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Dangers of the CCP Buying American Farmland

letters and testimony

Dangers of the CCP Buying American Farmland

July 14, 2023

Today, I testified before the Congressional Western Caucus for its forum on the "Dangers of the CCP Buying American Farmland." Click here to download a pdf of the testimony.

Chairman Newhouse, and members of the Congressional Western Caucus:

Thank you for the opportunity to testify. I am a policy technologist at the Foundation for American Innovation, a think tank focused on bridging the gap between Silicon Valley and D.C. by applying technology to governance and policy challenges. My research on Chinese investments in American farmland has been featured in the Wall Street Journal and on The Ingraham Angle on Fox News.

My research has found that people and companies connected to the CCP have been buying farmland and building infrastructure next to American military bases. Examples include purchases of land near Laughlin Air Force Base in Texas and near Grand Forks Air Force Base in North Dakota. Chinese investment in American farmland has skyrocketed from $81 million in 2010 to $1.8 billion in 2021, a 1,900 percent real increase. Chinese investors own a total of 383,935 acres of farmland in the United States.

To make matters worse, the Department of Agriculture (USDA) has not properly tracked these investments. Since 1978, a law passed with bipartisan support, the Agricultural Foreign Investment Disclosure Act (AFIDA), has required USDA to track foreign investment in American farmland. However, the AFIDA program has not been audited since 1989, and outside reporting has found that the program has limited capacity.

For example, until 2022, the AFIDA database (USDA’s database of foreign agricultural investment in the United States) did not include tens of thousands of acres owned by Sun Guangxin, a CCP-connected billionaire. These sorts of mistakes are inevitable, given the program’s limited manpower: as I discovered through a Freedom of Information Act request, there were only two people within USDA working on the AFIDA program until last year.

There are also data quality problems, including limited data on the price of the parcels of land, and a limited ability to connect the LLC that owns a property to the beneficial owner. I discovered these flaws through my study of a copy of the database, which I received through a separate Freedom of Information Act request to USDA.

There is growing recognition among federal and state leaders that Chinese purchases of land, especially those near critical infrastructure, pose a security threat. Our failure to properly track foreign investment in farmland exacerbates this threat. If USDA can miss tens of thousands of acres of land, how much critical infrastructure-adjacent property, from farmland to buildings in urban areas, could be owned by CCP-connected individuals without our knowing it?

In recent months, USDA has worked to make foreign ownership of American farmland more transparent, likely in response to the variety of bills that seek to reform AFIDA. USDA recently uploaded all the AFIDA reports since 1978. And last month, USDA finally made the AFIDA database public, making it much simpler for Congress and the public to learn the extent of foreign investments in U.S. farmland, and where those investments are going.

However, more must be done to protect our farmland.

First, Congress should pass legislation to restrict foreign investors’ ability to purchase farmland and property next to critical infrastructure. Bills to this effect from Representative Elise Stefanik, Senator Mike Braun, and Senator Jon Tester are worth considering. Congress should also pass legislation to create a national land registry, which would replace the current system, in which parcel data is maintained by individual American counties. Representative Mike Gallagher’s bill to give the Committee on Foreign Investment in the United States jurisdiction over land purchases by foreign adversary entities is also an approach worth considering.

Second, USDA must do a better job of tracking foreign investment in American farmland. Congress should give USDA the authority to more thoroughly investigate foreign investment in farmland, to ensure that investors are not hiding their true origin in layers of LLCs.

Third, Congress should conduct oversight of USDA, to understand why the AFIDA program has been mismanaged over the past 30 years. We need to understand the mistakes USDA has made with AFIDA, so that we can avoid repeating them. As I noted, the AFIDA program was last audited in 1989. Congress should require the Government Accountability Office to perform a new audit of the program.

Thank you, Chairman Newhouse, and members of the Congressional Western Caucus, for having me here today. I look forward to answering your questions.

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