cline, Fry, Johnson, Ross, and Kamlager-Dove.
Mr. Issa. The Subcommittee will come to order. Without
objection, the Chair is authorized to declare a recess at any
time.
We welcome today our guests for a hearing on Trade Secrets
in the Global AI Arms Race. I now recognize myself for a short
opening statement.
Today's hearing addresses the core tension in the age of
artificial intelligence to push for disclosure, balanced with
the need to protect innovation that drive U.S. leadership.
There is a nondisclosure on the phone.
The proprietary algorithms that, in fact, train data sets
are likely to be now and in the future the secret sauce, not
patented, not available to the public, but of such value that
other nefarious actors will do anything to get them. Without
strong protections, we risk sacrificing the very breakthroughs
we aim to encourage. Some have called the sweeping AI
disclosure mandates in the name of transparency. This Committee
has strongly believed and will continue to believe in
transparency, but like anything else, a protective order is
just a promise and a promise that is historically not kept, in
fact, has no value.
We cannot require disclosure of trade secrets or
proprietary data sets under the guise of transparency. Such
disclosures would not only have a chilling effect on
innovation, but hand strategic advantage to foreign adversaries
who do not play by the same rules. Consider this. The United
States' investment in AI is approaching $1 trillion. China has
invested not more than one third as much and is already neck to
neck with the United States. The DeepSeek and other Chinese
models are rapidly catching up to American companies. Let's
look deeper. The DeepSeek contains models that clearly were
taken from OpenAI and other sets. We know China's speed is not
merely because they invest in innovation. It is also the result
of IP theft, reverse engineering, and efforts to circumvent
U.S. export controls and more.
China has also weaponized our legal system by financing
lawsuits that target American firms in expensive litigation and
with the intent, in many cases, to mine that proprietary
information. All the while, China continues to refuse
meaningful protections on U.S. IP in its own courts. I
personally have been part of that recognition that they will
not defend trademarks, patents, even when you go to the expense
of getting them in China, even if you make your product in
China, you will not be protected.
Last, American companies have a reverse situation, one in
which we are working constantly, and this Committee has worked
tirelessly on a bipartisan to promote rocket dockets to, in
fact, get the speed of decision to the lowest cost in the
quickest time. Well, in China, you can be assured if you are an
American company asserting your rights, you will go into the
Never-Neverland of your case will come up some day.
Efforts continue to include the need to prevent U.S.
engineers with access to specific sensitive AI systems from
sidestepping noncompetes and NDAs by working for Chinese firms.
Ensure the disclosure regimes do not inadvertently reveal
protection by mirroring EU-style regulations. I might say here,
a little off the record, EU, as we speak, is second guessing
their very disclosures. It has not escaped us that the AI Act
of Europe, in fact, was a great step forward and as we speak
many are pushing to take at least a small step backward. With
that, I am delighted to introduce my Ranking Member for his
opening statement.
Mr. Johnson. Thank you, Mr. Chair. One hundred and 17 days
ago, the Chinese company DeepSeek launched its flagship model,
DeepSeek-R1. In the following days and weeks, American experts
wrung their hands and shook their heads, many considering for
the first time the possibility that we may be losing the so-
called AI arms race.
The DeepSeek claims R1 was developed faster and cheaper
than comparable U.S. models. Others argue DeepSeek at a minimum
violated OpenAI's terms of service to obtain proprietary
training data. Where everyone seems to agree is that AI
startups should be innovating faster. I have heard colleagues
suggest we should forget regulations, ignore IP laws and just
focus on clearing the way for AI companies. I agree everyone
wins when we foster American AI startups, but I think it is a
false choice to say we can succeed only if we do so
irresponsibly.
If you walk around the Capitol today you can see plants
sprouting out of the soil beginning to grow. What you will
notice if you look closely is some of those shoots growing in
the shade look like they are growing faster than the others. As
they race for just a little bit of sunlight, yes, they grow
quickly, but ultimately, they grow less hardy, more brittle,
and prone to disease. AI innovation works the same way. As we
seek ways to promote American AI startups, we should also work
to ensure that businesses meet minimum standards for system
cybersecurity. We should ask what types of transparency are
necessary to protect other IP rights and consider how to set
standards while still protecting trade secrets. By encouraging
companies to meet best practices and respect intellectual
property rights, we will foster hardy competition that protects
U.S. innovation from those who seek to undermine our success.
The Government of China has made no secret of its intent to
steal American intellectual property and there is bipartisan
agreement that the United States should protect its innovations
from those who seek to benefit from American ingenuity. There
is also a right way and a wrong way to compete with our
adversaries. While we don't always agree on this Committee, we
have had meaningful discussions on the right to protect
American IP from the Government of China, cybersecurity
standards to keep our people and our institutions safe, and the
threat landscape to AI innovation.
The only trouble, on the other hand, has acted in ways that
hurt American businesses. His ideologically inconsistent and
unpredictable tariffs have hurt American consumers, American
businesses, and our allies. Innovation in America suffers when
the path forward is uncertain. For generations, American
companies have benefited from attracting the best and the
brightest from other Nations, yet, seemingly without reason,
Trump again and again hurts American businesses by attempting
to revoke already granted student visas and threatening the H1B
visa program for highly skilled immigrants.
The deleterious impact of these policies on AI innovation
should not be ignored. According to a recent study, immigrants
founded or cofounded 28 of the top 43 AI companies in the
United States and 70 percent of full-time graduate students in
fields related to artificial intelligence are international
students. Instead of focusing on policies that stand to derail
American innovation, we should focus of upholding our treaties
and respecting our allies. We should encourage our research
institutions to engage with universities around the world. The
breakneck speed of innovation has made it easier than ever to
reach out to people around the world. Now, is not a time for
isolationism because history has shown us that true innovation
thrives on openness. After all, groundbreaking inventions
rarely emerge when knowledge is walled off.
I thank the witnesses for being here today and I yield
back.
Mr. Issa. The gentleman yields back. We now recognize the
Ranking Member of the Full Committee for his opening statement.
Mr. Raskin. Thank you very much, Mr. Chair, and thanks to
the witnesses for joining us. I am happy to participate in a
rare hearing on the important bipartisan work of this
Committee. We don't agree on a lot these days, but the
importance of the U.S. intellectual property regime to American
innovation is indeed a value that we all share. Even with this
agreement in Congress, the Executive Branch has injected
terrible instability into our intellectual property regime.
Innovation depends on stable and predictable rules the
people can rely on to secure their inventions and property
rights, manufacture their products, and attract investors and
consumers to their businesses. Instead of fostering a stable
atmosphere which allows people to innovate, the Trump
Administration has hampered creativity. Since he was
inaugurated, Trump has revoked Federal research grants to
universities where scientists make significant new discoveries
every year. He has tried to take over some universities. He has
tried to cancel student vias. Last time he was President, of
course, he increased the denial for highly skilled immigrants
who work in engineering, computer programming and at research
labs in highly technical fields.
Already in the first quarter of this year, Donald Trump's
trade war against the world, except for Russia, has reduced the
U.S. gross domestic product. It has raised prices for consumers
and it has encouraged businesses to hoard goods. Chaotic
tariffs that change from day to day make it difficult for
businesses to plan ahead and result in them taking fewer risks.
Companies are then less likely to invest in ideas and
innovators are, in turn, less likely to strike out on their
own.
We may never know what inventions, life-saving cures,
world-changing businesses are being sacrificed at the altar of
Donald Trump's helter skelter and lawless tariff agenda. We
should also remember that investors and creators aren't just
big businesses.
The heart of our IP system, our parents tinkering with an
invention at the kitchen table after putting the kids to sleep,
aspiring song writers, waiting tables to pay the bills while
chasing their dreams, and engineering students researching the
next big idea. Yet, now all these people are having a tough
time in Trump's America, a place where hope of that next big
break feels further and further away. Investing in ideas is a
risky proposition, but it is even riskier for the individual
who has to go it alone.
Finally, in most cases intellectual property ownership is
only as good as the ability to enforce that right in court.
Every rights holder should be worried as we watch the all-out
assault on the Judicial Branch unfold. A judicial system that
doesn't work for everyone eventually won't work for anyone and
that includes IP owners. Despite these threats, the U.S. IP
system is still lauded around the world for its ability to spur
innovation and creativity. That is in part because our Founders
chose to promote innovation by protecting the rights of
individual creators. In the Federalist 43, Madison wrote that,
``the utility of this power will scarcely be questioned,'' and
in the case of patents and copyrights, the public good fully
coincides with the claims of individuals. Rewarding individual
discoveries and creations has allowed innovation to flourish.
According to a recent study, the U.S. is home to over half
of the more than 10,000 AI startups across the 10 countries
leading in AI. We should be proud of our AI leadership. We must
also take steps to protect American trade secrets from
competing nations that seek to steal our technology. Some have
referred to the push to develop the most advanced AI model as
the AI arms race. Now, there is nothing wrong with competition
in this sense, but when other countries threaten U.S.
cybersecurity, steal our inventions, and conduct economic
espionage against U.S. companies as the Government of China has
done, that is cause for serious scrutiny. Just because we all
agree AI systems should be secure from foreign threats, does
not obviate the responsibility, of course, that AI platforms
have to other rights holders and to consumers.
Jack Dorsey and Elon Musk both recently made the claim that
we should delete all IP law. I think that we can all
emphatically reject that notion. America's intellectual
property system has not just made us a global leader in AI; its
very foundation created the careers of those two men.
Intellectual property is the engine that powers our economy,
drives innovation, jobs, and growth at every turn for all
inventors, big and small, including Dorsey and Musk. Without a
strong IP system, we risk losing the very spark that has made
us such a leader in global innovation and opportunity.
I look forward to hearing from our witnesses today and I
thank you, Mr. Chair, and yield back.
Mr. Issa. Without objection, all other opening statements
will be included in the record.
It is now my pleasure to introduce our panel of witnesses.
Mr. Nicholas Anderson. Mr. Anderson is President and Chief
Operating Officer of Invictus International Consulting Company
which provides technical services for national security
systems. He previously served as Chief Information Officer for
public sector at Lumen Technologies and served at the
Department of Energy, Office of Management and Budget, and the
Department of the Navy, Coast Guard, and served on active duty
as a United States Marine which I presume means that he has
been to Camp Pendleton in my District. It is a rite of passage.
Dr. Benjamin Jensen. Dr. Jensen is the Director of Future
Labs and a Senior Fellow with the Defense and Security
Department at the Center for Strategic and International
Studies. He is also the Frank E. Petersen Chair for Emerging
Technologies and a Professor of Strategic Studies at the Marine
Corps University--I knew you were asked for a reason--on
Advanced Warfare. Dr. Jensen previously served as Senior
Research Director of the U.S. Cyber Solarium Commission and is
a Reserve Officer in the United States Army. Double dipping.
Mr. Christopher Mohr. Mr. Mohr is President of the Software
Information Industry Association, a collection of
entertainment, consumer, and business software companies. He
previously served as Senior Vice President for Intellectual
Property and General Counsel at that organization and continues
to serve as the Chief Legal Officer for the association.
Ms. Helen Toner. Ms. Toner is the Director of Strategies
and Foundation Research Grants at Georgetown Center for
Security and Emerging Technology. She previously served as
Senior Research Analyst at Open Philanthropy where she advised
policymakers and grantmakers on AI policy and strategy.
Dr. John Villasenor is Professor of Electrical Engineering,
Law, Public Policy, and Management and the facility Codirector
at the Institute for Technology, Law, and Policy at UCLA. The
professor works and his work is focused on technology and law-
related to artificial intelligence, digital communication,
computing, network, cybersecurity, and privacy.
We welcome our witnesses here today and pursuant to the
Committee's rules, I would ask that you all rise to take the
oath and the right hand is always good to use.
Do you solemnly swear or affirm under penalty of perjury
that the testimony you will give will be true and correct to
the best of your knowledge and information?
Please be seated. Let the record reflect that all witnesses
answered in the affirmative.
Another part you have all seen on CSPAN, we would like you
to stay as close as you can to five minutes. The lights on in
front of you will count you down and indicate when you are
close to, and then finally when you hit five minutes. Rest
assured that not only will all your opening statements in their
entirety be included in the record, but additional information
that you provide or that later you provide pursuant to
questions or things which are stimulated by our discussion. You
really get hours and hours, you just get five minutes up front.
Dr. Jensen.
STATEMENT OF BENJAMIN JENSEN
Mr. Jensen. Thank you, Chair, Ranking Member Johnson, and
the Members of the Subcommittee. Before I start, I view my job
here today to really help frame a larger conversation. That
conversation really is about the defining competition of the
21st century and that is the race to shape what we are starting
to call agentic AI. When I say agentic AI, I am not just
talking about everybody playing with an LLM here or there or
narrow imagery recognition. I am talking about the next level
where all these applications start to work together and they
start to generate actual knowledge, influence our decisions,
and even help us manage complex tasks at scale. Frankly,
whoever leads this agentic AI race is going to shape the rules
of the future international order and I am not being
hyperbolic. I sincerely mean that. If you talk about the
efficiencies, the economic growth, the changing questions of
governance, we are literally at the historical inflection point
which made it so good to hear you bring in the Federalist
Papers because we almost have to really think at that level
about these tasks.
The stakes could not be clearer. This is not just about AI
as a tool of human flourishing or who makes more money or who
makes a better poem with an app. This is really about whether
or not this is going to be a mechanism for authoritarian
control or a way to really embody and propagate the best
traditions and values on which our Republic was founded. I
really mean it about the stakes. Frankly, while America has
been the leader of this, the pioneer, and you can go back to
the invention of the term artificial intelligence at Dartmouth,
all the early engineering from Cornell to other universities,
as you point out, this kind of basic research plus the beauty
of capitalism working together. Frankly, that is under assault.
The People's Republic of China is exploiting our economy and
our innovation ecosystem. Beijing is basically conducting a
coordinated strategy that siphons off intellectual property,
circumvents export controls, and exploits legal gaps with
State-directed theft and replication, Chair, what you have
accurately characterized as weaponizing our legal system
against us.
For at least today I want to talk about three ways the
strategy unfolds, some technical, some more general. First,
through knowledge distillation and what is called unbounded
consumption attacks, Chinese firms replicated U.S. foundation
models, so think OpenAI's ChatGPT, at a fraction, a fraction of
the cost, not talking $1 billion to develop a model, we are
talking millions of dollars. A significant economic difference.
Essentially what they did is they harvested the outputs of
American models, definitely without permission, and used them
to build their own versions like DeepSeek. Bluntly, this is not
innovative. This is intellectual looting.
Second, through State sponsored cyber espionage, Chinese
APT, Advanced Persistent Threat, groups like Salt Typhoon and
others target everything from our cloud infrastructure to
semiconductors. Increasingly, this isn't just random smash-and-
grab hacking. It is a calculated campaign to steal what free
societies and free people create.
Third, despite export controls, China continues to access
critical chips and software. Export controls have utterly been
futile up to this point and really make us have to rethink what
is our defensive play book and what is our offensive play book.
Through loopholes, third party countries and subsidies,
they keep advancing while American firms face regulatory
burdens and shrinking market access. In short, the current
approach is not enough. Export controls and AI diffusion policy
do more economic harm than good. As you pointed out,
Representative Johnson, we really have to protect the smaller
innovators. How are we going to balance that?
If the Chinese Communist Party and its network of little
giants and firms with parties the State control are using this
playbook of steal, copy, accelerate, what do we do? Well, first
America is never powerless. We at the time that we act
decisively and we preserve our AI leadership, and I think there
are three things that we can discuss along those lines.
First, we modernize intellectual property laws, and that we
have amazing experts to talk to you about that. We need to
address techniques like knowledge distillation and API abuse.
We need to basically coordinate globally so it is not just in
U.S. courts, it is other free society courts where we can bring
this to bear. We even start to imagine--I love that you brought
up again Federalist 43 , what would that look like written in
2025? What would that look like if a legal scholar, using an
LLM wrote it as a basis for us to start this conversation about
what are property laws?
Second, we may need to start treating AI companies like
critical infrastructure. Their products support national
security, economic competitiveness, and global influence and
those designations mean that you can work across jurisdiction
with other Subcommittees and other Committees to start to think
about tax credits and other incentives that get you what you
were talking about. How do you defend their IP?
I will close with saying we go on the offense. Lawsuits
alone will not deter coordinated State-backed theft campaigns,
so we have to prioritize the type of intelligence collection
that can be declassified and turned into legally admissible
information that can use to hold China accountable in multiple
courts. Frankly, even consider the type of offensive cyber
action that makes them think twice about stealing from America.
In closing, this is way more than about company profits. It
is about free societies and nonauthoritarian regimes, assuming
leadership of the coming AI century. I thank you for your time
and I welcome your questions in the comment period.
[The prepared statement of Mr. Jensen follows:]
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Mr. Issa. Thank you. Dr. Villasenor.
STATEMENT OF JOHN VILLASENOR
Mr. Villasenor. Chair Issa, Ranking Member Johnson--
Mr. Issa. Now, the little button in front when it turns
red, it is a good sign.
Mr. Villasenor. Chair Issa, Ranking Member Johnson, Ranking
Member Raskin, and the Members of the Subcommittee, thank you
very much for the opportunity to testify here today. I should
mention at the outset that I am testifying in my own individual
capacity, and I am not representing any organization.
America is the clear global leader in AI, a technology that
is foundational to our continued economic prosperity and
national security. The competitive differentiation that is so
instrumental to the success of the U.S. AI industry is
vulnerable in several ways.
First, precisely because American AI companies are so
innovated and market leading, they are ripe targets for trade
secret theft.
Second, policy discussions regarding AI regulation here in
the United States often give insufficient consideration to the
potential collateral damage to trade secret threats. Given the
enormous attention to generative AI products such as ChatGPT,
it is important to keep in mind that AI is much than generative
AI. The recent advances in other areas of AI are equally
impressive. For instance, AI is revolutionizing drug discovery.
AI is also at the core of algorithms that enable autonomous
vehicles to navigate complex city streets. Collaborations
between humans and AI are promising to bring improvements to
medical image interpretation. AI can extend the human capacity
to create new inventions and will revolutionize logistics,
weather forecasting and many other fields. AI is critical to
ensuring strong national defense.
Overly expansive transparency rules would undermine AI
leadership. Exhibit A for that would be, for example, the now-
revoked Executive Order issued in October 2023, which would
have required some AI companies to file with the Government
information about the physical and cybersecurity measures used
to protect their model weights. Clearly, if the Government were
to maintain databases like that, those databases would become
essentially a target list for cyber espionage, armed with the
information hacked from those databases and those databases
would get hacked, then State-sponsored actors could more easily
enter the systems of leading AI companies.
There are novel trade secret issues arising from the
adaptive nature and complexity of AI systems. Because AI
systems learn from their environment, they can operate in ways
that can be elusive even to their designers. This creates some
really important and interesting questions.
First, can CRADAs of AI systems have trade secret rights in
algorithms they do not understand? I believe that the answer to
this question is yes. Suppose that a company builds an AI
system that through adaptation has evolved to the point where
an algorithm it is executing is quite different from the one
initially envisioned and programmed by its employees. After the
adaptation process, the company employees no longer know how
the algorithm works, but they do know that it works extremely
well for its intended purpose. Does this algorithm qualify as a
trade secret owned by the company, even though no human knows
what it is? In my view it does.
Second, how can plaintiffs assert misappropriation of trade
secrets they don't know? Well, the answer that asserting trade
secret rights in an algorithm will require describing it which
requires plaintiffs to learn it. It will not be sufficient for
plaintiffs to State in effect we are not sure how our AI works,
but whatever it is doing, it is our trade secret and the
defendant has misappropriated it. Rather, plaintiffs will need
to provide enough detail for a court and a defendant to know
which specific trade secret is at issue.
I would also like to briefly mention the global context.
The preeminence of American AI companies creates an asymmetry.
Policy makers outside the U.S. may have less concern than their
U.S. counterparts about the collateral damage to trade secrets
resulting from AI regulations. They will have little incentive
to regulate in a manner that preserves the competitive
advantage of U.S. AI companies.
Finally, I would like to briefly comment on AI regulation
more generally. In the past several years, there has been a
steady drumbeat of calls to aggressively regulate AI. Sometimes
this is motivated by the premise which I disagree with that AI
is an existential threat to humanity. Sometimes it is motivated
by the view which I also disagree that the best way for
Government to respond to AI is by subjecting it to an extensive
new regulatory regime and that slowing AI down so that it can
progress only as fast as policymakers allow. If adopted in the
U.S. this approach would directly undermine American AI
leadership as there are countries, including geopolitical
rivals, that will certainly avoid adopting policies centered on
the goal of impeding AI development.
It is also important to keep in mind that there is already
a thicket of non-AI specific law and regulation that will apply
to AI. For example, the use of a discriminatory AI system to
make home loan decisions would already be unlawful under the
Fair Housing Act.
In closing, I would like to thank the Members of the
Subcom-
mittee for the opportunity to participate in today's hearing
and I look forward to your questions.
[The prepared statement of Mr. Villasenor follows:]
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Mr. Issa. Thank you. Mr. Mohr.
STATEMENT OF CHRISTOPHER A. MOHR
Mr. Mohr. Mr. Chair, Ranking Member Johnson, Ranking Member
Raskin, and the Members of the Committee, on behalf of SIIA and
its members, thank you for this opportunity to share our views.
The SIIA represents over 350 companies in the business of
information. Our members range from startups to some of the
largest and most recognizable corporations in the world. For
over 40 years, we have advocated for the health of the
information life cycle, advancing favorable conditions for its
creation, dissemination, and productive use. Our members create
educational software, search engines, e-commerce platforms,
legal research and financial databases, and a variety of other
products that people depend on in their day-to-day lives. We
are the place where information and technology meet and
occasionally collide.
The SIIA was founded on the premise of respect for
intellectual property rights, especially around software. For
decades, we helped our members enforce their copyrights against
infringers, something we still do. Today, our members are
building AI into many of their products and services. They
actively use it in their media operations, in the classroom, in
fraud detection, in market data, money laundering
investigations, and in locating missing children. They have
invested billions in its development, acquisition, and use.
They also have intellectual property rights undergirding that
investment including patent, copyright, and trade secret
rights.
As both software and information become increasingly sold
as services, the threat from IP theft has evolved. The most
valuable part of technology may not be in simply copying and
using it, although that is certainly a threat, but in figuring
out how it works. Our members welcome competition within the
bounds of legal rules. The problem is that not everybody
follows them.
From the very first days of the adoption of the TRIPS
Agreement in 1994, our members have had problems with State
sanctioned IP theft by the PRC. Now, the PRC has stated that it
wishes to leave the world in AI by 2030 and reduce reliance on
foreign technology. It intends to leverage the communist system
and achieve that leadership in key areas including smart
devices and speech recognition, image and video recognition,
and financial services to name just a few. Unfortunately, for
us and to mix metaphors a bit, the dragon has not changed its
stripes. It is actively involved in the theft of trade secrets
in several ways, from the use of insider threats to cyber-
attacks to forced technology transfer to investment in U.S.
startups, the conditioning market access under divulging and
proprietary information.
Legal rights are not the problem. Congress has adopted
substantive rights governing trade secrets in the United States
and a global framework to respect those rights. What is lacking
is it means to sufficiently incentivize the Chinese Government
to abide by those protections or to provide means to enforce
those protections. While there is no perfect solution, Congress
has tools that it can and should develop to further protect
American AI development from foreign theft and possibly
sabotage. We would suggest four areas for congressional
attention.
The first is cybersecurity, building and updating
infrastructure to keep up with emerging and evolving threats is
a constant project. Large companies have cutting-edge systems
that they can use to protect their products and users. Smaller
businesses lack such resources. The Government should continue
to explore ways to help them.
Second, Congress should ensure that the Committee for
Foreign Investment, or CFIUS, continues to serve as an
effective way to address trade secret risk by making sure that
its scope of review remains adequate to address those risks.
Third, Congress should assist the administration in working
with our allies and partners to build AI infrastructure on
trusted providers, adoption of Huawei and other PRC-located
providers creates an unreasonable potential for trade secret
theft.
Finally, while the legal framework for protecting trade
secrets is well developed, an emerging area of concern involves
the exploitation of the U.S. legal system to gain unauthorized
access to trade secret information through third party
litigation funding of patent disputes by sovereign wealth
entities. The landscape around AI and intellectual property is
constantly evolving and as technology continues to advance, new
threats will emerge. That pattern is unlikely to stop any time
soon and we commend the Subcommittee for continuing to monitor
these issues and engage industry.
Thank you for your consideration of our views and I am
happy to answer any questions.
[The prepared statement of Mr. Mohr follows:]
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Mr. Issa. Thank you. Ms. Toner.
STATEMENT OF HELEN TONER
Ms. Toner. Chair, Ranking Member Johnson, Ranking Member
Raskin, and the Members of the Subcommittee, thank you for the
opportunity to testify.
My name is Helen Toner and I'm part of the founding team at
CSET, the Center for Security and Emerging Technology at
Georgetown, where for the past six years I've focused on AI and
national security, U.S.-China competition over AI, and AI
safety and security issues, more broadly.
It's a cliche that AI is hard to govern because the
technology is moving so fast, but there's one important thing
about AI that is actually quite predictable: It's only getting
more capable, more powerful, and more strategically critical.
This is especially true of what gets called frontier AI
systems, which are the focus of my testimony. Frontier AI is a
term for the most cutting-edge general purpose AI systems, like
Google's Gemini 2.5, OpenAI's o3, or Anthropic's Claude 3.7.
The companies at the AI frontier are actively working to
build so-called artificial general intelligence, or AGI, which,
roughly, means AI that is as smart as a human, or even to build
super intelligence, which is AI far more capable than a human.
The CEOs of these companies claim that they'll get this far
within the next 2-5 years. It is not just marketing hype; many
top researchers agree.
Even if 2-5 years is overly optimistic, the possibility
that major tech companies could build human-level AI anytime in
the foreseeable future should galvanize us to take action now.
What action?
If we agree that AI is of strategic importance is already
high and will only grow from here, I want to note two vital
national security interests that follow from that.
First, for the topic of this hearing, the U.S. Government
has a critical national security interest in protecting the
trade secrets and IP of leading U.S. AI companies.
Second, there's also a critical national security interest
in understanding and monitoring the development of frontier AI
as it moves toward AGI and even super intelligence.
The most important point I want to make today is that these
two critical priorities--security and transparency--do not need
to be in tension with one another. We can pursue both in
parallel.
My written testimony lays out the kinds of trade secrets
that are most important to protect, primarily AI models
themselves, as well as the algorithmic secrets used to create
them, and datasets, and hard regulated IP as well.
I also lay out the areas where we most need transparency.
These are things like testing for capabilities and risks of new
systems; the goals that AI models are trained to pursue; safety
and security risk management practices within the frontier AI;
data on their internal use of AI, and whistleblower protections
for their employees.
Notice that there's not much overlap between the things we
most need to keep secure and the things that we most need to
bring into the sunlight. Where overlap does exist, we have
options. Information can be shared with governments via secure
channels, or it could be shared only with third-party
independent auditors who work under NDA inside companies' own
facilities.
I would make the following five recommendations to this
Subcommittee and to Congress:
First, fund and expand security collaborations between the
U.S. Government and frontier AI companies. There are several
small-scale voluntary programs that have recently been started,
including threat intelligence-sharing with the intelligence
community and voluntary testing for capabilities that are
relevant to national security. These initiatives are highly
valuable and should be strengthened and expanded.
Second, on transparency, you can use existing authorities
or create new ones to increase visibility into the most
advanced AI systems being built by frontier companies. Many of
these companies have already made voluntary commitments to
share safety and security information. So, Congress can ask
them about how those commitments are going and make sure
they're fulfilling them reliably. There are also existing
authorities that the government can use to compel disclosure,
if necessary. New legislation could enshrine transparency
requirements targeted for AI or create whistleblower
protections for AI company employees.
Third, invest in the technologies and infrastructure that
we need to ensure that strategically critical AI systems of the
future stay secure. This could include R&D funding, public-
private partnerships, or demonstration projects that push
forward things like secure-by-design hardware or highly secure
data centers.
Fourth, consider giving companies permission to prioritize
security in ways that are currently legally fraught. One
example here is creating safe harbor from antitrust concerns,
specifically, for collaboration on safety and security issues.
Another possibility would be to enact legislation that makes it
easier for AI companies to engage in intensive personnel
vetting and monitoring to reduce insider threats.
Fifth, in your interactions with AI companies, press them
on what their cybersecurity practices look like and how they're
working to improve. Use your bully pulpit to impress on them
that this is a critical question of U.S. security and
competitiveness. The United States cannot lead if adversaries
have easy access to our best technology.
Thank you and I look forward to your questions.
[The prepared statement of Ms. Toner follows:]
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Mr. Issa. Thank you. Mr. Andersen.
STATEMENT OF NICHOLAS ANDERSEN
Mr. Andersen. Mr. Chair, Ranking Member Johnson, Ranking
Member Raskin, and the Members of the Subcommittee, thank you
for the opportunity to testify today.
My name is Nick Andersen. I've served in senior
cybersecurity leadership roles in the previous Trump
Administration, including as the Principal Deputy Assistant
Secretary and performing the duties of the Assistant Secretary
for Cybersecurity, Energy Security, and Emergency Response at
the Department of Energy. I've also served in White House--I
was a White House cyber official, a State Chief Information
Security Officer, and a Chief Information Officer in the
intelligence community.
All that is to say I am not before you today as someone who
can intensive IP legal analysis, but as a national security and
cybersecurity professional who spent nearly two decades
defending this country, often against the adversaries who are
now racing to dominate the future of AI.
The Chief among them is the Chinese Communist Party. Almost
as a mirror image, as we sit here, just last week Xi Jinping
presided over a Politburo study session on AI. Let me be clear:
The People's Republic of China does not simply seek to compete
with us; it seeks to overtake us. In doing so, it's not going
to be through fair market competition. It's going to be doing
so through theft, deception, and the systematic targeting of
America's innovation base. The tactics used by the Chinese
intelligence services and the State-backed actors include cyber
intrusions, insider recruitment, deceptive investment
strategies, and the use of academic partnerships as cover for
espionage.
This is not speculative. It is confirmed through multiple
indictments by the Department of Justice and ongoing
intelligence assessments from the Office of the Director of
National Intelligence.
The AI community, particularly companies building dual-use
technologies, have become a top target. Yet, our national
defenses remain inconsistent. We do not require minimum
security baselines for companies building next-generation
models. We do not vet outbound investments that may expose
sensitive technology. We do not hold venture capital or private
equity firms accountable for facilitating access to strategic
industries by foreign adversaries. This must change.
I support efforts to codify these outbound investment
screenings, strengthen cyber requirements for federally funded
tech firms, and require public disclosures when there's foreign
ownership or influence in American AI companies.
This is not about isolationism; it's about discipline,
strategic clarity, and the courage to act before it's too late.
During our previous years in the last administration, we took
bold steps to harden our infrastructure and disrupt adversary
operations. This results-driven approach, including offensive
cyber operations, must be returned.
I believe we have 2-5 years to close the most dangerous
gaps. Beyond that, we risk losing our technological and
strategic edge-possibly for good. AI is not just an economic
issue; it's a national security issue and we must treat it
accordingly.
Thank you for the opportunity to speak today and I look
forward to your questions.
[The prepared statement of Mr. Andersen follows:]
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Mr. Issa. Thank you.
We will now go back and forth between the majority and
minority, beginning with the gentleman from Wisconsin.
Mr. Fitzgerald. Thank you, Mr. Chair.
Mr. Andersen, AI's infrastructure is not currently treated
or identified as critical infrastructure for cybersecurity
purposes. Should we rethink whether AI is actually critical
infrastructure, and if so, what would that mean from a
cybersecurity standpoint?
Mr. Andersen. Thank you for your question.
The short answer is yes. The longer answer is we have lots
of technologies that we previously considered critical
infrastructure designations, things like cloud computing and
artificial intelligence companies that were previously not
considered to be critical infrastructure. Doing so today would
give us an opportunity to examine minimum cybersecurity
requirements; would bring them into the fold for larger
strategic planning, and lash them up with communities like
DHS's CISA, the Cybersecurity and Information--excuse me--the
Cybersecurity and Infrastructure Security Agency, to be able to
engage in information-sharing operations. These types of things
would help to underpin greater security in these critical
infrastructure industries.
Mr. Fitzgerald. Very good. Thank you.
Mr. Mohr, the stakeholders raised concerns about
difficulties in protecting trade secrets during litigation.
What is the standard process for protecting trade secrets in
court cases, specifically?
Mr. Mohr. Well, typically, what happens is that there is a
protective order, in other words, when the accused party has a
right to defend themselves and they have a right to know, OK,
what are they being accused of stealing? So, if it is a trade
secret and it leaks out, for example, on a court docket, then
the secrecy is gone and it's no longer valuable.
So, what the judge will do is balance a number of factors,
and typically, write an order that restricts access to the
trade secret and makes sure that the information doesn't leak
out into the public domain.
Mr. Fitzgerald. Right. So, if the risk of trade secret
leakage increases as the use of third-party litigation funding
continues, especially like a patent case or other technology,
what would be kind of the scope of the requirements in and
around that?
Mr. Mohr. Well, it--
Mr. Fitzgerald. How do you protect yourself?
Mr. Mohr. Well, the scope is really left to the discretion
of the trial judge. From our point of view, the more
information the trial judge has, the better an order that the
judge is going to be able to write.
So, for example, suppose you knew that one of the parties--
let's take this: It's a third-party litigation-funded lawsuit.
It is a party that is funded by the Chinese government. If
you're the judge and you're crafting a protective order in that
case, you would write a pretty--you'd probably write a much
more severe one than if you thought it was just a couple of
local dry cleaners fighting over a formula. That protective
order might be very, very different.
You might have, for example, personal liability for the
attorneys, which has a way of focusing the mind, if any of the
information were to leak out. There's a number of things. The
judge can put protocols into how, in terms of how the
information is used; how it's stored; under what circumstances;
and who can see it, and how that access is logged, among other
things.
Mr. Fitzgerald. Very good. Thank you.
Dr. Villasenor, why is trade secret protection important to
AI development compared to just any other type of IP
protection? I guess, specifically, many of us heard testimony
this morning, between the United States and China as well. Why
is that? Why is it important?
Mr. Villasenor. Well, trade secrets are important across
the spectrum of industries, but they are absolutely critical to
AI. Because even in the case of--you might have heard these
systems that are described as open systems, the open AI
systems. There are still enormous amounts of trade secrets that
go into that.
In other words, if somebody releases the model weights, for
example, as open, they wouldn't necessarily release how they
trained those model weights and what the training aid that was
used. They're not going to often release the source code.
There's an enormous amount of trade secrets in AI, just
like there are in other areas as well, but with AI, it's
particularly complex, just because of the sheer size and
magnitude of these systems is so large, that there's just more
opportunity to build an incredible amount of trade secrets.
Without trade secrets, we do not have the ability to
maintain our AI leadership. That's what the investment is going
into and that's what the companies are being valued for.
Mr. Fitzgerald. I'm guessing, because China is so secretive
in the way they have, the way they view this, that it makes it
even more difficult when it comes to, specifically, seeing
exactly what they're up to, is that correct?
Mr. Villasenor. Well, the open system that we have here,
where companies make their own choices about what to reveal and
what to keep secret, is incredibly powerful. The proof is in
the pudding. We are, unquestionably, the country with the
leading AI ecosystem, and I don't think that's an accident.
Mr. Fitzgerald. Thank you, Chair. I yield back.
Mr. Issa. I thank the gentleman.
We now recognize the Ranking Member of the Subcommittee,
the gentleman from Georgia, for his opening--his questioning.
Mr. Johnson. Thank you, Mr. Chair.
Ms. Toner, the prospect of ceding American technological
leadership to China is often used as an argument against
implementing regulations of any kind on AI. Do you agree with
that approach?
Ms. Toner. No, I do not believe that we should say that the
need to beat China necessarily means that we cannot regulate AI
ourselves for several reasons.
The first and most important reason is that regulation does
not actually need to slow down our industry whatsoever. Well-
designed regulation can actually even support industry. So, AI
is an industry where there are huge problems with consumer
trust right now. There's been some data showing that products
that list that involve AI will actually be trusted less by
consumers, because consumers are used to experiencing these
hallucinations and reliability issues that we have with AI.
So, I think there are ways in which, if you can use
regulation to build consumer trust by making them know that
they're going to be interacting with high quality products, and
likewise, know that they are going to have recourse if
something goes wrong; know that they are not just out there on
their own, that actually can be very industry-boosting.
So, that would be a primary reason that this is not a good
argument. People making this argument that we can't regulate
because we might then lose to China, also tend to neglect the
pretty hefty regulations that China is enacting on its own AI
ecosystem, and also, sometimes overestimate the quality of the
training of the AI ecosystem, which is certainly competitive
with the U.S., but not poised to overtake and run far away from
us anytime soon.
So, no, it's really important to protect our citizens, to
uphold our democratic institutions and way of life, and also,
to support the industry itself that we put in place--smart
guardrails.
Mr. Johnson. Uh-hum. What makes you so confident that China
is not poised to overtake the United States in AI development?
What are some of the ways that regulations can hurt the pace of
innovation in America, AI innovation in America?
Ms. Toner. Sure. I'll take the questions in reverse order.
I think AI is a rapidly developing technology. If we were
to go ahead and try and create regulations that were sort of a
checklist of, if you're building AI, you have to do these 12
steps that a government committee came up with, and then, they
don't get changed and they don't get adapted. They're not
responsive to specific cases.
Regulations that really are very prescriptive and limit
what companies can do or force them to use procedures that
would not be competitive, that would not be productive. So, we
should not be going that route.
There are many other kinds of approaches. So, for example,
looking at transparency and disclosure, that doesn't need to
force you to build your systems in any particular way; simply
share information about what you're doing.
To your first question about Chinese competitiveness, this
may be an area where I differ a little from some of the other
witnesses present today. Honestly, the biggest advantage that
the U.S. has right now is our access to compute, so
computational power and advanced AI chips.
The export controls, while they have been imperfectly
applied and imperfectly enforced, they have been a huge
success, or at least have the signs of being a huge success, if
we carry out--if we continue to enforce them and keep them in
place.
One example of a signal for this is that the CEO of
DeepSeek has made very clear that access to compute is the
biggest limitation for him. So, the way that they were able to
train the system that made such a splash was using a large
number of chips that they imported in the gap between an
October 2022 set of export controls, and then, they bought a
bunch of chips throughout 2023. Then, in 2023, those chips were
also restricted. So, they are now no longer able to buy the
kind of chips that they used to train that system.
So, the way that the export controls work is not just a
matter of a few of them get slipped through? It's really a
question of the volumes that we are able to produce outside of
China.
We need to also be looking at the semiconductor
manufacturing equipment. That's a huge piece that often gets
neglected. So, this is not just preventing of the chips
themselves, but preventing the machines, the exquisite, very
expensive machines that are produced in a very small number of
countries that are U.S. allies. Preventing those--actually,
enforcing the protections on those would also help protect the
U.S. advantage.
So, I'm happy to have a longer conversation about the
export controls but I think that is a huge advantage right now.
Mr. Johnson. Thank you. Dr. Villasenor, would you agree
that not only AI transparency obligations implicate trade
secrets?
Mr. Villasenor. Yes. That's, that's true. There would be
some that would not, but many would, and some that don't.
Mr. Johnson. Is there a way to craft policies such that the
disclosure requirements necessary for transparency can avoid
touching on trade secrets?
Mr. Villasenor. In general, it is possible, but it probably
depends on the sector. AI spans all these sectors. So, the
answer can be different depending on the specific sector.
Mr. Johnson. Thank you. I'm out of time. I yield back.
Mr. Issa. The gentleman yields back.
We now go to the gentleman from Kentucky for his
questioning.
Mr. Massie. Thank you, Mr. Chair.
Which of the witnesses is proposing that the government
should take some kind of action? Raise your hand.
[Show of hands.]
Mr. Massie. OK. Ms. Toner, what is, what is the action that
you think the government needs to take?
Ms. Toner. So, I have several suggestions. Perhaps a top
priority would be to expand the current voluntary
collaborations that are being undertaken between national
security parts of the U.S. Government and the U.S.'s leading AI
companies.
So, there's some early efforts right now. They include
threat intelligence-sharing with the intelligence community.
So, they are working hand-in-hand, in similar ways to how they
do with critical infrastructure providers or our Defense
Industrial Base, to ensure that, when there are incoming
threats--and we do have State-based actors trying to infiltrate
our U.S. companies--they are trying to find unclassified ways
to ensure that the companies are aware and can prevent those
threats and defend against them.
There's also very valuable collaborative testing going on--
Mr. Massie. Which direction is most important: The
government sharing information with the companies or the
companies sharing information with the government?
Ms. Toner. They're both very important. Perhaps if I had to
pick one, I'd say the government sharing information with the
companies, but there has also been valuable threat reporting
from the companies as well.
There's also been within the Department of Commerce a
dedicated institute, the AI Safety Institute, that has been,
again, on a voluntary basis, working with some of these leading
companies to test their new, most advanced systems. So, these
are systems where the companies themselves say, ``We think they
might soon be able to aid in the creation of bioweapons.'' They
might soon be able to help not very sophisticated hackers hack
into U.S. critical infrastructure. They might pose other
threats. There are ways in which having access to classified
information and classified expertise allows the government to
actually help those companies do tests that they want to be
doing anyway.
Mr. Massie. Do you think the collaboration should be
compulsory?
Ms. Toner. No, most likely not. It should certainly be
resourced, authorized, and expanded.
Mr. Massie. Dr. Jensen?
Mr. Jensen. I guess you were seeing in my eyes I'm more of
the small government guy.
We are seeing broad agreement on a number of things.
Mr. Massie. You did raise your hand.
Mr. Jensen. I did a little tipsy-tipsy.
Mr. Massie. OK. Yes.
Mr. Jensen. We do have--
Mr. Massie. Which concerns me.
[Laughter.]
Mr. Jensen. Well, but--
Mr. Massie. Just kidding.
Mr. Jensen. We'll settle it over--
Mr. Massie. I'm interested in your answer.
Mr. Jensen. Yes. So, I would say this: You have broad
agreement about the need to provide cybersecurity. Now, whether
that's an incentive from the government, and then, there's some
minimum viable standard that industry is held to, or whether
there's more of a government can reach in and monitor
everything from the employees to the company, to push someone--
what becomes voluntary sharing becomes ``voluntold'' sharing.
So, I would tend to think we agree on quite a bit here, but
let's talk about that split difference. Because showing our
differences is important for you all as a Committee.
I would say I tend to think that smaller, lesser government
is what's important, because that's what actually allowed these
companies to grow, these companies to thrive.
Now, we have to balance that against that you have a large
predatory communist State that is directly targeting them. So,
there's a question of, what is the Federal Government's
national security obligation to protect U.S. persons and
companies versus not overreaching with regulation to have them
spending the marginal dollar to hire attorneys or to invest in
some system that they're not spending in the lab trying to
develop a new edge to the frontier model or some new component?
That is a really hard balance to strike. I don't envy your
job, but I'm glad you're all going to do it. Because it means
the basic protections, that even the Federalist Papers we're
talking about. It means thinking about, what does it looks like
to declassify sensitive intelligence information, where we
document this, so that it's admissible in our courts, or in
courts in other free societies?
So, what you're seeing is we broadly agree on the need to
help companies help themselves with cybersecurity. We broadly
agree that the Federal Government has a role. We might disagree
with the extent of that role. Then, we also agree that these
companies really are going to define our economic growth and
prosperity into the coming century.
Mr. Massie. I have another question. Probably, Dr.
Villasenor, you might be the one to answer this. Are AI
companies looking to use trade secrets because patents aren't
necessarily conducive to protecting their Indo-Pacific?
Mr. Villasenor. Well, it's a great question. There is a
subset of innovations that could be protected either as trade
secrets or patents, but trade secrets have a far broader scope.
They can protect far more. There are plenty of things that are
protectable by trade secrets. For example, long lists of files
of source code; you can't just get a patent on a million lines
of source code. That source code is certainly a trade secret.
There's an enormous amount of intellectual property that is
not protectable as a patent, but that is, nonetheless, vital to
the value and value proposition and differentiation of the
company.
Mr. Massie. Isn't the biggest trade secret risk here is
somebody just comes in and hires the employees?
Mr. Villasenor. Well, I would hope that employees would
respect their confidentiality obligations. It is certainly the
case that we have had problems--there have been problems like
that. That's one risk. There's hacking. There are many risks to
trade secrets.
Mr. Massie. Thank you.
Thank you, Mr. Chair. I yield back.
Mr. Issa. Thank you.
We now go to the Ranking Member of the Full Committee, Mr.
Raskin, for his questions.
Mr. Raskin. Thanks, Mr. Chair.
Continuing with you, Dr. Villasenor, many of the AI models
incorporate open-source code, coding that's publicly available,
into their models. How does this affect their ability to assert
a trade secret claim?
Mr. Villasenor. Well, it's a very good question. It depends
in part on how they've incorporated these open-source sources,
for example. It is certainly possible to have a system that has
some component that was based on open source, but that also has
a lot of intellectual property that's created independent of
that, and there were be trade secret value in that and, for
example, in how they integrate that with open source
information.
So, I wouldn't conclude, or I wouldn't believe that the
presence or the use of open source would eviscerate trade
secret rights for the companies that use it.
Mr. Raskin. All right. Dr. Jensen, do you agree with that
you can still maintain some kind of trade secret, some
actionable trade secret claim, even if you've been using open-
source code as part of your programming?
Mr. Jensen. It's hard, and this is why, again, I want to
stress that idea of going on with the offense. This is where it
definitely gets outside the jurisdiction of this Committee and
gets really into what's the rights of the Executive.
You are going to have to find ways to potentially sabotage
the most malicious offenders that you identify as linked to a
foreign government going after you. Because you can protect it,
he's right, with a larger trade secret, then, it becomes only a
matter of time before they put the pieces together.
If you have someone engaged in industrial-size, like
generation-defining theft, you can't trust that person. So,
where is the balance there of how you actually take other
measures that are, again, outside this jurisdiction to start to
hold those companies--countries accountable, and then,
undermine it? That's the only way I think it's going to work.
Mr. Raskin. OK. Ms. Toner, you've advocated for
transparency requirements for developers of high-stakes AI
systems, including transparency for training data, capability
testing, safety testing, risk management, safety cases, and so
on. What does transparency mean in this context? What is its
purpose in these different areas?
Ms. Toner. It's a great question. I would just clarify I
would not necessarily advocate for transparency over training
data, but the rest of the items that you listed, certainly.
There's different purposes and different forms it can take.
The simplest form of transparency is transparency to the
public. This has a very broad range of benefits. It means that
it's already transparent to governments, because governments
can access anything that is public, but it also lets a broader
set of academics, experts, employees of companies who might be
affected--it just really empowers the public to understand the
stakes of this technology and how the technology is changing
over time, which I think is important, given that it is going
to affect all our lives very profoundly and perhaps in sudden
and unexpected ways.
A different kind of transparency is transparency to
government. So, there's some information that maybe is not
suited to be public. Maybe we want to keep them protected.
Mr. Raskin. Uh-hum.
Ms. Toner. That could particularly be relevant for national
security-relevant information. So, for example, a big area of
concern right now is the potential cybersecurity capabilities
of the most advanced models, whether they're going to make
critical infrastructure systems more vulnerable than they have
been in the past. Maybe that's not something that we want
disclosed publicly immediately, but it is an area where
partnership with government makes sense.
A third form of transparency, which is maybe transparency,
is not quite the right word, but it's important to also think
about the ability to bring in independent third parties into
these companies and provide independent oversight or
independent verification of some high-stake claims they're
making. So, if they are saying that they are running certain
kinds of tests, that they're performing certain kinds of safety
protocols, can you bring in a third party under an NDA to work
inside the company's own facilities? That might allow you to
get a little bit of additional independent verification, so
you're not just taking the company's word for everything for
these high-stake claims they're making.
Mr. Raskin. Great. Thank you.
Dr. Jensen, The Washington Post reported that tech
companies, or some tech companies are telling their employees
on visas not to leave the United States, out of concern that
they won't be readmitted to the country or they could be
stopped at the border. Visa holders are, obviously, running a
lot of tech companies. They're working at startups. They're key
in the field. Seventy percent of graduate students in AI-
related fields are believed to be international students.
So, if the Trump Administration begins to deny H-1B visas,
as he did in the first term, what will the consequences be on
American AI innovation and on these businesses?
Mr. Jensen. Well, I'll start with this combat veteran. It
will cut my lab in half. Literally, the three people I employ,
I would cut it to four people, counting me, total--I would lose
two of them. I'm a microcosm compared to the size and scale of
how those could ripple through the American ecosystem.
That doesn't mean that we don't have the right, and the
Executive doesn't have the right to determine how best we seal
our borders and determine very complex immigration questions,
but we have to have a really hard conversation, as a Nation,
about what really is the major competition of the 21st century.
If it truly is AI, and AI becomes the focal point of grand
strategy, that means immigration discussions have to be taken
as part of that, and we're going to have to find some areas of
bipartisan agreement or compromise. Then, we're going to have
to really double-down in investment in STEM education, which is
going to even take longer, and we have to figure out how it
works.
Now, I'd just say one note quick about transparency to
double-down. There's a really interesting point of
transparency. So, in my lab, we do benchmarking. You're going
to need almost a Tocquevillian civil society function where,
whether it just naturally happens or it's incentivized by the
people's house, independent groups--not government, not
business--come together and hold company models accountable.
So, in our case, we actually do the hard work to say, when
a DeepSeek or a Gemini responds with escalatory responses on a
dataset trained on standard international relations and foreign
policy decisionmaking, that's just one example.
So, it's not just transparency in the ways we've discussed.
It's also let's get creative and think about all American
society, and what are the ways civil society can be
incentivized to organize organically from below and provide
checks on us? Because I don't think benchmarking can just be
the government; that will lead to overreach. It can't just be
companies because that will lead to kind of skirting claims.
There's just--there's perverse incentives for either the
government or just firms. So, transparency needs to also
include civil society and us thinking about, what does that
benchmarking look like, conducted through voluntary American
associations?
Mr. Raskin. I appreciate that. I yield back, Mr. Chair.
Mr. Issa. That was a great round of questioning. I
appreciate it. I appreciate your answer on broadening
transparency.
With that, we go to the gentleman from South Carolina, Mr.
Fry.
Mr. Fry. Thank you, Mr. Chair. Dr. Jensen, to continue with
you, you would agree that AI is one of our most critical tools
in strengthening national defense?
Mr. Jensen. One hundred percent.
Mr. Fry. In that same vein, would that translate, if we
were a leader in that, would that translate to superiority for
our defense capabilities and our warfighters on the
battlefield?
Mr. Jensen. A great question and I can tell you honestly.
So, as the chair at Marine Corps University for the last 2\1/2\
years, we've been experimenting with how could you use AI to
help marines plan better. So, no more eating crayons. Time to
actually get down with the code.
Frankly, we found tremendous strides. This is actually why
it's a complex answer to this. It's not just a function of the
engineering; it's how you actually change professional military
education and training to make officers and enlisted personnel
understand that technology and to know how to ask the right
question.
What makes us the best fighting force is that we care about
our people. We invest in them. We challenge them. We pull them
from all ranks of our society.
In an era of AI, that also means ensuring they have the
requisite technical education, and we've given them the ability
to work with algorithms to augment military decisionmaking.
So, it won't just be enough to be an AI superpower and to
give a trillion dollars to one company to give us widgets. It's
going to be the harder investments we make in our people, how
we change our training pipelines, and how we simulate future
battles.
Mr. Fry. So, to what extent do you think that Chinese
espionage is undermining our national defense capabilities in
the space of AI?
Mr. Jensen. Yes. Daily, if not every second. Remember, they
have proven that you can mass steal your way into the 21st
century through intellectual property theft, both with hackers,
but also, we heard about it today: These third-party purchases
of firms, through insider recruitment. They've got a deep,
well-established play book.
(1) That changes our cost to innovate. Every secret they
steal changes the marginal cost for the next innovation. It's
cheaper for them, more expensive for us.
(2) It also gives them sensitive data on how best to defeat
our systems. So, this is why we have to probably come up with
entirely new concepts of how we secure data and how we secure
training data. Because the worst thing we would want is they
actually steal every experiment we've done with AI in a
military training setting and, actually, statistically analyze
our patterns.
Most people, when they're fighting, have tells. Boxers know
this, but it's true at larger-order combat formations. We all
have patterns, and if you can see the enemy's pattern, you can
conduct a spoiling attack or some maneuver to offset it. We
have to make sure they can't use our patterns through seeing us
in that technology to exploit in the battlefield.
Mr. Fry. Well, how do we do that? In dealing with espionage
of trade secrets--
Mr. Jensen. Yes.
Mr. Fry. --what kind of protection do you think would be
most important toward that kind of incursion by the CCP?
Mr. Jensen. This is where the lawyers--don't get mad if I
say this.
[Laughter.]
Mr. Jensen. I'm going to put my warfighting hat on.
First, we probably have to get really creative with almost
creating entire digital terracotta armies. Why shouldn't it be
that every U.S. military personnel isn't in three to four
places simultaneously, only one of which is real? So, your
adversary, even if they can see you in a transparent global
competition, doesn't know what's real.
It means we're probably also going to have to get pretty
aggressive with data poisoning, knowing full well that there's
real risk of that blowing back on us, given how these models
are trained.
These are really the core counterintelligence and
operational security questions of the 21st century. That
doubles back to, if you don't train your intelligence community
and your warfighter how to answer these questions, we're never
going to develop policies in the military, and then, we're
going to have generals testifying before you who don't know
what they're talking about. Now, we can do better than that and
our military will do better than that, but it requires that
technical training, that pipeline, that space to experiment.
Mr. Fry. Thank you for that.
Ms. Toner, can you briefly explain China's Thousand Talents
Program? Does it specifically target U.S. scientists and AI
professionals?
Ms. Toner. So, the Thousand Talents Plan is only one of
many, a very large number of talent plans that China uses to
try and recruit talent in critical industries. They certainly
target AI with the Thousand Talents Plan and other plans, and
they're certainly making the most of the current
administration's effects on U.S. immigrants in the United
States.
So, there's a lot of interest among people who are
currently here in visas, in whether their future in the U.S. is
secure. You can bet that China is making the most of that, both
with plans like Thousand Talents and, also, offering lots of
resources for research--great, cushy jobs. They're, they're
certainly stepping in there.
Mr. Fry. Do you think that those recruitment efforts have
led to the leakage, if you will, of trade secrets or sensitive
technologies from the United States and other Western
countries?
Ms. Toner. Certainly, in the AI industry broadly, as has
already been mentioned, one of the biggest sources of trade
secrets being leaked is simply employees moving from one
company to another. This happens inside Silicon Valley between
Google and OpenAI, and other similar companies. Certainly, if
you're able to hire employees from those companies and get them
to cover over to China, that's going to have the same effect.
Mr. Fry. What can we do to close that security gap, just
briefly? I know my time is expired, but I wanted to get to
that.
Ms. Toner. One piece here would be, for people who are
doing it intentionally and are doing it maliciously, that is
where some of my recommendations around personnel vetting could
come in. It's very important that this not become a broader
anti-immigrant sentiment, though. Because, as Dr. Jensen has
already laid out, the contributions of foreign nationals to
U.S. AI competitiveness are immense.
Mr. Fry. Thank you for that.
Mr. Chair, I yield back.
Mr. Issa. I thank the gentleman. We now go to the
gentlelady from North Carolina, Ms. Ross.
Ms. Ross. Thank you, Mr. Chair and Ranking Member, for
holding this hearing.
I apologize for being a little late, but we had a hearing
on quantum computing that raised many of these same issues.
Mr. Issa. The best part is you arrived just in the nick of
time.
Ms. Ross. Yes, there you go. Anyway, Dr. Jensen, DeepSeek's
rapid AI advancements have sparked debate. I wanted to know
whether you think they are driven by local innovation or
replication or theft of American research. Where do you think
they come from?
Mr. Jensen. It's straight-up stealing. We can give
different verbs to describe theft, but it's how they did it
that's important for us to provide the right type of
protection.
So again, the idea is, if I'm going to, basically, do these
attacks where I exploit your ability to pull data and ask a
question to one model, to shorten the amount of time and the
amount of computational cost to train my model, it's at minimum
a legal gray area, but I really do think it's that. I defer to
the legal experts on that.
What's more important about DeepSeek to take stock of is I
think stealing in the 21st century, as awful as it is still
subject to diminishing returns, and why we can still win and
will continue to.
I say that because of our benchmarking study, we tested
DeepSeek. DeepSeek was actually prone toward escalatory
responses in a foreign policy scenario, so 66,000 unique
question-and-answer pairs and 400 scenarios. Even worse, it was
horribly biased against the U.S. and the U.K. Now, you might
say that's a mirror into Chinese Communist Party leadership,
but any mirror like that has a bias, is actually a weakness we
can exploit over time.
So, that's why benchmarking becomes so important. Because
you want to understand the tendencies in these models, and
then, an open society with an open market, there will be
commercial incentives to update those models. Whereas, a closed
society excels only at lying to itself, and that's actually
going to put them in a strategic deficit.
Ms. Ross. Thank you.
Ms. Toner. Can I comment on that as well?
Ms. Ross. Oh, absolutely.
Ms. Toner. Yes, I apologize, but just to respectfully
disagree with the assessment of what DeepSeek did here. I think
it's really important.
There has been plenty of overstating of the sophistication
of what they did and how advanced their AI system is, but it
doesn't help us to understate it, either. It's important to
describe what it is believed that they did in terms of
distillation, which is the technique they used.
This is a very common technique that a lot of U.S. AI
developers will use as well. Essentially, it's using a more
advanced AI model to get some answers and to use that as part
of your training data.
I don't have any inside information. We'd have to look at
the internal investigation OpenAI is running. What's available
externally suggests that they have just done a pretty regular
standard practice procedure as one small part of their overall
process for building this model.
It's important that we not underestimate the level of
engineering sophistication and research that they did bring.
They were genuinely innovating here, in addition to making some
use of OpenAI's models, I believe, according to evidence we
have--again, in a way that I think is a legal gray area is
correct, a legal gray area and very commonly done by many U.S.
AI developers as well.
Ms. Ross. Thank you for that addition.
Back to you, Dr. Jensen. Drawing from your analysis of
technology diffusion, what indicators, patent citations, talent
flows from U.S. labs, or code-based similarities would signal
reliance on external knowledge versus organic R&D in China?
Mr. Jensen. So, I love this question because you're getting
at the heart of what does it means to be an AI superpower, and
how would you measure it? Then, how could you, as elected
officials, look at those measures and determine the right mix
of legislation, or even the right type of budget allocations to
go forward with.
A few stand out, even before whether it's externally or
internally driven.
First, triad patents, absolutely, are always going to be a
key one.
Second, even though we can't necessarily always draw a
direct link, even if there's a correlation, I do think STEM
education is critical, as well as basic research investments.
There are certain categories of research, frankly, that
it's just not commercially viable for companies to invest in.
In fact, most of our more interesting technological
developments, really in the kind of post-World War II, Vannevar
Bush moment, come from our willingness to take risks and basic
research on universities, and then, finding the right type of--
whether it's protecting it with patents, but then, also,
commercial incentives for those researchers, and then,
entrepreneurs to roll those out.
So, one of the real measures will be those things, in my
opinion, and then, you'll know if it's really coming up.
There's only so much of that you can steal.
Ms. Ross. So, we just came--I just came from the Science
Committee, and we are actually seeing NSF grants being canceled
if they have, quote, ``DEI connection,'' which, to me, is a way
of canceling investment in talent in underserved communities,
because we have talent everywhere in the United States. Could
you comment on that?
Mr. Jensen. Sure.
Mr. Issa. Briefly, if you would, please?
Mr. Jensen. Yes, I'll be very quick.
For me, first, it starts with basic research. True DEI in
this case means we just really want good researchers, and
you're right, they come from everywhere.
The debate here would be whether trying to preface certain
communities inadvertently undermines the commitment to treating
everybody by the content of their character, not by the color
of their skin.
My first priority would be increasing that basic research
investment, and then, figuring out how we make sure we have
research ecosystems that are distributed across America, so we
can find all that talent where it is.
Ms. Ross. Thank you. I yield back. Thank you for your
indulgence.
Mr. Issa. I thank the gentlelady. No problem.
We now go to the gentleman from Virginia for five minutes.
Mr. Cline. Thank you, Mr. Chair.
Mr. Andersen, trade secrets are often described as one of
the most important tools for fostering innovation. In your
view, how critical is the protection of trade secrets for the
continued advancement of AI technologies, particularly in the
context of U.S. companies trying to stay competitive with
foreign players like China?
Mr. Andersen. I believe it's exceedingly critical. Being
able to safeguard the secret sauce, if you will, of how we're
going about our business is exceedingly important.
I'm as antiregulation as I probably can be, but, when I
left home and deployed to Iraq and left the wire to go out on
patrol, I didn't look at having to put on a flak jacket and
Kevlar and be conditioned with my rifle as an overly burdensome
regulation. I looked at it as a recognition of the operating
environment that I was in. Engaging in both good cybersecurity
practices and being able to protect trade secrets is
exceedingly important to maintaining our edge.
Mr. Cline. Given China's rapid advancement in AI, what
steps should the United States take to protect its AI
innovations from theft or exploitation by foreign adversaries,
especially considering the open AI ecosystem that may
facilitate such activities?
Mr. Andersen. So, first and foremost, it's engaging in
good, good cybersecurity hygiene. I brought this up very
briefly with regard to the earlier question about critical
infrastructure. Our technology companies, whether it's an AI
company or cloud computing companies or some of the more
generic developers in the market, are critical infrastructure.
Moreover, the information that they're producing today is
critical to both our economic success and our national
security.
So, good, basic cybersecurity hygiene, whether it's looking
at CMMC and what we're doing with the Defense Industrial Base,
or how it would apply within this industry segment, personnel
screening and vetting, and again, outbound investment
screening, making sure we're not, unwittingly or wittingly,
investing in a way that's going to harm U.S. national security
interests is critically important.
Mr. Cline. As Congress considers AI transparency
legislation, how do we strike the right balance between
disclosing enough to ensure AI systems are safe and
understandable without undermining the incentives for American
companies to keep innovating?
Mr. Andersen. So, that's exceeding tough to do, to the
requirement for disclosure versus, again, keeping sort of your
secrets in-house. In my mind, you have to develop sort of
redline thresholds of what information is important and what
information needs to be disclosed, in particular, focused on
those critical technology security areas that we've identified
as high-risk. So, in my mind, it's about bounding things in
that appropriate way, not necessarily asking for a full
disclosure and full openness in a way that would degrade
competitiveness within the environment.
Mr. Cline. Are there lessons that you've learned from your
experience in cybersecurity risk management that could inform
disclosure frameworks that would be created for AI systems
without compromising proprietary data?
Mr. Andersen. Well, I think you--if you look at legislation
that's existed for the past decade, things like CISA 2015,
which has allowed for private industry to be able to share more
openly with the government and participate in threat
intelligence information-sharing, that's a good model.
Mr. Cline. Now, that's up for renewal this year. Would you
make any adjustments or changes or--
Mr. Andersen. There are always opportunities for
improvement, but I would certainly support its reauthorization,
just to be completely honest, just because I don't want to have
one more opportunity for a company's general counsel to whine
to me about liability protection issues. Anything we can do to
continue to encourage the private sector to share information
is fantastic.
Mr. Cline. Any other panelists want to comment on the
reauthorization of CISA 2015 that is coming up this year? OK.
Anyone?
[No response.]
Mr. Cline. All right. Mr. Mohr, from the software
industry's perspective, what trade secret protections are most
critical to ensuring that American AI companies can continue to
innovate without fearing intellectual property theft,
especially by State-backed actors?
Mr. Mohr. Thank you for the question.
There are several areas where the trade secret doctrine can
apply. It can apply to the algorithm itself. Professor
Villasenor raised a very interesting, a really interesting
point, for example, about how, if, for example, one of these
algorithms were found not to be covered by the trade secret
doctrine, because nobody understands it, basically, a black
box, but it's something that was kept secret and kept for
commercial advantage--that would be a legislative gap. That
would be a problem.
It can apply to the algorithm; it can apply to the training
data; it can apply to perhaps a specific configuration of the
chips used, any number of pieces of the puzzle.
Mr. Cline. Thank you. I yield back.
Mr. Issa. I thank the gentleman.
Mr. Andersen, if I can briefly just ask one question. You
noted you are going over the wire, through the wire, and
wearing your armor. Isn't it true that not everyone wears the
same amount of armor, and that in some cases, if you wear every
piece that they manufacture, you won't be able to move
sufficiently fast to accomplish the mission?
Mr. Andersen. Yes, sir, that's absolutely true. I couldn't
say, just because I'm going into potential armed engagements in
Fallujah, that somebody who's a police officer here in D.C.
should be walking around with the same amount of body armor.
There's still a potential threat engagement there, but the
operating environments are different. The requirements need to
be tailored to what, specifically, is going to be useful both
for the operating conditions and the risk.
Mr. Issa. I thank the gentleman.
The gentlelady from California is recognized for five
minutes.
Ms. Kamlager-Dove. Thank you, Mr. Chair, and I want to
thank the Ranking Member.
This was a really interesting discussion. For me, it
remains abstract if we're also not talking about the available
human capital and the talent investment that is needed.
I have a young person getting ready to go to college. I
have been talking to college students. I have actually been
talking to a lot of engineers in this space who are worried
about their prospects for employment and, also, their ability
to stay here and to contribute to building our edge in AI.
Mr. Chair, I would like to submit for the record a January
14, 2025, White House AI Talent Report.
Mr. Issa. Without objection, so ordered.
Ms. Kamlager-Dove. It warns that international researchers
may increasingly choose to work in countries like Canada or the
U.K. due to visa uncertainty. We know that nearly 50 percent of
noncitizen AI Ph.D.s face immigration challenges, and many are
unsure if they will even remain here.
So, Ms. Toner, if we continue to make it harder for top
talent to stay, what are the strategic risks to U.S. innovation
and our ability to protect those innovations through trade
secrets?
Ms. Toner. The biggest thing I would say is that talent is
a huge, asymmetric advantage for the United States. We're in
systemic competition with China and in different elements. We
have different levels of advantage. The ability to attract the
world's best and brightest is one of our very biggest and most
asymmetric advantages over China.
They are graduating more and more Ph.D. students, master's
students, and specialty students. They are vastly outstripping
our ability to train domestic talent because their population
is larger. If we're just using domestic talent, even if we
should, obviously, be improving our K-12 education system, our
high education system, but we can do that all we want; if we
only use domestic talent, we cannot match them.
We're very fortunate, the number of people, the number of
really brilliant researchers and engineers who want to come to
the United States, if we'll only let them.
I would say, we look at the way that affects the U.S. AI
ecosystem. Two-thirds of the top AI startups had an immigrant
founder. More than half of the AI talent at the Ph.D. level in
the United States is foreign-born. This is a big part of our
ecosystem. We should treasure it. We should value it. We should
let those people come and let them stay.
Ms. Kamlager-Dove. Thank you so much.
Unrelated, I was having discussions with folks in my
district about breast cancer research and finding cures. The
folks that were actually at the center are immigrants. I just
kept thinking to myself, OK, and now, we're demonizing this
group of people that's actually working to try to figure out
ways to save lives.
Even Dr. Jensen just said that good researchers comes from
everywhere. They may come from everywhere. We want them to come
here, and by golly, we want to stay here. Because we want to
have the edge.
We cannot protect our edge in AI and cybersecurity,
actually, without investing in the people and the institutions
that are building the edge. I'm talking about colleges and
universities that feel like they are under attack--the faculty,
the curriculum, the prospective students, and the students that
are there right now.
Given that between 40-60 percent of AI-related master's
degrees and nearly 60 percent of AI Ph.D.s have gone to non-
U.S. citizens in recent years, I'm going to say to you,
Professor Villasenor, what are the long-term risks to U.S.
innovation if we keep pushing out the very talent that is being
used to build this field?
Mr. Villasenor. I think the risks are enormous. I think we
are leaders in AI in large part because of our human capital.
As has been said by multiple people here, our human capital is
people who are at least half, and probably a lot more, from
overseas. We need to make sure to create a climate where they
feel that they can stay here and start their businesses here.
Because the businesses they start are going to be the ones that
employ 100, 1,000, or 10,000 people in the future. They're
going to start those businesses somewhere and we want it to be
here.
Ms. Kamlager-Dove. Thank you for that.
As I mentioned, I know we are talking about cybersecurity
and cyber threats. I'm also thinking about all the other ways
where AI can play a positive and constructive part in how we
are coming up with solutions; how we are protecting our people;
how we are enhancing our national security.
What should be most important is what folks bring to the
table rather than what they look like or where they were born.
I don't think a solution cares too much about the person who
came up with it. We're interested in how we can build our
competitive edge; how we can protect the folks in our country;
how we can create more jobs; how we can create an ecosystem
that is both safe and sustainable--right? Economically and
politically, from a national security standpoint.
I'm just saying this because I'm talking to all the young
people who are graduating, who want to play a role in how we
are finding solutions for all these issues, and they are
scared. We don't want folks to be scared. We want folks to feel
hopeful and engaged, and like they're able to work with their
country on addressing some of these solutions.
With that, Mr. Chair, I yield back.
Mr. Issa. I thank the gentlelady.
I would only opine that you may be making a case for us to
bring back up the H-1B reform, so that we are, in fact,
recruiting and retaining the best and the brightest, as you
noted.
With that, we will not go to that, gentlemen. I guess it
boils down to me now. I will recognize myself for a series of
questions.
One of the questions I have is--I will followup on the
recruit and retain. It was opined by people on both sides of
the dais that we may be losing good people under current
policy.
For all of you, isn't one of the loopholes in our system
that the massive amount of people who are training on AI,
getting their degrees in AI, they go back to China? Isn't that
effectively--the people at your university, you include Chinese
exchange students who will train on AI, will be advanced by
looking at what we're doing, and then, they will, whether they
want to remain or not, be forced to return to China? Isn't that
a practical reality today?
Ms. Toner. So, in fact, this is a great question and an
important question, and it's one that colleagues of mine at
CSET at Georgetown have done great work on.
Actually, if you look at the numbers, specifically, in AI
and, specifically, for Chinese immigrants, and you look at how,
what percentage of those researchers are staying over five
years, over 10 years, the numbers are North of 85 percent. So,
there's actually a very, very large fraction who do stay in the
country.
Mr. Issa. Yes, but under the current, under the current
law--
Ms. Toner. Yes.
Mr. Issa. --they are circumventing their original presence
to do it. They are marrying an American. They are applying for
this visa or that visa.
Yes, many people who come here who are the best and the
brightest remain, but they don't come under a status that
guarantees they remain. They take an undergraduate degree, then
a graduate degree, then a work program, and then another
graduate degree. We all know that there are ways to stay here
for a long period of time, and eight years is a blink in the
back-and-forth at university.
The question is: How many people come here and have a
reasonable expectation that they can remain here permanently,
and thus, make the plans that might lead to loyalty? That would
be a different question.
I have two service members here. Are you both current?
Reservists? You're not?
Were you an officer, Mr. Andersen?
Mr. Andersen. I was not.
Mr. Issa. You are enlisted. So, I'm going to make one
assumption.
Dr. Jensen, you currently hold at least a Secret security
clearance, don't you?
Mr. Jensen. That's true, Chair.
Mr. Issa. OK. How many other people here hold security
clearances today?
[Nonverbal response.]
Mr. Issa. OK. For your security clearances, was there a
background check?
Mr. Jensen. Yes, and now, we're also subject to what's
called continuous monitoring evaluation.
Mr. Issa. As a result, one of the questions in that
background is, are you susceptible to, in fact, being leveraged
by a foreign power? Isn't one of the greatest foreign power
leverages having family in a foreign Nation, particularly a
hostile one?
So, isn't one of the questions that has--the genie that we
have to let out of the bottle is, one of our challenges, by
definition, is whether--you said you had two out of the four.
If they are from China and their family is in China, they are
subject to potentially being leveraged through their family. If
they are from China, and for the 6, 8, 10, or 12 years, every
day of their lives, they are potentially susceptible to being
taken back to China. They are less likely to be reliable from a
standpoint of keeping secrets secret.
Ms. Toner, wouldn't you even agree with that?
Ms. Toner. That is true and a concern for, I would say, a
small fraction of the people in question here.
Mr. Issa. We only need one to give away the secrets and the
next bomb will not be stopped on its way in.
One of the questions that I have here today is, there's
been a lot of discussion about, basically, foreign policy,
immigration, and so on. From a standpoint of keeping our edge,
tariffs will not keep our edge in AI, is that correct?
Mr. Jensen. I think that's correct.
Mr. Issa. Ms. Toner, one of the areas that you opined on
positively was that our export controls have helped us keep
that edge, correct?
Ms. Toner. Yes, sir.
Mr. Issa. When we talked about cooperation, the very chips
that we have export controls on trying to keep from leaving,
every company that we want to have work in a collaborative way
with our government to help keep secrets secret, to help have
the level of cybersecurity, every one of them pretty much uses
those chips, right?
Ms. Toner. Yes, sir.
Mr. Issa. Maybe we can have a sense of consensus here for a
moment. Isn't it fair to say that, although we want it to be
cooperative, we want it to be voluntary, access to those very
powerful chips that we will not let our enemies have, in fact,
creates a bargain in which you really must work with the
government to make sure that you are safeguarding the fruit of
those very powerful chips. Is that fair to say?
OK. Seeing no disagreement, I will say we have gotten that.
I'm going to--this is one of those times in which I don't
want to abuse the opportunity. The Ranking Member is going to
let me have an extra minute or two.
I just want to close with a question that, hopefully, sets
it up. This hearing was primarily about our current edge, where
it is, and what we should do. There will be a lot of questions,
both from Members who couldn't be here--myself, I couldn't be
at the Science Committee. I'm going to be asking them a lot of
questions on quantum.
Isn't one of the most important things we should be doing--
and I want to bring together both sides and their questions; we
should be figuring out how to recruit and retain from the
entire world the best and the brightest, and create an
environment in which they are safe and secure from being moved
out of the United States. That we have the first step in
developing the best technology, and then, continue in every way
possible to make sure that those who are our enemies will not,
in fact, use the fruit of that to their benefit; i.e., China?
Is that all a consensus?
[No response.]
Mr. Issa. The last one is, Dr. Jensen, you touched on one
thing, and I just want to make sure I understood it. It is sort
of a technical question.
This whole question of diffusion--we all understand that
today's AI, various AI models, are being offered in some cases
free as a service. What you alluded to that is part of
DeepSeek--Ms. Toner, I'm sure you saw it, too--if we allow
models to be used as a service, and if they can be a service to
people outside of the country nefariously trying to get ahead
of us, then don't we, in fact, provide the very need that we
are trying to deny when we hold back chips?
Either one of you.
Mr. Jensen. Yes, I'll just start, Chair, by saying, yes,
but this is where it gets precarious, right? So, the thing,
again, I was talking about was the unbounded consumption
attack, so how to manipulate the API beyond just the knowledge
distillation. Even if that is just a legal gray area, and U.S.
people exploit it, it doesn't make it right.
So now, the question becomes, how do you make sure that
this technology proliferates? Because everyone has talked
about, whether it's breast cancer, weather, the really
interesting next innovations are second order. It's how people
begin to employ these models to solve other problems, and you
don't want to limit that. At the same time, you want to limit
its abuse.
This is why you need to really go on the offense, and why I
want to be brutally clear when I say that. That means finding a
way for sensitive intelligence to be declassified, to then
differentiate between what's natural business competition and
what's actually nefarious, and then, begin to make it
admissible in not just the U.S., but also in multiple other
free societies. It starts to create a compounding effect.
Even in the more extreme case, that's when you turn it over
to a Presidential finding and you actually talk about what you
might sabotage digitally overseas.
Mr. Issa. Ms. Toner, you had a closing statement?
Ms. Toner. Yes. To build on that, a really important
element here that often is not discussed as much as it should,
is how these companies are monitoring the use of their systems.
It's not just a question of testing them in advance or the
cybersecurities at the companies themselves, which are very
important. If you're going to make your products available to
users, which is important for their business models; it's
important for us to benefit from them, how are they detecting
when they're being used improperly?
Different leading AI companies have different practices
around monitoring different quality. I would certainly
encourage you in your oversight role to discuss with the
leading AI companies on how they are monitoring their systems
being used.
I believe that OpenAI is currently investigating whether
Deep-Seek used their systems inappropriately, and if so, how?
How do they detect that? What are they logging? What systems,
automated and human-based, do they have in place to tell when
those improper uses are occurring?
Mr. Issa. Thank you.
Having no further questions from the dais currently, I
would bring this to a close by saying that, for the next five
legislative days, we will allow Members to ask additional
questions. Would you all agree to respond to those in writing?
Then, just to make sure I don't miss anything on the
close--nope.
Without objection, this hearing is adjourned.
[Whereupon, at 11:44 a.m., the Subcommittee was adjourned.]
All materials submitted for the record by Members of the
Subcommittee on Courts, Intellectual Property, and the Internet
can
be found at: https://docs.house.gov/Committee/Calendar/ByEvent
.aspx?EventID=118204.