This is an effort to unpack the US-China relationship and its impact on the current global order following the Xi-Biden Summit at the margins of the APEC Summit last month in San Francisco. It is difficult to assess the consequences of the very real US-China competition and the potential for not just competition but confrontation and conflict. As Fareed Zakaria describes it in an opinion piece in the Washington Post:
China is the largest of the challenges and the one that, in the long run, will shape the international order — determining whether the open international system collapses into a second Cold War with arms races in nuclear weapons, space and artificial intelligence.
But that nuanced assessment is not found everywhere. We’ve made passing reference in the past in this Substack posts to the House Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party (Select Committee). With the most recent Select Committee Report the grim clarity of the Select Committee’s view is on full display.
This Committee, it seems to me, is the cutting edge of the reaction against decades-long ‘engagement’ strategy in US-China foreign policy. The ‘death of engagement’ came with the Trump years but has continued with some in the Biden Administration. From a position that argued that economic interdependence between the United States and China would encourage peace and stability between the two and in the more extreme view that such engagement would even be a force for political liberalization in China, that view is ‘dead and buried’. While the latter view of political liberalization was clearly ‘over the top’, the notion of economic interdependence promoting economic growth and prosperity and encouraging continuing focus on societal wellbeing was not then and is not now. But not for the Select Committee.
The Select Committee was created on January 10, 2023 at the beginning of the 118th Congress to, according to the recent Select Committee Report, to: “investigate and submit policy recommendations on the status of the Chinese Communist Party’s economic, technological, and security progress and its competition with the United States.” At that time, it was then Speaker Kevin McCarthy – yes the same guy who was fired from Speaker and has now left Congress – who appointed Mike Gallagher its Chair. Gallagher was first elected to the US House of Represenattives in 2016 and is a Marine veteran who was deployed twice to Iraq as a commander of intelligence teams, and was on now-retired Army Gen. David Petraeus’s Central Command Assessment Team.
Gallagher has been vocal about what he sees as the Biden Administration’s failure to understand the threat posed by China. In an early set of remarks as Chair Gallagher made clear what he believed to be the necessary course correction in US policy toward China. In an interview in the spring Gallagher laid out his vision:
I think there should be three pillars to our grand strategy vis-a-vis China. One is traditional military competition, hard power, and there we need multiyear appropriations for critical munition systems that need to be prepositioned in the Indo-Pacific. … The second line of effort involves ideological competition. Human rights go in this bucket. One of the things we can do in this area is make sure that the Uyghur Forced Labor Prevention Act is fully implemented and that companies aren’t exploiting any loopholes. … The third line of effort is the most complex. It’s what I call economic statecraft, or what others refer to as “selective economic decoupling.
From early on, indeed from his opening remarks at the Select Committee’s first hearing in February, Gallagher has been explicit that he views the competition and rivalry with China as an “existential struggle”:
We may call this a “strategic competition,” but this is not a polite tennis match. This is an existential struggle over what life will look like in the 21st century — and the most fundamental freedoms are at stake.
The Select Committee is made up of the following members:
Chair: Mike Gallagher WI-08
Republican Members
Robert J. Wittman VA-01
Blaine Luetkemeyer MO-03
Andy Barr KY-06
Dan Newhouse WA-04
John R. Moolenaar MI-02
Darin LaHood IL-16
Neal P. Dunn FL-02
Jim Banks IN-03
Dusty Johnson SD-
Michelle Steel CA-45
Ashley Hinson IA-02
Carlos A. Gimenez FL-28
Ranking Member: Raja Krishnamoorthi IL-08
Democratic Members
Kathy Castor FL-14
André Carson IN-07
Seth Moulton MA-06
Ro Khanna CA-17
Andy Kim NJ-03
Mikie Sherrill NJ-11
Haley M. Stevens MI-11
Jake Auchincloss MA-04
Ritchie Torres NY-15
Shontel M. Brown OH-11
It is notable that all members of the Committee, Republican and Democrat, with the exception of Representative Auchincloss, a Democrat, signed this most recent recent Report by the Select Committee. It underscores the growing negative shift in Congress over the relationship with China. As pointed out recently in the NYTimes:
… that ties to China could be weaponized in the event of a conflict. It could be catastrophic for the U.S. economy or the military, for example, if the Chinese government cut off its shipments to the United States of pharmaceuticals, minerals or components for weapons systems.
Beijing’s subsidization of Chinese firms and incidents of intellectual property theft have also become an increasing source of friction. In some cases, China has allowed foreign firms to operate in the country only if they form partnerships that transfer valuable technology to local companies.
The report said that the United States had never before faced a geopolitical adversary with which it was so economically interconnected, and that the full extent of the risk of relying on a strategic competitor remained unknown. The country lacks a contingency plan in the case of further conflict, it said.
And, it reflects what is today described as ‘bipartisanship’ in US-China relations.
The current Report, titled ‘Reset, Prevent, Build: A strategy to win America’s economic competition with the Chinese Communist Party’ was intended to address, what the Report describes as an “equally critical concern: America’s economic and technological competition with the People’s Republic of China (PRC)” – one of three pillars identified by the Select Committee. The central narrative of US-China relations, according to the Select Committee was, and is:
For a generation, the United States made a bipartisan bet that robust engagement with the PRC would lead the PRC to open its economy and financial markets, which would in turn lead to reforms in the political system, greater freedom for the Chinese people, and peace and stability in the region. That bet has failed. The PRC, led by the CCP, has abandoned the path of economic and political reform, doubled down on repressive activities at home, and engaged in destabilizing activities in the region. In the decades since its accession to the World Trade Organization (WTO), the PRC has consistently broken its promises, which ranged from commitments to allow wholly foreign-owned internal combustion engine vehicle manufacturing licenses in the PRC to pledges to reduce market-distorting agricultural subsidies. It committed to these reforms dozens of times and reneged each time.
At the same time, the CCP has pursued a multidecade campaign of economic aggression, fulfilling General Secretary Xi Jinping’s directive to be the “gravediggers of capitalism.” It has employed extensive mercantilist and coercive policies to hollow out the American economy and displace American workers and has wielded extensive subsidies at unprecedented levels and market access restrictions to strengthen indigenous industries and decrease the PRC’s reliance on foreign partners. At the same time, it has sought access to U.S. technology, expertise, and capital. It has often done so illegally, stealing as much as $600 billion per year of intellectual property (IP) and technology—in what the former director of the National Security Agency called “the greatest transfer of wealth” in history.
This Select Committee Report presents findings from the Committee hearings and it outlines recommendations for a strategy for the economic and technological dimensions of the competition with China. Once again there are three pillars to the described strategy with the intent to “…reset the terms of economic and technological competition and shape a strategic environment that favors the national and economic security of the United States and its allies while upholding our values.” The pillars include:
- First, the United States must reset the terms of our economic relationship with the PRC and recognize the serious risks of economically relying on a strategic competitor;
- Second, the United States must immediately stem the flow of U.S. technology and capital that is fueling the PRC’s military modernization and human rights abuses.
- Third, the United States must invest in technological leadership and build collective economic resilience in concert with its allies.”
Identifying just these three pillars fails to do justice to the rather ‘breathtaking’ list of recommendations – some 150 recommendations – that covers a multitude of issues from AI to rare earth production and manufacturing. As described in the Washington Post:
The report, released Tuesday by the House Select Committee on the Chinese Communist Party, contains a broad legislative blueprint that — if followed — could ratchet up duties on Chinese goods, significantly curtail certain U.S. investments in China and further restrict or ban U.S. market access for companies including TikTok, as well as drone makers, chip manufacturers and telecommunications groups.”
Though the Select Committee Report describes something less than full throttled decoupling it is hard not to see the rising barriers to US-China trade and investment and the rising protectionism and the costs for the United States and its allies and partners from such a severe strategy as outlined in the Report.
Reading the Select Committee Report one could be forgiven if one presumed that the US-China competition was just a ‘hair’s breadth’ from a dramatic confrontation.
It leaves one unnerved and more than slightly depressed.
This was posted earlier at my Substack Post, Alan’s Newsletter – https://substack.com/@globalsummitryproject
Image Credit: Asia Freedom Institute