The complex political and economic relationship between the United States and China--the largest U.S. creditor--is expected to be a top priority for either President Barack Obama or GOP candidate Mitt Romney after the November elections. U.S.-China relations are marked by economic imbalances, compounded by what both candidates allege to be Chinese currency manipulation and unfair trade practices. At the same time, China’s foreign policy is increasingly assertive, particularly with regard to contested territories in the South China Sea.
The Obama administration has consistently brought complaints against China’s trade practices at the World Trade Organization. At the same time, the administration has expanded the U.S. presence in Asia--both diplomatically and militarily--to check China’s rise in the region. Romney has accused Obama of not taking a hard enough line against China, specifically on issues of currency and trade. He said he would immediately confront the currency manipulation issue upon taking office.
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Democratic Incumbent, Running Mate Joe Biden
President Obama came into office seeking a cooperative relationship with China. In 2009, his administration launched the U.S.-China Strategic and Economic Dialogue to discuss trade and other issues, which Secretary of State Hillary Clinton called "the beginning of an unprecedented effort to lay the foundation for a positive, cooperative, and comprehensive U.S.-Chinese relationship for the twenty-first century."
During a January 2011 state visit by Chinese President Hu Jintao, Obama noted, "In an interconnected world, in a global economy, nations--including our own--will be more prosperous and more secure when we work together."
At the same time, the president has criticized China for allegedly manipulating its currency, a practice that has contributed to the U.S.-China trade imbalance. The administration has also beefed up its defense policy vis-à-vis China, including the release of a $5.8 billion arms sale package (Defense News) to Taiwan in September 2011. On a trip to Asia in November of that year, Obama announced plans for an expanded U.S. Marine presence in Australia, part of a U.S. strategic pivot seen as countering China’s regional influence and coming at a time of increasing tension over disputed islands and resources in the South China Sea (NYT).
During his 2012 State of the Union address, Obama announced the creation of a Trade Enforcement Unit to investigate "unfair trading practices in countries like China." He also noted that his administration had brought trade cases against China at nearly twice the rate of President George W. Bush’s administration. In March, the administration, along with the EU and Japan, filed a "request for consultations" with China at the World Trade Organization over its restrictions on exporting rare earth metals. In August, the Obama administration filed another complaint at the WTO over China’s allegedly unfair taxes on U.S. vehicle imports (Bloomberg).
The Obama administration was faced with a complex Chinese human rights case this past May when Chinese dissident Chen Guangcheng (NYT) escaped from house arrest and took shelter in the U.S. embassy in Beijing. The administration’s diplomacy ultimately succeeded in securing Chen’s safe passage to the United States, allowing him to study law at New York University.
In September 2012, Obama filed another case with the World Trade Organization, this time alleging that China unfairly subsidizes (NYT) its auto and auto parts exports. The announcement, made in auto-industry reliant Ohio, came hours after China filed its own case against the United States (AP) challenging anti-dumping measures on a variety of goods. In another executive action later that month, President Obama blocked a bid by a Chinese firm (BostonGlobe) to own wind farms near a Navy drone testing site in Oregon, citing national security risks.
In the second presidential debate, Obama said he would reform the tax code to make outsourcing less financially attractive for U.S. companies, as well as lower corporate tax rates to spur manufacturing investment in the United States.
He also pledged to double U.S. exports by increasing the number of domestic manufacturing jobs, and reminded voters that he has brought twice as many fair trade cases against China in his first term than the previous administration.
In the third presidential debate held in Boca Raton, Florida on October 22, Obama said that "China is both an adversary, but also a potential partner in the international community if it’s following the rules." He also emphasized the importance of education, research, and technology as ways to help keep the United States competitive with China.