Biden can hold China accountable for human rights abuses by divesting now

The last year of the Trump administration witnessed major addresses by secretaries, the national security adviser, director of the FBI, and the release by key departments of strategies to confront China. The January 2021 declassification and release of the 2018 strategic framework for the Indo-Pacific was also notable. The document was a blueprint for balancing against China during the Trump administration. Also this month, the Department of Homeland Security’s Strategic Action Plan to combat the China threat provided an important statement of how to respond to cybersecurity, critical infrastructure and supply chain vulnerabilities, as well as how to employ the Coast Guard to check Chinese influence from the South China Sea to the Arctic.  

With these measures, there has been significant progress within the U.S. government to the acknowledgement of the China threat. 

As the Biden administration begins its tenure, it is propitious to assess where the United States is in the government’s recognition of the threat. There is the question of whether what Donald Trump achieved will be bridged to the new administration or will  be reversed in practice, if not in name. More importantly, are there measures that the Biden administration could implement or execute to address the threat that the previous administration could not? 

President Biden has a considerable opportunity — in essence, he can get China out of Wall Street. He can use the financial power of the U.S. to promote human rights in China, and stop Beijing from raising money in U.S. capital markets to fund the growth of China’s economy, the Chinese military, and the sustained abuse of Chinese citizens. As only Richard Nixon could go to China because of his strong anti-communist credentials, so too might Biden be the only president to go to the world’s major financial hub and important source of support for political campaigns to demand changes to bring about progress in the protection of human rights.  

Chinese firms are still traded and allowed to raise capital in U.S. and other Western markets.  They should not be. Much like Gandhi’s “Quit India” campaign to pressure the British into leaving India, and the 1970s-1980s divestment movement for firms that traded with apartheid South Africa, Biden could start a “Divest China” movement. Divestiture is essential because many Chinese entities profit directly or indirectly from coerced labor or have close ties with the Chinese military.  

The Biden administration has the opportunity to lead the world in requiring that Wall Street eject Chinese entities that do not recognize human rights of the Chinese people and those that profit from the coerced labor of the Chinese Muslim concentration camps. Biden can divest now and encourage other countries, state and local governments, and firms to join the effort. He can compel Chinese and U.S. entities to honor their commitments to human rights, including the protection of religious minorities. 

Since June 2020, the Pentagon has released several tranches of lists of Chinese firms that operate openly or obliquely in the United States and participate in a military-civil fusion development strategy that supports the People’s Liberation Army’s modernization goals by ensuring access to advanced technology and expertise. The Department of Homeland Security’s Customs and Border Protection has issued “Withhold Release Orders” against many Chinese entities to deny entry or importation for goods, including apparel and garments, tomatoes, cotton and cotton products, hair products and computer parts produced by forced labor in Chinese concentration camps.

These efforts are important and must be sustained, but additional measures are necessary and will require that the Treasury Department enter the fight with an energy it did not possess under Trump’s secretary, Steven Mnuchin. To accomplish this:

• First, there must be far better organization and implementation of the Chinese firms and other entities that abuse human rights. 
• Second, all U.S. entities should divest from Chinese entities with direct or indirect ties to human rights abuses, the Chinese military, or the Chinese Communist Party.
• Third, the Chinese entities must be identified and targeted, root and branch, to deny them access to U.S. and Western markets.
• Fourth, any Chinese or Western entity that interacts with these firms also should be sanctioned. Any Western entity that does so must be held accountable for associating with entities that traffic in gross human rights. U.S. federal, state and local government investment and retirement — indeed all — portfolios must be examined and scrubbed of any entity that is linked directly or indirectly to these human rights abuses.

Yet, simply separating these entities from markets is not sufficient. A divestiture campaign involving global media, Hollywood and popular culture (akin to the effort against South Africa) should be started to draw the public’s attention to Chinese and other firms that participate or are associated with the Chinese Communist Party, the People’s Liberation Army, or that are associated with forced labor. That such a movement does not already exist is alarming and must be corrected.  

The protection of human rights requires constant vigilance. A positive step in the waning days of the Trump presidency was the rapid sanctioning of Chinese and Hong Kong officials over China’s crackdown on pro-democracy groups in Hong Kong in 2020 and 2021, and Mike Pompeo’s emphasis on China’s human rights abuses. These were important signals to the rest of the world that human rights abuses incur a cost. Where such abuses occur, Chinese officials and others must be identified, publicized and sanctioned so that the abuses can be ended. 

The fact that concentration camps exist in China and that entities are profiting from the labor of these inmates is unconscionable. Divestiture and sanctions are two necessary measures to support human rights. Those who use such labor or profit from these sordid abuses must be held to account, whether in China or the rest of the world.

Bradley A. Thayer is the co-author of “How China Sees the World: Han-Centrism and the Balance of Power in International Politics.”

Lianchao Han is vice president of Citizen Power Initiatives for China. After the Tiananmen Square Massacre in 1989, he was one of the founders of the Independent Federation of Chinese Students and Scholars. He worked in the U.S. Senate for 12 years, as legislative counsel and policy director for three senators.