Former Transportation Committee Chairman Warns China Could ‘Weaponize’ Dominance Over Shipping
Peter DeFazio (former Chairman of House Transportation Committee) raised alarm about China’s dominance over the shipping sector, warning that Asia could become a superpower. “weaponize” Its dominance against the United States.
China currently controls a large proportion of the shipping equipment and ships, while the United States is still lagging behind.
DeFazio, who spoke at an event held by the Hudson Institute in Washington, D.C., criticised China’s decision to end the 20th Century with full trade rights. He said it was “a mistake.” “mistake.”
The United States signed a number of free trade agreements during that time, including the North American Free Trade Zone agreement (NAFTA), which greatly reduced U.S. tariffs for goods made in Canada and Mexico.
DeFazio claimed that NAFTA, and many other similar agreements, were more beneficial for other nations than they are for the U.S. DeFazio pointed out that Mexico’s economy was much smaller than New Jersey’s at the time NAFTA was signed.
“Who’s really benefitting here?” DeFazio said.
DeFazio indicated that NAFTA is of greater concern to China than NAFTA. He said the United States decision to give China full trade rights was a bigger problem.
The United States and China established diplomatic and trade relations in 1979. These had been suspended since 1949, when China was overthrown by the communists. This resulted in a rapid increase in trade between the two countries and eventually helped China become the global superpower that it is today.
China Trade Rights Advocates “thought that China would democratize, but it didn’t,” DeFazio said.
Although the United States still holds the title of the world’s largest economic country, China is close behind, and its economy continues to grow faster than the U.S. China’s economy has been growing rapidly, and so has its control over shipping. DeFazio stated that the United States has lost control of shipping.
He emphasized the fact that 95 percent of U.S.Asia shipping is controlled by three large shipping conglomerates. 85 of the approximately 50,000 shipping ships in the world are owned and controlled by the United States, which is the largest economy on Earth, at several trillion dollars.
This lack of control can have grave consequences. DeFazio cited as an example such consequences the fact that the United States had borrowed foreign ships to fight in the Gulf War.
“There are two concerns here: the U.S. doesn’t control shipping, and China does,” DeFazio said.
Cargo tracking
China’s dominance over shipping, DeFazio said, means that it can track most U.S. cargo—including U.S. military cargo.
DeFazio warned the Chinese Communist Party (CCP), through software that was installed on cranes. China is a major manufacturer of these cranes.
DeFazio warned China that if the United States does not increase its control of shipping, it could be subject to retaliation. “weaponize” Its dominance over America.
“We need to take control over shipping more seriously,” He stated.
DeFazio also pointed out that the average U.S. Tariff Rate is “the lowest in the world” at 3.4 percent in average and urged Congress to reconsider its trade relationship with China.
Congress could do this, with a bipartisan bill currently pending in the GOP controlled House. It would review U.S.-China trade relations.
‘National Security Has to Come First’
Critics of China’s trade freeze have suggested that consumers could suffer from the economic consequences of trade restrictions between these two countries, which are now economically dependent.
China has some of the lowest labor costs due to its lax labor laws, as well as the strict sweatshop conditions that it allows, In turn, cheaper labor means lower prices for consumers.
A dramatic change in U.S. trade relations with China would undoubtedly result in higher prices for consumers.
DeFazio was asked how to balance national security concerns and the needs of consumers. He suggested that the United States should be able to create policies to gradually decrease their dependence on China.
However, he stated that where national security or consumer prices clash, “I think national security has to come first.”
DeFazio’s warning came at a moment when tensions are high between the United States of China. China’s dominance over the shipping sector is likely to become a more serious issue in years to come. China could use its maritime industry control to threaten national security and trade.
DeFazio stated that it was essential for the United States take steps to improve its control over shipping to prevent such a situation.
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