In a recent congressional hearing, Treasury Secretary Janet Yellen stated that decoupling from China would be disastrous. She bases her analysis almost entirely on economic cost and benefit in the short run and ignores that, first and foremost, decoupling is a political strategy. By failing to acknowledge this crucial aspect, she overlooks the potential long-term benefits that decoupling could bring. She is not alone on this. In addition to the Biden administration, most so-called “China experts” in Washington are against decoupling. Here I want to show that she is mistaken and why such a view is wrong and misleading.
One of her arguments against decoupling is that she implies that decoupling supporters do not want the Chinese people to prosper. While her intention here is to seize the moral high ground, this assertion is entirely false. In reality, proponents of decoupling understand that the Chinese people’s welfare is not contingent upon maintaining close economic ties with the Chinese Communist Party (CCP).
In the early 1980s, a few years after the radical communist dictator Mao died, the CCP was desperate to jumpstart China’s ruinous economy and sought help from the U.S. and other free market economies. The democratic countries, led by the U.S., eagerly helped China to develop, hoping that China would become affluent and more free. Forty years later, the Chinese economy has become the world’s largest based on purchasing power parity, but the Chinese people are not free: their entire lives are tightly controlled by the CCP.
However, the forty-year opening up has enabled the Chinese people to see how we live in the free world, which prompted them to question why China cannot adopt universal human rights and the rule of law. This has created a huge headache for the CCP. The CCP faces a fundamental dilemma: politically, it wants to close China to ward off the influence of the democratic world on the Chinese people; economically, it needs China to open in order to access the highly profitable markets of the democracies.
To solve this dilemma, the CCP has the following options: first, embrace the universal value of respecting human rights and the rule of law, but this means giving up the CCP’s power monopoly, which the CCP has vowed to protect at all cost; second, close China, which the CCP cannot afford because a close dictatorial regime will degenerate into a zero-sum infight between the ruling and ruled classes. So the CCP has decided that it will keep China open and will not allow the ideas of freedom and the rule of law from the democratic world to influence China. To achieve this, the CCP must change the world, especially the democratic countries.
For decades, the CCP, using China’s vast resources, has methodically and painstakingly invested in and grown its influence worldwide, with particular attention paid to infiltrating the U.S., the leader of the free world.
The CCP has been using all state, military, and civilian resources to influence the U.S.; These include trade weaponization, espionage, intellectual property theft, systematic brainwashing, as seen with the Confucius Institutes, the Thousand Talents program, and academic exchange programs, and even setting up Chinese police stations in the U.S.!
Recently we discovered that the CCP has built and upgraded a spy station in Cuba! I could almost visualize the poor Cuban intelligence agents working for the CCP are totally confused because, based on what they detect in the U.S. — the Confucius Institutes and the Chinese police stations, they are probably not sure which country they are watching.
Now many Americans have felt the influence of the CCP in their homeland and demanded to change it. But as long as the CCP is in power, China will be aggressively infiltrating the free world, with the U.S. as its number one target. The root cause of China’s threat is the political ideology and dictatorship of the CCP. So, to eliminate China’s threat from its root, the CCP must change to respect the rule of law and individual freedom. And only under international pressure will the CCP be forced to change. This is the most important purpose of decoupling. The U.S. must unite all the major democratic countries to demand the CCP change, and we can use a credible threat of decoupling as an effective weapon to achieve this goal.
Undoubtedly, decoupling will have short-term economic repercussions for the United States and other democracies. However, if we fail to demand change from the CCP, China’s increasing economic growth will give it greater power relative to the democratic camp. The long-term consequences and damage resulting from a more powerful China would far outweigh the temporary hardships we may experience by significantly decoupling from China. Thus, decoupling emerges as the only viable strategy to ensure our long-term security and prosperity. It is disheartening to witness the short-sightedness of the Biden administration in this regard.
Secretary Yellen and other decoupling naysayers are not only short-sighted, but they are also dangerously misleading. They deliberately hide the true goal of decoupling, which is to seek changes in China’s political system. They openly deny that the U.S. does not seek changes in China, which is illogical and self-defeating. The CCP is actively seeking changes in the U.S. through various means, legal or illegal. To address these challenges, we must address the root cause by seeking change in China’s political system to dismantle the inherent incentives embedded within its communist ideology and its agenda of world domination.
By reevaluating our approach and recognizing the potential benefits of decoupling, we can proactively protect democracy, freedom, and the rule of law from China’s expanding threat.
To discredit the decoupling supporters, Yellen uses the lofty claim that she wants to see a more affluent China. While it is important to help improve the living standards of ordinary people in China, we must consider who controls the economy and resource allocation in China — the CCP. Indisputably, the CCP utilizes its resources to project influence worldwide, particularly in the United States. In light of this, I pose the question to Secretary Yellen: Do you still believe it is in our best interest to assist the growth of the largest dictatorship, one that considers the United States its number-one enemy?
By reevaluating our approach and recognizing the potential benefits of decoupling, we can proactively protect democracy, freedom, and the rule of law from China’s expanding threat.
Shaomin Li is a professor of International Business at Old Dominion University.
