Ways & Means Chair Baits Reds in Detroit

In a stern letter, House Ways and Means Committee Chairman Jason Smith (MO-08) warned Treasury Secretary Janet Yellen that regulations must be immediately issued to prevent taxpayer funded subsidies for electric vehicles and batteries in the Inflation Reduction Act (IRA) from flowing to adversarial nations such as China.

Following on similar recent exhortations from Rep. Mike Gallagher (R-WI) and his committee, Mr. Smith chimed in with a letter and press release.  

“While I do not agree with the policy that provides massive taxpayer-funded subsidies for electric vehicles, certainly we should be able to agree that taxpayer funds should not flow in a way that benefits the Chinese Community Party (CCP) or other entities who do not share our aligned interests.

Treasury guidance should make clear in the most comprehensive way possible that taxpayer subsidies cannot flow to foreign entities of concern through any structuring mechanism conceivable.

Guidance on this topic should be as strict and prompt as possible so there is no ambiguity that the benefit of taxpayer subsidies cannot end up in the hands of our adversaries,” wrote Chairman Smith.

In conjunction with his letter to Treasury, Chairman Smith sent follow-up letters to electric vehicle (EV) automakers, Nissan and Tesla, requesting further clarification whether misguided from the IRA have enticed EV automakers to enter into partnerships with Chinese companies or those from other "adversarial nations."

In April, following reports that Ford Motor Company is partnering with China’s Contemporary Ameperex Technology Co. (CATL) to spend $3.5 billion on a new electric vehicle battery factory in Michigan after passage of the IRA, Mr Smith demanded the Ford provide additional information on the partnership and called on other U.S. automakers to detail any similar partnerships.

Both Nissan and Tesla’s response to Smith’s initial inquiry failed to fully address his concerns, which led him to seek additional information.

Messrs Smith and Gallagher further underlined their concern with the CATL partnership in a letter to Ford in July after new details came to light showing CATL’s ties to forced labor and Ford’s potential reliance on Chinese technology, minerals, and employees.

Read the letter to Treasury Secretary Yellen here.
Read the letter to Nissan here.
Read the letter to Tesla here.