China Trade - the Short Version

The Annual Report for 2018 was published yesterday for the US-China Economic and Security Review Commission.  It reminds me that the Congress actually considered doing away with this Commission but changed its mind at the last minute.  This is a group that has led a good bit of the discussion and factual reporting on what China is really up to.  We have to wonder why anyone would want to stop funding it when the published work is so good. 

"The United States has unilateral, bilateral, and multilateral tools to address the Chinese government’s unfair practices. While these tools have been successful at targeting some discrete aspects of China’s industrial policies (e.g., a particular subsidy program or tariff), they have been less effective in altering the overall direction of Chinese industrial policy, characterized by greater state influence and control, unfair treatment of foreign companies, and pursuit of technological leadership using legal and illicit means. China leverages the attraction of its large market to induce foreign companies to make concessions (including transferring technology) in exchange for promises of access, while protecting and supporting domestic companies both at home and abroad."

This is one paragraph from a 536 page report but it summarizes what the trade negotiations with China are really about.  There is one more paragraph I wanted to mention since it applies to trade and to the South China Sea which is related:  

"Within its region, China took new steps to advance its sovereignty claims over disputed territory as President Xi declared in unusually strong language in his 19th Party Congress address that other countries should not have “the fantasy of forcing China to swallow the bitter fruit of damaging its own interests.” At the Party Congress, President Xi proclaimed the success of China’s South China Sea island-building efforts, while China’s military increased patrols near the Senkaku Islands and continued fortifying its position near the site of a recent military standoff with India. China made new efforts to deepen partnerships with Russia, Iran, and Pakistan - leveraging the relationships to challenge U.S. security and economic interests— and continued taking steps to expand its overseas military presence."

Any wonder why China would want to reduce the influence of this Commission?