Biden Must Solve the ‘China Trap’: Changing the Course of US Businesses to Save Them

Commentary An important, timely, and damning study reveals how eight U.S. tech corporations aid America’s enemy, communist China. A report from the Victims of Communism Memorial Foundation documents the role of Amazon, Apple, Dell, Facebook, GE, Google, Intel, and Microsoft in providing a spectrum of support to the Chinese regime. GE, Intel, and Microsoft directly support the Chinese military or security services. From the George H.W. Bush administration, to Bill Clinton, George W. Bush, and Barack Obama, the simple and stark fact is our national security leaders failed the American people by allowing U.S. firms to augment the growth of the Chinese regime. The expansion of this threat occurred over decades and was not identified or countered by U.S. strategists. These administrations favored U.S. investment and cooperation with the regime. China was perceived as an endless source of inexpensive manufacturing labor. Its considerable economic growth in the 1990s greatly accelerated once Beijing was admitted into the World Trade Organization (WTO). China rose from dire poverty to economic superpower in a generation. The rapid economic and military growth of the Chinese regime should have alarmed the American government, people, and businesses—especially those identified in the report. This alarm should have compelled a response against China. That this did not occur is, first, a massive failure in American grand strategy; second, it is an indictment of each of these administrations and the American national security community for failing to notice what was in front of their noses—year after year. Regrettably, in a historically unprecedented act, the United States contributed mightily to the creation of its most formidable peer competitor. It is both shocking and reprehensible that U.S. decision-makers labored to create this challenger. Warnings of this adverse change in the balance of power were not heeded by U.S. decision-makers. To the contrary, too many in Washington, Wall Street, and Silicon Valley pursued policies that emphasized cooperation, “bringing China in” to the international order and fostering its growth, so that it would become a “responsible stakeholder” in it. Trump’s Security Measures The Trump administration attempted to change this by alerting the American people and government bureaucracy to the threat from the Chinese regime. President Donald Trump made four major contributions to the security of the United States and the well-being of the American people. First, Trump changed the strategic direction and tone in Washington by calling attention in defining strategic policy documents to great power competition, which should have governed U.S. strategy since the end of the Cold War. He strengthened the military’s nuclear and conventional capabilities and directed it to the Indo-Pacific where it belongs, given the size and scope of the Chinese regime’s threat. Second, in the diplomatic realm, Trump recognized that China’s challenge to the United States existed from the Arctic to Antarctic. He understood that the United States must stand with its allies to balance against China. Furthermore, the Trump administration called attention to and punished the Chinese regime for its atrocious human rights record, including the concentration camps for religious and ethnic minorities in Xinjiang. Third, in the technological realm, Trump protected the cyber and critical infrastructure of the United States and called attention to Beijing’s efforts to dominate 5G through the “China 2025 project” and the Digital Silk Road. These are efforts to create the next digital 5G infrastructure and, in time, quantum and artificial intelligence (AI), with the objective to control the internet, gather intelligence, and coerce other states through digital means. Technology, including unmanned aerial vehicles (UAV), telecommunications systems, apps like TikTok, and even health and exercise monitoring, serve as vectors for information collection. The consolidation of data in China’s possession jeopardizes the privacy of U.S. citizens, undermines American prosperity, and aids the ability of the Chinese Communist Party (CCP) to control its population within and outside of China as well as to influence and adversely impact Americans. Trump warned the rest of the world of the dangers of depending on China for information technology (IT). Moreover, he imposed tariff increases and banned Chinese tech giants, such as Huawei and ZTE, from using U.S. chip and other 5G technologies. A display for facial recognition and artificial intelligence is seen on monitors at Huawei’s Bantian campus in Shenzhen, China, on April 26, 2019. (Kevin Frayer/Getty Images) Fourth, Homeland Security was a priority. The Trump administration recognized the necessity of the American worker and industry for the country’s security. He helped American economic prosperity by identifying and stopping the Chinese regime’s predatory economic pr

Biden Must Solve the ‘China Trap’: Changing the Course of US Businesses to Save Them

Commentary

An important, timely, and damning study reveals how eight U.S. tech corporations aid America’s enemy, communist China.

A report from the Victims of Communism Memorial Foundation documents the role of Amazon, Apple, Dell, Facebook, GE, Google, Intel, and Microsoft in providing a spectrum of support to the Chinese regime. GE, Intel, and Microsoft directly support the Chinese military or security services.

From the George H.W. Bush administration, to Bill Clinton, George W. Bush, and Barack Obama, the simple and stark fact is our national security leaders failed the American people by allowing U.S. firms to augment the growth of the Chinese regime. The expansion of this threat occurred over decades and was not identified or countered by U.S. strategists.

These administrations favored U.S. investment and cooperation with the regime. China was perceived as an endless source of inexpensive manufacturing labor. Its considerable economic growth in the 1990s greatly accelerated once Beijing was admitted into the World Trade Organization (WTO). China rose from dire poverty to economic superpower in a generation.

The rapid economic and military growth of the Chinese regime should have alarmed the American government, people, and businesses—especially those identified in the report. This alarm should have compelled a response against China. That this did not occur is, first, a massive failure in American grand strategy; second, it is an indictment of each of these administrations and the American national security community for failing to notice what was in front of their noses—year after year.

Regrettably, in a historically unprecedented act, the United States contributed mightily to the creation of its most formidable peer competitor. It is both shocking and reprehensible that U.S. decision-makers labored to create this challenger. Warnings of this adverse change in the balance of power were not heeded by U.S. decision-makers.

To the contrary, too many in Washington, Wall Street, and Silicon Valley pursued policies that emphasized cooperation, “bringing China in” to the international order and fostering its growth, so that it would become a “responsible stakeholder” in it.

Trump’s Security Measures

The Trump administration attempted to change this by alerting the American people and government bureaucracy to the threat from the Chinese regime. President Donald Trump made four major contributions to the security of the United States and the well-being of the American people.

First, Trump changed the strategic direction and tone in Washington by calling attention in defining strategic policy documents to great power competition, which should have governed U.S. strategy since the end of the Cold War. He strengthened the military’s nuclear and conventional capabilities and directed it to the Indo-Pacific where it belongs, given the size and scope of the Chinese regime’s threat.

Second, in the diplomatic realm, Trump recognized that China’s challenge to the United States existed from the Arctic to Antarctic. He understood that the United States must stand with its allies to balance against China. Furthermore, the Trump administration called attention to and punished the Chinese regime for its atrocious human rights record, including the concentration camps for religious and ethnic minorities in Xinjiang.

Third, in the technological realm, Trump protected the cyber and critical infrastructure of the United States and called attention to Beijing’s efforts to dominate 5G through the “China 2025 project” and the Digital Silk Road. These are efforts to create the next digital 5G infrastructure and, in time, quantum and artificial intelligence (AI), with the objective to control the internet, gather intelligence, and coerce other states through digital means.

Technology, including unmanned aerial vehicles (UAV), telecommunications systems, apps like TikTok, and even health and exercise monitoring, serve as vectors for information collection. The consolidation of data in China’s possession jeopardizes the privacy of U.S. citizens, undermines American prosperity, and aids the ability of the Chinese Communist Party (CCP) to control its population within and outside of China as well as to influence and adversely impact Americans.

Trump warned the rest of the world of the dangers of depending on China for information technology (IT). Moreover, he imposed tariff increases and banned Chinese tech giants, such as Huawei and ZTE, from using U.S. chip and other 5G technologies.

Epoch Times Photo
A display for facial recognition and artificial intelligence is seen on monitors at Huawei’s Bantian campus in Shenzhen, China, on April 26, 2019. (Kevin Frayer/Getty Images)

Fourth, Homeland Security was a priority. The Trump administration recognized the necessity of the American worker and industry for the country’s security. He helped American economic prosperity by identifying and stopping the Chinese regime’s predatory economic practices—including intellectual property theft, counterfeiting and piracy, and the use of coerced labor to produce goods.

As Americans have witnessed over decades, China’s actions eroded America’s economic strength, costing American jobs and decimating industries and communities throughout the United States. The Chinese regime has caused long-lasting damage to the economic prosperity as well as the health and welfare of Americans.

Cooperation with Chinese firms only leads to the “China trap:” U.S. firms want profits from the Chinese market but by participating in it, they lose their viability. This is because Beijing requires technology transfer through legal agreements, but also resorts to indirect and illegal measures to achieve this.

China’s siphoning off technology and knowledge results in the creation of a Chinese competitor for the U.S. firm, before excluding U.S. firms from access to China’s market. By entering the Chinese market, the U.S. firm won short-term profits but lost their proprietary knowledge and practices, created their competitor, and would inevitably lose its position.

The lure of the expansive Chinese market drew many U.S. businesses to China. As the Victims of Communism report documents, it still does. Economic decisions that appeared advantageous to individual U.S. and Western businesses in the short term placed their own business interests, the country, and the American people at risk over the long term. The United States became overdependent on China as a supplier, allowing it to manipulate prices and drive free market competitors out of business. The result is that the American people are vulnerable, as COVID-19 brought into sharp relief.

Over a year into the Biden administration, it is clear what Trump accomplished was significant. For the first time, the United States had a cogent, dynamic, and sustained U.S. response to the threat from communist China, including the threat to U.S. businesses. If the United States is going to remain secure, these efforts must remain and expanded, particularly in U.S. capital markets, which still fund the growth of the Chinese military.

The Biden administration is returning to the flawed and dangerous past strategy of accommodation of America’s greatest rival. The administration should heed and build upon the Victims of Communism Memorial Foundation report to prevent the loss of U.S. economic power and the viability of U.S. businesses. The administration must provide a solution to the “China trap.”

Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.


Follow

Bradley A. Thayer is a founding member of the Committee on the Present Danger: China and is the co-author of “How China Sees the World: Han-Centrism and the Balance of Power in International Politics.”