Rep Peter DeFazio, chair of the House Committee on Transportation and Infrastructure, last month urged greater examination of the purchase of rail cars from Chinese state-owned companies.
“One of the greatest threats to a strong US transportation manufacturing sector is the rise of predatory Chinese state-owned and supported enterprises,” the Democratic lawmaker from Oregon wrote in a letter to the administrator of the Federal Transit Administration.
DeFazio called for an investigation into a US railroad operator’s contract with China’s CRRC, the world’s largest rolling stock maker, to determine whether the deal could hurt American manufacturers. CRRC has won several contracts in the US in such places as Boston and Los Angeles.
Concern also has grown over land acquisitions by Chinese state-owned companies, one of which bought farmland near a US Air Force base in North Dakota. Over 100 lawmakers including Rep Michael McCaul, the top Republican on the House Foreign Affairs Committee, urged the US government on Oct 1 to look into the surge in such transactions in recent years.
In 2018, then-president Donald Trump signed a law that expanded the authority of the Committee on Foreign Investment in the US. Past executive orders have restricted land purchases near military bases and other sensitive locations. Congressional lawmakers are considering going further with legislation to establish stricter curbs.
Some voices in Congress and the business community have expressed opposition to moves by the Biden administration and the Democratic and Republican lawmakers to tighten screenings on US investment in China. But resistance seems to be softening.
“If those investments credibly pose a risk to our national security, then I’m not reflexively opposed to this concept,” Sen Pat Toomey said at a Senate Banking Committee hearing in late September. Toomey, a Republican from Pennsylvania, has been a vocal opponent of such restrictions.
Such curbs “should, at a maximum, only be applicable to direct US investments in Chinese entities that are manufacturing, producing, developing or testing a technology,” Toomey said.
Restricting American companies from investing in China could put them at a disadvantage against global competitors, critics say. The Biden administration wants to impose targeted rules that respond to security concerns while letting US businesses compete with foreign rivals.
The push for stricter curbs extends to exports. On Oct 7, the Commerce Department’s Bureau of Industry and Security announced a requirement that companies seek approval to sell cutting-edge chip technology used in supercomputers and artificial intelligence to China. This widens chip export restrictions beyond select companies, such as Huawei Technologies, to a broad swath of Chinese industry.
Some Republicans favour a zero-tolerance policy when it comes to protecting such technology.
“If the BIS implements and enforces these rules to the strictest of standards, then it will strike at the core of the CCP’s strategic objectives,” McCaul said, using the initials of the Chinese Communist Party.
American public opinion on China has worsened across the political spectrum in recent years. Both Democrats and Republicans have made a tough talk on China ahead of midterm congressional elections on Nov 8. Biden has shown a willingness to listen to congressional voices on this economic security issue, as with the export rules announced Oc 7.