The Biden Administration Needs to Pass The USICA and Get Tougher On China

Before Russia launched its unjust invasion of Ukraine, President Biden’s foreign policy efforts were focused on countering another authoritarian adversary, China, whose economic aggression continues to threaten both the United States’ position as a world leader as well as the entire global economy.

For more than a year, Congress has been debating a bill that would heighten America’s competitiveness vis-à-vis China by boosting U.S. semiconductor chip production and providing domestic manufacturing incentives. Positively, the Senate is set to begin working on a version of the USICA bill next week on a bipartisan basis.

To be sure, the USICA is necessary in order for the U.S. to be able to compete with China economically and for President Biden to demonstrate that he is willing to stand up to China, especially in light of his administration’s misguided decision to roll back Trump-era tariffs.

While these bipartisan USICA talks are an encouraging development, a couple of the White House’s other current policy initiatives regarding China are troublesome to say the least.

The administration is weighing dropping tariffs on China in order to ease inflation, which is at a forty-year high. However, leading economists note that relaxing tariffs won’t considerably lower inflation, but rather will unnecessarily support China’s trade interests while leaving American union jobs vulnerable.

Congressman Tim Ryan, the Democratic nominee in the Ohio Senate race, went as far as to say it would be a “major mistake” to lift the tariffs.

More perniciously, the Administration has agreed to give up American innovators’ intellectual property rights by waiving TRIPS protections. The TRIPS suspension has the stated purpose of invalidating intellectual property protections on American Covid-19 vaccines in order to expand global access to these formulas.

Yet, waiving TRIPS is an unnecessary and illogical solution to addressing global Covid-19 vaccine and treatment distribution, and in reality, suspending American intellectual property protections will just jeopardize jobs, dampen American innovation, and give leverage to unfriendly foreign powers.

It would be a mistake for the U.S. to give away our cutting-edge medicines and technologies to our most threatening adversaries, which includes China, especially since IP theft has been a top prerogative of the Chinese Communist Party for over two decades. To worsen matters, in five months the WTO will discuss waiving protections on treatments and therapeutics, potentially gifting China even more American property.

In a midterm election year that has been rife with economic and national security concerns, ceding ground to China on both trade and intellectual property protections – key pillars of the 21st century American economy – is both a practical and political misstep for President Biden.

From a political perspective, with less than four months until the midterms, President Biden cannot afford to be seen as soft on China.

The president has struggled to project strength and steadiness as Commander in Chief, and as a result, his approval rating on foreign affairs is just 40%, according to a recent Harvard-Harris poll. Handing over American technology and products will only worsen voters’ perceptions of his ability to lead on the world stage, and will give his political opponents fresh ammo in the midterms.

More importantly than the political implications, the United States has earned its reputation as a world leader in large part because, when the world faces a crisis, American people and American companies step up – the most prevalent example of which is the domestic production of the three leading Covid-19 vaccines, which have saved millions of lives around the world.

Without strong intellectual property law and trade protections, those vaccines – along with countless other life-saving medicines and technologies – may have never been developed. Waiving Chinese tariffs and TRIPS sets a dangerous precedent for the future of American innovation.

Instead, the Biden Administration and Congressional Democrats should stand up to China by prioritizing the passage of the USICA. The USICA would make America less reliant on Chinese imports in a way that helps address supply chain issues, which will ultimately also help get inflation under control.

By passing the USICA and disbanding efforts to waive Chinese tariffs and TRIPS, the president and his party can help protect America’s economic interests abroad while also stemming inflation here at home – which will benefit the country in the long-term, and could even benefit Democrats politically in the short-term.