Interview: Fears of China are overblown, says U.S. trade expert

"U.S. political leaders paint scare scenarios for the American public. These in turn lead to negative polls when Americans are asked about China. Negative polls then prompt political leaders to push legislation that curbs U.S.-China commercial ties. A vicious circle," said Gary Clyde Hufbauer.

by Xinhua writer Xiong Maoling

WASHINGTON, Oct. 2 (Xinhua) -- Fears of China are "overblown," and many U.S. policies toward China are entirely political, Gary Clyde Hufbauer, a nonresident senior fellow at the Peterson Institute for International Economics, has said.

"U.S. political leaders paint scare scenarios for the American public. These in turn lead to negative polls when Americans are asked about China. Negative polls then prompt political leaders to push legislation that curbs U.S.-China commercial ties. A vicious circle," Hufbauer told Xinhua in a recent written interview.

"American firms and consumers are big losers," said Hufbauer, who served as deputy assistant secretary for international trade and investment policy of the U.S. Treasury Department from 1977 to 1979.

He noted that the U.S. Commerce Department's proposed ban on Chinese-developed software and hardware in connected and autonomous vehicles "clearly has a protectionist flavor."

The department "did not research ways of dealing with the perceived national security threat other than an outright ban," Hufbauer said.

He suggested that a U.S.-China agreement could have been negotiated, saying that independent testing was a possibility.

But any alternatives would not have served protectionist interests, he added.

The former U.S. Treasury Department official told Xinhua that a "fear of Chinese technological superiority" and "a widespread disposition in favor of protection" have resulted in bipartisan support for restrictive economic and trade policies toward China.

Hufbauer argued that the latest proposed ban, which is intended to protect the U.S. automotive industry, would harm U.S. companies.

"The biggest harm is that U.S. firms will no longer learn from superior Chinese technology. Chinese firms are way ahead of U.S. firms in electric vehicles (EV) and battery production, and probably other areas as well," said the veteran trade expert.

"In addition, U.S. consumers will be deprived of access to high-quality Chinese software and hardware," he added.

In an online article recently published on the Peterson Institute website, Hufbauer argued that the U.S. Commerce Department's latest proposed ban creates a template for "enlarging the scope of de-risking."

He noted that National Security Advisor Jake Sullivan previously promised that U.S. restrictions on direct commerce with China would be confined to limiting the flow of advanced technologies with "a small yard and a high fence."

Unfortunately, the "small yard has since grown into a pasture with no discernable fence," said Hufbauer.

Earlier bans on Chinese tech giant Huawei and current efforts to force TikTok to be sold to a U.S. firm or face a ban follow the same logic, with no evidence of actual surveillance or harm.

"Any toy, TV, iPhone, or industrial part that contains elementary electronics can be suspect," Hufbauer said.

He concluded that if the latest proposed rule charts the future path of U.S. import bans, then "it is only a matter of time before de-risking becomes decoupling."■