Chinese Ambassador Xie Feng presented his credentials to President Joe Biden at the Oval Office on a humid summer afternoon in 2023. Less well-known is that following his presentation, Xie’s first official meeting was not at the State Department with his bureaucratic counterparts. Instead, it was down the block at the Department of Commerce with U.S. Deputy Secretary Don Graves, to discuss the broader strategic relationship between the two countries. Xie’s visit, which preceded Commerce Secretary Gina Raimondo’s own trip to China several weeks later, represented just how expansive the national security portfolio of the Department of Commerce had become.
Meanwhile, over at the Pentagon, the Department of Defense was in the middle of launching a slew of economic initiatives. Many of these were focused on economic deterrence, including its first Defense Industrial Strategy and the Maritime Economic Deterrence Executive Council — with the goal of growing and protecting U.S. technology and innovation to deter foreign aggression.
Today, economics is still at the red-hot center of national security work, even with the change in U.S. administration. Much has already been written on economics and national security strategy, but — with some exceptions — comparably less attention has been given to the mechanics of economic security policymaking within government, and the execution of economic security policy. In our experiences, the government needs to drastically expand its analytical and enforcement capability, coordinate internally with more emphasis on economic issues, and lastly, engage more with the real driver of economics: private industry.
Economic Security: Hard to Understand, Harder to Achieve
Economic issues have long impacted national security interests. Nevertheless, because of the shock of the COVID-19 pandemic, the Russo-Ukrainian war, and the fact that China, America’s third largest trading partner, is also its greatest strategic competitor, economics matters more today to U.S. national security than ever.
In part, this has to do with the race on advanced technology that the United States is determined to win. But economic security implies far more than developing and dominating the most cutting-edge technologies. It is the subset of national security focused on protecting an economic system from coercive threats, critical infrastructure vulnerabilities, and major disruptions. Many other issues, therefore, such as low-tech products, healthcare, foreign investment, supply chains, agriculture, banking, trade, financial flows, even cybersecurity are all part of economic security too.
As a result, across the U.S. government, agencies have been sprinting to figure out what economic security is and to determine their respective roles in achieving it. In 2023, for instance, the Office of the Director of National Intelligence, the coordinating body of the intelligence community, stood up a new unit called the Office of Economic Security and Emerging Technology. The purpose of this office, according to the intelligence community itself in 2024, was to “increase the IC’s understanding” of the impact of technology on national security issues. Though its leadership is currently vacant, the launch of that office reveals the high-level prioritization of economic security within the national security establishment, focused on emerging technology. But its nascency is also a stark admission that — even within the belly of the beast — the relationship between economic security and national security is still being sorted out.
Not only is economic security increasingly complex to track and understand, it is also increasingly complex to pursue. Though the U.S. government has a wide range of economic tools, the interdependence of the global economy presents constant tradeoffs for policymakers — and loopholes for adversaries. Solving one problem can easily create another of greater magnitude, such as collateral damage on other parts of the economy or from adversary retaliation. Economic security, in other words, is not the same as self-sufficiency. Supply chains are too numerous, complex, or both to go it alone. For that reason, nuanced, tailored approaches, especially with tools like export controls or tariffs, help minimize that risk. As then-Under Secretary of the Bureau of Industry and Security Alan Estevez recently noted, export control rules used to average 30 pages in length. Today, that number is closer to 250.
What is more, the U.S. government alone cannot achieve economic security. It can inform, guide, and shape the operating environment through incentives and costs, and it can directly undertake lab research. But gone are the days when the federal government dominated the research and development of foundational technologies. On driving innovation, the private sector rules. If the private sector cannot transparently understand, comply, and flourish within a policy environment, actions to pursue economic security will undermine it.
Addressing the Deficiencies: Resources
In our experiences, the challenges of executing economic security in government broadly fall into three categories: resources, outreach, and coordination. The first of these, insufficient government resources, is the most straightforward. At a high level, the government needs significantly more help understanding the larger threat picture on economic security issues. A good example of this is in investment screening, both inbound and outbound, where the shape of the challenge of adversary exploitation and abuse of American investment, technology, or know-how is understood — but not the scope and scale.
Some observers have rightly called attention to the need for greater resources. And in many cases, the market for expertise may naturally follow need. Consider Ph.D. dissertations as one indicator. The average number of dissertations mentioning “terrorism” tripled in the decade after Sept. 11, 2001. Over the last 25 years, the trend has been more extreme for dissertations mentioning “China” — a staggering growth factor of 10.
But the same trend has not been true of “economics and national security,” or of “economic security,” where the average number of Ph.D. dissertations mentioning these phrases has actually fallen slightly in the last decade, compared to the prior decade. Given how long dissertations take to write (we know from personal experience), some lag is not surprising. But without funding or hiring in these areas, universities are less likely to produce this expertise.
This is one way in which the Trump administration’s federal hiring freezes, cancellation of federal grants, and attacks on higher education are so insidious for national security. Doctoral students respond to the market. If they do not see jobs in their future, they are less likely to pursue a topic of inquiry. This will have follow-on effects. Fewer graduates mean less research. And the fewer of those who decide to join government, the less likely the government will be to update internal training programs, modernize operating systems, and run sophisticated data collection and analysis, changes which are overseen and driven by experts. In addition to Ph.D. graduates, industry experts, practitioners, and think tankers could also help fill this unmet need, though these pipelines to government employment are also threatened. The Trump administration need only flip the demand signal and hire and fund more, not less.
Hiring new talent from the outside is one method of addressing the lack of expertise inside government. But it is not the only one. The government can also retrain people already serving within government in two ways. The first is economic, statistical, and industry expertise and training for traditional national security offices. As the recent launch of the Office of Economic Security and Emerging Technology suggests, this is even true within the intelligence community. The second way to retrain is the reverse: economic, technology, and scientific offices across the U.S. government are now newly implicated in national security issues but often lack security clearance — leading to bottlenecks— and training in national security threats. These shortages surfaced regularly at the Department of Commerce and the Department of the Navy during the Biden administration, among their scientists, technologists, and trade analysts.
Finding talent or undergoing additional training are not fast processes, but they are solvable issues. And the need is the same on the enforcement side as it is on the analytical and policy side. For instance, as Estevez has long lamented, the number of enforcement agents for export controls significantly lags behind expanded government rule-making on dual-use technologies.
The Importance of Industry Engagement
Having the right people and analytical systems in place is necessary, but insufficient for developing and executing policy. Engaging stakeholders matters too. In an interconnected world, economic tools generally matter the least when used unilaterally, because target states often have other options. The more countries brought on board, the tighter the squeeze. Coordinating policy and intelligence sharing with international partners and allies is thus a critical part of the economic security equation.
This need for international partnerships however, has received more attention than the need for industry engagement. But if anything, industry engagement is the more important element. That is because the private sector leads on innovation, and supply chains are nothing but voluntary actions of private companies. As much as industry needs clear guidance from policymakers on national security standards and how best to follow the rules, policymakers need awareness from industry on current practice to craft the right rules and incentives in the first place. If economic policy is developed in a vacuum, it will have less bite — or bite back.
This was one lesson the Biden administration learned on export controls. Over the course of Biden’s presidency, regular industry engagement at a staff level — by the people who were drafting the regulations themselves — enabled smarter and better export controls to remove loopholes and catch mistakes in rule-making. But that practice was less the norm at the start, as the national security portfolio was more walled off from industry and impact analysis at the beginning than it was at the end of the Biden administration. The more the government can work closely with the private sector — and be specific, transparent, and clear — the greater the impact the policies will likely have.
How should the government do this? Engaging with industry can be terribly tricky business. The private sector seeks profit while the government seeks security. Sometimes these interests are in tension. The law, furthermore, prohibits the government from advantaging a specific company with insider information, and prohibits federal employees from revealing national security information to unauthorized individuals. Following the law can therefore lead to vague and circular conversations, wherein private actors request clarity and detail, and the government stays mum.
Though it is not easy, productive conversations with industry are possible. Regular engagement is key for building ongoing awareness, as is engaging with former industry actors and consultants on a more targeted basis. High-level, high-profile leadership interactions are good, but really only a start. Besides one-off commercial roundtables with the president, the government should also invest in regular, structured interactions with companies, as well as with trade councils and industry associations. One model to follow is the President’s Export Council, a multi-sector body that was reconstituted in 2023 by the Department of Commerce to advise the president on trade-related issues. But far more important than high-level interaction is regularizing staff-level interaction, by updating protocols and routinizing industry engagement as policy is being developed.
Reforming Coordination: A Pivot to Economics
By far the most difficult challenge in policy is coordination. National security work in the U.S. government is a sprawling constellation of offices, personalities, and routines spread across the globe.
For the executive branch, the central coordinating body is the National Security Council, established in 1947. It has changed considerably since its earliest days, transforming from a small group of advisors to a hundreds-large policymaking body formally in the Executive Office of the President. It is organized into both regional-focused directorates — such as the Western hemisphere and Africa — and subject-area directorates — such as arms control and strategic planning.
In 2021, the Biden administration updated the council’s organizational chart, adding new subject-area directorates such as cybersecurity and technology and national security. Four years on, as the contours of economic security have clarified, those updates should be taken one step further. Specifically, because economic security encompasses more than critical and emerging technologies, China, and foreign policy, the council should widen and deepen its emphasis on subject-area directorates, reorienting even further toward economic issues. The “pivot to Asia,” as it were, should become a “pivot to economics.”
Though the president has another body, the National Economic Council, to provide advice on economic policy, this body should support but not lead on economic security. Security issues should stay within the National Security Council’s lane. Otherwise, it would decentralize national security coordination and create an organizational nightmare of reporting and turf battles.
There are a number of bureaucratic ways to execute a pivot to economics. The lowest-hanging fruit is National Security Council staff reform. Renaming or creating subject-area directorates that fall between the seams, for instance, on domestic economics or low-tech trade, is one option. Another is to follow the “pivot to Asia” playbook and create a coordinator or deputy for economics role within the council. At a more ambitious level, the Department of Commerce could be added as a statutory member of the National Security Council, and the national security advisor could prioritize developing — as many have already called for — an economic security strategy.
Beyond the National Security Council, the U.S. government has other methods of internal coordination. Some have suggested creating an “Economic Joint Chiefs of Staff” — composed of the Commerce, State, and Treasury Departments — to mirror the military advice the president receives from the Joint Chiefs of Staff. To some degree, this already exists ad hoc within the National Security Council system when it calls for a Principals Small Group or Deputies Small Group when tackling economic issues. Outside the National Security Council, principals and deputies sometimes self-organize on an issue, which staff joked were not formal Deputies Small Groups, but instead a “small group of deputies.” Formalizing a grouping like an Economic Joint Chiefs of Staff would rightly add high-profile attention and tighter organization to a loosely existing practice.
The 2024 National Defense Authorization Act provides at least two other coordinating ideas that the new administration might consider. The first, the “Countering Economic Coercion Task Force,” was formally launched in December 2024 just before the new administration arrived. The second, a National Defense Economic Competition Research Council, never got off the ground given the end of the Biden administration but was intended to coordinate internal analysis of economic activities that undermine U.S. national security. More than any specifics, these two products of the National Defense Authorization Act signal bipartisan, congressional agreement that more focus and coordination on economic security issues are needed.
Malleable Moment
Bureaucracy may not be a term that fires most people up. But to develop and execute effective national security policy, organizational set-up, processes, norms, and routines are critical. Maybe the most critical.
Like all administrations in their first year, the Trump administration has a malleable moment. This is especially true for organizing its National Security Council and setting precedents of partner and industry engagement.
At the moment, given the cleaving of the federal bureaucracy and a coercive, broad-based tariff policy of fits and starts, the outlook for successful economic security policy appears challenged. This tumult widens the aperture for U.S. adversaries to exploit the global economic system and threatens the relative stability, predictability, and flourishing of American economic life. The recent stock market slump appears to have softened the Trump administration’s tariff policy, as the administration focuses more acutely on China. Provided the state of turmoil continues to regress to the mean, the Trump administration has a shining opportunity not just to resource and mitigate economic issues in the short term, but also to offer an organizational model for future administrations to follow long into the future.
Chris Díaz served as the chief of staff to the secretary of the Navy from 2022 to 2025.
Aroop Mukharji, Ph.D., served as senior advisor for economic and national security to the U.S. deputy secretary of commerce from 2022 to 2024.
Disclaimer: The views expressed are the authors’ alone and do not represent the official policy or position of any entity of the U.S. government.
Image: B.S. Halpern (T. Hengl; D. Groll) / Wikimedia Commons / CC BY-SA 3.0
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