Communist China retreats on Unocal

Today, the China National Offshore Oil Company (CNOOC) dropped its $18.5 billion bid to purchase U.S. oil and gas giant Unocal, declaring that it would have continued to pursue the deal "but for the [adverse] political environment in the U.S."

It is worth noting that little more than a month ago the "political environment" in Washington was all too familiar: China seemed no more likely to encounter real resistance to its latest effort to take over a major American energy and vital mineral asset than had it experienced with previous strategic acquisitions in this country.

Fortunately, such opposition did emerge in time. In part, that was thanks to the involvement of individuals who were able to encourage Congress to express strong opposition to Beijing’s gambit. Among them was Center for Security Policy President Frank J. Gaffney, Jr. who testified in what proved to be a pivotal hearing before the House Armed Services Committee on July 13. Mr. Gaffney impressed upon legislators that the proposed deal was not a normal commercial transaction. Rather, it was part of the PRC’s long-term strategy to "supplant the United States as the world’s premier economic power and, if necessary, to defeat us militarily."

The PRC’s abandonment of the CNOOC-Unocal deal is a decided victory for American interests. There can be no doubt, however, that China will continue to pursue its long-term campaign of economic warfare against, and strategic checkmating of, the United States.

America must, consequently, begin thinking strategically as well, both about the nature and implications of the threat posed by Communist China’s strategy and about the steps available to this country to counter and neutralize that threat. Among the latter must be a concerted effort to help free the Chinese people on the mainland – much as Ronald Reagan helped free their Soviet counterparts a generation ago – even as we intensify our protection of those Chinese who already enjoy freedom on the island of Taiwan.