With the Trump administration ending with Joe Biden’s inauguration on Jan. 20, it’s quite likely that much of President Donald Trump’s comprehensive China policy will go with him. That includes Trump’s executive order that mandates delisting Chinese companies from U.S. capital markets.
In fact, it’s almost a fait acompli.
Wall Street’s Priorities
This can be said with confidence because even though U.S. investment and retirement accounts are heavily invested in fraudulent Chinese companies, American money managers have a strong financial motivation to ignore Trump’s order. Big Chinese money and the lure of an open Chinese market to U.S. financial services and global investment firms are driving their behavior.
Both promise to deliver great financial windfalls to Wall Street investment banks. In fact, even though the executive order specifically identifies how U.S. capital markets are enabling China’s military and industrial growth to pose growing threats to America both at home and abroad and undermine U.S. financial stability, Wall Street doesn’t care.
Biden has the opportunity to prove his mettle up front by enforcing Trump’s executive order and reining in the big investment banks. It would also send a message to both allies and China alike, Biden’s political Achilles heel, that he has a clear understanding of the present challenges and is unencumbered by the past.
But if those things don’t happen, it would free up the U.S. financial community’s singular priority, which is making money, even at the expense of national security.
With a Biden administration now imminent, insiders predict, however, that the executive order will be short-lived. Others say that it may never be put into full effect.
Undercutting the Trump Legacy
But there are more aspects to Trump’s China policy than blocking China’s access to U.S. stock markets and indexes, as important as those things are. Will Biden’s presidency undercut Trump’s hard-line approach to trade with China? Or will he choose a middle way? In either case, Biden needs a strategy that encompasses protecting intellectual property rights, keeping a closer eye on academic exchange programs, closer relations with Taiwan, and even such “minor” things as internet apps.
Let’s look at recent news for China apps, for example. Trump’s latest executive order adds bans on the popular apps WeChat and TikTok. Many experts have identified Chinese apps as vectors for data and identity theft, as well as for tracking anti-China activity. But in a Biden administration, it’s not certain that this executive order—like the previous one—will be recognized or acted upon.
As far as Trump’s steep 25 percent tariff on Chinese manufactured goods is concerned, it’s thought that Biden won’t reverse them and others—at least not initially. The rationale is that the new president will use them to cut a new trade deal with China, perhaps with the participation of European nations.
If past is prologue, multilateral agreements tend not to favor the United States. That may or may not be the case; it remains to be seen.
It also remains to be seen how Biden plans to stop the Chinese from stealing U.S. intellectual property, which is estimated to be between $225 billion and $600 billion per year. The Trump administration made IP protection a big part of its China trade policy.
But will Biden, with his deep financial ties to China and the Chinese Communist Party (CCP), be willing or able to continue protecting the United States from the CCP’s longstanding policy of IP theft?
Let’s hope so.
Will Biden Curtail Academic, Research Exchanges?
A significant part of China’s IP theft apparatus is its deep and pervasive academic relationship with U.S. universities and researchers. Through various initiatives such as the Confucius Institutes and the Thousand Talents program, the Chinese regime has been able to gather enormous amounts of IP and technological innovation.
Too often, key scientists became Chinese assets.
Under the Trump administration, universities began to kick Confucius Institutes, which are essentially CCP indoctrination and IP gathering centers, off of their campuses. The Thousand Talents program is literally a means by which the best and brightest scientists and researchers in the United States are paid handsomely to relocate to China to do their work.
Of course, the CCP has reaped enormous technological rewards from both of these programs.
China: ‘A Competitor, Not an Adversary’
As vice president of the eight-year Obama administration under which these efforts flourished, why should we expect a President Biden to behave any differently?
Biden is perceived as the best president the CCP could wish for. Regardless of how much or how little money the incoming president has made in his dealings with China, the fact is that he views China as a competitor, not an adversary.
Will he change his view? If so, such a shift in perspective could make a world of difference when it comes to forming a new China policy.
Will Biden Abandon Taiwan?
This is particularly important regarding U.S.–Taiwan relations. On Jan. 9, Secretary of State Mike Pompeo announced that restrictions limiting contacts between Taiwan and U.S. officials will be removed. This effectively means an official recognition of Taiwan as a sovereign state, a key part of America’s “One China” policy, which only recognized the Beijing government as the government of China and Taiwan.
Prior to this change in diplomatic policy, the Trump administration sold more defensive arms to Taiwan in one year than Obama did in eight years. The idea is to enable the island nation of 23.5 million people to deter an invasion from mainland communist China.
What’s more, given that the CCP now has Hong Kong under its boot heel, it’s not unreasonable to presume that Beijing plans a similar fate for Taiwan. Indeed, the CCP leadership has declared that as a main geopolitical objective.
Will the United States revert to the One China policy? What will the Biden administration say or do if China invades Taiwan? Will we see a return to the United States enabling the rise of China as the dominant global power, or will Biden challenge the CCP?
We don’t know. Perhaps a simpler question will do: Will a Biden–Harris administration rise to the challenge that the CCP poses to the United States?
We’ll soon find out.
James R. Gorrie is the author of “The China Crisis” (Wiley, 2013) and writes on his blog, TheBananaRepublican.com. He is based in Southern California.
Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.