The U.S.-China Economic and Security Council (USCC) held a hearing on “U.S. Investments in China’s Capital Markets and Military Industrial Parks” on Friday (19) EST.
Yu Maochun: “Reciprocity” Principle to Address Beijing’s Challenges
On April 15, the U.S.-China Economic and Security Review Commission (USCC) held a hearing on “China’s Economic Ambitions,” featuring two key China policy officials from the Trump administration.
“The Trump administration and the Biden administration have a lot in common in their approaches to policy (toward the Chinese Communist Party).” Matt Pottinger, a former deputy national security adviser and current visiting fellow at Stanford University’s Hoover Institution, gave this assessment of the Biden administration, which has been in office for more than three months. Members of Congress at the meeting expressed concern about the threat of Chinese Communist expansion.
Bomen suggested that when planning policies and considering budgets, the U.S. government should consider whether these investments will strengthen U.S. competitiveness against Beijing. At the same time, it should guard against the entry of U.S. capital and technology into Chinese military and state-owned technology enterprises.
Yu Maochun, former chief China policy planning adviser to Secretary of State Pompeo and now a senior fellow at the Hudson Institute, a U.S. think tank, mentioned three major characteristics of China’s economy during the hearing. First, China, a communist dictatorship led by Marxist-Leninist ideology, is fully integrated into the global free market system by exploiting its cheap yet large internal labor force.
“China’s labor force has no meaningful labor protections, no right to independently form unions, bargain collectively and fight for benefits. In Xinjiang, there has been a tragic genocide against religious and ethnic minorities, and disenfranchised laborers have been placed in concentration camps. The CCP has built a massive, state-sized sweatshop, and the world is paying for it.” Yu Maochun said.
Second, the CCP’s monopoly on power has led the Beijing government to exert strict control over financial resources. This control encompasses Chinese companies as well as foreign companies, and limits the right of the Chinese people to freely exchange money. He also mentioned that at least 27 Chinese billionaires have been arrested in the past 15 years, “on charges that are as bizarre as they are absurd.”
Yu Maochun named the case of Jack Ma Alibaba. “In the U.S., we applaud those who make Forbes’ list of billionaires; in China, being on the Hurun 100 list can be added to the list of those struck down (by those in power).”
A third feature is the CCP’s lack of transparency in information about economic-related data.
Yu Maochun suggested that the U.S. government should respond to China’s negative list item by item. In the same way that the CCP restricts U.S. companies, it should “reciprocally respond” by banning CCP investments in high-tech farming, social science research, news media, film and culture, and key minerals.
He also believes that the U.S. government should be on the front line in responding to the Chinese Communist Party’s crackdown on U.S. companies. He cited the example of the Chinese Communist Party banning Twitter and Facebook from entering the market, which should not just be a problem for U.S. companies, but the U.S. government should resort to sovereign reciprocal action and not let U.S. companies become hostages of the Chinese Communist Party. He is worried about the way these U.S. companies instead turn to lobbying agencies or Chinese Communist Party agents for help when they encounter the Chinese Communist Party’s crackdown.
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