Posted on 12/01/2002 10:45:40 PM PST by maui_hawaii
The bipartisan U.S.-China Security Review Commission recently issued its first annual report to Congress. The report, which was approved by 11 of the commission’s 12 members, sets forth a comprehensive assessment of the national security implications stemming from our burgeoning economic relationship with China.
The bottom line: China’s strengthened capabilities pose significant new challenges to the United States that require a renewed focus by Congress and the executive branch.
The commission notes in the report that U.S. policy towards China has lacked consistency and depth and has often been dominated by narrow commercial or human rights interests, strong executive branch personalities, and inordinate secrecy. We need to build a sustainable consensus on the fundamental national interests of the United States in our relations with China among our elected officials.
The U.S.-China trade relationship has expanded rapidly to become one of our most significant economic relationships and key driver of China’s rise as an economic power. U.S. trade with China has grown from about $1 billion in 1978 to around $120 billion in 2001. This trade relationship is increasingly one-sided. From 1990 to 2001, the U.S. merchandise trade deficit with China leapt from $11.5 billion to $83 billion.
This is our largest trade deficit in absolute terms and our most imbalanced trade relationship. While the United States takes 41 percent of China’s total exports, China takes only 2 percent of total U.S. exports. Both Japan and the European Union export more to and import less from China.
The United States has also become a major investor in China, with U.S. firms having invested around $10 billion in the country (much higher if Hong Kong is included). According to Chinese statistics, the United States accounted for 10 percent of China’s total inflows of FDI [foreign direct investment] over the last few years.
Much of this investment has come from U.S. firms establishing manufacturing facilities in China to produce goods for export to the United States and elsewhere. The percentage of U.S. imports coming from China-based affiliates of U.S. firms has steadily risen over the past decade. Foreign-invested firms now account for nearly 50 percent of China’s total exports.
The nature of the U.S.-China economic relationship has important implications for our military security and economic security. The continued relocation of production and R&D [research and development] centers by American firms to China raises concern about the loss — or “hollowing out” — of U.S.-based manufacturing capacity in certain strategically important industries and the accompanying loss of higher- wage U.S. jobs.
Contrary to popular thinking, U.S. imports from and investment into China have included a growing number of advanced technology products, not simply low-tech items such as toys and footwear. We found that the U.S. runs a trade deficit with China in almost two-thirds of the 650 individual Advanced Technology Products (ATP) tracked by the U.S. Commerce Department.
But the challenges these trends pose for the United States extend beyond the economic realm. U.S. trade and investment is providing China with the monetary resources and technology to enhance its military capabilities.
Due in significant part to its imbalanced trade relationship with the United States, China has been able to amass large hard-currency reserves giving it the capacity to purchase advanced military hardware from Russia and elsewhere.
China has also leveraged its trade and investment relationship with us to acquire advanced technologies, some of which have military capabilities, by expressly or implicitly requiring U.S. firms to transfer such technology or establish research and development facilities in China as a cost of doing business.
These are troubling developments considering U.S.-China frictions over Taiwan and China’s continued proliferation of weapons and technologies relating to weapons of mass destruction to terrorist-sponsoring states, including Iran and Iraq.
China’s accession to the World Trade Organization this past year was hailed in the United States as a means to expand U.S. exports to China while promoting civil and political reform. If these hoped-for outcomes materialize, the U.S.-China relationship can move forward on the basis of mutual interests. We believe the U.S. government should provide technical assistance and other support aimed at promoting such an outcome. But the U.S. government should be adequately prepared to deal with less optimistic outcomes.
Fundamentally, we believe that the U.S. government needs to devote more resources and put in place new programs to build wider expertise about China and to protect our industrial base from eroding as a result of our economic relations with China. The commission offered several recommendations in this regard and will continue to pursue these issues in the years ahead.
C. Richard D’Amato is chairman of the U.S.-China Security Review Commission.
Amen!
But is anybody in Congress or in the Bush Administration listening?
The Foreign Relations Committee web page is the friggin Joe Biden show. These guys were absolutely positively protecting their own special interests.
Jiveass Joe was even going to have hearings about China, all by his lonesome. He is in the closet, but is totally meandering around the tough issues in regards to China. He has no clue about East Asian affairs. At the same time, him and Rockefeller are the poster boys for saying that all of our security concerns with China are nothing compared to what they say our corporations will lose if we don't accomodate China.
Anything that GE doesn't like, Joe doesn't like either.
I am not holding my breath.
By the way, soybeans are about the ONLY thing we export to China.
Why do folks bring up these esoteric questions when the answer is so obvious?
Does anyone know of anyone who wants to have diplomatic relations with China? The spin never stops. It never ends!
With guys like Senator Lugar on "our" side we have no chance. Anything that gets in the way of their special interests isn't getting anywhere.
Those corporations can make just as much money diversifying their operations away from China. They will actually make more... but there are those special interests.
I wrote him a letter several months back expressing my distaste for subsidizing the tuition of illegal immigrants (primarily mexicans) and that they should be returned to the land from which they came here from if their parents came here illegally. He wrote back saying that the children were here by no fault of their own and that we (the tax payers) owe it to them to educate them and make them productive members of society. Needless to say, I wrote him back and explained taht I would be sure to share his letter with as many (tax paying citizens) as I could and that I would remember his letter when he was up for election again.
Back to China, this report is nothing new, for god sakes anyone with half a brain that follows our "relations" with China could have stated what was written above. The fact is that we are being sold out to China at the highest levels of our government.
That is exctly right ... and too many Americans are funding it with their own pocketbooks ... either unaware of the danger, or oblivious to it because they don't want to be bothered or have to make relatively simply sacrifices (compared to the ultimate alternatives) to vouchsafe their lierty IMHO.
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