The Chinese flag flies over the American flag in Shanghai, China, July 30, 2019. (Aly Song/Reuters) Donors, and the terms of their gifts, must be disclosed to reveal possible conflicts of interest.
Tucked inside the Innovation and Competition Act, recently passed by the Senate and now on the House’s agenda, are crucial updates to foreign-gift transparency laws — and some big opportunities for improvement.
The public should know when foreign donors make substantial gifts to colleges and universities. In the last few years, foreign governments have bought the right to pick curricula, as the Chinese Communist government did with Confucius Institutes. Royal-family foundations endow campus centers in their own names, as did Saudi Arabia’s Prince Alwaleed bin Talal with $20 million gifts to Harvard and Georgetown. Foreign tech companies such as Huawei and ZTE, both designated by the FCC as “national security threats,” contract with colleges for research collaboration.
Since the 1980s, colleges have been required to disclose gifts and contracts with foreign sources that exceed $250,000 per year. But from the beginning, colleges and their lobbyists have fought that law, Section 117 of the Higher Education Act. Many institutions simply do not file the required disclosures.
When the Trump administration reviewed Section 117, it found widespread noncompliance. A scathing 2020 report from the Department of Education found that Yale “underreported its foreign gifts and contracts by $375 million.” Another university, whose name is redacted, professed itself “dumbfounded” when the department asked how it forgot to document more than $760 million in foreign funding. In 2020, colleges back-reported over $6.5 billion in foreign funding that should have been disclosed years before, but never was.
This widespread pattern of noncompliance makes it all the more important that the Innovation and Competition Act (ICA) must contain updates that strengthen Section 117. As the House considers the ICA, it should keep three important provisions of the bill and add two more, looking to the Countering Communist China Act, introduced recently by Representative Jim Banks (R., Ind.), for guidance.
First, the House must maintain the requirement for colleges to disclose the names of foreign donors. Without this information, it’s impossible to know a
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