In the wake of pandemic, the magnitude of our dependence on Chinese products first dawned on many who had not considered just how much of our vital infrastructure was owned by China.
An article in Fox news, “How much of the United States does China really own?” details the percentage of Chinese ownership in the medicine, food, education, and media. The numbers are shocking.
Many of our largest companies are now owned by China, as a 2017 list by CNBC shows.
But it goes much deeper than this; besides everyday products, China is buying up a variety of companies that could have broad military and economic consequences.
China Cash & Aviation
China has purchased or made agreements with many General Aviation (GA) companies in the United States, from airplanes to helicopters to kit planes, which are homebuilt planes that can be built in a garage. These companies include well known names in the aviation industry such as Sikorsky, Cessna, Cirrus, Mooney, and US Aerospace.
A 2017 publication by RAND describes these purchases and agreements, along with the timeline of their acquisition. The RAND study states, “In March 2016, the People’s Republic of China (PRC) issued its 13th Five-Year Plan reiterating support for the development of the aviation industry.”
The RAND study notes, “However, direct military implications are minimal because advanced commercial-aviation technology differs from military-aviation technologies (e.g., stealth, radar, supersonic engines).”
Technology is now being developed that is able to turn small GA planes into drones. Drones have several possible military applications. Moreover, as the RAND study theorizes, “There is always a possibility for some civil-military integration or comingling of civilian technologies with the military side. This is a very real concern in China because ‘civil-military integration’ continues to be emphasized by PRC political and military leaders.”
According to the online encyclopedia Infogalactic, TieJi Fang, chairman of the Jilin Hanxing Group, said that he envisions Glasair producing trainers for flight schools and eventually personal aircraft for the Chinese market. He stated that purchasing Glasair was “the first step in a very long journey.”
Since Glasair also produces kit planes that could be converted into drones, that is a first step that should be cause for concern.
While the ubiquitous of Chinese electronics is well known, the implications are not often considered. According to a 2018 Washington Post article, “Information technology products made by enterprises owned or influenced by China could be modified to work poorly, conduct espionage or otherwise interfere with government operations, said the report for the U.S.-China Economic and Security Review Commission, which is scheduled to be released Thursday.”
Art of the Steal
China is well known for stealing intellectual property and copying products. It is considered just a cost of doing business. However, it is a big cost, not just to individual companies but to the United States as a whole.
CNN money reported in 2017 that a “Commission on the Theft of American Intellectual Property named China as the main offender, estimating the cost to the U.S. economy at up to $600 billion a year.”
China Cash: Land, Food & Energy
Even NPR is concerned, writing an article in 2019 titled “American Soil is Increasingly Foreign Owned.”
NPR writes, “And because there are no federal restrictions on the amount of land that can be foreign owned, it’s been left up to individual states to decide on any limitations.”
An AP article titled “Efforts to restrict foreign ownership of US farmland grow” explains that land ownership is not just about the land itself, but about food security for the United States.
An Institute for Energy Research article about a large land purchase of 130,000 acres in Texas for a wind farm raises concerns about both land and energy. It states, “The project, however, has many officials in the United States concerned about the security of the U.S. power grid and the proximity of the farm to U.S. Government facilities.”
China Cash, Reconsidered
The expansion of China’s purchasing power is concerning for both economic and military reasons. A RAND report titled “Developing a U.S. Strategy for Dealing with China— Now and into the Future” states, “China’s strong economy and sustained investment in military modernization will be the most powerful disruptive influences in the future security environment in the Western Pacific.”
A 2018 Industry Week article “Should We Allow the Chinese to Buy any Company they Want?” takes a deep look into industries that are being purchased and legislation we could use to limit Chinese purchases. It states, “In theory, we have the means to protect ourselves from this. CFIUS, the Committee on Foreign Investment in the United States, has the power to regulate, approve and deny these purchases. Unfortunately, it has been rare for CFIUS to block deals that don’t directly pose a threat to our national security.” The article is well worth reading in full and considering the implications.
A longform Politico article, “How China acquires ‘the crown jewels’ of U.S. technology:The U.S. fails to adequately police foreign deals for next-generation software that powers the military and American economic strength,” also sounds the alarm.
It argues that we are now in an information age with information warfare. Therefore, information companies should also be considered critical infrastructure and not allowed to be foreign owned. The article should also be read in full by those wanting a deeper understanding of the threat of foreign ownership.
China Cash is continuing to pour into the United States. We need to take a hard look at what we can and should do about it, for ourselves and for our future generations. The Chinese have a long view and are using their cash for “the first step in a very long journey.” We should plan our steps carefully as well.