President Biden on Wednesday signed an executive order banning new American investments in advanced semiconductors and quantum computers in China starting in 2024. The order also requires Americans doing business in China to report any direct investments in artificial intelligence and other types of semiconductors.
Without a doubt, the order is not nearly sufficiently expansive. We should outlaw all U.S. investment in China and require current investments to be unwound within a few years.
The importance of American capital goes well beyond the cash involved.
As the executive order correctly notes: “Countries of concern are exploiting or have the ability to exploit certain United States outbound investments, including certain intangible benefits that often accompany United States investments and that help companies succeed, such as enhanced standing and prominence, managerial assistance, investment and talent networks, market access, and enhanced access to additional financing.”
In other words, access to our capital markets helps legitimize and strengthen the communist regime in Beijing, the same regime that the Biden administration — and the Trump administration before it — has identified as genocidal and built on slavery. Investing in China makes them stronger and makes us at best morally compromised and almost certainly economically weaker.
There may be some Republicans who correctly believe that the executive order is too narrow. The unfortunate reality for them is, however, that this executive order places the Biden administration well to the right of the Republicans, especially those in Congress, with respect to China.
Because of the executive order, the Biden administration now has the advantage of having done something — however modest — about the threat posed by China.
In comparison, congressional Republicans have been unable to produce any legislation or even vote on any legislation that would slow Chinese aggression.
Rep. Andy Barr, Kentucky Republican, tried introducing legislation that would have banned American investment in companies that support China’s military.
Inexplicably, that legislation was left behind in committee while House Banking Committee Chairman Patrick McHenry, North Carolina Republican, shipped more than a dozen mostly meaningless messaging bills to the House floor.
The omission was almost certainly not accidental. House Republicans have taken no action whatsoever against China. They have not even managed so much as a vote on banning TikTok, despite widespread acknowledgment that is it the most successful psychological operation ever conducted on a nation’s population.
Senate Republicans are no better. In an embarrassingly feeble effort, they recently voted to require those investing in China’s military-industrial complex to notify the federal government.
That is pointless and certainly less emphatic and meaningful than the executive order.
To be sure, the executive order has its limitations. U.S. capital markets should not be used at all to support and strengthen the genocidal, slaving, communist regime in Beijing that instigates international hooliganism and worse.
That said, the Biden administration has taken an important first step in what is likely to be a generational effort to disentangle ourselves from China. The White House should be commended.
As for Republicans, especially those in Congress and those running for president, they should think about how they can build on and improve what the Biden administration has done. Banning all investment in China is the next right answer, as is banning TikTok.
Either China is an adversary or it is not. The administration has made clear what it thinks.
It’s time for the Republicans to provide the same sort of clarity to the American people.
• Michael McKenna, a columnist for The Washington Times, is president of MWR Strategies. He was most recently a deputy assistant to the president and deputy director of the Office of Legislative Affairs at the White House. He can be reached at email@example.com.