[House Report 116-539]
[From the U.S. Government Publishing Office]


116th Congress  }                                             {   Report
                        HOUSE OF REPRESENTATIVES
 2d Session     }                                             {  116-539

======================================================================



 
AMERICAN COMPETITIVENESS OF A MORE PRODUCTIVE EMERGING TECH ECONOMY ACT

                                _______
                                

 September 29, 2020.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

 Mr. Pallone, from the Committee on Energy and Commerce, submitted the 
                               following

                              R E P O R T

                        [To accompany H.R. 8132]

    The Committee on Energy and Commerce, to whom was referred 
the bill (H.R. 8132) to require the Federal Trade Commission 
and the Secretary of Commerce to conduct studies and submit 
reports on the impact of artificial intelligence and other 
technologies on United States businesses conducting interstate 
commerce, and for other purposes, having considered the same, 
reports favorably thereon without amendment and recommends that 
the bill do pass.

                                CONTENTS

                                                                   Page
  I. Purpose and Summary..............................................1
 II. Background and Need for the Legislation..........................2
III. Committee Hearings...............................................3
 IV. Committee Consideration..........................................6
  V. Committee Votes..................................................6
 VI. Oversight Findings...............................................6
VII. New Budget Authority, Entitlement Authority, and Tax Expenditures6
VIII.Federal Mandates Statement.......................................7

 IX. Statement of General Performance Goals and Objectives............7
  X. Duplication of Federal Programs..................................7
 XI. Committee Cost Estimate..........................................7
XII. Earmarks, Limited Tax Benefits, and Limited Tariff Benefits......7
XIII.Advisory Committee Statement.....................................7

XIV. Applicability to Legislative Branch..............................7
 XV. Section-by-Section Analysis of the Legislation...................7
XVI. Changes in Existing Law Made By the Bill, As Reported............9

                         I. PURPOSE AND SUMMARY

    H.R. 8132, the ``American Competitiveness Of a More 
Productive Emerging Tech Economy Act'' or the ``American 
COMPETE Act'', was introduced on August 28, 2020, by 
Representatives Cathy McMorris Rodgers (R-WA), Bobby L. Rush 
(D-IL), Greg Walden (R-OR), Darren Soto (D-FL), Richard Hudson 
(R-NC), Robin Kelly (D-IL), Robert E. Latta (R-OH), Michael C. 
Burgess (R-TX), Fred Upton (R-MI), Brett Guthrie (R-KY), Larry 
Bucshon (R-IN), Greg Gianforte (R-MT), H. Morgan Griffith (R-
VA), and Earl L. ``Buddy'' Carter (R-GA). H.R. 8132 aims to 
ensure America leads the world and outpaces the People's 
Republic of China in charting the future of emerging 
technologies. Specifically, H.R. 8132 directs the Department of 
Commerce (DOC) and the Federal Trade Commission (FTC) to study 
and report to Congress on the state of artificial intelligence 
(AI), quantum computing, blockchain, and new and advanced 
materials. The bill also requires the DOC to study and report 
to Congress on the state of the Internet of Things (IOT), IOT 
manufacturing, three-dimensional printing, and unmanned 
delivery services and directs the FTC to study how AI may be 
used to address online harms.

              II. BACKGROUND AND NEED FOR THE LEGISLATION

    Maintaining U.S. leadership in emerging technologies is 
essential for American growth, security, and competitiveness in 
the 21st century. To ensure American leadership and to outpace 
the People's Republic of China, who has a stated goal of 
surpassing the U.S. with its ``Made in China 2025'' initiative, 
the U.S. must make it a priority to lead on critical 
technologies, such as AI.\1\
---------------------------------------------------------------------------
    \1\Council on Foreign Relations, Is `Made in China 2025' a Threat 
to Global Trade? (May 13, 2019) (www.cfr.org/backgrounder/made-china-
2025-threat-global-trade).
---------------------------------------------------------------------------
    Although the U.S. is the current leader in AI, such 
leadership is not guaranteed. In fact, if current growth trends 
continue, some experts expect China to overtake the U.S. in 
just five to ten years.\2\ Eric Schmidt, Chairman of the 
National Security Commission on Artificial Intelligence 
(NSCAI), recently warned, ``Americans should be wary of living 
in a world shaped by China's view of the relationship between 
technology and authoritarian governance. Free societies must 
prove the resilience of liberal democracy in the face of 
technological changes that threaten it.''\3\ The U.S. cannot 
afford to cede global leadership on AI.
---------------------------------------------------------------------------
    \2\The Arms Race: A Groundbreaking New Index Ranking 54 Countries, 
Tortoise Media (Dec. 3, 2019) (members.tortoisemedia.com/2019/12/03/
global-ai-index/content.html).
    \3\Eric Schmidt, Eric Schmidt: I Used to Run Google. Silicon Valley 
Could Lose to China, New York Times (Feb. 27, 2020) (www.nytimes.com/
2020/02/27/opinion/eric-schmidt-ai-china.html).
---------------------------------------------------------------------------
    Additionally, American leadership is also important in 
other emerging technologies such as IOT, unmanned delivery 
services, quantum computing, three-dimensional printing, new 
and advanced materials, and blockchain. H.R. 8132, the American 
Competitiveness on More Productive Emerging Tech Economy, or 
the American COMPETE Act, aims to ensure American leadership on 
these technologies by compiling critical information about 
Federal efforts on these technologies as well as private 
industry development, integration, and deployment of such 
technologies.
    H.R. 8132 also directs DOC and the FTC to provide 
recommendations to grow the U.S. economy through the secure 
advancement of these technologies, to develop national 
strategies to advance the U.S. global position on these 
technologies, develop strategies to mitigate current and 
emerging risks to the marketplace and supply chains of these 
technologies, as well as ways to incentivize expeditious 
adoption and refinement of such technologies.
    Through the various hearings and meetings with stakeholders 
on these issues, it is clear that such a compendium of 
information created by H.R. 8132 will advance the development 
and deployment of these technologies.

                        III. COMMITTEE HEARINGS

    For the purposes of section 103(i) of H. Res. 6 of the 
116th Congress, the following hearings were used to develop or 
consider H.R. 8132:
    In the 114th Congress, the Subcommittee on Commerce, 
Manufacturing, and Trade held an informational hearing on March 
24, 2015. The hearing was entitled, ``The Internet of Things: 
Exploring the Next Technology Frontier.'' The Subcommittee 
received testimony from the following witnesses:
           Daniel Castro, Vice President, Information 
        Technology and Innovation Foundation
           Brian Van Harlingen, Chief Technology 
        Officer, Belkin International, Inc.
           Rose Schooler, Vice President, Internet of 
        Things Group and GM, IoT Strategy and Technology 
        Office, Intel Corporation
           Brad Morehead, Chief Executive Officer, 
        LiveWatch Security, LLC
    In the 114th Congress, the Subcommittee on Commerce, 
Manufacturing, and Trade held an informational hearing on 
November 19, 2015. The hearing was entitled, ``The Disrupter 
Series: The Fast-Evolving Uses and Economic Impacts of 
Drones.'' The Subcommittee received testimony from the 
following witnesses:
           Joshua M. Walden, Senior Vice President & 
        General Manager, New Technology Group, Intel 
        Corporation
           John Villasenor, Professor of Public Policy 
        and Electrical Engineering, University of California, 
        Los Angeles, Luskin School of Public Affairs
           Brian Wynne, President and CEO, Association 
        for Unmanned Vehicle Systems International (AUVSI)
           Margot Kaminski, Assistant Professor, Moritz 
        School of Law, Ohio State University
    In the 114th Congress, the Subcommittee on Commerce, 
Manufacturing, and Trade held an informational hearing on 
February 26, 2016. The hearing was entitled, ``The Disrupter 
Series: 3D Printing.'' The Subcommittee received testimony from 
the following witnesses:
           Alan Amling, Vice President, Global 
        Logistics & Marketing, United Parcel Service, Inc.
           Dr. Edward Herderick, Additive Technologies 
        Leader, GE Corporate Supply Chain and Operations
           Neal Orringer, Vice President, Alliances & 
        Partnerships, 3D Systems Corp.
           Ed Morris, Vice President and Director, 
        America Makes, the National Additive Manufacturing 
        Innovation Institute National Center for Defense 
        Manufacturing and Machining (NCDMM)
    In the 114th Congress, the Subcommittee on Commerce, 
Manufacturing, and Trade held an informational hearing on March 
16, 2016. The hearing was entitled, ``The Disrupter Series: 
Digital Currency and Blockchain Technology.'' The Subcommittee 
received testimony from the following witnesses:
           John A. Beccia III, General Counsel and 
        Chief Compliance Officer, Circle Internet Financial on 
        behalf of the Electronic Transactions Association
           Jerry Brito, Executive Director, Coin Center
           Jerry Cuomo, Vice President Blockchain 
        Technologies, IBM
           Matthew Roszak, Chairman, Chamber of Digital 
        Commerce, and Co-Founder, Bloq. Inc.
           Paul Snow, Chief Architect, Factom
           Juan Suarez, Counsel, Coinbase
           Dana Syracuse, Counsel, BuckleySandler LLP
    In the 114th Congress, the Subcommittee on Commerce, 
Manufacturing, and Trade Subcommittee held an informational 
hearing on September 14, 2016. The hearing was entitled, ``The 
Disrupter Series: Advanced Robotics.'' The Subcommittee 
received testimony from the following witnesses:
           Jeff Burnstein, President, Robotic 
        Industries Association
           Meg Jones, Ph.D., Assistant Professor, 
        Communication, Culture, and Technology, Georgetown 
        University
           Dean Kamen, Founder, Deka Research
           Sridhar Kota, Ph.D., Herrick Professor of 
        Engineering, University of Michigan
    In the 115th Congress, the Subcommittee on Digital Commerce 
and Consumer Protection held an informational hearing on March 
15, 2017. The hearing was entitled, ``Disrupter Series: 
Advanced Materials and Production.'' The Subcommittee received 
testimony from the following witnesses:
           James M. Tour, Ph.D., T.T. and W.F. Chao 
        Professor of Chemistry, Professor of Computer Science, 
        and Professor of Materials Science and NanoEngineering, 
        Smalley Institute for Nanoscale Science & Technology, 
        Rice University
           Keith Murphy, Chairman and Chief Executive 
        Officer, Organovo Holdings, Inc.
           Shane Weyant, Chief Executive Officer and 
        President, Creative Pultrusions, Inc.
           Hota GangaRao, Ph.D., Maurice A. and Jo Ann 
        Wadsworth Distinguished Professor of CEE, CEMR, 
        Director, Constructed Facilities Center, Director, 
        Center for Integration of Composites into 
        Infrastructure, West Virginia University
           Afsaneh Rabiei, Ph.D., Professor, Department 
        of Mechanical and Aerospace Engineering, North Carolina 
        State University
    In the 115th Congress, the Subcommittee on Digital Commerce 
and Consumer Protection held an informational hearing on May 
23, 2017. The hearing was entitled, ``Disrupter Series: 
Delivering to Consumers.'' The Subcommittee received testimony 
from the following witnesses:
           Brian Wynne, President and CEO, Association 
        for Unmanned Vehicle Systems International (AUVSI)
           Bastian Lehmann, Founder and CEO, Postmates
           Shyam Chidamber, Chief Evangelist and Senior 
        Advisory, Flirtey
           Harry J. Holzer, Ph.D., Jo John LaFarge Jr. 
        S.J. Professor of Public Policy, McCourt School of 
        Public Policy, Georgetown University
    In the 115th Congress, the Subcommittee on Digital Commerce 
and Consumer Protection held an informational hearing on June 
13, 2017. The hearing was entitled, ``Disrupter Series: Update 
on IOT Opportunities and Challenges.'' The Subcommittee 
received testimony from the following witnesses:
           William S. Marras, Ph.D., Executive Director 
        and Scientific Director of the Spine Research 
        Institute, The Ohio State University
           Gary D. Butler, Ph.D., Founder, Chairman and 
        CEO, Camgian Microsystems Corporation
           Mark Bachman, Ph.D., CTO and Co-Founder, 
        Integra Devices
           Peter B. Kosak, Executive Director, Urban 
        Active Solutions, General Motors North America
           Cameron Javdani, Director of Sales and 
        Marketing, Louroe Electronics; and
           Bill Kuhns, President, Vermont Energy 
        Control Systems, LLC
    In the 115th Congress, the Subcommittee on Digital Commerce 
and Consumer Protection held an informational hearing on 
January 18, 2018. The hearing was entitled, ``Disrupter Series: 
The Internet of Things, Manufacturing and Innovation.'' The 
Subcommittee received testimony from the following witnesses:
           Rodney Masney, Vice President, Technology 
        Service Delivery, Information Technology, Owens-
        Illinois
           Sanjay Poonen, Chief Operating Officer, 
        VMWare
           Thomas D. Bianculli, Chief Technology 
        Officer, Zebra Technology
           Thomas R. Kurfess, Ph.D., P.E., Professor 
        and HUSCO/Ramirez Distinguished Chair in Fluid Power 
        and Motion Control, George W. Woodruff School of 
        Mechanical Engineering, Georgia Institute of Technology
    In the 115th Congress, the Subcommittee on Digital Commerce 
and Consumer Protection held an informational hearing on May 
18, 2018. The hearing was entitled, ``Disrupter Series: Quantum 
Computing.'' The Subcommittee received testimony from the 
following witnesses:
           Michael Brett, CEO, QxBranch
           Christopher Monroe, Chief Scientist and 
        Founder, IonQ, Inc. and Professor of Physics, 
        University of Maryland
           Matthew Putman, CEO, Nanotronics. Inc.
           Diana Franklin, Director of Computer Science 
        Education, the University of Chicago
    In the 115th Congress, the Subcommittee on Digital Commerce 
and Consumer Protection held a legislative hearing on May 22, 
2018. The hearing was entitled, ``Internet of Things 
Legislation.'' The Subcommittee received testimony from the 
following witnesses:
           Tim Day, Senior Vice President, Chamber 
        Technology Engagement Center, U.S. Chamber of Commerce
           Dipti Vachani, Vice President Internet of 
        Things Group and General Manager of the Strategy and 
        Solutions Engineering Division, Intel
           Michelle Richardson, Deputy Director, 
        Freedom, Security, and Technology Project, Center for 
        Democracy and Technology

                      IV. COMMITTEE CONSIDERATION

    Representatives Rodgers (R-WA), Rush (D-IL), Walden (R-OR), 
Soto (D-FL), Hudson (R-NC), Kelly (D-IL), Latta (R-OH), Burgess 
(R-TX), Upton (R-MI), Guthrie (R-KY), Bucshon (R-IN), Gianforte 
(R-MT), Griffith (R-VA), and Carter (R-GA) introduced H.R. 
8132, the ``American Competitiveness Of a More Productive 
Emerging Tech Economy Act'' or the ``American COMPETE Act'', on 
August 28, 2020, and the bill was referred to the Committee on 
Energy and Commerce. The bill was referred to the Subcommittee 
on Consumer Protection and Commerce on August 31, 2020.
    On September 9, 2020, the bill was discharged from the 
Subcommittee on Consumer Protection and Commerce as the bill 
was called up for markup and consideration by the full 
Committee. The Committee on Energy and Commerce met in open 
markup session, pursuant to notice, on September 9, 2020, to 
consider H.R. 8132. No amendments were offered during 
consideration of the bill. Mr. Pallone, Chairman of the 
committee, subsequently moved that H.R. 8132 be ordered 
reported favorably to the House, without amendment, and the 
Committee on Energy and Commerce agreed to the motion by a 
voice vote, a quorum being present.

                           V. COMMITTEE VOTES

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list each record vote 
on the motion to report legislation and amendments thereto. The 
Committee advises that there were no record votes taken on H.R. 
8132, including the motion for final passage of the bill.

                         VI. OVERSIGHT FINDINGS

    Pursuant to clause 3(c)(1) of rule XIII and clause 2(b)(1) 
of rule X of the Rules of the House of Representatives, the 
oversight findings and recommendations of the Committee are 
reflected in the descriptive portion of the report.

 VII. NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX EXPENDITURES

    Pursuant to 3(c)(2) of rule XIII of the Rules of the House 
of Representatives, the Committee adopts as its own the 
estimate of new budget authority, entitlement authority, or tax 
expenditures or revenues contained in the cost estimate 
prepared by the Director of the Congressional Budget Office 
pursuant to section 402 of the Congressional Budget Act of 
1974.
    The Committee has requested but not received from the 
Director of the Congressional Budget Office a statement as to 
whether this bill contains any new budget authority, spending 
authority, credit authority, or an increase or decrease in 
revenues or tax expenditures.

                    VIII. FEDERAL MANDATES STATEMENT

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

       IX. STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES

    Pursuant to clause 3(c)(4) of rule XIII, the general 
performance goal or objective of this legislation is to conduct 
studies and submit reports on the impact of AI and other 
technologies on United States businesses conducting interstate 
commerce.

                   X. DUPLICATION OF FEDERAL PROGRAMS

    Pursuant to clause 3(c)(5) of rule XIII, no provision of 
H.R. 8132 is known to be duplicative of another Federal 
program, including any program that was included in a report to 
Congress pursuant to section 21 of Public Law 111--139 or the 
most recent Catalog of Federal Domestic Assistance.

                      XI. COMMITTEE COST ESTIMATE

    Pursuant to clause 3(d)(1) of rule XIII, the Committee 
adopts as its own the cost estimate prepared by the Director of 
the Congressional Budget Office pursuant to section 402 of the 
Congressional Budget Act of 1974.

    XII. EARMARKS, LIMITED TAX BENEFITS, AND LIMITED TARIFF BENEFITS

    Pursuant to clause 9(e), 9(f), and 9(g) of rule XXI, the 
Committee finds that H.R. 8132 contains no earmarks, limited 
tax benefits, or limited tariff benefits.

                   XIII. ADVISORY COMMITTEE STATEMENT

    No advisory committee within the meaning of section 5(b) of 
the Federal Advisory Committee Act was created by this 
legislation.

                XIV. APPLICABILITY TO LEGISLATIVE BRANCH

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

           XV. SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION

Section 1. The ``American Competitiveness of a More Productive Emerging 
        Tech Economy Act'' or the ``American Compete Act''

    Section 1(a) designates that the short title may be cited 
as the ``American Competitiveness Of a More Productive Emerging 
Tech Economy Act'' or the ``American COMPETE Act''. Section 
1(b) provides the table of contents.

Sec. 2. Study to advance artificial intelligence

    This Section requires a report not later than one year 
after the date of enactment of this Act. The Secretary of 
Commerce and the Federal Trade Commission (FTC) shall complete 
a study on the state of the AI industry and the impact of such 
industry on the economy of the United States.

Sec. 3. Study to advance internet of things in manufacturing

    This Section requires a report not later than one year 
after the date of enactment of this Act. The Secretary of 
Commerce, in coordination with the head of any other 
appropriate Federal agency, shall complete a study on the state 
of manufacturing in the United States.

Sec. 4. Study to advance quantum computing

    This Section requires a report not later than one year 
after the date of enactment of this Act. The Secretary of 
Commerce and the FTC shall complete a study on the state of the 
quantum computing industry and the impact of such industry on 
the economy of the United States.

Sec. 5. Study to advance blockchain technology

    This Section requires a report not later than one year 
after the date of enactment of this Act. The Secretary of 
Commerce and the FTC shall complete a study on the state of the 
blockchain technology industry and the impact of such industry 
on the economy of the United States.

Sec. 6. Study to advance new and advanced materials

    This Section requires a report not later than one year 
after the date of enactment of this Act. The Secretary of 
Commerce and the FTC, in coordination with the head of any 
other appropriate Federal agency, shall complete a study on the 
state of new and advanced materials industry, including 
synthetically derived or enhanced natural properties, and the 
impact of such industry on the economy of the United States.

Sec. 7. Study to advance unmanned delivery services

    This Section requires a report not later than one year 
after the date of enactment of this Act. The Secretary of 
Commerce, in coordination with the head of any other 
appropriate Federal agency, shall complete a study on the 
impact of unmanned delivery services on United States' 
businesses conducting interstate commerce, including the 
effects on safety, traffic congestion and mitigation, and job 
gains, losses, or changes. In the report recommendations, the 
Committee expects the Secretary of Commerce to include 
strategies to promote public safety and mitigate the effects of 
job displacement related to the development and adoption of 
unmanned delivery services.

Sec. 8. Study to advance internet of things

    This Section requires a report not later than one year 
after the date of enactment of this Act. The Secretary of 
Commerce shall conduct a study on the state of the internet-
connected devices industry (commonly known as the ``Internet of 
Things''') in the United States.

Sec. 9. Study to advance three dimensional printing

    This Section requires a report later than one year after 
the date of enactment of this Act. The Secretary of Commerce, 
in coordination with the head of any other appropriate Federal 
agency, shall complete a study on the state of the three-
dimensional printing industry and the impact of such industry 
on the economy of the United States.

Sec. 10. Study to combat online harms through innovation

    This section requires a report not later than one year 
after the date of enactment of this Act. The FTC shall conduct 
and complete a study on how AI may be used to address the 
online harms described in this section, including scams 
directed at senior citizens, disinformation or exploitative 
content, and content furthering illegal activity.

       XVI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

    There are no changes to existing law made by the bill H.R. 
8132.