February 09, 2021
The U.S.’s China Strategy Needs New Tools
On Jan. 20, Treasury Secretary Janet Yellen committed to “use the full array of tools” to counter China’s “abusive, unfair and illegal practices.” But however determined Yellen and the rest of President Biden’s team may be, the toolbox they inherited from the Trump administration is a few drill bits short.
Chinese state capitalism caught U.S. policymakers flat-footed. While far from perfect, the “China model” is dramatically reshaping global industry through the concentrated power of economic tools like subsidies, market protection, forced technology transfer and economic espionage. “CCP Inc.” now has the scale to “unleash waves of overcapacity that undercut U.S. firms, … support[] China’s military modernization and overseas expansion,” and, in so doing, threaten key U.S. interests.
Policymakers maintain an unparalleled capacity to push back using sanctions, export controls and investment restrictions. Trade, however, presents a unique dilemma.
Thanks to U.S. leverage over global economic networks, policymakers maintain an unparalleled capacity to push back using sanctions, export controls and investment restrictions. Trade, however, presents a unique dilemma. The World Trade Organization is not well equipped to deal with Chinese policies and requires substantial reform to meet the challenge. Meanwhile, U.S. trade instruments are limited, outmoded and even counterproductive when it comes to pursuing national security ends. The Biden administration should rethink its geoeconomic toolkit and work with Congress to provide the executive branch more effective means to respond to predatory Chinese economic policy targeting allies and strategic industries.
Read the full article from Lawfare.
More from CNAS
-
When and Why China Might—or Might Not—Attack Taiwan
Commentary
Washington should continue to emphasize to Beijing the costs of aggression and the value of the status quo for China, the region, and the world...
By Jacob Stokes
-
Why China’s eventual aims with Taiwan could have a major global financial and economic impact
Video
On CNBC’s Worldwide Exchange, Martijn Rasser discusses the rise in tensions between China and Taiwan, potential responses by the U.S. and G-7 countries, and whether Beijing co...
By Martijn Rasser
-
China and Russia’s Dangerous Convergence
Commentary
Any effort to address either Russia’s or China’s destabilizing behavior must now account for the two countries’ deepening partnership....
By Andrea Kendall-Taylor & David Shullman
-
US monitors Beijing interest in global microchip market
Video
Martijn Rasser offers insights to Fox News on how semiconductor shortage intensifies US-China tensions. Watch the full conversation on Fox News....
By Martijn Rasser
