A congressional advisory panel urged the Obama administration and Congress on Wednesday to apply more scrutiny to China's military expansion and signs of aggressiveness. The group also pressed for a tougher U.S. stance against what it called anticompetitive Chinese trade policies.
As President Barack Obama announced a new security agreement with Australia aimed at China's growing military presence in Asia, the U.S.-China Economic and Security Review Commission said Beijing's buildup is aimed squarely at countering America's defenses and exploiting weaknesses.
The commission recommended that the Government Accountability Office evaluate the ability of the Pentagon's early warning system to detect an attack from China's military wing, the People's Liberation Army. The group also said that suspected Chinese cyber-intrusions remained high in 2011 and may have interfered with the operations of at least two U.S. space satellites.
"The PLA's military strategy is designed to provide the army with the means to defeat a technologically superior opponent, such as the U.S. military," the commission said. That strategy, it added, is aimed at "degrading an opponent's technological advantages and striking first in order to gain surprise."
The Chinese military has pressed a full-scale upgrade of its weaponry in recent years while at the same time striking a more combative pose in the South China Sea. Since January, the commission noted, the Chinese military tested the latest model of its next-generation fighter jet, sent its first aircraft carrier on a maiden trial and is developing an anti-ship ballistic missile.
Those efforts follow a tense 2009 skirmish between U.S. and Chinese warships in the South China Sea and several years of strains between China and neighboring countries following several sea-based disputes.
U.S. Secretary of State Hillary Rodham Clinton has pushed for a process that would resolve those disputes, but recently backed the Philippines in its protest of China's territorial claim on an island chain long tied to the Philippines.
The report echoed recent Pentagon warnings about possible Chinese cyber-intrusions aimed at sensitive U.S. defense and intelligence sites and at American companies. It said such suspected intrusions came at a "substantial volume" in 2011 and that China "has identified the U.S. military's reliance on information systems as a significant vulnerability."
In recent years, the commission said, two U.S. government satellites "have experienced interference apparently consistent with the cyber-exploitation of their control facility." In January 2007, China demonstrated its satellite-killing capacity by firing a ballistic missile that destroyed an obsolete Chinese weather satellite. Fears of a collision with debris left from the satellite blast, the report noted, forced astronauts to evacuate the International Space Station last April.
Warning of China's growing upper hand in its economic relationship with the U.S., the commission suggested strengthening federal laws to stiffen "effective remedies against the anticompetitive actions of Chinese state-owned or state-invested enterprises."
The U.S. trade deficit with China increased 9 percent this year over the same period in 2010, and the imbalance with Beijing accounts for more than half of America's entire trade gap.
"China's foreign currency reserves are skyrocketing," the panel said, adding that those reserves are estimated at $3 trillion, three times higher than second-place Japan. At the same time, the report cautioned, China is grappling with inflation and the prospect of its own real estate bubble.
Worried about the pace and depth of Chinese investments, the commission recommended that the Commerce Department report annually on Chinese investment, particularly companies owned by the state. "China's investment policies are part of the government's plan to promote the development of key industries in China through access to foreign technology and capital," the report warned.
That prompted a strong dissent from William A. Reinsch, the panel's chairman, and a second commissioner, Robin Cleveland.
"These recommendations are not in and of themselves fatal flaws in our report, but they reflect a disturbing trend in our country towards economic nationalism," said Reinsch and Cleveland said. Reinsch, a former Commerce Department official and now president of the pro-business National Foreign Trade Council, issued a similar caution with Cleveland in last year's panel report.
Commission report: http://tinyurl.com/7jkglqj