Mark Schiefelbein/AP Photo
U.S. Treasury Secretary Janet Yellen, center, speaks as U.S. Ambassador to China Nicholas Burns, right, and Michael Hart, left, president of the American Chamber of Commerce in China, listen during a meeting with members of the American business community, July 7, 2023, in Beijing.
Janet Yellen’s mission to Beijing had progressives a little worried. She is among the most naïve free-marketeers in Biden’s Cabinet, and she has foolishly criticized Biden’s strategic tariffs on Chinese exports as anti-consumer. Her expertise is in finance, not diplomacy, even less so on China.
But National Security Adviser Jake Sullivan is firmly in control of China policy. Though Yellen, as a relative dove, was dispatched to Beijing bearing olive branches, she stuck to the script and gave away nothing except some soothing words. The essence of the conflict between the U.S. and China is unchanged, as well as the strategic connection between Biden’s China policy and his industrial and supply chain policies.
Indeed, Yellen’s opening speech on Friday was a pleasant surprise. She chose as her venue and audience the American Chamber of Commerce in China, and put her Chinese hosts on the defensive by criticizing all the ways that the regime hobbles American companies doing business in China.
“During meetings with my counterparts,” Yellen said, “I am communicating the concerns that I’ve heard from the U.S. business community—including China’s use of nonmarket tools like expanded subsidies for its state-owned enterprises and domestic firms, as well as barriers to market access for foreign firms.”
After ten hours of meetings with various Chinese officials over the weekend, Yellen’s closing remarks at a Sunday press conference were deliberately soothing. “President Biden and I do not see the relationship between the U.S. and China through the frame of great-power conflict,” Yellen said. “We believe that the world is big enough for both of our countries to thrive.”
The trajectory of her dual role of bad cop, then nice cop, did not just happen. It was carefully choreographed.
Yellen also rejected the idea of a U.S.-China “decoupling,” a vague, straw-man term that no serious person has proposed. In the conventional wisdom, the Chinese leadership is very sensitive to terminology. They are also not fools. Beijing must realize that despite a mutual desire to avoid military conflict, the substance of Biden’s China policy is unchanged.
That message has been delivered repeatedly by Biden’s real diplomats and China experts. Yellen’s visit was mainly for public consumption, and of course the press played right along.
Yellen deserves some (faint) praise for not mixing the message or undercutting her president, as she has occasionally done in Washington.
Back in her lane, Yellen did another good deed. In a Sunday interview with Face the Nation, she warned that while the economy is strong, the risk of recession “is not completely off the table,” but added that the economy is nicely on track to moderate job growth and subsiding inflation. That message is directed squarely at the fanatics at the Fed, who need to relent and let the recovery thrive.
