Lawmakers back Biden on potential economic penalties for China

Lawmakers in both parties warn there will be strong political support for hitting China with economic penalties if it helps Russia evade U.S. and European Union sanctions or ships military hardware to support the Russian invasion of Ukraine.

The warnings come a day after national security adviser Jake Sullivan warned a senior Chinese diplomat that there would be "consequences" for helping Russia.

But lawmakers also caution that such steps would have to be taken carefully, given how closely the Chinese and U.S. economies are integrated.

The slowdown in Chinese exports caused by the COVID-19 pandemic has already contributed to the highest pace of domestic inflation in 40 years. Rising fuel prices have accelerated since Russia's invasion of Ukraine, and a ban on Russian oil and gas imports, which President Biden announced last week, is expected to send them even higher.

But Democratic and Republican senators warn they will have to respond forcefully if China helps prop up the Russian economy, which has come under heavy pressure because of Western sanctions.

"There should be sanctions on those individual companies or whoever's involved in it," Sen. Marco Rubio (R-Fla.), the ranking member of the Senate Intelligence Committee, said of what the U.S. response should be if China helps Russia.

But he cautioned there could be an economic price to pay.

"Part of the reality is that China's economy is a lot bigger and a lot more influential than Russia's. It won't be nearly as easy to sanction given the fact that we've become way too dependent on them economically. It's an argument to reindustrialize America," he said.

Rubio believes China is secretly helping Russia even now, though he did not cite any specific U.S. intelligence.

"I'll just say that my expectation is they're already helping them," he said. "I don't need to see anything to tell you that. I know that China would help Russia for a lot of different reasons, primarily because they view them as partners in this anti-Western, anti-U.S. effort, which is broadly about redefining the order of the world."

U.S. officials believe Russia has already asked China for military and economic aid and that China has expressed openness to providing support.

China, however, says publicly that it remains neutral in the conflict and supports the principle of "territorial integrity."

Senior administration officials told reporters Monday that they have "deep concerns about China's alignment with Russia at this time" and that Sullivan told Yang Jiechi, the senior Chinese official, in Rome about "those concerns and the potential implications and consequences of certain actions."

Placing economic penalties on China for unfair trade practices was a major controversy during the Trump administration, with both Democrats and Republicans in Congress complaining about the impact on U.S. exports, especially farm products.

But even farm-state senators say they would back new sanctions on China if it is found to be helping Russia evade the economic blockade imposed by the United States and its European allies.

"I would support," said Sen. Jon Tester (D-Mont.).

Senate Majority Whip Dick Durbin (D-Ill.) also warned that China would face serious consequences if it helps Russia sustain its bogged down invasion.

"China's making a big mistake to ally itself with Vladimir Putin and his outrageous conduct. It's hard to build yourself into a world superpower with that kind of ethic or set of morals," Durbin said.

But he cautioned there could be economic fallout for Americans if sanctions extend to China as well as Russia.

"It's all connected, and it gets very serious. Even what we've done to Russia, though they're a bit player in the global economy, is going to have some impact on us. They supply us with critical minerals, which we use for a lot of things," he said, referring to China's dominance in mining rare earth minerals.

The ban on Russian oil and gas imports are expected to contribute to inflation at home, as gas prices have already risen 79 cents a gallon, according to the Energy Information Administration and AAA.

While the causes of inflation have spurred partisan debate and attacks on Capitol Hill, Republicans and Democrats are united in calling for new economic sanctions on China if it supports Russia economically or militarily.

Senate Minority Whip John Thune (R-S.D.) predicted there would be strong support in the Senate GOP conference, though he also acknowledged that it would likely entail economic sacrifice domestically.

"I think there would be support for that," he said. "If China aids in this effort or takes the pressure off of Russia either economically or with respect to military assistance, then, yeah, I think we ought to keep every option on the table."

At the same time, he conceded the United States relies on Chinese imports.

"It's a very symbiotic relationship. They need us, [and] we need them, economically, but I think there are areas and things we can do, as we found during the previous administration," he added, pointing to the tariffs on Chinese goods imposed by former President Trump.

While Thune was a critic of Trump's tariffs on China, he now believes "in some ways some of those were effective. They changed some behavior in China."

Senate Majority Leader Mitch McConnell (R-Ky.) also signaled Tuesday that he would support economic sanctions for any country that helps Russia, including China, though he didn't float any specific proposals.

"I think we are open to applying any pressure we possibly can, not only on Russia but those that try to help Russia," he told reporters.