How Beijing Is Testing the Biden Administration

The Chinese government goes after U.S. businesses.

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The Chinese government welcomed President Joe Biden to office by sanctioning 28 former Trump administration officials (and their families) on Inauguration Day. Since then, the Chinese Communist Party has continued to test the new administration to assess whether it is prepared to defend American interests. 

Many security experts predicted the next sizing up from the party leadership in Beijing would be in the Taiwan Straits. Instead, it is turning its ire toward the boardrooms of some of the most prominent retail brands produced by the United States and its close allies. 

Leading companies around the world are reviewing their supply chains to make sure they aren’t indirectly or directly involved in the CCP’s systematic campaign of atrocities against the Uyghur Muslims of Xinjiang (a territory the CCP has claimed to be a part of China only since the murderous reign of Mao Zedong). The U.S. under Donald Trump recognized the seriousness of these crimes by imposing sanctions in July and, in January, declaring that the abuses constituted genocide. 

Corporations are particularly concerned that Beijing is using Uyghurs for forced labor, and that such labor could be involved in their supply chains, given how much global manufacturing takes place in China. Popular Western brands like H&M and Adidas have taken steps to make sure the supply chains for their products don’t include material sourced to Beijing’s forced labor complex. H&M, for example, has said it would stop buying cotton from Xinjiang.

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  1. Avatar photo
    Earl King

    I will be looking to the Women's Olympic team who joined NFL athletes in condemning police brutality against Blacks to see either if A) They don't care about anyone else who is oppressed or B) There ire is simply about local tribal politics and a higher paycheck.

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  2. Avatar photo
    Show Jay Janney the 🚪!

    M.A.D.
    The Chinese own trillions of our debt. With all the reckless spending today, we' are running annual deficits at historic levels. If the Chinese refuse to buy our debt, we are screwed, bigly. Potential economic collapse. Although if we default on what they owe, they are screwed even bigger.

    M.A.D.

    We'll continue to cooperate with them. We'll complain at the margins, but we'll let it go.

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    1. Avatar photo
      Narwhal

      The PRC owns around 1/20th of our national debt. We are not screwed bigly if they stopped buying it and sold what they already have because it is still highly desirable even with the absurdly low rate of return currently. And if they did sell theirs off then their exports to us would get more expensive.

      “The repercussions for China of such an offloading would be worse. An excess supply of U.S. dollars would lead to a decline in USD rates, making RMB valuations higher. It would increase the cost of Chinese products, making them lose their competitive price advantage. China may not be willing to do that, as it makes little economic sense.

      If China (or any other nation having a trade surplus with the U.S.) stops buying U.S. Treasurys or even starts dumping its U.S. forex reserves, its trade surplus would become a trade deficit—something which no export-oriented economy would want, as they would be worse off as a result.

      The ongoing worries about China's increased holding of U.S. Treasurys or the fear of Beijing dumping them are uncalled for. Even if such a thing were to happen, the dollars and debt securities would not vanish. They would reach other vaults.”
      https://www.investopedia.com/articles/investing/040115/reasons-why-china-buys-us-treasury-bonds.asp

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      1. Avatar photo
        Show Jay Janney the 🚪!

        Our interest rates will increase substantially if they quit buying our debt, and that will lead to a major recession, or worse.

        It's why I call it M.A.D.

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        1. Avatar photo
          Narwhal

          They own 1/20th of our national debt. Our debt is still highly desirable even at absurdly low rates. Inflation is a greater concern than the PRC trying to dump their US treasuries, and inflation isn’t much of a concern at present or in the foreseeable future. Also again, if they did so they might cause themselves to have a recession.

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  3. Raincheck

    China needs to be treated more like South Africa was. A world wide response. Yes, there is a lot more money at stake. But there is a lot at stake for the Uighurs. For Hong Kong. Possibly for Taiwan. In industrial espionage. And in numerous other areas where China’s actions are not acceptable.

    The idea was that if we brought China into the world economy they would have to become better actors. Now it seems like it has made us hostage to our economic connections with China. That has to change.

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  4. Avatar photo
    Victor Clairmont

    No compromise.

    If they want to escalate this Cold War, we should respond against their businesses. Yes it will hurt us and them economically, but I am not interested in placating a genocidal regime of the CCP. It stinks since we are in economic trouble in our own way, and was stupid of President Nixon to open China to trade in the first place, but let us no longer cooperate and use the full power of our foreign diplomacy and economic ability to slow and stifle the evil communist party. Which means going after their One Belt One Road policy all over the world through competing and making other countries resist Chinese influence, especially Africa where 1/3 of China’s wealth comes from in trade.

    The longer we ignore the devils deal, the worse this world will be.

    We need to confront this CCP in all ways and help our allies resist it.

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    1. Avatar photo
      Narwhal

      Can you remind me how we got into a war with the Empire of Japan?

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      Chris L

      It was reasonable to try to open up to China once upon a time, especially considering that the Hayek-Friedman hypothesis was newly making the rounds in the 1960s. But the plug needed to be pulled a long time ago, and far before becoming permanent members on the UN Security Council (among other disastrously inclusive international involvements, most recently their machinations in WHO).

      And good on your point on undermining Belt and Road - if we get enough sudden pressure on them, China will lash out and further undermine Belt and Road through such tantrums. Internationally, they did *not* look good during the Alaska summit from that, as most of Africa and Asia definitely looked at China with bemusement at best.

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      1. Avatar photo
        Narwhal

        Exploiting the Sino-Soviet split made sense during the Cold War. Outsourcing from say 1995 onwards was unwise on the scale we did it.

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          Narwhal

          Two things we outsourced to the PRC and elsewhere: pollution and low skilled jobs with poor working conditions, low pay, and long hours. I rarely see the outsourcing of pollution mentioned when discussing outsourcing or why it might have been an attractive consideration to those who outsourced certain types of things.

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            Victor Clairmont

            This is true.

            Outsourcing to China (and India), the first two major polluters world wide still going up (while our carbon emissions go down) is something not normally talked about.

            Probably because that means we would have to confront China more-so than ourselves.

            On the low pay long hours, the problem here is compared to what they would make on average in their countries, these are very well paying jobs. Even those coming here to work for low pay to us, is high pay to them.

            If that makes sense. So if the average American worker were to get minimum wage of a state lets say 11.50 an hour, most people would agree a single parent working while one stays home with three kids, this is insufficient to raise a family with full benefits.

            To the immigrant however, who would not have healthcare, dental, insurance for the home etc., it's a King's ransom since they just want a roof over heir head and food, and then send extra money home to their poor relatives in Argentina that can use the funds for cheaper family dental etc. Our sensibilities say, "That's poverty". Their sensibility is, "Compared to what I came from? This is upper class".

            So it gets complicated whichever way we go with this. Not saying they all say that, but hopefully it gets across the different perspective.

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    Chris L

    I am normally against boycotting of athletic events, especially those as big a deal as the Olympics. But the more I think about it, the more I am in favor of the US doing so - there can be no more conspicuous message to send to China, and would also result in rapid snowballing of corporate pullout from the country altogether.

    However, this must be done as soon as possible to ensure that the rest of the West follows suit in all of these things, and to minimize any animus by the athletes themselves (though leaning into the "Genocide Olympics" moniker is a good touch to emotionally divorce them from attending). Without all these other countries' support, it would be a meaningless gesture and backfire. But with that support, this would also suddenly starve CCP of cashflow for their rapidly expanding military which is always an expensive prospect, and pump the brakes on their South/East China Sea incursions. This would then trickle down to further starve North Korea of support (currently *literally* starving) as well as to the general Chinese population, eroding that support for CCP.

    Of course China would then turtle up internationally and huddle even more closely w/Russia than they already are, but they already intend on doing this anyway. This will just greatly hasten that timeline, and China isn't very good at anything when they have to rush.

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    1. Avatar photo
      Show Jay Janney the 🚪!

      Send them, but humiliate them by doing so. Design uniforms with a message of support for the Uyghurs. Pay athletes to show solidarity with them while over there.

      As for me, I probably won't take any stimulants so I can watch them...

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        Pat @ Tavi Hall

        China has already started to hold US citizens in China. I'm concerned this type of tactic could cause athletes and others to be held.

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          Show Jay Janney the 🚪!

          I'm not up to speed on the details to that, and it would be a concern. At the same time, it'd get world wide negative attention at the same time. My fear is they'd use a ruse like a trumped up charge; like drug dealing or sexual assault, etc.

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            Pat @ Tavi Hall

            Something in a recent piece here linked out to this story from two years ago, https://www.cbsnews.com/news/american-siblings-trapped-in-china-make-public-plea-for-help/

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        Narwhal

        I’m guessing that their are regulations against political expressions by athletes in all olympics. A hand gesture could get past, uniforms wouldn’t.

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          Show Jay Janney the 🚪!

          If our athletes aren't there, the value of the Olympics declines for them substantially. If we make our uniforms a condition of participation, it's gonna stress them,.

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            Narwhal

            They don’t make they call. The Olympic organizing committee makes the call. Ain’t gonna happen.

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      Narwhal

      “Without all these other countries' support, it would be a meaningless gesture and backfire.”

      At a minimum we need the UK and Australia to also boycott it. The boycott, if it happens, needs to show unity and strength, not isolation and weakness.

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        Victor Clairmont

        Yup.

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        Chris L

        Five Eyes and the Quad absolutely must boycott if we do, but I think that's not enough. We'd have to get most of the EU too. They need to be deprived not just of EU revenue, but India and Australia as well. They really need to flex to make China flinch right at their doorstep.

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          Narwhal

          Agreed. However, the five eyes and the quad plus a few others might be a tough pull.

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