Congressman Rick Larsen Speaks on Economic Decoupling and Various Other U.S.

At a CSIS event on December 15, Congressman Rick Larsen (D – WA), co-chair of the US – China Working Group, offer remarks and responded to questions from Bonnie Glaser, director of the China Power Project. The following is a transcript of the discussion, which covered issues such as economic decoupling, human rights, Congressional views of China, technology competition, competition for influence in other parts of the world, travel bans, and how to describe the current U.S. – China relationship:

Bonnie Glaser:

I’m Bonnie Glaser, director of the China Power Project at the Center for Strategic and International Studies. … We have a special guest joining us to talk about US – China relations. I’m delighted to have with us Congressman Rick Larsen, who represents the second Congressional District of Washington State, and importantly for this conversation, is the co- chair of the bipartisan US – China Working Group, which was created in 2005 to provide accurate information to members of Congress on critical issues pertaining to China, and to provide a forum for discussion with Chinese officials and leaders. And in this capacity Congressman Larsen has really made a significant contribution to the understanding of China within Congress. He’s frequently engaged with experts on China as well, to discuss China’s internal developments and its evolving approach to the world. And I admire his determination to help Congress understand China, and his dedication to protecting American interests, and to promoting better understanding between our two countries.

So we’re going to start with some framing remarks from Congressman Larsen, and then I’ll pose a few questions. …

Congressman Larsen:

Thanks Bonnie and thanks to CSIS China Power for asking me to say a few words and take a few questions. …

I want to thank you for a chance to say a few words about this relationship because it has evolved since 2005, when Mark Kirk and I started the US – China working group in Congress, and we began that, as you noted, to help educate members of Congress about the relationship that exists between the United States and China. And one of the fundamental tenets of the US – China working group is that we don’t think there is one relationship between the US and China, that it’s various relationships, depending upon the issue. And over time, depending on the issue, things have gone well and things have gone poorly.

I think right now if you look at the general direction of the overall relationship, it’s not going very well at all. That’s not breaking news, I’m sure, for anyone. But I do think it has an implication for the incoming administration and implications for Congress, as well. One of the ways I’ve tried to categorize members of Congress — and this is my, this is my political science in me, you know, one day, I want to be a scientist so finding ways to classify and categorize things as important — we’ve always talked about the Hawk and Dove metaphor, in talking about how we approach national security and foreign policy. And with regard to China, we’ve had, you know, economic security hawks, those are the kind of trade protectionist, China’s eating our lunch, folks; national security hawks, with concerns about military modernization, not just the rise of trend economically but the rise of China militarily; and then, human rights hawks, those members of Congress who focus a lot on issues like, these days, Hong Kong and Xinjiang.

But that classification really isn’t an accurate, an accurate description, or as helpful as looking at members of Congress and their approaches a different way, and so I’ve got a different way to think about them: as punishers, decouplers, and salvagers.

From a legislative perspective, we’ve had, what, 300 400 pieces of legislation introduced, just in this 116th Congress in China, where members of Congress are taking an approach to punish China. Think of sanctions on individuals as an example. So those are kind of the punishers. Then there are the decouplers, looking at the economic relationship and trying to really sever that economic relationship. And then the salvagers, which I would put me in that category, and people like Darin LaHood, a Republican who is the co chair of the US -China Working Group, recognizing there’s areas where we’re going to conflict, where we’re going to compete, but there are areas where we need to cooperate, trying to salvage parts of that relationship in a way that keeps a process open to think about this relationship strategically.

I think that’s where we sit today, I think that’s what the administration, the incoming administration, needs to consider, that Congress has changed, the center of gravity on China has changed in Congress, and that as the Biden Harris team approaches Congress, say for nomination fights, or for even crafting legislation or crafting an approach when they are talking to members of Congress, keeping in mind that that center of gravity has changed, that there are folks who are punishers and decouplers and salvagers as well.

And so I think it’s going to prove to be an interesting time, because the administration probably doesn’t have a lot of time to accept this from Congress, and adjust. So, as we think about what the Biden Harris team, and who they are putting into place in these positions. I think they need to be thinking about how they’re going to approach members of Congress, how they’re going to approach the Senate for confirmations, keeping this change in the center of gravity in mind.

I finally will note two points. One point, with an (a) and a (b) here. There are two areas where I don’t think there’s a lot of wiggle room from Congress. One is on human rights. We’ve seen several pieces of legislation on Xinjiang pass. We’ve seen Congress taking, the House and Senate taking, a much stronger vocal and rhetorical stance on what’s going on in Hong Kong and its National Security law and its implementation. And many, not many, but several members of Congress, like myself, we’ve met some of these folks in Hong Kong who have been arrested. And have had conversations with them in the past, we know them, the young and the old. So, I think that there’s not a lot of wiggle room on the role of human rights and how we approach that from the US perspective.

The second, where I think there’s not a lot of wiggle room, is in the issue of technology. Folks, not me, I won’t claim this as mine, but I’ll say it, some folks that we’re not a trade war with China, we’re in a tech war. And I think from a Congressional perspective, most members of Congress who follow this issue, believe that’s true and so having an approach on technology, technology transfers, 5G investment, on the role of artificial intelligence and its uses, the development of algorithms and who gets his hands on those, the administration is really going to have to keep that issue really close at heart, because I think in Congress we see technology in this fourth industrial revolution as an economic advantage that we don’t want to lose, if we are losing it we want to get it back. And so, probably not a lot of wiggle room for the incoming administration on that either. So those are some thoughts I’ll toss out for you, Bonnie, and for the good folks on the podcast and the webinar to think about and turn it back over to you.

Glaser:

Great, Congressman, thanks so much for those really thoughtful remarks, I like your characterization of the different groups in Congress and they may reflect, to some extent, the broader constituencies and other communities that follow China. But let me ask you whether you really think that there is a bipartisan consensus on some issues. So many people who talk about the views of China today in Congress, do say there is now a bipartisan consensus, and not just in Congress but across other groupings where there’s a view that China is now seen as posing the biggest challenge for the United States, as you said technology seen as a central area of competition. And we know that in the Trump administration that the US-China relationship was fraying, as one of strategic competition, and China is labeled a rival. So, if there are areas of consensus in Congress, what do you see as those areas, and what are the key areas of difference?

Larsen:

Well, I think that there’s a variety of areas that cause levels of concern that, for members of Congress, and the approaches that we generally have taken have been areas where, steps that we’ve taken, that don’t really reflect a, an offense, but rather in the United States getting defensive. I’m thinking of, on technology, the administration’s approach, the current administration’s approach, has been less about trying to beat China at its own game, if you want to call it that, or you know, invest and get our own house in order, if you want to call it that, the kinds of things that we can do to make the United States stronger relative to whatever China’s doing on technology, much less any other country is doing. So that we provide that other choice that, or another set of choices, for others to make when it comes to 5G investment, and the like. What are we doing about being active on standards setting, when these groups meet to set standards on technology. Are we being active or do we have an offensive approach going into these meetings, well laid out plans working with our friends and allies to ensure that that US ideas about transparency and openness and as they translate into actual standard setting, is that getting reflected. And I think that’s where we lack, so it’s not so much, you know, my main criticism is really not that there isn’t a consensus and that consensus has kind of changed the center of gravity to be more negative. It’s that we haven’t done, we haven’t taken the action to look at things beyond just a relationship between the US and China. Now, China doesn’t necessarily look at the US – China relationship as strictly its only relationship, as strictly a bilateral relationship, and there’s nothing else going on in the world. We’ve tended to look at the US – China relationship as a bilateral and nothing else is going on the world that impacts that. We do a better job, and this will sound like a broken record, we need to do a better job of addressing that consensus and bringing our friends and allies and partners in as part of that and sometimes taking the lead from our friends and partners and allies as well. So, I think that’s where we should be headed. Again, I think that’s gonna be news anyone, but I think that’s a change with I’d like to see happen in the administration.

Glaser:

You mentioned Hong Kong and human rights as being areas that will continue continued to receive attention in Congress, and we know that President during the campaign had some tough words to say on both of those issues. And in fact, his campaign did say that what is taking place in Xinjiang’s camps is genocide, and that’s going beyond what the Trump administration has said. But the Trump administration did take many actions, particularly in Hong Kong to change that relationship fundamentally, and to try to punish people in Beijing who are responsible for essentially violating one country, two systems, and not respecting the autonomy that was promised to Hong Kong. And of course actions taken on Xinjiang as well. So my question is, what more do you think can be done by Congress, or the executive branch in the next administration to try and influence Chinese policies in that area. As you know, it’s really hard to influence China’s decision making on those particular issues. So, is there more that we that we could do and that we should do.

Larsen:

Yeah, let me make two points before I answer that. Human rights is a long game. And standing up for human rights is a long game. And I think from a rhetorical perspective the US is going to have to continue to show the leadership in Beijing, that we are in for human rights for the long term. It’s not claimed to be a, something that we turn on or off. And, you know, frankly, that’s where Congress is, Democratic and Republican, very bipartisan. And so I hope that the Biden team can continue with their with strong rhetoric on human rights.

The second is finding a way to operationalize that in the relationship. It may become an annoyance to, or an outright insult to, the Beijing leadership. I don’t think that members of Congress are going to care about that. And so the administration’s going to have to make, the incoming administration will have to make some decision about how strongly they want to continue to press us because they will get pressure from Congress on finding ways to continue to address human rights in China.

There’s a third thing I’d say, there’s one more thing, is that, I like a frame that the administrative Trump administration’s really pressed on human rights. I would say, we wouldn’t have had to, right, we didn’t, we didn’t make the choice of passing a security law. We didn’t make a choice to set up labor camps in Xinjiang, or try to wipe out the Uighurs. We’re not making those choices. The Chinese leadership is making those choices. And I think we have more, I think the US has more friends on this issue than China does. And we need to, as well, address this from a multilateral and collective perspective.

Glaser:

Recently, the Trump administration did announce sanctions on 14 members of the National People’s Congress Standing Committee, which includes asset freezes and travel bans, and this was taken in response to the ongoing crackdown in Hong Kong, and as you mentioned the national security laws. And of course the NPC is Congress’s counterpart organization, so I wanted to ask specifically what you think of that action, and whether you think that will in any way affect your interactions with the Chinese going forward, and do you think this was an appropriate action, is this the kind of thing we should be doing. Is it is it mostly symbolic, or do you think it’s more than that?

Larsen:

Well, it’s gonna be mostly symbolic until the Chinese ban me from travel to China. Then it’s much less symbolic. And the only thing stopping me right now from traveling China is COVID-19, and the issues around that. And it’s half-joking on that, but I think, if we’re going to get to a point where the US and China are in fact trying to work through this era of, where we’re competing, but there’s areas where we need to cooperate, then banning travel among leaders like those in the Standing Committee, probably isn’t, well it isn’t a good idea, because these are the folks who, we need to talk to them, they need to talk to us. I know the NPC is a rubber stamp. But I do know that they’re also communicators with others in the Chinese leadership, and we need to have the opportunity to tell them what they think. And I always tell folks, I’ve been to China eleven times, and a few of my colleagues criticize me for going that many times, but I tell them it’s like, you get to stand outside the room and yell at China. I’m inside the room yelling at the Chinese leaders who need to hear it from us. We’re better off being in the room, literally across the table from each other, being frank and honest and open these discussions, then lobbying, press releases, or, you know, for me, reading China Daily to read what they really think the United States. I’d rather be one on one, or five on five or however many folks we can get over there, to talk to them directly. And so travel bans like this kind of get in the way of continuing those discussions and those debates.

Glaser:

I’ll give you a question from one of our viewers. … How does Congress generally frame the US – China competition. Is it Cold War 2.0 with the resulting end state producing a winner and a loser? Or is it about finding a sustainable state of coexistence? So as you said there’s multiple views in Congress.

Larsen:

Yeah, thanks. Generally, generally, I don’t sense that Congress, you know as a collective group, we don’t categorize it as Cold War 2.0. I think it’s, some of your viewers may not understand this reference, but a few years back on the Halloween episode of Saturday Night Live, Tom Hanks played this character called David S Pumpkins. And it was quite a cultural, swept the cultural milieu here in the United States for a couple of couple of weeks. And he said, at one point in the skit he goes, I’m my own thing. And I think that’s probably the way to describe this US – China relationship. It’s its own thing, it’s not a Cold War 2.0. It has its own dynamics. Obviously the leaders are very different as well. There is a level of competition to it, but I think with a country, with two countries, that are so integrated to each other and two countries that are so integrated in the global economy, just to start, it really doesn’t lend itself to the Cold War 2.0. So I think I would say its own thing without getting too far into trying to describe it exactly how to characterize it. I know what it isn’t. But trying to define what it is these days — it’s not going well, that’s enough.

Glaser:

So we have a question from Charles Kimball from the Korea Center for International Finance, and he wants to know whether you could address the issue of China’s growing role in Latin America, and what the US is doing to counter it and expand our influence. Is that something that you personally, your office or other members of Congress are paying attention to.

Larsen:

Yeah. Other members are paying attention to that, and I obviously do track that, but I think we’re gonna see with our incoming Chair of the Foreign Affairs Committee, Gregory Meeks from New York City, he’s the Incoming Chair, and he has talked about the US role in Latin America, more as a partner than anything, and trying to ensure that we up our game there, and this gets into broader question too, of the Belt and Road Initiative, and whether the United States, or the US and its allies and partners, have an alternative, not a one for $1 alternative BRI, I don’t think that’s gonna be possible. But we don’t need that, as much as we need to have a plan to have presence, a plan to be there. And this would apply in countries in Africa, it would apply to regions like Latin America, as well. And we’ve put some pieces in place, we need to fund those pieces. You know, we have the Export Import Bank, we’ve changed OPIC, the Overseas Private Investment Corporation, through legislation recently to create a — through actually some of the help from some of your colleagues and CSIS — as well. So I think it’s, it’s a matter of upping our game. So that the US is seen as being more of a partner.

Our challenge is, we don’t run US Incorporated. And I think that’s a big challenge to counter the BRI, because China as a country, as a government, its policy, it’s basically taking its industrial policy and trying to export that model a little bit. But we don’t do that, we actually, we use private investment markets, they usually lead on investment, in the United States, and we want to use that model, but the US government can be a facilitator and enabler of companies and we need to do a better job on that, so that’s how that’s how we’re thinking about that.

Glaser:

One last question, from Collins Chung from the University of Malaya, the race for technological edge especially in the spheres of quantum, 5G and AI has been increasingly putting the US and its superiority — I don’t know if that’s the right word — but our edge in these areas under tremendous challenge and pressure. So, what is the US doing, what should we do to ensure that the, the advantage, basically, is still in the direction of the United States. And I would add to that question, since you just referred to industrial strategies, do you think that we should be developing more in the United States, is this the right response to compete with China’s industrial policy.

Larsen:

Thanks. I think the first thing is, we just need to declare that we’re going to lead. We need to set those aggressive goals. For instance, I think about the Chinese leadership, officially says you know they want to lead an AI be the world leader in 2030, and our response in the United States has been to, you know, pull our hair out. I think our response ought to be, fine, well, you’ll be behind us because we’re going to be leading by 2029. We should just set the goals and start doing these things, taking actions we need to take to continue our technological edge.

The National Defense bill, which we passed in the House in the Senate last week, the President has said he’s going to veto it over unrelated issues. If he does, we will override it. That national defense bill has the Chips Act in it. The Chips Act is a separate piece of legislation folded into the defense bill that makes a serious United States investment in semiconductors, which is a foundational technology for a lot of what has to happen to maintain a lead in technology. So we’re taking action there.

I have legislation — actually it’s law now — where we’re expanding the education in the defense department, about AI, what artificial intelligence is, what it isn’t. We’re not trying to create 2.2 million coders as much as we’re just trying to be sure that we have a model where educating people, what is AI, why is it important. And this is a model based on what Finland has done. So, there are big things we need to do. There are little things we need to do. But we are not going to, as some have suggested, even in the United States surprisingly have suggested, that the US sort of just nationalize some of the stuff. And, you know, I’m a Democrat but I’m a capitalist, so we’re not going to be nationalizing large parts of our economy. We are going to do it the way we’ve always done it, but there are opportunities to work with like minded partners, like-minded allies who support transparency and openness and markets as a different model. But we need to get started on that, because that race has already started.