Across political divide, there are focused efforts to make serious changes to the way the US does business with China, and China’s dangerous avariciousness is being called out in very high profile ways.
MIAMI:‘Pssst, hey mister, want to buy some cheap manufacturing? How about access to the biggest market in the world? I’ve got that and a whole lot more, just follow me down this dark alley. No, no, don’t worry about where it’ll lead. Trust me.”
And so, over the past few decades, entire global business sectors and the national leadership of whole countries have been lured down a dark road by China, along the way becoming addicted to cheap labour, lax environmental regulations, authoritarian facilitation of access to land, a rigged market, a docile media, a compliant legal system, and a lot of wining and dining (and more).
The model expanded out of China with individual non-Chinese politicians and business people acting as middlemen for what China was peddling. In exchange for great personal gain, they addicted their economies and stakeholders to fast, cheap, economic thrills, paying for it with their country’s and company’s IP, critical digital, physical and economic infrastructure, and so much more.
China presented the engagement as “just economic”—win-win for China, its partners and the middlemen. But with Covid-19 turning the spotlight on China’s hidden face, it now looks less simply economic and more triple use: a commercial face, yes, but with a strategic spine, and deep corruption running through its veins. The Chinese business sector, Beijing’s strategic ambitions, and the country’s extremely wealthy and powerful corrupt elements have been the real three winners. Until now. Until Covid-19.
The virus came out of China and glided along the established pathways created by the Chinese Communist Party (CCP): lies about its severity, Beijing’s corruption of global safeguards (for example the World Health Organisation), the sale of faulty protective equipment, a deliberate campaign to confuse the world about the origins, racist attacks on Africans in China (as if to blame them for the virus), false declarations that China is all clear now and open for business, etc.
China’s behaviour has been so egregious that it has opened many eyes to the fact that the addiction to China has left entire global systems weakened and dependent, and seriously, seriously ill.
Like a dipsomaniac the morning after, countries are waking up, bleary-eyes, looking around their trashed economies and suffering populations, and saying “what did I do?”
Like many deep in the throes of a hangover, they are also saying: “I’ll never do that again. I promise.”
But, once the crisis is over, the lure will be strong to return to old patterns. Which is why it is so important to quickly put in floodlights to see even more clearly what China and its allies have done, so we can build resolve, find healthier ways of engaging with partners and, above all, don’t get drawn back down the rabbit hole while no one is looking.
In the US, this process is already starting. Across the political divide, there are focused efforts to make serious changes to the way the US does business with China, and China’s dangerous avariciousness is being called out in very high profile ways.
US Senator Marco Rubio summarized the shift in DC. “The theory around here, for a long time, as you well know, was: ‘Don’t worry. We’re going to open up to China, and capitalism is going to change China,’ and instead, it’s China that’s changed capitalism and weaponized it.”
President Trump highlighted how, when China “was allowed to join under those circumstances the WTO, that was a very bad day for the United States because they have rules and regulations that were far different and far easier than our rules and regulations”. He also said, “They should have never been allowed it, this should have never been allowed to happen.”
China managed its entry into the WTO the way it does so many things, with the benign commercial front masking the strategic ambition and corruption. While, as India knows all too well, other countries use the WTO for advantage, the US included, China’s manoeuvrings have been particularly audacious, and aided by currency manipulation.
As with so many things that get entrapped by China, the WTO host ended up taking on some of the characteristics of the parasite China and, ultimately, has become sickened to the point of near paralysis. Which is why, now, with countries scrambling to save the shreds of their economies through onshoring, bilateral side deals, and even invoking war time economic measures, no one is even mentioning the WTO anymore. It’s consigned to isolation, as the Trump administration has done with the World Health Organization, until it can prove its health.
With weak global systems in stunned disarray, some are advocating for a cold turkey approach to dealing with the China addiction.
US Senator Marsha Blackburn (R-Tennessee) and Senator Bob Menendez (D-New Jersey) have introduced the bipartisan Securing America’s Medicine Cabinet Act to encourage moving the manufacture of critical medicines out of China. Blackburn said it is a “National security risk when pharmaceuticals we need are made in China. We shouldn’t be in position for having this happen ever again.” Blackburn has also called for a ban on Confucius Institutes on US campuses, says there are problems with “Huawei trying to set up a spy network”, and that the US must demand debt forgiveness for the $1 trillion of US debt currently being held by China.
Rep. Mac Thornberry (R-Texas), the top Republican on the House Armed Services Committee has called for over $6 billion to be invested in 2021 to create an Indo-Pacific Deterrence Initiative, saying “this effort consolidates and funds the policies, infrastructure, and platforms needed to reassure our allies and partners while we deter China”.
Senator Lindsey Graham (R-South Carolina) said, “If it were not for the irresponsibility of the Chinese Communist Party, there would be no pandemic in the world… Americans would be alive today, and 22 million people would be at work. China is responsible, and it’s time to hold them responsible. They’re the largest state sponsor of pandemics in the entire globe, and they need to pay the price.”
Sen. Tom Cotton (R-Arkansas) and Rep. Dan Crenshaw (R-Texas) introduced the “Holding the Chinese Communist Party Accountable for Infecting Americans Act of 2020” bill that would allow Americans to sue China in federal court for “death, injury, and economic harm caused by the Wuhan Virus”.
What would have been considered extreme a month ago is now considered close to mainstream, and is likely to gather momentum as the effects of the virus linger, and the election in November approaches. There is a maxim in US politics that foreign policy doesn’t win elections. But, to Americans stuck in their homes, unemployed and getting increasingly desperate, US-China relations aren’t foreign policy anymore, they are domestic economic survival and national security at its most raw.
And it’s not just the US. In the UK, which was seen as “soft on China” as it looked for a post-Brexit trade deal, First Secretary of State Dominic Raab has said, “I think there absolutely needs to be a very, very deep dive after the event review of the lessons—including of the outbreak of the virus. But there is no doubt we can’t have business as usual after this crisis”. In Nigeria, fury at Chinese racism towards Africans resulted in the burning of a Chinese factory. In Kenya, one Senator has called for non-Kenyan ethnic Chinese to be expelled, saying: “Yes we are corrupt and broke but we are not children of a lesser God and neither are we stupid.”
As the world awakens from its China-induced fugue state, and tries to put in place recovery plans, options open up for India. Globally, especially outside the West, weaning off China requires displacing it at its primary entry point, the “gateway drugs” of affordable goods, infrastructure development, etc.
In many sectors where China has proven dangerously unreliable, India can contribute to stability. For example, while China threatened to withhold lifesaving drugs from the US as punishment for questioning the CCP, India shared supplies with the US (and others). This is particularly striking as previous US administrations had tried to smother the Indian pharmaceutical sector (properly presented in DC, at this crucial time, this might help underline the role of affordable Indian generics to global security).
Apart from pharma, India can be a global provider in everything from AI innovation to energy systems to space technologies to water technologies to English language education (I bet quite a few US parents would be glad for online tutors from India at the moment). And so much more. It can also potentially play a role in creating new permanent international structures that are more difficult for China (or whomever) to corrupt.
The list is only limited by India itself. The fact is, India should already be filling those roles. It’s only been obstruction and sometimes corruption within the Indian system that has kept the country back. Jignesh Shah, for example, was revolutionizing markets around the region before he fell foul of vested interests and was brought crashing down. There are way too many similar stories.
This is a unique opening at a moment when the Indian economy really needs a break. If there was ever a time for the governments at all levels to facilitate Indian international engagement, or at least get out of the way, this is it. If those vested interests insist on taking a cut, let them wait until later on, when there is more fat. If they cut now, the patient could bleed to death. Make no mistake, China is not going to lose its street corner without a nasty, dirty, expensive fight. It will take resolve to stay sober.
As the world tries to shake off its deadly China addiction, a strong, energetic, thriving India could inject new healthy life into the global economic system, helping itself, as well as everyone else. It just needs to treat its own infections first.
Cleo Paskal is Non-Resident Senior Fellow for the Indo-Pacific at the Foundation for Defence of Democracies.
And so, over the past few decades, entire global business sectors and the national leadership of whole countries have been lured down a dark road by China, along the way becoming addicted to cheap labour, lax environmental regulations, authoritarian facilitation of access to land, a rigged market, a docile media, a compliant legal system, and a lot of wining and dining (and more).
The model expanded out of China with individual non-Chinese politicians and business people acting as middlemen for what China was peddling. In exchange for great personal gain, they addicted their economies and stakeholders to fast, cheap, economic thrills, paying for it with their country’s and company’s IP, critical digital, physical and economic infrastructure, and so much more.
China presented the engagement as “just economic”—win-win for China, its partners and the middlemen. But with Covid-19 turning the spotlight on China’s hidden face, it now looks less simply economic and more triple use: a commercial face, yes, but with a strategic spine, and deep corruption running through its veins. The Chinese business sector, Beijing’s strategic ambitions, and the country’s extremely wealthy and powerful corrupt elements have been the real three winners. Until now. Until Covid-19.
The virus came out of China and glided along the established pathways created by the Chinese Communist Party (CCP): lies about its severity, Beijing’s corruption of global safeguards (for example the World Health Organisation), the sale of faulty protective equipment, a deliberate campaign to confuse the world about the origins, racist attacks on Africans in China (as if to blame them for the virus), false declarations that China is all clear now and open for business, etc.
China’s behaviour has been so egregious that it has opened many eyes to the fact that the addiction to China has left entire global systems weakened and dependent, and seriously, seriously ill.
Like a dipsomaniac the morning after, countries are waking up, bleary-eyes, looking around their trashed economies and suffering populations, and saying “what did I do?”
Like many deep in the throes of a hangover, they are also saying: “I’ll never do that again. I promise.”
But, once the crisis is over, the lure will be strong to return to old patterns. Which is why it is so important to quickly put in floodlights to see even more clearly what China and its allies have done, so we can build resolve, find healthier ways of engaging with partners and, above all, don’t get drawn back down the rabbit hole while no one is looking.
In the US, this process is already starting. Across the political divide, there are focused efforts to make serious changes to the way the US does business with China, and China’s dangerous avariciousness is being called out in very high profile ways.
US Senator Marco Rubio summarized the shift in DC. “The theory around here, for a long time, as you well know, was: ‘Don’t worry. We’re going to open up to China, and capitalism is going to change China,’ and instead, it’s China that’s changed capitalism and weaponized it.”
President Trump highlighted how, when China “was allowed to join under those circumstances the WTO, that was a very bad day for the United States because they have rules and regulations that were far different and far easier than our rules and regulations”. He also said, “They should have never been allowed it, this should have never been allowed to happen.”
China managed its entry into the WTO the way it does so many things, with the benign commercial front masking the strategic ambition and corruption. While, as India knows all too well, other countries use the WTO for advantage, the US included, China’s manoeuvrings have been particularly audacious, and aided by currency manipulation.
As with so many things that get entrapped by China, the WTO host ended up taking on some of the characteristics of the parasite China and, ultimately, has become sickened to the point of near paralysis. Which is why, now, with countries scrambling to save the shreds of their economies through onshoring, bilateral side deals, and even invoking war time economic measures, no one is even mentioning the WTO anymore. It’s consigned to isolation, as the Trump administration has done with the World Health Organization, until it can prove its health.
With weak global systems in stunned disarray, some are advocating for a cold turkey approach to dealing with the China addiction.
US Senator Marsha Blackburn (R-Tennessee) and Senator Bob Menendez (D-New Jersey) have introduced the bipartisan Securing America’s Medicine Cabinet Act to encourage moving the manufacture of critical medicines out of China. Blackburn said it is a “National security risk when pharmaceuticals we need are made in China. We shouldn’t be in position for having this happen ever again.” Blackburn has also called for a ban on Confucius Institutes on US campuses, says there are problems with “Huawei trying to set up a spy network”, and that the US must demand debt forgiveness for the $1 trillion of US debt currently being held by China.
Rep. Mac Thornberry (R-Texas), the top Republican on the House Armed Services Committee has called for over $6 billion to be invested in 2021 to create an Indo-Pacific Deterrence Initiative, saying “this effort consolidates and funds the policies, infrastructure, and platforms needed to reassure our allies and partners while we deter China”.
Senator Lindsey Graham (R-South Carolina) said, “If it were not for the irresponsibility of the Chinese Communist Party, there would be no pandemic in the world… Americans would be alive today, and 22 million people would be at work. China is responsible, and it’s time to hold them responsible. They’re the largest state sponsor of pandemics in the entire globe, and they need to pay the price.”
Sen. Tom Cotton (R-Arkansas) and Rep. Dan Crenshaw (R-Texas) introduced the “Holding the Chinese Communist Party Accountable for Infecting Americans Act of 2020” bill that would allow Americans to sue China in federal court for “death, injury, and economic harm caused by the Wuhan Virus”.
What would have been considered extreme a month ago is now considered close to mainstream, and is likely to gather momentum as the effects of the virus linger, and the election in November approaches. There is a maxim in US politics that foreign policy doesn’t win elections. But, to Americans stuck in their homes, unemployed and getting increasingly desperate, US-China relations aren’t foreign policy anymore, they are domestic economic survival and national security at its most raw.
And it’s not just the US. In the UK, which was seen as “soft on China” as it looked for a post-Brexit trade deal, First Secretary of State Dominic Raab has said, “I think there absolutely needs to be a very, very deep dive after the event review of the lessons—including of the outbreak of the virus. But there is no doubt we can’t have business as usual after this crisis”. In Nigeria, fury at Chinese racism towards Africans resulted in the burning of a Chinese factory. In Kenya, one Senator has called for non-Kenyan ethnic Chinese to be expelled, saying: “Yes we are corrupt and broke but we are not children of a lesser God and neither are we stupid.”
As the world awakens from its China-induced fugue state, and tries to put in place recovery plans, options open up for India. Globally, especially outside the West, weaning off China requires displacing it at its primary entry point, the “gateway drugs” of affordable goods, infrastructure development, etc.
In many sectors where China has proven dangerously unreliable, India can contribute to stability. For example, while China threatened to withhold lifesaving drugs from the US as punishment for questioning the CCP, India shared supplies with the US (and others). This is particularly striking as previous US administrations had tried to smother the Indian pharmaceutical sector (properly presented in DC, at this crucial time, this might help underline the role of affordable Indian generics to global security).
Apart from pharma, India can be a global provider in everything from AI innovation to energy systems to space technologies to water technologies to English language education (I bet quite a few US parents would be glad for online tutors from India at the moment). And so much more. It can also potentially play a role in creating new permanent international structures that are more difficult for China (or whomever) to corrupt.
The list is only limited by India itself. The fact is, India should already be filling those roles. It’s only been obstruction and sometimes corruption within the Indian system that has kept the country back. Jignesh Shah, for example, was revolutionizing markets around the region before he fell foul of vested interests and was brought crashing down. There are way too many similar stories.
This is a unique opening at a moment when the Indian economy really needs a break. If there was ever a time for the governments at all levels to facilitate Indian international engagement, or at least get out of the way, this is it. If those vested interests insist on taking a cut, let them wait until later on, when there is more fat. If they cut now, the patient could bleed to death. Make no mistake, China is not going to lose its street corner without a nasty, dirty, expensive fight. It will take resolve to stay sober.
As the world tries to shake off its deadly China addiction, a strong, energetic, thriving India could inject new healthy life into the global economic system, helping itself, as well as everyone else. It just needs to treat its own infections first.
Cleo Paskal is Non-Resident Senior Fellow for the Indo-Pacific at the Foundation for Defence of Democracies.
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