As we all adapt to social distancing, the new normal for daily living, we’ve also got to get serious about economic distancing from China. We have become too dependent on China in key sectors of our economy — like pharmaceutical and medical supply production.
China’s state news agency has issued several warnings that if the United States isn’t careful, China could ban exports of pharmaceuticals and medical protective gear and throw our nation into “a mighty sea of coronavirus.”
And they could do it! We depend on China for 80 percent of the core components we use to make our generic drugs. Generic drugs comprise 90 percent of the medicines Americans take. China also supplies more than 90 percent of the antibiotics we take plus many other drugs and biologics that we depend upon.
According to Rosemary Gibson, author of China RX: Exposing the Risks of America’s Dependence on China for Medicine, “China has pursued a deliberate strategy to disrupt, dominate, and displace advanced industries in the U.S. and other Western countries.” One tool China uses for this purpose, she writes, are cartels which work to undercut the prices other countries charge for things. China can do this because of its lower labor costs, weaker environmental regulations and worker protections.
An example of how this works is penicillin. The U.S. once produced 70 percent of the world’s supply. Rosemary Gibson writes that, in 2004, “the Chinese cartel dumped the chemical material to make penicillin on the global market at below market prices, kept them low for four years, and drove out U.S. production.” In fact we are in the dangerous situation where production of practically all antibiotics and many other vital medicines has disappeared from the U.S.
U.S. Senator Tom Cotton (AK) says, “It’s time to pull America’s supply chains for life-saving medicine out of China.” He and Representative Mike Gallagher (WI) have introduced legislation to do so. This needs to be executed rapidly.