In a bipartisan effort, a U.S. congressional committee has issued an extensive set of recommendations aimed at reshaping America's economic relationship with China. These legislative proposals for 2024 are intended to prevent the United States from becoming overly dependent on its primary geopolitical rival and to safeguard its economic interests.
The comprehensive recommendations put forth by the House of Representatives' select committee on China are the result of a year's worth of hearings and investigations. They encompass a wide range of strategies, from potential shifts in U.S. regulatory approaches to more technical legal revisions. These measures include imposing restrictions on outbound investments to China and revising the threshold for duty-free shipments from China into the United States. The committee acknowledged that implementing these measures would require difficult trade-offs and come with associated costs.
"The United States now has a choice: accept Beijing's vision of America as its economic vassal or stand up for our security, values, and prosperity," the committee declared.
Despite the November meeting between President Joe Biden and Chinese leader Xi Jinping in San Francisco, aimed at improving strained relations, committee leaders Mike Gallagher (Republican) and Raja Krishnamoorthi (Democratic) asserted that the recommendations remained largely unchanged.
Among the 150 recommendations proposed are actions such as forcing a ban on or divestment from the Chinese-owned social media platform TikTok, directing the Commerce Department to impose import duties on older Chinese semiconductors, mandating that the Federal Reserve assess U.S. banks' ability to withstand potential market access loss in China, and placing restrictions on U.S. federal agencies' purchases of Chinese-made drones.
Krishnamoorthi stated, "I think this is really a blueprint for some bipartisan legislation that we're hoping to move in the next year."
Established earlier this year, the committee's mission is to convey the importance of why Americans should be concerned about competing with China and to advocate for the selective decoupling of the U.S. and Chinese economies.
Gallagher noted that Republicans are engaged in a robust discussion about how to proceed with legislation that restricts U.S. outbound investment to China, a proposal that was removed from an annual defense authorization bill. He expressed optimism that these discussions would lead to responsible legislative activity in the first quarter of 2024.
"Even those major asset managers or bankers with whom we've engaged that are skeptical of any restrictions on investment in China, even in military and critical technological areas, I think would welcome the predictability that legislating the issue would provide," Gallagher added.