As reported previously on FedSmith, Senator Marco Rubio (R-FL) has been trying for some time to prevent retirement funds in the Thrift Savings Plan (TSP) from being used to support the Chinese military.
Despite his efforts to prevent these investments from continuing, the Senate has rebuffed his latest effort to make this change. Late last week, the Senate declined to support his amendment to the National Defense Bill to block these investments from the TSP.
When he made a previous attempt to restrict the TSP from investing in Chinese companies that support their military, he commented, “The Board (Federal Retirement Thrift Investment Board) and their friends on Wall Street will get away with using American service members’ savings to fund threats to U.S. national security.”
He made a similar comment after this amendment failed: “The Senate had a chance to prevent China from benefiting from our military service members and federal workers’ retirement funds. Instead, it allowed pressure from Wall Street and other special interests to block this common-sense amendment.”
Arguments in Favor of Restricting TSP Investments in China
Before the vote on the amendment, the Florida Senator outlined why the amendment should be passed:
It’s pretty straightforward. The Federal Thrift Savings Plan is the largest defined contribution plan in the world. It has 22 China-only funds, every single one of them has money going towards companies that are sanctioned, that are on the entities list. Companies that are responsible for the human rights violations against Uyghurs. Companies that our own government has said are helping the Chinese build their military, Chinese-sponsored companies.
And so this amendment basically is geared towards that – it tells us TSP – the Thrift Savings Plan Board that they can no longer invest your money, the money of members of Congress, members of the military, federal employees! Federal employees’ retirement money is being invested in companies that are undermining American national security, according to our own government, we’re investing in those.
Pertaining primarily to military personnel, Rubio made this argument:
Think about the irony: you’re a member of the military and your retirement money is being invested in companies that are building missiles designed to blow up the ship that you serve on…And it’s money – your money, the investment money of federal employees, being used to invest in companies that our own government has placed on lists for human rights violations and posing a threat to the national security of the country.
Rubio’s Other Efforts to Combat China
He was successful in getting other issues involving China included in the Senate Defense Authorization Legislation:
- Deterring Chinese Preemptive Strikes Act. This item directs the Department of Defense (DoD) to harden U.S. facilities in the Indo-Pacific to deter a preemptive strike against U.S. forces and assets in the region by China ahead of an invasion of Taiwan.
- No Federal Funding for CCP SPIES Act. This amendment eliminates a waiver program allowing institutes of higher education to host Confucius Institutes.
Senator Rubio says he will continue to pursue this issue of TSP investments in companies supporting the Chinese military. His efforts to date underline his grave concern about this issue and his willingness to continue to gather sufficient support to pass a law on the subject.
Another Rubio bill, the TSP Fiduciary Security Act, is similar and would require the TSP to restrict investments and voting rights in Chinese military companies to protect the national security of the United States.
Investing TSP money into Chinese companies supporting the Chinese military is a national security issue. At first glance, it would be a bipartisan issue. The reality though is Senator Rubio’s arguments are more persuasive to Republicans than Democrats.
Currently, the House is controlled by Republicans and the Senate by Democrats. The topic is more likely to be passed if Republicans control the House and Senate after the next election or if international events highlight significant potential for a military conflict with China that would alter the perspective of those opposed to restricting these investments.
