During his maiden speech on the floor of the United States Senate, U.S. Senator Mitt Romney addressed the need for a strategy to confront the challenges China poses to the United States.
Mr/Mme President, I’ve been a member of this body for several months now, and I’d like to offer a few observations about the experience.
I had been told I might not like it here. Having previously been a governor, some friends thought I might find the pace too slow and decision-making too diffuse and cumbersome.
But that has not been the case. My committee assignments are interesting and the work is important. And while few bills actually become law, the fact that both political parties must reach consensus for a bill to pass reinforces the ties that bind our Republic.
Given the public passions of our politics these days, I had also presumed that the atmosphere here would vary between prickly and hostile. But the truth is that senators on both sides of the aisle are remarkably friendly and collegial…once the cameras are turned off.
I have now met privately with 68 of my fellow senators. Like them, I came here in part because I believe my life experiences could help us confront our national challenges. I also believe that the values and policies practiced in Utah can inform national debates. Our state has the fastest job growth in the nation, balances its budget every year, and has the country’s most highly educated population.
It is a great privilege to represent the people of Utah in the United States Senate. I’m humbled by the history that’s been made here, by the character of the patriots whose sculptures adorn the halls, and by the sacrifice made to construct the Capitol of the greatest nation on earth. To serve here is to be reminded hourly of the history and greatness of this blessed country.
The American character has been distinct from our very beginning. Alexis de Tocqueville observed that Americans had fashioned a culture different from any he had ever encountered.
Just a few weeks ago, I attended the 150th anniversary of the completion of the transcontinental railroad at Promontory Summit, Utah. In his keynote address, historian Jon Meacham observed that in a number of ways, that endeavor revealed some of the distinct elements of the American character.
President Abraham Lincoln signed the project’s enabling legislation on the eve of the Civil War. The country was divided as never before or since, and the President was preoccupied with preserving the union. Despite the gathering storm, he had both the foresight to see the impact of a transcontinental railroad and the confidence to believe it could actually be constructed. We Americans are drawn to visionary endeavors, and we rarely lack the confidence needed to undertake them.
It is difficult from today’s vantage point to appreciate the extent of the project’s engineering and construction challenges. Some have called it the greatest engineering triumph of the 19th century. Tunnels were blasted through the Rocky Mountains and the Sierra Nevada, at first only with black powder. There were no hotels or restaurants along the way, no local sources of energy, no power tools. On some days, the progress through granite mountain was measured in inches.
The cost was prohibitive, particularly for a country preparing for war. So Congress made it a public private partnership. Two companies, one from the west and another from the east were each granted tracts of land commensurate with the amount of track laid. Furious competition ensued, each company wanting to obtain the most land possible.
There were many who opposed the idea of granting public land to private companies which stood to make fortunes off those lands. There were others who thought the project was the height of folly: too expensive, too dangerous, and unnecessary; after all, it was already possible to go from New York to California in just six weeks by land or two by sea.
But having studied and debated the matter, Lincoln and Congress defied popular criticism and did what they believed was in the best interest of the country.
The construction crews numbered in the thousands. 15,000 Chinese immigrants would work for the Central Railroad that began in Sacramento; roughly 7,000 Irish immigrants labored for the Union Pacific Railroad coming from the East. In time, veterans of the Civil War joined the crews, as did several thousand Mormons from Utah.
The work conditions were brutal. Somewhere in the neighborhood of 500 to 1,000 men died.
The achievement was also marred by failures of character. The promoters were oblivious to the rights and needs of Native Americans and to the plight of the immigrant workers. When the railroad was completed, Chinese laborers were denied citizenship.
There can be a blindness in the human mind that’s clouded by ambition.
Despite these unpardonable failings, the transcontinental railroad was a grand achievement. It joined two great oceans, and overcame the challenge of a nation spread across vast distances and foreboding lands. Intrinsic in the American mind is the conviction that we can overcome any challenge.
In the years since then, we have achieved greater marvels and overcome greater challenges. 75 years ago, brave Americans landed on the beaches in Normandy and began the process of liberating a continent. Americans turned the tide of two World Wars, overcame a global depression, conquered deadly, debilitating diseases, and walked on the surface of the moon.
Mr/Mme President, we who’ve inherited this incomparably accomplished nation might wonder if we will face challenges as daunting and opportunities as transformational as theirs.
The decisions each generation of Americans makes, affect the course of history and profoundly impact our prosperity and our freedom. We face such decisions today.
Eight years ago, I argued that Russia was our number one geopolitical adversary. Today, China is poised to assume that distinction. Russia continues its malign effort, of course, violating treaties, invading sovereign nations, pursuing nuclear superiority, interfering in elections, spreading lies and hate, protecting the world’s worst actors from justice, and promoting authoritarianism. But Russia is on a declining path: its population is shrinking and its industrial base is lagging. John McCain famously opined that Russia is a gas station parading as a country. And as it falls further behind, we must expect Russia’s inevitable desperation to lead to further and more aberrant conduct.
Unlike Russia, China is on a rising path. When it was admitted to the World Trade Organization, the expectation was that China would embrace the rules of the global order, including, eventually, respect for human rights. It has done the opposite, imprisoning millions in re- education camps; brutally repressing dissent; censoring the media and Internet; seizing land and sea that don’t belong to it; and flouting the global rules of free and fair competition. And like Russia, China promotes authoritarianism and protects brutal dictators like Kim Jong Un and Nicholas Maduro.
Today, we mark the anniversary of the Tiananmen Square Massacre. That day, cries for freedom were brutally crushed. Since then, China has pursued a relentless course to smother the kind of hopes and dreams that filled that square thirty years ago.
It is possible, Mr/Mme President, that China might someday experience a discontinuity or another uprising that will change its course. But barring that, because China’s population is almost four times our size, it’s economy should eventually dwarf ours. And because economic advantage enables military advantage, China’s military could eclipse our own. It is possible that freedom itself would be in jeopardy.
If we fail to act now, that possibility may become reality.
We have two imperatives: first, strengthen ourselves and second, stop China’s predation.
Mr./Mme President, in the long term, for a country like ours with a relatively small population to rival a country like China with its much larger population, we must join our economic and military might with that of other free nations. Alliances are absolutely essential to America’s security…to our future. I can’t state that more plainly. Our alliances are invaluable…to us and to the cause of freedom. We should strengthen our alliances, not dismiss or begrudge them. We should enhance our trade with allies, not disrupt it, and coordinate all the more closely our security and defense.
It is in the United States’ most vital interest to see a strong NATO, a strong Europe, stronger ties with the free nations of Asia and the subcontinent, and with every free country. We need to hold our friends closer, not neglect them or drive them away. These alliances are a key advantage we have over China: America has many friends, China has very few.
We have another advantage: innovation. The country that leads in innovation will lead in prosperity. China knows this as well as we do. After all, it began its economic rise by stealing our technologies. Today, China has become an impressive innovator itself. Last year, China received almost as many global patents as did the United States. It is far ahead of us in 5G and it is on track to surpass us in artificial intelligence, and AI is a general purpose technology that will have systemic impact on the world.
It is critical that we protect the technology we have and propel the innovation we will need. Well-resourced and guided, our great research universities combined with the productivity inherent in free enterprise are capable of reasserting America’s innovation leadership.
One dimension of American innovation is often underestimated: America is a magnet for the world’s best and the brightest. They want to come here, not China. Over half of the 25 most valuable high tech companies in the U.S. were founded by immigrants or their children. It is very much in our national interest to keep attracting the world’s best minds to America.
We must also tame our national debt and deficit. The federal government took in about $3 trillion last year and spent about $4 trillion. Adding a trillion dollars every year to the debt means that in 10 years we will be spending almost as much on interest as we spend on our military. America won’t be strong enough to defend its interests and leadership if it strains under a crippling fiscal burden.
In addition to strengthening America, Mr/Mme President, we must also confront China’s aggression. China has focused its ambition most acutely on trade. Flouting global rules and conventions, China has corrupted the free market. China views companies in countries that play by the rules as the proverbial fish in a barrel. And too often we just ignore China’s aggression, genuflecting before the throne of free markets. But you don’t have a free market if the biggest player is allowed to cheat.
China’s cheating takes many forms. For many years, it held down the value of its currency to make its products artificially inexpensive, intending to drive competitors from other countries out of business, when it could then raise prices. More recently, China has debased its currency to partially compensate for tariffs imposed on its goods.
Today, so called “industrial policy” is the Chinese primary weapon of choice. China subsidizes a company by loaning it funds at sub-market rates, by forgiving loans, by providing free research and development, or by simply allowing it to use intellectual property stolen from others. Subsidy is even easier to hide when the company is owned by the government itself; there are 140,000 state-owned companies in China, accounting for 40 percent of its industrial assets.
Profitability, return on capital, and repayment of debt are mostly irrelevant in such state-owned enterprises. They can employ predatory pricing, entering a foreign market by pricing a product well below its cost, driving domestic competitors out of business. When an American company does this, it is prosecuted under antitrust law. Proving a Chinese product is priced below cost is extremely difficult given the lack of reliable cost data.
China’s industrial policies are killing and debilitating businesses throughout the world. I’m a free trade, free market guy, but free markets require rules to enforce honest competition. Slavishly accepting China’s cheating as a dynamic of free market competition makes no sense. The President is right to use tariffs to crack down on China’s theft of intellectual property. But when it comes to China’s predatory industrial policy, the cheating will not end. We will need counter it directly.
Classically, a country has several tools to counter a predatory competitor. It can ban all or certain of its products. We did this with the Soviets during the Cold War. It can employ counterbalancing subsidies. It can require high levels of local content. And, of course, it can align with other nations to establish strict rules of conduct, which it then vigorously and swiftly enforces. All or some mix of these are needed.
As we confront China’s aggression, we must also endeavor to convince it to turn back from the road of economic, military, and geopolitical conflict upon which it has embarked. Joining the other nations of the world in genuinely fair and free trade and in respect for the sovereignty of its trading partners and neighbors is very much in China’s, America’s, and the world’s interest. China is not yet a geopolitical foe, but its actions over the last several years have brought it right up to the line of being so.
What I have said today won’t come as news to leaders here in Washington. The forms of China’s aggression are widely understood by members of the Administration, members of Congress, and foreign affairs experts on both sides of the aisle. But to date, our national response has been ad hoc, short term, or piecemeal. It is past time for us to construct a comprehensive strategy to meet the challenge of an ambitious and increasingly hostile China.
Mr./Mme President, I said at the outset of my remarks that there are two dimensions needed in a strategy to preserve American leadership: first, strengthen America and second, confront China’s predation. There is a third dimension. We must alert the American people to the threat we face and unite them to the greatest extent possible in our response. In the past, an act of war or blustering threats by hostile actors have united us. But don’t expect to see the Chinese President pound his shoe on the counter or shout that he will bury us, as Nikita Khrushchev once did. No, China intends to overcome us just like the cook that kills the frog in a pot of boiling water, smiling and cajoling as it slowly turns up the military and economic heat.
The disappearance of traditional media and the emergence of social media have made it more difficult to unify the country. Conspiring voices online prey on the human tendency to diminish the dignity and worth of people with different views, of different races, religions, or colors. Contempt rather than empathy is a growing feature of our politics and media. Each of us must make an effort to shut out the voices of hate and fear, to ignore divisive and alarming conspiracies, and to be more respectful, more empathetic of our fellow Americans. And when it comes to cooling the rhetoric and encouraging unity, there is no more powerful medium than the bully pulpit of the President of the United States.
Bringing a nation of 330 million people together in a shared effort is a greater challenge these days than bringing two coasts together with a railroad. But now as then, national unity demands that the voices of leaders draw upon the better angels of our nature. They must call upon the distinctive qualities of our national character evidenced time and again in American history. We must reaffirm the principles of the Declaration of Independence; Jon Meacham said it well: “the greatest words ever originally written in English may be these: ‘All men are created equal.’”
That founding conviction propelled America to become the greatest nation on earth. No people have done more to assuage poverty, to combat tyranny, and to advance the God-given right of every woman and man to be free. That is still our common cause, our enduring legacy, and our promise to generations unborn.
Only America can lead that endeavor, but only with honor, with integrity, and with the combined strength of the friends of freedom will we succeed. America remains the best hope of earth and the champion of freedom. May God bless us with the courage and wisdom to keep that sacred trust.
Thank you, Mr/Mme President.