The U.S.-China Commission proposes consolidating disparate economic tools like export controls into a single entity. This would prevent critical decisions from languishing at mid-levels within conflicted departments and create a single forcing function for action, reducing the need for constant NSC intervention.
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The most potent criticism of the U.S. chip controls wasn't flawed strategy, but the chronic underfunding and limited capacity of agencies like the Bureau of Industry and Security (BIS) to effectively enforce complex export bans against determined adversaries.
The concept of 'weaponized interdependence,' highlighted by China's use of export controls, is driving Asian nations like Japan, India, and South Korea to implement economic security acts. This shifts investment toward domestic supply chains in critical minerals, semiconductors, and defense, creating state-backed opportunities.
As economic tools like sanctions become primary weapons in global competition, the U.S. should develop a formal doctrine with limiting principles, similar to military rules of engagement, to govern their use and prevent a destructive "race to the bottom."
The U.S.-China Commission was established by a skeptical Congress during China's WTO accession not only to monitor China, but also to oversee the U.S. executive branch's handling of the relationship. It focuses on long-term strategic issues rather than immediate crises.
Major shaping legislation on China, from the CHIPS Act to sanctions, often originates in Congress. Congressional action creates durable policy that outlasts fleeting presidential administrations, providing guardrails and tools for the executive branch.
Key departments like Commerce have conflicting mandates. The Commerce Secretary's primary goal is to promote U.S. business abroad, which structurally disincentivizes them from implementing tough export controls that could harm those same businesses, thus undermining national security objectives.
Following US policy moves, China is likely to expand its use of export controls on critical materials. Silver, essential for EVs, solar panels, and AI data centers, has been added to its list, signaling a willingness to leverage its supply chain dominance as a geopolitical tool against rivals.
Unlike Treasury's sanctions unit, which was deeply integrated into the intelligence community post-9/11, the Commerce Department's Bureau of Industry and Security (BIS) is not. This means the IC is reactive, providing information on request rather than proactively shaping export control policy with intelligence.
Major US technology policies, such as the October 2022 semiconductor export controls, are not sudden shocks. They are often telegraphed years in advance through influential government commission reports, like the one from the National Security Commission on Artificial Intelligence (NSCAI), which provided the blueprint for these actions.
The U.S. government approaches economic foreign policy in a piecemeal fashion, with different factions advocating for trade, investment controls, or supply chain resilience separately. This lack of an integrated national economic security strategy leads to internal competition for resources and inconsistent policy application.