I am not thrilled with these policy proposals: President Joe Biden is expected to issue an executive order next month restricting US investment in China, in part over concerns about US national security. Those concerns are valid, but the move would cede far too much arbitrary power to the federal government over capital flows and economic activity. The policy
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I am not thrilled with these policy proposals:
President Joe Biden is expected to issue an executive order next month restricting US investment in China, in part over concerns about US national security. Those concerns are valid, but the move would cede far too much arbitrary power to the federal government over capital flows and economic activity.
The policy will reportedly cover semiconductors, AI and quantum computing, and on the supply side it applies to venture capital, private equity and some technology transfers and joint ventures. It’s reminiscent of the proposed ban on TikTok. You can debate whether a bill that said “Ban TikTok” — and little else — would be a good idea. In reality, what was proposed would potentially criminalize a broad swath of internet activity in America.
Restrictions on capital flows to China would run into similar problems. On the surface, they would be addressing commonsensical national-security issues. Underneath, they would give the executive branch carte blanche to both punish foreign nations economically and to restrict domestic investors.
And this:
All said, it would be better for the US to devote resources to limiting Chinese espionage, or upgrading US supply chains and weapons systems. When it comes to relations with China, blocking its access to key weapons systems should be the priority.
Here is the full Bloomberg column.
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Economics, Law