Former U.S. Trade Representative Robert Lighthizer told Congress it is in America's best interest to separate its trade interests from China during recent testimony before a House Select Committee.
Lighthizer testified on Wednesday, May 17, that the Chinese Communist Party (CCP) perceives industrial dominance as key to its global geopolitical power. As a result of that national vision, he said, China's economic policies have led to a state-owned sector monopolizing crucial industries. He said indirect control is also exerted over other significant areas of the economy through legal threats, compulsory CCP representation in firms and widespread government investments.
Additionally, the CCP pushes for foreign acquisition backing, enforced mergers, state-funded research, opaque licensing regimes and coercive practices to acquire technology and trade secrets, Lighthizer said, concluding that the U.S. needs to distance itself from China.
"I believe that Congress should act now to ensure American wealth no longer builds up Chinese power," he said. "Congress should enact policies that strategically decouple the United States economy from the Chinese economy. In parallel, it should take steps to reinvigorate the health of the American industrial base to support American workers and ensure that America is prepared to combat Chinese military and economic coercion."
According to Lighthizer's testimony, which was released by the America First Policy Institute, China's increasing economic power harms the U.S. in multiple ways, such as a trade imbalance, which can lead to reduced economic growth, national security threats, labor market distortions and significant wealth transfer from the U.S. It also fuels China's tech advancements and military capabilities while weakening American industry and causing widespread job losses, particularly in the manufacturing sector.
Lighthizer also said that the fallout has been especially damaging to the manufacturing sector, compromising domestic supply chain resilience, eroding the defense industry's capabilities and stifling innovation. The broader socio-economic implications include increased unemployment, wage suppression, heightened dependency on government aid and societal breakdown in communities most impacted by competition with China.
In recognition of China's threat to American security, he said, the Trump administration leveraged Section 301 of the Trade Act of 1974 to combat China's unfair practices and technology theft. This contributed to tariffs on Chinese goods and negotiations resulting in the "Phase One" deal in January 2020. Lighthizer said these actions initiated a process of decoupling U.S. and Chinese economies and increased U.S. production in various sectors.
Lighthizer asked Congress to adopt a strategy that supports U.S. interests, rather than expanding trade deficits with Asian nations by joining the Trans Pacific Partnership (TPP). In his opinion, TPP could harm American businesses and strengthen China's influence. Instead, he encourages closer relations and cooperation with Indo-Pacific countries without risking American jobs.
Lighthizer's Georgetown bio said he served as the 18th U.S. trade representative, and he brokered the U.S.-China Phase One Economic and Trade Agreement. Before his role as USTR, Lighthizer held influential positions in law and public service, serving as deputy USTR under President Ronald Reagan.
