The threat that China poses both militarily and economically is widely recognized. I’m proud that the Senate recently passed a strong defense bill that will enable the U.S. military to better deter Chinese aggression. But we also need to compete with China from a position of economic strength, and a key part of doing that is strengthening American industry and building a more resilient economy.
There’s widespread agreement that competing with China requires stronger industry at home. But how we go about doing this matters. The president and Democrats in Congress have shown a preference for costly taxpayer subsidies for select industries. The level of government involvement in the economy they envision is a significant departure from our tested free enterprise system. And it’s worth asking, what will be the result of increased government involvement in our economy in the long term? Will it stifle innovation in our most important engines of growth? Will small businesses and start-ups be able to compete with large, government-subsidized firms?
We now know that the green energy subsidies included in Democrats’ so-called Inflation Reduction Act are largely going to large companies and often to companies based in foreign countries, including China. And the Biden administration has implemented subsidies for semiconductor manufacturers in a way that goes far beyond the scope of the program. They are giving preference to companies using union workers and, in some cases, conditioning funding on companies offering employee benefits that align with their social agenda. This is the opposite of creating a level playing field – it’s government using taxpayer dollars to pick winners and losers.
I believe that government should be focused on creating conditions in which businesses large and small can grow, innovate, and create jobs. Republicans’ 2017 tax reform provides an example of this sort of pro-growth policy at work. It lowered our sky-high corporate tax rate to make American businesses more competitive and made it easier to recover the cost of a small business, farm, or ranch investing in themselves. The result was a stronger economy with rising wages and job creation, and companies bringing production back to the United States. Republican-led tax reforms have made our economy more resilient, and making these pro-growth policies permanent would give American businesses and entrepreneurs the certainty they need to compete and grow.
We also need to resume a real and robust trade agenda. Trade opens new jobs and opportunities for American workers. It opens new markets for our agricultural products and other goods and services. And while the Biden administration has been largely inactive on trade for over two years, the rest of the world has not. In fact, China is negotiating or implementing a number of new trade agreements. It’s clear that if the United States stays on the sidelines on trade, China will be happy to fill the vacuum. So, competing with China will require that we stay engaged and lead on trade.
The United States must rise to the occasion to compete with China. We have to compete from a position of economic strength, but we won’t get there with the heavy hand of government meddling in the economy. I believe that America succeeds when innovators and entrepreneurs are empowered to do what they do best and government steps out of the way. I’ll continue to push for pro-growth policies that put us in the best position to create opportunity at home and compete around the world.