Sen. Marco Rubio (R-FL) expressed concern Thursday that a Biden administration executive order that changed Trump-era rules on U.S. investment in Chinese companies would give too much authority to a Treasury Department “too closely aligned with Wall Street.”
The Biden administration this week issued an executive order that expanded a Trump executive order banning U.S. investment in Chinese companies supporting China’s military to companies that also sold surveillance technology.
However, Biden’s order moved authority for the ban from the Defense Department to the Treasury Department, which Rubio argued would put a Treasury Department close to Wall Street in charge of creating and maintaining the list of Chinese companies that would face financial penalties.
“We know for a fact that Wall Street is helping to finance the Chinese Communist Party’s effort to weaken and ultimately replace American leadership,” Rubio said in a statement:
The story of the past two decades has been America’s unwillingness to confront Beijing’s exploitation of our legal, political, and financial systems. While the administration updated the Trump-era policy in important ways, I am very concerned that President Biden’s Treasury Department is too closely aligned with Wall Street to take the actions necessary to prevent American savings from being used to fund the Chinese Communist Party.
A Biden official told the Washington Post that the Treasury Department has more experience drafting sanctions programs “in a way that meets all the U.S. judicial and legal standards.”
“Treasury has a regulatory structure to list names and enforce prohibitions. Defense doesn’t,” said Kevin Wolf, a former senior Commerce Department official.
A former Trump official, David Feith, told the Post that Biden’s move is “a welcome thing,” but said shifting enforcement from the Defense Department to Treasury might complicate implementation because “the Department of Defense takes a fundamentally national security-focused perspective on things and Treasury traditionally does not.”
Rubio warned in a recent American Prospect article that American capital markets are the most “open, liquid, and valuable in the world” and are “increasingly a source of funds for China’s most strategically important companies.”
“Chinese companies that produce surveillance technology and weapons of war that could one day kill Americans finance their investments with Wall Street capital,” Rubio wrote.
Rubio also noted that at the same time U.S. corporations are enriching China and turning a blind eye to its human rights abuses, they are taking left-wing stances in the U.S. to curry favor with a new base of Democrat support. He wrote:
It’s the height of hypocrisy. U.S. corporations with lucrative business ties to the Chinese Communist Party will boycott states here over anti-abortion laws, while Beijing systematically sterilizes Uyghur women. They routinely inflame divisive race issues within the U.S. while marginalizing African American actors or erasing Tibetan characters to keep Chinese audiences happy.
Rubio noted that Wall Street has intervened to protect Chinese companies, to the detriment of American national security. He said for example, when the Trump administration called for the delisting of Chinese companies tied to Beijing’s military from the stock market last fall, Wall Street “went to bat to ensure that three Chinese telecommunications firms complicit in state censorship, China Telecom, China Mobile, and China Unicom, were spared.”
Although the three companies ended up recently delisted, Rubio noted the Biden administration has allowed one of China’s biggest electronics companies, Xiaomi, to relist on U.S. exchanges.
Rubio also noted in his article that the U.S. became a net investor in China for the first time in history in 2019, after China opened its market to American financial companies and sought the listing of its businesses on American stock exchanges, allowing American investment portfolios to become increasingly invested in Chinese companies.
“Many well-meaning Americans may inadvertently be propping up a genocidal regime because Wall Street does it for them,” he wrote.
Rubio said in his statement Thursday:
We need to start requiring more transparency from Wall Street when it comes to investing in China and Chinese government controlled companies. … Beijing long ago figured out how to get rich and powerful Americans to use their influence in American politics.
He added, “Allowing Wall Street and Big Finance to enrich themselves by hurting Americans, they make a lot of money in the short term, for those individuals, but it is hurting America in the long run. in the long run. It is national economic suicide.”