Lawmakers and former officials are making a last-ditch push to persuade the Trump administration to halt plans to invest billions of federal employee retirement dollars in Chinese companies that Washington suspects of human rights abuses or threatening U.S. security, according to sources and documents seen by Reuters.
The campaign, which includes letters and calls from Republicans and a sharply worded memo shared with White House Chief of Staff Mark Meadows, coincides with heightened U.S.-China tensions over the origins of the COVID-19 pandemic.
At issue is whether administrators of the Thrift Savings Plan (TSP), a retirement savings fund similar to a 401(k) for federal employees and members of the military, should allow its $50 billion international fund to track an index that includes some China-based stocks of companies under scrutiny in Washington.
Among the Chinese companies in the index that have drawn the ire of some in Washington who see China as America’s biggest economic and geopolitical threat is surveillance firm Hangzhou Hikvision Digital Technology, which was placed on a trade blacklist last year because its technology is used in detention camps for China’s Uigher Muslim minorities.
The fund would also invest in telecoms equipment company ZTE , which was penalized by the U.S. government for violating American sanctions, as well as aircraft and avionics company Aviation Industry Corporation of China, which provides weapons for the Chinese military.
For China hardliners, the matter has taken on greater urgency because administrators have begun opening custodial accounts abroad to make investments due in the second half of 2020.
“Are we very soon going to witness … federal employees … being, in effect, unwittingly compelled to fund with their retirement dollars a number of Beijing’s most egregious corporate national security and human rights abusers?” asked Roger Robinson, a former White House official in the Ronald Reagan administration who has tracked the issue closely.
The Federal Retirement Thrift Investment Board (FRTIB) which administers the TSP, said all of its peers are making similar investments and that it “would be a lagging outlier amongst retirement savings plans” if it doesn’t expand its investments, according to spokeswoman Kim Weaver.
The White House did not respond to requests for comment.