Derisk, Decouple, Diversify: Gallagher Committee Churns Ahead

Members of the House Select Committee on the Chinese Communist Party continue their effort to challenge diplomats, bureaucrats and captains of industry a quest to bring trade security policy in line with the 24 hour news cycle.  

 

Committee Chair Mike Gallagher’s key take away from his panel’s hearing July 20th on the Administration’s China policy is that the White House seems unclear on what it means by economic “derisking” from China.

 

There seems to be a “semantic” debate about derisking versus decoupling, Mr. Gallagher said at a program sponsored by Punchbowl News shortly after the hearing ended.

 

“If the core tenet of the Biden strategy toward China is derisking, we have to understand what that means. It’s a little muddy,” he said.

 

Committee ranking Democrat Raja Krishnamoorthi (Ill), who also participated in the discussion, suggested that another “D word” needs to be added to the policy debate – diversify. He stressed the importance of diversifying US supply chains for key products away from China.

 

If crucial inputs like critical minerals cannot be mined in sufficient quantities in the United States, the Administration should be looking to US allies – not China – for its sourcing.   China has a chokehold on critical minerals and Beijing uses that fact for economic coercion, he said.

Robust Policy Recommendations

Rep. Gallagher said he expected his committee will produce a “series of robust policy endorsements and recommendations” by the end of this year, that will be teed up for legislative action in the second session of the 118th Congress.

 

He does not expect all of the committee’s recommendations to be translated into legislation. Despite a bipartisan consensus about the need to compete with China, the chairman said there are differing views between, and even within, the two political parties that are likely to make it difficult to reach a consensus in the House on some issues.

 

Next year, Rep. Gallagher wants to see the committee take a deeper dive into specific issues, again resulting in recommendations for the 119th Congress.

 

Rep. Gallagher said he is cautiously optimistic that the current Congress will approve legislation restricting China’s popular social media app TikTok. Saying he personally prefers either a forced sale or a ban, the chairman noted that work on legislation has slowed, partly because the measure falls into the jurisdiction of multiple committees and party because of aggressive lobbying by China. Work does continue behind the scenes on compromise language, he said.

Sharp Exchanges at Hearing

At Thursday's hearing, the Select Committee heard from three Administration witnesses –

 

Committee member Rep. Darin LaHood (R-Ill) complained that the secretaries of the three departments should have been testifying. Rep. Gallagher agreed, adding that he expects them to appear before the committee before the end of this year.

 

During the hearing there was a sharp exchange over whether there has been an attempt by State to delay the imposition of further restrictions on the export of key technologies to China. Asked whether he has spoken against moving forward with restrictions, Mr. Kritenbring repeatedly declined to answer.

 

A number of committee members, including Rep. Gallagher, accused the Administration of putting diplomatic engagement with China before national and economic security.

 

“Instead of holding the CCP accountable, incredibly, Administration officials chased CCP diplomats around the world, desperately seeking meetings like ardent suitors, as if they, not the CCP, had something to apologize for,” Rep. Gallagher said.

 

“Perhaps most troubling, the Administration has also delayed policies to end Huawei export licenses, restrict outbound capital flows in critical sectors, and hold CCP officials responsible for the Uyghur genocide accountable. Clearly, the push for high-level engagement has come at the cost of defending ourselves from CCP aggression.”