China’s Cash Drives America Towards Electrification
This piece originally appeared in Forbes
Director, Center for Energy, Climate, and Environment
China is actively attempting to steer America in the direction of greater dependence on battery-powered vehicles.
America is walking into a problem of dependence in its vital transportation sector, just as Europe walked into a problem of dependence on Russia.
Through federal and state targets for renewable energy and battery-powered electric vehicles, America is becoming more dependent on China.
Last week Foxconn, a Taiwanese company under the influence of China, injected another $170 million in Lordstown Motors, the Ohio electric truck company. This follows Foxconn’s purchase of Lordstown’s plant and $50 million worth of stock in November 2021.
Although America has achieved independence in oil and gas production, China is actively attempting to steer America in the direction of greater dependence on battery-powered vehicles. A new Congress should consider whether this makes sense.
Lordstown Motors was in great financial difficulties in 2021 and might have gone under, but Foxconn bailed it out. Although the new funding is dependent on approval from the U.S. Treasury’s Committee on Foreign Investment in the U.S. (CFIUS), it’s likely that the Chinese government will be permitted its expanded stake in Lordstown Motors.
The Foxconn investment and other electrification projects make the United States more reliant on China. It’s to China’s advantage to prop up America’s battery electric vehicle companies because China makes the batteries. The greater the number of battery-powered buses, trucks, and cars in the United States, the more batteries China can sell.
China has purchased other U.S. electric vehicle and electric battery companies. The Chinese company BYD won a contract in 2018 to sell electric buses to the State of Georgia. Smith Electric partnered with Wanziang to make electric vehicles.
Chinese companies can list on American stock exchanges, raising capital in America for Chinese companies. But American companies do not list on Chinese stock exchanges. Li Auto, a Chinese hybrid auto company, went public on NASDAQ last year, and it aims to sell hybrids in the American market.
Consider that our laws allow Chinese companies to buy 100 percent of American companies, but American companies often cannot buy 100 percent of Chinese companies. The government of China keeps a stake in Chinese companies purchased by American companies.
Teens are switching from Facebook and Instagram to Tik Tok, the Chinese social media darling. But Gmail and many other American social media apps are prohibited in China.
China’s algorithms can be used to influence and track our teens, but Chinese teens cannot access our platforms.
China sets up Confucius Centers at American universities to teach American students the advantages of the Chinese Communist Party. Yet China would not allow Federalist Societies, or Adam Smith Societies, to be set up in Chinese universities.
Current energy policies weaken rather than strengthen America. Through federal and state targets for renewable energy and battery-powered electric vehicles, America is becoming more dependent on China.
What to do?
Either America has to accept dependence on China, and live in a constrained way, or it needs to forcibly disconnect with China, and abandon mandates for battery-powered electric vehicles, wind turbines, and solar panels. America gradually needs to incur the costs of shifting overseas manufacturing elsewhere.
The next Congress needs to consider the ramifications of both options. Because the second one is difficult, the temptation will be to keep the status quo and accept the first option by default.
This would be a serious mistake. It’s time to stop giving China leverage over the United States.
By Jamie McIntyre, Senior Writer
A disarming prospect
On a warm August day last year, while House Speaker Nancy Pelosi (D-CA) was drawing the ire of Beijing with her high-profile visit to Taiwan , a small group of national security experts was huddled around two big game boards in a small window-lit conference room in Washington, D.C.
The professionals from MIT and the Center for Strategic and International Studies were playing another iteration of a tabletop exercise designed to game out what might really happen if China were to launch an invasion of Taiwan and the United States went to war to thwart them.
With two competing teams matching wits and moving tiny game pieces around on the two maps — one showing China, the other the U.S., Japan, and Taiwan — the results from 24 different scenarios, stretching over several months, varied, always with both sides suffering big losses but usually with the U.S. prevailing, albeit at enormous cost.
“The good guys win in the sense that we are able to maintain an autonomous Taiwan and the Chinese are not able to conquer the island, but the bad news is that we take a lot of casualties,” said Mark Cancian, senior adviser at CSIS, one of the participants in the real-world version of Risk.
“For example, often we lose 500 aircraft, two aircraft carriers, and Taiwanese economy is devastated, so there’s a very high price,” Cancian told the Washington Examiner. “The Chinese also lose a lot of ships and aircraft, so it’s costly all around.”
There was, however, one glaring deficiency on the U.S. side, which months later would be echoed in a display of Russia’s embarrassingly flawed plan to invade and subjugate Ukraine — namely a critical shortage of certain kinds of precision munitions.
Ukraine is primarily a ground war with stationary targets that can be attacked by cruise missiles and drones, which, as the war dragged on much longer that Russian President Vladimir Putin planned, began to be in short supply.
In a war with China over Taiwan, which is an island, the weapons of choice would be air-to-air and anti-ship missiles, especially the LRASM (Lockheed Martin’s Long Range Anti-Ship Missile ).
“It’s the preferred munition because it can attack surface ships from long distances. Otherwise, you have to get in very close — that gets very dangerous,” Cancian said. “Increasing the inventory of long-range anti-ship missiles is critically important for the United States and also for Taiwan.”
“If we look at the roughly two dozen iterations of a war game in the Taiwan Strait … the U.S. expended all of its joint air-to-surface standoff missiles and long-range precision-guided anti-ship missiles within the first week of the conflict,” said Seth Jones, director of CSIS’s International Security Program. “We’ve seen similar war games done by government agencies, including one where the U.K.’s third division exhausted national stockpiles in just over a week.”
The war in Ukraine exposed not only Russia’s inability to produce more precision munitions, in part due to sanctions from the West, but also gaps in the capabilities of American defense contractors to ramp up assembly lines on a wartime schedule to replace the stocks of armaments the Pentagon was pulling out of U.S. inventory and shipping to Ukraine.
“We burned through seven years’ worth of Javelins [shoulder-fired anti-tank missiles] in a couple of months,” Rep. Mike Gallagher (R-WI) told the Washington Examiner. “We’re running low on all our stockpiles. We have to turbocharge our munitions industrial base.”
“There is a gap between what the Biden administration’s National Defense Strategy says and what the U.S. is prepared for,” said Jones. “This really is an industrial base that, at least in my judgment, is in no way fully prepared to fight, let alone deter, the Chinese.”
“The war in Ukraine … exposed deficiencies in the U.S. defense industrial base — did the same thing with our European partners and allies,” Jones said at a CSIS event in late October. “It’s depleted stocks of some weapon systems and munitions, Stingers [anti-aircraft missiles], for example, M-777 howitzers, 155 mm ammunition and Howitzers, Javelin anti-tank missile systems.”
Rearming the U.S. military comes with an array of impediments, including increased demand, labor shortages, supply chain constraints, and a shortage of rare earth metals, of which China has a near monopoly.
But one of the bigger problems is the inability of Congress to pass a defense budget on time, instead relying on short-term funding bills known as continuing resolutions that freeze spending at last year’s levels and prevent the Pentagon from entering into multiyear contracts, which defense companies need in order to invest in new production lines.
Last month, Lockheed Martin, maker of the now-famous HIMARS (High Mobility Artillery Rocket System), announced that it was ramping up production of the multiple-launch rocket systems from 60 to 96 a year in anticipation that demand would be high for the precision weapons that have wreaked destruction on Russian ammo dumps and supply lines.
“We advance funded ahead of a $65 million contract to shorten the manufacturing lead time,” said Lockheed CEO Jim Taiclet on an earnings call . “That was without a contract or even any other memo or whatnot back from the government. We just went ahead and did that because we expected it to happen.”
But defense contractors shouldn’t have to guess what the Pentagon wants to buy, say leaders of the Senate Armed Services Committee who last month proposed an amendment to the annual defense policy bill to give the Pentagon emergency procurement powers to cut through peacetime red tape and replenish missiles and other munitions in wartime quantities.
“We need to give the Pentagon multiyear procurement authority for munitions, and they just need to start buying these things,” Gallagher said. “We can draw upon some recent lessons of Operation Warp Speed (Covid Vaccine Development) to modernize the Defense Production Act, to really build out our defense industrial base and get new defense companies involved in the munitions business.”
The Pentagon’s chief weapons buyer says he expects Congress to approve new authorities this month when the National Defense Authorization Act comes up for a vote in the Senate.
“They are supportive of this. They’re going to give us multiyear authority, and they’re going to give us funding to really put into the industrial base,” said Bill LaPlante, undersecretary of defense for acquisition and sustainment, at an event at George Mason University.
“I’m talking billions of dollars,” he said. “We have not done that since the Cold War.”
Are they going to fund this? I found another interesting article that could save billions and achieve the same goals.
Congress must address America’s dependency on Chinese technology in defense bill
By Jon Schweppe
Jon Schweppe is the director of policy and government affairs for the American Principles Project.
While China may have recently closed the military capability gap, Sen. John Cornyn (R-TX) has introduced legislative language that could spoil the Chinese Communist Party’s predatory military plans in one fell swoop.
Building off the important work of former President Donald Trump , who imposed 25% tariffs on Chinese-made microchips, the senator’s amendment to the National Defense Authorization Act (NDAA) would restrict the U.S. from purchasing microchips from companies that work with the CCP.
Microchips are what make much of America’s modern warfare equipment hum. Yet, the U.S. remains dependent on China for its supply. That’s a problem when companies with ties to the CCP make them and sell them to contractors and suppliers working with the federal government. And it’s especially a problem when the bulk of China’s strategy to defeat the U.S. military hinges upon these chips.
According to a new report released in October by the Special Competitive Studies Project, China is seeking to use advanced technologies to apply military force “with the aim of eroding or even leapfrogging the United States’ military strengths.”
China wants to become the “first movers” in “intelligentized warfare” — warfare that uses emerging technologies such as AI, 5G networks, and quantum computing to beat military rivals — to supersede the U.S. as the world’s leading superpower. And it’s developed a Made in China 2025 road map to make becoming a global leader in artificial intelligence (AI), 5G wireless, quantum computing, and other related industries a reality in dangerously short order.
Guess what technology is necessary to operationalize this intelligentized warfare technology ? You guessed it: microchips. So why would Congress allow the federal government to purchase ones that have ties to the same CCP trying to use them to destroy America and its interests?
That doesn’t sound safe — not by a long shot. It raises many issues, including but not limited to the prospect of future supply chain problems and backdoors that could lead to cyber-attacks and espionage.
While both sides of the aisle agree on the need to reduce dependency on these Chinese-made chips, they have disagreed on the best approach.
Some opposed the CHIPS Act, which aimed to reduce dependency on this foreign technology by bolstering U.S. production, because they found its $250 billion price tag too expensive and too favorable to large, wealthy corporations.
Sen. Cornyn’s NDAA proposal eliminates all those concerns. It doesn’t spend a ton of money we don’t have; it doesn’t even ban all microchips — it just gets to the root of the problem by stopping microchips built by companies with known ties from the CCP from coming the federal government’s way.
After hearing the chilling speeches and proclamations that came out of the CCP’s 20th Party Congress last month, including the party’s plans to prioritize tech and innovationfor strategic purposes, every legislator should agree that protecting America from potential Chinese technology threats should be a top national priority.
Passing the Cornyn amendment to the NDAA would be a great place to start.
Here’s hoping the rational heads prevail. Our national security depends on it.