But it has long been recognized that not all trade with all trading partners is the same. The father of capitalism, Adam Smith, wrote in The Wealth of Nations, that Great Britain’s interest in preserving naval supremacy was more important than free trade in the maritime sector. “Defense,” he wrote, “is of much more importance than opulence.”
America has long understood this truth. During the Cold War, our government crafted new policies and programs to check Soviet military technological progress. These included export control and trade promotion programs that served national security purposes.
Now it’s time to take a similar approach with Communist China. The coronavirus pandemic has shown just how dependent we are on that country for vital medical supplies, from specific drugs to much-needed personal protective equipment. This crisis is as dangerous as the coronavirus itself, and addressing it should be one of our top priorities.
The extent of our country’s reliance on China for medical supplies was clear from the early stages of this pandemic. As Americans rushed to purchase masks and gloves, and as hospitals tried to stock up on everything they needed, shortages quickly arose. China, which controls nearly half of all U.S.-imported personal protective equipment, was hoarding material for itself while banning companies from exporting their products. Beyond masks and ventilators, China produces 97% of U.S. antibiotics, 95% of ibuprofen, and the vast majority of many other medicines.
All of this leaves us less safe and jeopardizes American lives in a time of crisis. But it’s also part of the strategic plan of China’s communist rulers. Beijing has long had its sights on capturing the world’s most important supply chains to give it an edge over America and the free world. To accomplish this goal, the Chinese Communist Party has used its state-led economic model to manipulate the market to its advantage, often illegally. Among other things, China has subsidized competitors to U.S. companies and ordered the theft of their trade secrets and intellectual property.
Medical equipment may be the most urgent need right now, but in the near-term, China is especially focused on controlling the cutting-edge industries of 5G, advanced manufacturing, artificial intelligence, and robotics.
The Chinese communists envision an authoritarian world where they call the shots and command an unbeatable technological edge. They’re working overtime to make that vision a reality.
This is where America must respond — and lead. While Beijing has abused the free market in order to destroy it, America must harness the free market to protect our freedom and national security.
What would this look like? It starts by setting up stronger guardrails to prevent China from exploiting America’s economic openness and punish it for its predatory actions. It involves pushing back against Beijing’s manipulation of international forums like the World Trade Organization. It means ensuring that our most important security-related industries — from essential medicine to semiconductors — have American-friendly supply chains, instead of depending on an authoritarian rival state.
Americans have always understood that national security is the foundation of economic security. As we strive to come through the coronavirus crisis stronger and safer, we must courageously and creatively act to protect our people from Chinese communist duplicity and aggression.
Nikki Haley is a former South Carolina state legislator, a former governor of South Carolina, and a former United States ambassador to the United Nations.
