CIA officer turned GOP lawmaker: Trump's tariffs send wrong message to China on US technology theft

Key Points
  • Rep. Will Hurd says America needs to "step up our game" because China wants to be the world biggest superpower by 2049.
  • President Trump's "random tariffs" are the wrong way to pressure China on trade, the Texas Republican contends.
  • Hurd, an undercover CIA officer for nearly a decade before going into politics, prefers a more direct route.
We had ZTE on its knees, we could have had a 'tectonic impact' on US companies, says Congressman Hurd

President Donald Trump's "random tariffs" are the wrong way to go about pressuring Chinese leaders to reform their allegedly unfair trade practices, Republican U.S. Rep. Will Hurd of Texas told CNBC on Wednesday.

Hurd, an undercover CIA officer for nearly a decade before going into politics, prefers a more direct route.

The White House squandered an opportunity in the spring to let Beijing know that "we're not playing around," he said. That's when the U.S. was banning American firms from selling parts to China's No. 2 telecommunications company.

The Commerce Department at the time was punishing ZTE for allegedly misleading regulators and failing to discipline the employees responsible for doing business with Iran and North Korea in violation of U.S. trade agreements.

Hurd, chairman of the House Oversight Subcommittee on Information Technology, said on "Squawk Box" that the U.S. "let them go" by agreeing in June to lift the ban, which nearly shut down ZTE, in exchange for a $1 billion fine and the installation of a U.S.-chosen compliance team. The settlement also included a requirement to put $400 million in escrow to cover any future violations.

"ZTE and Huawei, they are extensions of the Chinese government. Period. Full stop. They are trying to become the infrastructure of the rest of the world," said Hurd. "The Chinese do not care about things like privacy."

Chinese smartphone giant Huawei is appealing to U.S. federal regulators to lift restrictions on doing business in the United States, measures put in place due to national security concerns.

Hurd said America needs to "step up our game," because Chinese President Xi Jinping wants to make China the world's No. 1 superpower by 2049. "They have a national strategy. They have an emperor in place for the next 40 years."

In March, China removed the two-term limit on its president, basically giving Xi a mandate to be leader for life.

"The quickest way they're going to get there is what they've been doing; stealing our technology, forcing technology transfer, using debt traps with countries and with businesses. And we need to be prepared to deal with that," Hurd said.

The Texas Republican reiterated that tariffs, "which are pretty haphazard and are actually impacting American businesses," are not effective in getting China to changes its ways on trade.

With $250 billion in U.S. tariffs against China in effect, the question now is whether Trump will put tariffs on the rest of Chinese imports to the U.S., which totaled $505 billion last year, according to federal data.

Hurd, who faces a tough race in the lead-up to the midterm elections, said he feels good about his chances. "When folks in the 23rd District 'grade my paper' in November, I'm going to get a passing grade."

In a congressional district known for swinging back and forth, Democrat Gina Ortiz Jones, a former Air Force intelligence officer, is trying to prevent Hurd from winning a third term.

In 2017, Hurd was appointed to the House Permanent Select Intelligence Committee, replacing then-Kansas Rep. Mike Pompeo, who became director of the Central Intelligence Agency. Pompeo is currently Trump's secretary of State.