What policy choices does the US face on Chinese clean energy investment?

Michael Dunne
I think the single biggest risk is if China overwhelms our auto industry and becomes dominant here in the United States.

China is so powerful and has so much leverage—low cost, high speed, good quality—that it could simply, as Elon Musk has said, obliterate legacy automakers. That’s the risk.

Michael Davidson
Thanks for having me. There are a couple of key risks here that we could discuss.

First is supply chain vulnerabilities: the overwhelming dependence on Chinese products, intermediates, and upstream critical inputs for a wide range of clean tech manufacturing. The second is related to technology and data security. How do we secure data privacy as well as control over critical infrastructures?

There has been concern around facility and community security related to Chinese investments and manufacturing, and their proximity to sensitive locations. A smaller risk, but one that has also been raised, is around dual use, the application of Chinese technology in both commercial and military domains.

Kate Logan
I would respond by flipping the question and asking first: Why do we want or need Chinese investment in the United States? Start by centering the benefits rather than the risks. The United States is currently struggling to meet other critical needs, especially in reindustrialization, job creation, competitiveness, and energy affordability. Greater access to Chinese technologies could help address these challenges.

So far, the conversation has been dominated by centering risks rather than balancing those with the potential tradeoffs or benefits. Some of the security-minded approaches, such as the data concerns that Michael Davidson mentioned, have risen to the forefront.

But I would encourage thinking more broadly about the trade-offs at hand and recognizing that some benefits may themselves become risks if the United States does not access technologies that could meet its interests.

Michael Dunne
Do we want to develop batteries, battery supply chains, and EVs domestically, or not? If we are committed to that goal, everything becomes easier. When we are not, we default to the view that we cannot get our act together and should invite Chinese firms to help.

But the bigger risk is that we do not know our own objectives. What is our long-term vision as a nation for batteries and their supply chains? Do we want them or not? From there, we can determine the extent to which Chinese involvement is necessary.

Michael Dunne
Let’s take Ford Motor Company as an example. It initially thought, “We want to build our own batteries, and we’ll do so in partnership with South Korean or Japanese companies.” Then Ford came to understand that those partners made the wrong chemistries for their purposes and shifted toward lithium iron phosphate. That meant relying on Chinese battery makers like CATL or BYD. From there, they decided to form a licensing arrangement where the Chinese battery makers provide the technology, but Ford owns the manufacturing.

Where is this going? Will Ford learn enough to stand on its own and build its own batteries eventually? Or does this become a dependency situation where Ford is forever the supplicant, and the Chinese are forever the masters?

At both the state and federal levels, we need to make up our minds. Are we going to do this ourselves, or are we going to capitulate and say, “We’ll never get there, so let’s just make the best of the situation we can”?

Michael Davidson
When we started to see some more policy responses in this area, a group of us wrote a piece and explored the risks of integrating with China across several clean energy technologies. At the time, we focused on solar, wind, and batteries, and we observed that the policy debates around this often lack specificity. They don’t have objective assessments of the risks, and so there’s a one-size-fits-all approach.

We found that there are generic benefits of diversification, but the specific costs of decoupling depend on the technology and the timeframe. On the grid, we can distinguish between consumer- and developer-facing technologies and bulk grid operations.

For small-scale products that are connected to the grid, the cybersecurity risks of back doors are less consequential than if they are core, connected grid components. Think about the Colonial Pipeline ransomware episode. Core operational control leads to huge outcomes.

Here, the key question is: how many points of failure are needed to threaten grid stability? You can try to game out how many different interconnected components would need to simultaneously fail in order to threaten grade frequency and potentially lead to a blackout.

At the bulk level, it’s quite clear. Current Department of Energy guidance prevents Chinese technology from being installed at those core grid control levels. At the individual renewable energy project level, there are limited examples of policies restricting Chinese investment in products. Most of those are related to the facility and community security that I discussed, and not to the operational control.

Data security is much more salient in the transportation sector now because of regulations around the importation of Chinese EVs. Modern-day electric vehicles have sensors and communications. They’re recording and transmitting lots of data on people and places.

Because of these concerns, the Biden administration, just a few months after imposing 100% tariffs on Chinese EVs, established the connected vehicle rule, which, in practice, prohibits importing any vehicles or the sale of any vehicles from China, particularly Chinese EVs, because of all of the connected hardware.

To your point on calibration, and whether this is the appropriate recourse, other countries have found alternate approaches to these data security dependencies. For example, Tesla vehicles are allowed to operate in China through a deal that consists of a couple of key components, such as data localization, meaning keeping those data centers within China; compute localization; and utilizing China’s preferred mapping software, which satisfies the country’s security guidelines. There are some lessons that we can learn across that, but they differ across the technology as well as the timeframe.

Michael Davidson
I know that the Europeans are discussing this, but there’s no European Union-wide policy. There are no current plans to ban the sale, but rather concerns around how you would deal with data localization.

Other countries have mirrored our policies on tariffs and other constraints on Chinese operations. Canada has done so, for example, though those have been softening with the recent deal to allow the importation of some Chinese EVs into Canada. So yes, in some cases, the United States stands as a category of one, but there are some other countries that follow along with some of our policies.

Michael Dunne
Europe has discovered that there are devices embedded in the buses that they’ve acquired from the Chinese that would allow those services to be turned off remotely. There has been an after-the-fact discovery in Europe, an awakening of the risks of having Chinese vehicles on their roads.

But to answer your question, I think the United States today is on an island in just how strict it is with regard to allowing Chinese cars on its roads. Vehicles with embedded Chinese software or hardware are essentially not allowed to be registered in the United States.

If you look at the rest of the world, you might ask: Are we on an island? Did we miss something? Let me take the opposite point of view, and this may sound extreme, but bear with me. If it were 1939 and you were Winston Churchill, would you look at German products and say, “They are the best in the world—the most sophisticated, technologically advanced, highest quality, and lowest cost—so we buy them”? Would he do that? I don’t think so.

Michael Dunne
It’s real. Let’s just be honest. It’s not Japan or Korea that we’re dealing with. It’s not one of our allies. It’s our adversary. Do we want to invite it in?

And if so, why? What is it that China can do that we’re not able to do, today and five years from now?

Kate Logan
Yeah, I’ll just start by responding to that last point. This is all happening in the wake of the Sino-Canadian deal, where Prime Minister Mark Carney went to Beijing and agreed for Canada to import a limited quantity of Chinese EVs and did so with the explicit aim of attracting Chinese investment.

That begs the question: There are countries, among the hypothetical allies and partners of the United States, that have greater access to this technology. How are they managing those risks? Because there are certainly common interests there, and I wonder how that might shift the conversation in practice as those vehicles start to show up in Canada, especially because Canada has also said that it wants about half of those vehicles to be affordable by 2030.

When you think about the role of public opinion as well, how does that shape outcomes? Turning back to this question of a patchwork of restrictions, we’ve talked a little bit already about the connected vehicles rule, but basically, without a central framework. There’s a variety of different rules and restrictions that have shaped outcomes so far.

Apart from that rule, there is also the role of Foreign Entity of Concern (FEOC) requirements, originally developed under the Inflation Reduction Act (IRA). Last summer, however, when the reconciliation bill passed and scaled back some tax credits, those requirements were significantly expanded. For certain credits, particularly those tied to batteries and manufacturing, eligibility over the next decade will require limiting material assistance from Chinese entities in investment projects.

Other factors include the Committee on Foreign Investment in the United States, or CFIUS; a range of tariffs; entity lists; and the Uyghur Forced Labor Prevention Act—all of which have shaped outcomes so far. On top of that, political risk, including local protectionism and congressional pushback, continues to influence decisions.

All of this has shaped outcomes in two ways. One is that companies looking to invest in the United States face uncertainty around whether future restrictions could extend this patchwork. Maybe they are willing and able to innovate in order to comply with the current restrictions. Right now, we see a lot of the Chinese investments that have been restructured to meet those restrictions, especially when it comes to FEOC restrictions. However, if there are future restrictions, that tamps down on that potential incentive.

The second piece is that taking away certain incentives to invest also increases general uncertainty. But I’d argue that, because Chinese companies still have an interest in the high-end U.S. market, the chaotic patchwork of restrictions may actually create some degree of leverage for the United States to put forward something that can prompt Chinese investments on American terms in a way that meets American interests.

Kate Logan
Building on what I just said, we have this patchwork already, so I’d almost argue that there are quite a number of restrictions that could be packaged in some way, shape, or form.

The question is, what’s the most effective way to do that? And I think that there’s also this question around the politics and how that layers on top of the restrictive policy. If you’re a business and you are able to comply with the current policies but are afraid of future restrictive policies coming into play, what degree of political cover do you need to be willing to move forward on investment with some degree of guarantee?

There’s a role for a bilateral committee to consider what would be needed to ensure that potential Chinese investments and technologies could meet U.S. interests, but also work for the competitive interest, especially for American firms that are looking to secure some degree of competitiveness and revenues in a very shifting landscape, especially from an electric tech perspective. I don’t know if that necessarily answers the question of federal versus local in practice, but having some degree of leading with politics would be helpful.

Michael Davidson
We can make some determinations at this point that the national security risks are manageable with a suite of policies.

First, there should be bans on high-sensitivity applications, such as voltage control of the grid. For instances involving dual-use risks or dependencies on upstream minerals, production for high-performance military applications should be clearly separated and restricted. There should, of course, be enhanced attention to shared upstream minerals and some of the bottlenecks that those present.

On the data side, there are quite a few examples already, including those unfolding with the TikTok deal, of data protection and localization rules that can provide blueprints for resolving some of these issues.

For more moderate risks, the challenge is often less about national security than economic security. Diversification is still an option, but the United States tends to lack strong tools to encourage it. We can encourage onshoring, but if we want to achieve true diversification, then there are a couple of options before us.

The first is to create incentives through frameworks such as FEOC, Prohibited Foreign Entity, or the material assistance cost ratio. All of these depend on sustained incentives.

The recent shift toward reducing those incentives complicates that strategy. Ironically, repealing major portions of the IRA effectively leveled the playing field for EV manufacturers to use Chinese batteries, as opposed to before, when there was a strong incentive to collaborate with Korean and Japanese automakers. There is still strength in rules around advanced manufacturing tax credits, which still have some bite.

The other major option is to strengthen and clarify how intellectual property is managed, given concerns about technology dependence, facility security, and investment screening. Last year, together with Third Way, we produced a report on security engagements with Chinese firms in clean energy. In that, avenues such as stronger intellectual property management protocols and clearer approaches to facility security, including ownership structures in which Chinese partners do not own physical assets but retain stakes elsewhere in the business. There is also a need for a more robust conversation about improving the principles and operations of the Committee on Foreign Investment in the United States, or CFIUS, which is the main lever through which the United States regulates inbound investments.

Lastly, the policies that we are going to put in place should be calibrated based on the mode of engagement. A wholly owned Chinese subsidiary—such as Jinko Solar or Gotion battery plants—presents different risks and different policy options compared to a technology licensing arrangement like Ford’s partnership with CATL. In between those two, we have joint venture models like Illuminate USA.

The policy should be calibrated well to that mode of engagement. At present, the United States lacks a sufficiently differentiated toolkit to calibrate Chinese investment and participation against varying levels of national security risk.

Michael Dunne
Let’s come back to that at the end, CATL-Ford, because that’s the juicy gossip. We’ll start on guardrails and how to manage Chinese investment: One lesson I took from spending years in China is how licensing works. In the United States, we tend to think of a license as something you apply for and receive. In China, companies have to work really hard to obtain a license, and even harder to keep it.

I would encourage the United States to adopt a similar approach and say to Chinese companies, “We understand that you want access to the U.S. market because, at least in the auto space, it’s the most lucrative in the world by far. And in exchange for that, you’re going to have to contribute in the following ways: technology transfer, investment training, commitment to supply chains, etc.”

These should be tied to benchmarks, with regular reviews. If firms meet them, they retain their license. If not, they lose it. That approach would be familiar to Chinese companies and would preserve leverage for the United States. Approval should not be a one-time decision. The United States should maintain ongoing oversight and hold firms accountable. This offers a more effective way to manage inbound Chinese investment.

If we pivot to the Ford-CATL arrangement, it follows the letter of the law. On paper, it looks great: American-owned, American manufacturing, American jobs. But I’m skeptical about the extent to which Ford will actually learn and be able to eventually stand on its own. One, will CATL be motivated to transfer technology? And two, will Ford be hungry enough to pursue that technology? On both counts, I’m doubtful.

No, let’s not pretend. I’m not a fan of the licensing arrangement. I don’t think it’s a win for the United States. I think we have to roll up our sleeves and remember that lithium-ion batteries were invented here after all. There’s no reason why, given a certain amount of time, we can’t become competitive once again. Relying on a licensing agreement looks a little bit lazy to me.

Michael Davidson
Ryan, could I also probe this one a little bit? There are legitimate concerns about the extent to which we can capture some of the Chinese know-how, the soft knowledge, as well as the hard knowledge, like tech transfer.

But that varies based on the agreements. I’m reflecting on when the United States was facing existential pressure from Japanese automakers, trade barriers, etc. One of the resolutions was to invite investment—not tech transfer from Japanese firms—but investment in the United States. That competitive pressure from better Japanese practices then spilled over and helped to improve U.S. automaker practices.

Would we not expect something similar to happen in the Chinese clean tech space? Having CATL or BYD with some skin in the game in the United States to provide competitive pressure and develop more spillover to the U.S. automakers? I’m curious, Michael Dunne, about your thoughts on that. In my opinion, that is a viable strategy, of course, with all the guardrails in place.

Michael Dunne
In Japan’s case, we were competing against Toyota and were inviting Toyota in. In China’s case, if a Chinese company comes in, it comes with considerable baggage. What are China’s ambitions? To win. To dominate the global auto industry just as it dominates solar panels, shipbuilding, steel, drones, etc.

Today, it has the automotive industry in its sights, and it is overwhelming legacy automakers in markets outside of the United States. They’re coming in at prices that are 25% to 30% lower, not 10%. They are not competing and making us better. They are more so eating our lunch. I’m fearful that we’re not competing with individual companies but rather with a system whose ambitions are to eliminate competition.

Would we learn from that? I don’t know. I think we’re an open market economy competing with one that has a lot of levers. If all Chinese companies were allowed to export to the United States today or invest here, Detroit would come under enormous pressure, and I’m not sure that they’d have the wherewithal to recover from it.

Kate Logan
If I may layer a second question on top of this, Michael Dunne, is this question around fostering domestic innovation on the software front? Previously, you’ve brought up this point that, on the Chinese side, vehicle companies have become integrated as software providers and that vertical integration has really benefited them.

But on the U.S. side, some of the Silicon Valley tech companies haven’t closely integrated with the auto industry. We’re looking at a world where we are trying to foster connected vehicle software into a domestic product. What incentives could the United States offer to encourage that integration in a way that accords with connected vehicle rules and enhances competitiveness on U.S. terms?

Michael Dunne
If you go to plants of GM, Ford, and Chrysler around Detroit, Michigan, and Indiana, they are very good at putting cars together. But the future of the auto industry has moved on to technology.

This means software-defined vehicles, autonomous vehicles powered by battery electrics. In this instance, we have to come to the realization that the greatest hope for the United States going forward lies not in Detroit, but in California or Texas. Tesla’s Waymo. Zoox’s Rivian. This is where the action is. And if I were in charge of incentives, I would do everything in my power to help those companies move from software expertise into manufacturing expertise.

That’s a message that I understand—being a native of Detroit, Michigan—may not be that welcome, but that’s the reality of where the industry is going. Globally, we’re blessed to have tremendous companies here in the United States, like Tesla, like Waymo. I think we need to feed those companies much more generously with incentives to develop their capabilities to build robot taxis, self-driving cars, etc.

Kate Logan
On licensing, it is worth noting that under recently released interim guidance on FEOC rules, access to some remaining tax credits prohibits new licensing agreements after July of last year. So, the Ford-CATL licensing agreement could be irrelevant if other companies can’t replicate that. So, there’s a question about how to make license agreements potentially work for U.S. interests, but even putting that aside, can those licensing agreements even be recreated by other firms?

The second piece is this idea of what an affirmative framework would look like. Michael Davidson brought up the point that we’ve removed a lot of incentives, but that doesn’t mean we can’t create new incentives. For auto manufacturing, there currently isn’t a suite of incentives like there was under the Inflation Reduction Act. We could consider a set of new incentives that tie together job creation, tech transfer, productivity, ownership, and some of the elements that we want to see in practice.

Michael Dunne
I’m recalling a recent conversation with executives from a leading Chinese automaker. I asked how they would enter the U.S. market, and they said, “Yes, we’ll definitely manufacture. We understand we’re not welcome to export from China into the United States, so we’ll manufacture.”

I then asked where they would locate production. They said the South, away from unionized labor. When pressed on specific states, they were initially reluctant to say. But they made clear they had mapped the entire region, state by state, with profiles of each governor and assessments of their openness to Chinese investment on a scale of one to 10.

So, they have mapped out a plan to enter, manufacture, invest, and produce cars in the United States. They even know which states they want to go into, and, to your point, they have strong feelings that one state may be friendlier than another, and those are the ones that they’re going to hone in on.

An Achilles’ heel for the United States is that if California, Oregon, Nevada —California is the most likely—Arizona, or Alabama says, bring it in. What terms do you want? Absolutely. You’re going to employ 10,000 people and bring in $3 billion in investment? Yes, let’s do it. Let’s make it happen. And so that’s a very plausible scenario of the future, that the states move first, and the Chinese take advantage of that.

Michael Davidson
To take a step back, we should be clear about what the benefits are. We know that low-cost clean tech today is entirely predicated on globalized supply chains, and that has been the fruit of free flows of capital, technology, talent, people, and goods. That’s how we got to where we are today. Now, we don’t live in that world anymore. Going forward, we’re putting restrictions on all four of those things.

How do we maintain continued cost declines in the clean tech that we need to deploy, given these new realities? That’s what we need to address here.

Decisions about Chinese foreign direct investment, in any sector, should be guided by the extent to which the United States can achieve key objectives. These include developing domestic learning and capability, as Michael Dunne noted, as well as managing supply chain concentration and reducing disruption risks. All of these factors should be considered.

If we’re thinking about the potential risks, particularly to the energy system, these barriers may advance certain policy goals—such as local economic activity and some national security benefits—but they also carry costs. These include reduced energy security and adequacy, higher prices, and increased emissions due to slower clean energy adoption.

I’ll start with the risks on the grid. Solar and batteries today are the cheapest and quickest resources to build. At a time when we are really concerned about the ability to meet growing energy needs, especially through increased demand from data centers, hamstringing ourselves by preventing resources from coming onto the grid is not a good idea.

We know this is the fact because Texas is the largest deployer of batteries. That’s not a climate policy; that is a market-based policy driven by energy demands and the highly volatile electricity market that Texas adopts.

Additional barriers would likely lead to higher prices, particularly in the absence of incentives, as well as slower capacity additions and potential scheduling delays from product detentions tied to compliance rules. While these effects may not be immediate, over time—if tariff and investment conditions remain unresolved—regions such as Texas could face challenges deploying sufficient battery and clean energy capacity at reasonable cost.

The risks in the transportation sector are even more salient because EVs are cheaper than gas-equivalent cars in China, and SUVs have recently reached price parity. Without tax credits in the United States, EV sales are going to slow down. You already see battery projects shifting from EV to battery manufacturing projects. Access to Chinese EVs would provide consumers with more options. So, there’s a clear potential risk that the clean transportation transition will be slowed down if we have high barriers.

In the long run, having those capabilities in the United States, even if China is a minor player, would provide a jolt to U.S. manufacturers; that goes for EVs, batteries, and solar.

Acquiring those capabilities, generating that competitive pressure, and technology spillover are going to be essential for U.S. manufacturing to accelerate to the global frontier. If we don’t change direction, the United States will become a fortress where we manufacture and consume all of our own products and are miles away from the global frontier.

Michael Dunne
I’m nodding because you make very strong points, and they’re all valid. What comes to mind is the fact that we previously invited Germans, Japanese, and Koreans in to help make us more competitive and offer better products at lower prices to consumers.

And that has worked out pretty well, at least for the foreigners. Detroit’s market share has fallen consistently for the last 20 years. But the customers are better off, and we have a more competitive industry. The question is, is China fundamentally different from Japan, Korea, or Germany? I think that’s it.

There’s no question China can build cars more cheaply, do it more quickly, and offer very good value for money. What’s the cost to the United States?

Kate Logan
Analysis shows that if low-cost Chinese EVs were to enter the United States, they would actually first displace some of the foreign brands because those are the brands that dominate the low end of the market. That’s interesting to take into account in terms of the actual threat to U.S. incumbent automakers.

I want to return to the earlier point about trade-offs. It’s interesting to see what happened with Ford and CATL. In December, Ford moved to use CATL’s technology at a factory in Michigan. In doing so, it stepped away from a joint venture with a South Korean battery firm and instead adopted CATL’s lithium iron phosphate (LFP) technology to manufacture grid-scale batteries.

And the reason for that is that energy demand in the United States is rising rapidly due to data centers and artificial intelligence (AI). LFP is the best technology for meeting the energy needs that the United States has in the current environment, and they’re trying to figure out how to stay competitive.

Chinese LFP technology is, at present, best in class. The question, then, is what the United States gains in other areas, including AI and broader competitiveness, from maintaining access to that technology? That balance is worth examining more closely.

Kate Logan
Not to be contrarian, but it is notable that we have had this entire discussion without mentioning the potential meeting between Donald Trump and Xi Jinping in Beijing in the coming weeks.¹

This question of politics is perhaps more important than policy levers and what happens at the highest level. From where things stand now, I would be relatively pessimistic about some big breakthrough in a couple of weeks. But there will also be additional touch points and potential leader-level meetings later this year.

With the Asia-Pacific Economic Cooperation forum and Group of Twenty on the agenda, keeping an eye on the politics and how that influences the broader policy environment could be the one thing that could dynamically shift the entire situation.

Michael Davidson
Over the next 12 months, the most immediate constraint on meeting energy demand is permitting. Federal policy has made it more difficult to permit clean energy projects on federal lands, which runs counter to the need to deploy resources to support growing demand from AI and data centers. As a result, we are beginning to see a shift toward costly onsite generation options that do not deliver the same systemwide benefits.

Permitting reform in Washington is, therefore, a critical issue and likely the most significant near-term lever affecting energy supply.

Second, tariff policy will also matter. Twelve months is too short a horizon to see meaningful impacts from changes in investment, but adjustments to tariffs on key components could have more immediate effects.

Michael Dunne
Those are two tough acts to follow, Kate and Michael.

What’s left? The number one policy is investing in the technologies of tomorrow. Humanoid robots, drones, and EVs all depend on batteries and motors, and today, our cupboard here in the United States is largely empty.

Unfortunately, whether one drives an EV or not today carries political baggage or stigma. “You drive an EV, you must be a such and such kind of person,” or vice versa. We have to move beyond that to understand that the world is going toward batteries and battery supply chains, and we don’t have them. What are the steps to develop them ourselves and scale them here in the United States?

One of the key contributors to that will be for people to open their minds and realize that EVs are actually not associated with someone’s political stance. They are a new technology that the rest of the world is embracing and that the United States is missing out on. So, I’d recommend a policy to educate Americans and prompt them on whether we want to be independent, free, powerful, and wealthy. If so, we had better get with the program. We can’t sit back on former technologies.

Michael Dunne
Okay. I think the dam’s going to break. The Chinese will come in, they will manufacture here, probably through some joint ventures, but eventually owning it themselves.

And once those floodgates open, they’ll all come in, and the industry will be transformed. That’s my prediction.

Michael Davidson
Yeah, I do think at some level that the dam will break, as Michael said. We would expect to have a very complex landscape of partnerships. We have technology licensing, we’d have joint ventures, maybe wholly owned, maybe upstream.

I don’t know about Chinese Original Equipment Manufacturers. That’s a big question mark for me, given the experience BYD has had in the United States with trying to stand up something similar. But certainly in the battery side and in joint ventures, I would expect Chinese to be here.

I don’t expect Chinese companies to make up a majority of manufacturing, and I don’t even know if they would surpass Korea or Japan in that timeframe, but I think they would be a force to be reckoned with.

Kate Logan
I’ll point out a few things I’m watching. First, Chinese companies are already almost salivating at the U.S. market. You see all of these industrial rumors, especially after the Canadian deal, about Chinese firms saying that they’re going to find a way to enter the U.S. market. And they’re very innovative, as Michael Davidson just reflected in his comments, in terms of finding ways that work. But those ways could differ.

If we don’t figure this out in the near term, it will become even more dire for U.S. competitiveness in the medium term. That could lead to an inflection point, as Michael Dunne said earlier.

What happens in the rest of the world will be important to watch as well. We’ve mentioned the Sino-Canadian deal. The European Union is struggling with similar issues, but it already has a lot of Chinese investment, and now it is trying to retroactively attach strings to that, but the strings that it is attaching are too restrictive.

There’s a lot of pushback in that regard, but I think that what happens to the rest of the world could influence the United States. But what the United States does could also have a lot of impacts on the rest of the world, potentially even more so.

Michael Dunne
Just to build on what Kate just said about Canada. It’s absolutely right that the Chinese are swarming into there. I’ve never seen them move as quickly as they’re moving on Canada right now. And I ask them why? It’s only 49,000 quota and units anyway. They said it’s a staging area. We’ll get planted in Canada, and eventually, from there, we’ll get access to the United States.

In the meantime, another thing to watch in Mexico: Chinese companies are now bidding on plants there for the first time. It’s like the Chinese are hell-bent on finding a way into the United States, and they have a pincer movement now into Canada, into Mexico, or through the front door.

I’d like to see the United States move from the defensive to the offensive. What’s our plan? What’s our vision? Are we going to compete outside of North America? If so, how do we do it? Right now, we’re too much on the defensive, trying to figure out how to handle this Chinese onslaught.

Kate Logan
We didn’t even talk about the United States-Mexico-Canada Agreement renegotiation, and how that relates to the Canadian-Mexican markets, because that’s a big open question that will be answered to a certain extent in the next 12 months, too.