The DETER Act Calls China’s Bluff
Communist Chinese Party (CCP) leaders have consistently taken advantage of poorer nations around the world, eliminated personal freedom in Hong Kong, committed untold human rights violations, stolen American intellectual property, and continued to threaten their neighbors. The vast majority of illicit fentanyl that has killed tens of thousands of Americans originated in China.
It’s past time to stop pretending China has peaceful intentions and use the tools we have to deter Beijing.
In a retrospectively unwise move in 2001, Congress gave China “Most-Favored Nation” (MFN) status, which provided them with preferential tariff treatment for manufactured goods into the United States. Americans have paid billions to import products from China, and the CCP has used that money to expand its military prowess in the air, at sea and in space. The communist leaders seem determined to spark a new Cold War with the United States—with Taiwan as their flashpoint.
We have enjoyed a long and close trade and military relationship with Taiwan for decades. The free people of Taiwan have made it clear that they do not want to live under the thumb of Beijing, especially after the world saw what happened in 2020 when China broke its word and took away sovereignty and freedom in Hong Kong.
The people of the United States do not seek any conflict with China, but Taiwan has been both an ally for peace in Asia and a top economic partner for decades. A military assault on Taiwan would have major and immediate global repercussions. The United States should proactively state that we have significant diplomatic, military and economic tools and we will not hesitate to use all of them.
While we keep the diplomatic channel wide open for dialogue, we should also prepare our nation for the possibility that economic ties could be severed with China in an instant if they invade Taiwan. When Putin foolishly decided to invade Ukraine and slaughter his neighbors, the United States quickly revoked Most-Favored Nation status with Russia, which devastated the Russian economy. Within days, American companies withdrew from Russia as the its banking system faced harsh global sanctions.
China and American international businesses should be on notice that if China invades Taiwan, the United States would automatically withdraw MFN status, apply sanctions and accelerate the contagion of economic decoupling.
That is the message of my Deterring Escalation Through Economic Retaliation Act (DETER) Act, which I am introducing this week. The bill is not designed to discourage any current diplomatic engagement with the CCP, but it does set in law that if China invades Taiwan, their MFN status is immediately revoked.
Our companies should preemptively prepare their supply chain and logistics for that possibility, and the leadership of China should realize that the American people are serious about standing with our allies and maintaining peace in Asia.
Currently, China controls the United States’ supply chain for pharmaceuticals and critical minerals. But China is also dependent on America as its largest export market. That symbiotic relationship is reasonable for trade partners, but it should not be assumed, if China attacks its neighbor.
In the months leading up to the Russian invasion of Ukraine, President Biden sent mixed signals to Putin about our commitment to use our leverage to maintain peace by waiving sanctions on Russian natural gas. We need to learn from that mistake and remove any ambiguity that China’s access to the American market will be revoked, if they engage in military action against Taiwan.
Our goal should be to prevent a war before it ever starts.
Over the last few years, the United States has taken serious steps to bolster our defense posture in the Indo-Pacific with the goal of deterring CCP aggression. We have new basing agreements in the region, more warships in the area and stronger partnerships like the Quad Security Dialogue and AUKUS. Taiwan is set to receive American-made F-16s, and we have increased security assistance to help Taiwan prepare to fight and win against the Chinese military. Strength reminds everyone that there is a high cost to war, so we should work toward peace.
China is in this for the long game. We should be just as committed to our long-term relationships.