Friends,
For those who grew up watching MTV in the late 80s, you will undoubtably remember the music video for “Land of Confusion” by Genesis. It is almost as memorable as the music video for Peter Gabriel’s “Sledgehammer” (now that song is stuck in your head… you’re welcome!)
“Land of Confusion” has those weird (more accurately, deeply disturbing) puppets depicting Ronald Reagan having a nightmare, turning into Superman, riding a dinosaur, and then waking up in the White House to blow up the world by mistake (if you haven’t seen it or don’t remember it, it won’t make sense until you watch it again).
I had forgotten just how much this song and video was a pop culture reference to the Soviet-American Cold War, so I’m going to use it as a link (albeit tenuous) to our topics this week.
Let me kick off with a quibble I have with a recent Foreign Affairs article.
I’m mindful that the author of this piece is the director of the institution where I have a visiting fellowship. My criticism is of a portion of her argument, not of her or her overall thesis, which I whole-heartedly support and agree with.
The Perils of Isolationism: The World Still Needs America—and America Still Needs the World
Condoleezza Rice, Foreign Affairs, August 20, 2024
Condi’s overall thesis is that the United States must remain engaged with the world. She is spot-on, we must do that.
But I take issue with her first four paragraphs, which I believe undercuts the case she makes in the rest of the article.
In times of uncertainty, people reach for historical analogies. After 9/11, George W. Bush administration officials invoked Pearl Harbor as a standard comparison in processing the intelligence failure that led to the attack. Secretary of State Colin Powell referred to Imperial Japan’s attack in making the case that Washington should deliver an ultimatum to the Taliban, saying, “Decent countries don’t launch surprise attacks.” And as officials in the Situation Room tried to assess progress in Afghanistan and, later, Iraq, another analogy came up more than a few times: U.S. President Lyndon Johnson’s disastrous reliance on body counts in Vietnam. Even if history doesn’t repeat itself, it sometimes rhymes.
Today’s favorite analogy is the Cold War. The United States again faces an adversary that has global reach and insatiable ambition, with China taking the place of the Soviet Union. This is a particularly attractive comparison, of course, because the United States and its allies won the Cold War. But the current period is not a Cold War redux. It is more dangerous.
China is not the Soviet Union. The Soviet Union was self-isolating, preferring autarky to integration, whereas China ended its isolation in the late 1970s. A second difference between the Soviet Union and China is the role of ideology. Under the Brezhnev Doctrine that governed Eastern Europe, an ally had to be a carbon copy of Soviet-style communism. China, by contrast, is largely agnostic about the internal composition of other states. It fiercely defends the primacy and superiority of the Chinese Communist Party but does not insist that others do the equivalent, even if it is happy to support authoritarian states by exporting its surveillance technology and social media services.
So if the current competition is not Cold War 2.0, then what is it? Giving in to the impulse to find historical references, if not analogies, one may find more food for thought in the imperialism of the late nineteenth century and the zero-sum economies of the interwar period. Now, as then, revisionist powers are acquiring territory through force, and the international order is breaking down. But perhaps the most striking and worrying similarity is that today, as in the previous eras, the United States is tempted to turn inward.
Our times aren’t uncertain, we are in a new cold war, and that conflict is of the same category as the First Cold War between the United States and the Soviet Union. Waging it over the long-term will require a similar level of effort, similar political consensus, and similar public acknowledgment. Admitting that this is a cold war, does not condemn us to complacency. We are already complacent, with a deeply ingrained attitude towards business as usual.
The difference between “analogy” and “category”
Analogies can certainly become crutches, or shortcuts we employ to avoid critical thinking. But by focusing on analogy, I think Secretary Rice misses an important point: the reason why folks use the term “cold war” isn’t because they are analogizing to an earlier era, it is because the circumstances we face today fit the category of “cold war.”
The Sino-American rivalry is a great power competition that is unfolding in the nuclear age. We call those situations “cold wars,” a term coined by George Orwell in an essay weeks after the first use of atomic weapons.
Orwell predicted how nuclear weapons would impact great power rivalry. These weapons would make those states that held them “unconquerable.” He argued that this would create a “peace that is no peace” and a “permanent state of “cold war”.” Nuclear weapons make direct military conflict between the great powers too costly (and dangerous to the leaders themselves personally… the chance of being incinerated in your command bunker in less than an hour tends to focus the mind on the risks of escalation).
The dynamic of nuclear weapons pushes the rivalry between these states into other domains (economics, ideology, technology, proxy wars, diplomacy, culture, the list goes on). Almost inevitably, it becomes a long-term war of attrition… a war of systems or a war of global orders (this is how we get the proliferation of trade wars, tech wars, propaganda wars, spy wars, etc).
Orwell was clairvoyant, what he described in October 1945 is essentially what happened between 1947 and 1991. The U.S. had its system or vision of world order (which it persuaded a collection of countries to support), and the Soviets had theirs (with their collection of supporters), both sides expended enormous effort to see their vision win out, while avoiding a direct military conflict. Go read the intellectual historian Louis Menand’s book The Free World: Art and Thought in the Cold War to understand how this rivalry between the U.S. and the Soviet Union seeped into nearly everything during those years.
In 1991, it appeared that we found genuine peace and stability, breaking the cycle Orwell identified. But now it appears that was simply temporary vacation from history and we are back in the same category of international affairs that Orwell identified 79 years ago.
Credit should go to Niall Ferguson, who started making these arguments a few years ago. Just as there was the ‘First World War’ and the ‘Second World War’ (not identical wars, but of course the participants in the second could not ignore the lessons of the first), there is also the category of ‘world war,’ a direct military conflict between great powers that unfolds globally and in which both sides seek to force the capitulation of the other.
This logic should not be hard to grasp for ‘cold wars.’ There was the ‘First Cold War’, and we have already entered the ‘Second Cold War.’ Largely because of nuclear weapons, the principal rivals seek to avoid direct military conflict with one another, which forces their rivalry into other domains. These two cold wars won’t be identical (and there is no guarantee we will succeed without enormous effort), but they do fit in the same category.
Why is it important to recognize we are in a cold war?
I feel like a broken record here since I’ve covered this over and over, but I will make the argument again. (Perhaps this just proves I’m bad at making a convincing argument or that I’m simply shouting into the wind.)
For states to protect their interests or achieve objectives geopolitically, leaders of a state must recognize and acknowledge the challenges they face. One must categorize the challenge correctly to mobilize one’s resources and population (this is fundamental to leadership). This requires an understanding of the nature and continuities of war. War has a political dimension, a human dimension, the existence of uncertainty, and it is a contest of wills. The most important action for political leaders to take is to recognize these continuities, communicate that to their people, and set out a common understanding of the challenge facing their nation, in other words, build political consensus and will. If political leaders fail to do that, or they miscategorize the challenge, subsequent actions risk being misapplied or of insufficient effort.
[NOTE: this is basic Clausewitzian shuff, and we really shouldn’t be screwing this up]
Today, our refusal to recognize and acknowledge that we are in a “cold war” with a Sino-Russian alliance (along with their partners Iran and NK) means that we are responding to each of their challenges individually (in essence we are reacting to the symptoms of a cold war, rather than developing an overall strategy). We also lack the resources to handle the totality of the challenge, as well as the simultaneous nature of what our rivals are doing together (largely because we continue to delude ourselves into thinking that they cannot be “allies” because we are the only ones with allies… something I covered last week). This second point forces us into needless debates about prioritizing Asia, Europe, or the Middle East, as if these are completely distinct and separate problems.
The other problem with refusing to admit we are in a cold war is that it allows us to ignore a series of decisions we made over a decade ago about defense spending and our posture in the world. Those decisions (which assumed a benign international environment characterized by global cooperation and threats emerging from environmental degradation) coincided with a set of decisions by our rivals to unite and seek to overturn the existing international order (this is the “great changes unseen in a century” that Xi is so fond of talking about with Putin). The international order that they want to overturn was designed to advantage democracies and disadvantage autocracies. The international order Beijing and Moscow want to replace it with, would flip those advantages and disadvantages.
Some folks in Europe, North America, and Asia don’t want to reopen those thorny debates about guns and butter or which global challenge is most important, and they hope the geopolitical crisis will just pass like a bad storm (in the U.S., there are folks in both political parties with their heads in the sand on this issue… I won’t name names, they know who they are).
Re-watching the Genesis “Land of Confusion” music video simply serves to remind us how stressful cold wars are, so I guess it shouldn’t be surprising that individuals would prefer to pretend it isn’t happening again.
But, if we hope to avoid the perils of isolationism, and the resulting collapse of an international order that provides us with enormous advantages, then we have to have the courage to face reality: we are already in a cold war and it will require significant sacrifice to avoid capitulation or nuclear disaster.
Thanks for reading!
Matt
MUST READ
1. Top Chinese Chip Gear Maker Sues Pentagon to Void Sanctions
Bloomberg, August 15, 2024
One of China’s most prominent chip gear makers is suing the Pentagon for linking it to the People’s Liberation Army, seeking to get off a blacklist that bars business with American firms.
Advanced Micro-Fabrication Equipment Inc. alleged that the defense agency harmed the company’s business and reputation by adding the Shanghainese entity to the so-called Section 1260H list of firms linked to China’s military. Pentagon officials took months to respond to a request for additional information, then justified their decision with evidence of an award from China’s Ministry of Industry and Information Technology, AMEC said in its lawsuit.
COMMENT – This is a mess and I’m not entirely sure who is at fault. I suspect that a combination of failures in Congress and the Administration opened the door for companies controlled by a hostile rival to wage lawfare against the United States in our own courts.
Hesai walked through that unlocked door first and now we will see a flood of them, backed by the full weight of the PRC Government, that will be used to dismantle the restrictions put in place to protect our national security.
It’s just sloppy and embarrassing that our legislators, regulators and government attorneys get outwitted by these folks in our own courts, when we would never get so much as a hearing in theirs.
I suspect that no one in DoD or DOJ will get fired or reassigned… which means that we’ve admitted that our rival can undermine our national security in our own courts. This whole fiasco suggests that folks are unserious about the challenge posed by the PRC and the only way this will get fixed is if political leadership takes it much, much more seriously.
This clusterf&%k is also indicative of the two conflicting China policies that the Administration has allowed to take root over the past 18 months (the first China policy was described in the 2022 Indo-Pacific Strategy from the White House which calls for building an international system that is “maximally favorable” to the United States and our allies… and the second China policy was articulated by Treasury Secretary Yellen in her April 2023 John Hopkins speech which calls for a mutually beneficial economic relationship between the US and the PRC and has been progressing under Treasury’s leadership with the restart of shadow S&ED meetings).
The mixed messages in these two conflicting China policies creates the kinds of seams that Beijing exploits with lawfare like this. This is the downside of “half-measures” and “managed competition.”
2. China-US tensions erode co-operation on science and tech
Michael Peel and Eleanor Olcott, Financial Times, August 18, 2024
Rising tensions between the U.S. and China could lead to the termination of a 45-year-old science and technology pact, which has been a key pillar of Sino-U.S. collaboration in areas like energy, agriculture, and disaster management.
As the agreement faces possible non-renewal, researchers are seeking alternative ways to maintain cooperation, especially in less politically sensitive areas such as climate change. The U.S. and China are negotiating, but a long-term extension seems unlikely before the U.S. presidential election.
COMMENT – The Biden Administration has allowed for two temporary extensions of this science and technology agreement already.
It appears that Beijing won’t budge on the kinds of protections the United States demands for continued collaboration. It is time to force Beijing’s hand and bring the agreement to an end (suspension or cancellation), if Beijing won’t compromise. Simply extending the agreement for another six months or a year gives Beijing exactly what it wants: continue to gain the benefits of access to the U.S. S&T ecosystem without accepting responsibilities for research integrity.
I suspect that Beijing feels fairly confident that the Biden Administration won’t force their hand and suspend/cancel the agreement, and so Beijing has absolutely no reason to agree to the changes the United States wants.
This is Negotiation 101… if you have no leverage (i.e. your counterparty is already getting what they want and you aren’t seriously holding that at risk), your counterparty has no reason to compromise.
This kind of fecklessness only persuades Beijing to be more inflexible.
3. China expands export controls on drones, parts with potential for military use
Liu Zhen, South China Morning Post, August 19, 2024
China has tightened its drone-export controls due to international pressure and concerns over the use of dual-use products for military purposes. New regulations, effective September 1, 2024, ban the export of drones and components with potential military applications, such as high-powered aero engines and infrared imaging devices, without permission.
COMMENT – I wonder if Beijing is pursuing a “small garden, high fence” approach… I suspect not.
Beijing appears to want to win the competition, not manage it.
4. Why China Is Starting a New Trade War
Lingling Wei and Jason Douglas, Wall Street Journal, August 22, 2024
Faced with stagnating growth, Xi Jinping decided to go all in on manufacturing—and much of that production is destined for export.
China is cranking up its massive export machine again, and this time there’s nowhere for competitors to hide.
A Massachusetts startup called CubicPV bet on silicon wafers, a high-tech component in solar panels. Buoyed by President Biden’s climate legislation enacted two years ago, with billions of dollars in tax credits and government loans, CubicPV announced plans in late 2022 for a $1.4 billion wafer plant in Texas.
Since then, China has nearly doubled its output of silicon wafers, way more than it needs. The extra wafers had to go somewhere—and they went overseas, pushing prices down by 70%. CubicPV had to halt its production plan early this year, putting engineers and other employees out of work, citing “a distorted market as a result of China’s overcapacity.”
Thousands of miles away, in Chile, iron ore miner and steelmaker CAP is grappling with Beijing’s continued commitment to low-end commodity manufacturing, as an onslaught of cheap Chinese metal hits its shores. The firm said this month that it would shutter its giant Huachipato steel mill in central Chile indefinitely, with the loss of some 2,200 jobs. The company said it can’t compete with low-price Chinese metal even after the government raised tariffs on steel bars and other imported products.
Beijing’s solution to a weak Chinese economy—putting the country’s factory sector on steroids—is squeezing businesses around the world and raising the specter of a new global trade war.
The European Union’s recent decision to impose tariffs on imported Chinese electric vehicles is only the latest sign of deepening tensions. The U.S. earlier this year hiked levies on Chinese steel, aluminum, EVs, solar cells and other products. Turkey has jacked up duties on Chinese EVs, while Pakistan raised tariffs on Chinese stationery and rubber.
Other countries have opened antidumping investigations to see whether Chinese goods are being sold below fair value. India is examining Chinese pigments and chemicals. Japan is looking at electrodes. The U.K. is investigating imports of excavators and biodiesel, while Argentina and Vietnam are probing Chinese microwave ovens and wind towers.
Behind it all is a bold but risky calculation by Beijing that investing more in manufacturing can restore the country’s economic vitality and build up its industrial resilience without triggering so much international pushback that it threatens China’s future.
Interviews with policy advisers in Beijing and people who have consulted with Chinese officials show that China’s leadership faced a pivotal crossroads last year, as the country’s real-estate bust brought the economy to one of its weakest points in decades.
Some advisers argued that China’s economy needed a fundamental rethink, graduating from its traditional heavy reliance on manufacturing and construction and instead prioritizing more domestic consumption—a shift that would make China more like the U.S., and potentially put it on a more stable growth path.
Instead, Chinese leader Xi Jinping ordered officials to double down on the country’s state-led manufacturing model, with billions of dollars in fresh subsidies and credit. He used a slogan to make sure officials got the message: “Establish the new before breaking the old,” or xian li hou po in Chinese.
The “new” in Xi’s model doesn’t mean a pivot to a new growth model. Instead, it is the top leader’s way of refining his idea of what kind of manufacturing for the state to back. In essence, the phrase calls for building industries China wants to dominate for the future—such as EVs, semiconductors and green energy—while also maintaining the country’s traditional areas of strength in “old” sectors such as steel. Any overcapacity problems can be punted to the future.
The mantra appeared in an official account of a major government confab last December, when it mapped out its economic agenda for 2024. The readout acknowledged “overcapacity in some industries” and “insufficient effective demand,” yet Xi’s slogan still indicated an emphasis on expanding industrial production.
Xi repeated the slogan at an annual legislative session in March, just weeks before Treasury Secretary Janet Yellen traveled to Beijing to warn the leadership about the global consequences of China’s manufacturing overcapacity.
Two principles have guided Xi’s thinking, Chinese policy advisers say. The first is that China must build an all-encompassing industrial supply chain that can keep the domestic economy running in the event of severe sanctions by the U.S. and other Western countries. In the top leader’s views, advisers say, industrial security sits at the core of China’s stability as tensions with the developed world rise.
The second is a deep-rooted philosophical objection to U.S.-style consumption, which Xi sees as wasteful.
That leaves China with few options other than investing in exports to stabilize its weakened economy and create jobs to make up for losses in domestic construction.
The upshot: Rather than Chinese workers losing their jobs, steelworkers in Brazil, chemical engineers in Europe, and solar panel makers in the U.S. may lose theirs.
Chinese support kicks in
Official data show Xi’s priorities filtering through the economy.
Loans to industry, including manufacturing firms, have increased 63% since the end of 2021, while Chinese banks have pulled back sharply on lending to real-estate developers.
Government subsidies, though long central to China’s economic playbook, have also ramped up significantly. Companies listed on the Shenzhen and Shanghai stock exchanges declared $33 billion in government subsidies in 2023, according to figures from data provider Wind—23% more than in 2019.
Chinese battery maker CATL received the equivalent of around $790 million, double the 2022 level. Other big recipients included PetroChina, China Mobile and Warren Buffett-backed carmaker BYD.
In all, 99% of publicly listed Chinese companies now disclose some form of subsidy, according to the Kiel Institute, a German think tank. China spends about 4.9% of its gross domestic product on nurturing industries—several times higher than the U.S., Germany and Japan, according to Scott Kennedy, a China expert at the Center for Strategic and International Studies in Washington.
Craig Allen, president of the U.S.-China Business Council, a lobbying group for American companies in China, said Xi’s manufacturing fixation was on display when he met recently with the governor of one of China’s poorest farm provinces.
When Allen asked the governor about his economic priorities, the governor listed semiconductors, software, biotechnology, robotics, aerospace, batteries, and EVs.
“I would have thought that addressing the immediate needs of his overwhelmingly rural constituents, such as improving agricultural harvests, might be at the top of his economic priorities list,” Allen said.
COMMENT - Great point by Craig Allen!
5. Biden Approved Secret Nuclear Weapons Strategy Focusing on China
David E. Sanger, New York Times, August 20, 2024
In a classified document approved in March, the president ordered U.S. forces to prepare for possible coordinated nuclear confrontations with Russia, China and North Korea.
President Biden approved in March a highly classified nuclear strategic plan for the United States that, for the first time, reorients America’s deterrent strategy to focus on China’s rapid expansion in its nuclear arsenal.
The shift comes as the Pentagon believes China’s stockpiles will rival the size and diversity of the United States’ and Russia’s over the next decade.
The White House never announced that Mr. Biden had approved the revised strategy, called the “Nuclear Employment Guidance,” which also newly seeks to prepare the United States for possible coordinated nuclear challenges from China, Russia and North Korea. The document, updated every four years or so, is so highly classified that there are no electronic copies, only a small number of hard copies distributed to a few national security officials and Pentagon commanders.
But in recent speeches, two senior administration officials were allowed to allude to the change — in carefully constrained, single sentences — ahead of a more detailed, unclassified notification to Congress expected before Mr. Biden leaves office.
COMMENT – If the reports on this are true (and I have every reason to believe David Sanger got access to an official “leak,” given his close relationship with the White House), I’m glad the Administration issued this Nuclear Employment Guidance.
But it does beg the question:
If the President and his Administration think it is necessary to make these significant policy changes in secret documents, why does the President and his cabinet refuse to make the case publicly to the American people that we are in a long-term, hostile rivalry (aka cold war) with the PRC, as well as making the case for an increase in defense spending to fulfill the policy inherent in a document like this (as opposed to the decreases in defense spending that they have put forward each of the last three years)?
This gap between internal, classified rhetoric and the actions and rhetoric that they use publicly causes massive confusion across the U.S. bureaucracy, with the American people, and with our allies. They appear unable, or unwilling, to make hard choices and instead try to make a bug into a feature (the strategy is complex and nuanced, so it only appears contradictory to those who don’t understand its sophistication).
For example, if the President really does believe that the PRC poses such a great danger as to require the reorientation of our nuclear forces, why on earth is the Treasury Secretary still pursuing a mutually beneficial economic relationship with the PRC? Why are we narrowly scoping our technology restrictions? Why aren’t we imposing far greater costs on Beijing’s material support to Moscow?
Either one hand is not talking to the other… or more likely, there are deep divisions within the Biden Administration on China policy and the “leak” of this document is simply an effort by those who advocate a more robust competition with the PRC, to persuade the American people of the severity of the situation.
I wish the President could make the case clearly to the American people, rather than relying on “leaks.”
Mike Gallagher, Wall Street Journal, August 22, 2024
The Cold War began with the end in mind. As early as 1947 George Kennan stated explicitly that U.S. policy should aim to “increase enormously the strains under which Soviet policy must operate . . . which must eventually find their outlet in either the break-up or the gradual mellowing of Soviet power.” Americans still had bitter arguments over our approach to the Soviet Union—the 1952 Republican platform, for example, rejected President Harry S. Truman’s “futile and immoral” policy of containment. The ensuing debate, however, focused on the means of containment rather than whether containment itself was the proper end for American strategy. Historian John Lewis Gaddis argues that over the decades that followed there was an “implicit agreement” among the foreign-policy establishment on containment’s purposes that never wavered.
Contrast that with the present day: The cold war with China has begun without an end in mind. American strategy lacks a guiding objective. We have an emerging bipartisan consensus on the short-term means of U.S. grand strategy. Republicans and Democrats increasingly agree on the need to arm Taiwan to deter a Chinese communist invasion and reduce U.S. economic dependency on China. But there is little discussion, let alone consensus, on the long-term ends of U.S. grand strategy.
The Biden administration briefly appeared willing to accept the reality of a new cold war and offer something approximating a long-term objective. The White House’s 2022 Indo-Pacific Strategy called for “building a balance of influence in the world that is maximally favorable to United States [and] our allies and partners.” In essence, the administration sought constrainment—to constrain Beijing’s operating environment. Thirteen days later, Russia invaded Ukraine. As the Biden team’s focus moved to the conflict in Europe (and later the Middle East), its approach to China softened significantly.
Now the only stated end of American strategy toward China seems to be to avoid at all costs a cold war that could erupt into a major crisis. Thus, President Biden launched an “all hands on deck effort” to intensify “detailed, dogged diplomacy” with China. While in Asia last year, Mr. Biden repeatedly reassured regional leaders that he isn’t trying to contain or hurt China. The priority, according to national security adviser Jake Sullivan, is to “manage competition [with China] to reduce tensions and find a way forward on shared challenges” such as climate change, public health and the risks of artificial intelligence. The administration seeks to “outcompete” rather than contain or constrain China. Mr. Sullivan disavows any expectation—or even aspiration—for a “transformative end state like the one that resulted from the collapse of the Soviet Union.”
Many in the Biden administration have framed the resulting lack of clarity on China as strategic wisdom. Deputy Secretary of State Kurt Campbell believes a confrontational approach is “reckless” and “unproductive.” He previously criticized what he calls a “neo-containment policy.” Rush Doshi, a former leading China strategist in the Biden White House, concedes that “managed competition” is unlikely to resolve any “fundamental disagreements,” and he fears that seeking victory would “turn the U.S.-Chinese rivalry into an existential one for China’s leadership,” giving them “little reason to exercise restraint.” The best we can achieve is a stable but uneasy balance of power, in which the U.S.-led coalition denies Beijing regional hegemony.
There are at least two problems with the Biden approach. First, the Chinese Communist Party—which is pursuing global hegemony and openly talks about the struggle with the U.S. in existential terms—is unlikely to settle for a stable regional balance of power. This is especially true if American policymakers continue to let the ghost of the Cold War spook them even from uttering the word containment—let alone aggressively pursuing it or constrainment as a long-term goal. We are creating a permissive environment that feeds Xi Jinping’s appetite for conquest and invites war.
Consider that the Biden administration, along with allies in the Group of Seven, recently called out China for fueling the Russian war machine, conducting persistent cyberattacks, engaging in aggressive military activity in the South China Sea, employing forced labor in Xinjiang, and undermining our democratic institutions (a nonexhaustive list). Does that sound like the behavior of a nation exercising restraint in response to Mr. Biden’s skillfully managed competition and detailed, dogged diplomacy?
Second, strategic competition with China will be difficult and expensive. There is no easy or cheap way to rebuild and modernize the U.S. military to prevent World War III or undo two decades of Chinese integration into the global economy. American leaders must convince their constituents to sacrifice, and nobody wants to sacrifice much in pursuit of “managed competition” or “a stable balance of power” or some fragile equilibrium in which the U.S. constantly exercises restraint as China salami-slices its way to regional and global dominance.
Better to level with the American people, mobilizing their patriotism and creativity in pursuit of cold war victory. This means constantly highlighting Beijing’s malevolent campaign to destroy the free world. It means stating plainly that America doesn’t merely want to deter China’s designs on Taiwan and the Indo-Pacific. It means containing the Communist Party’s attempts to export its techno-totalitarian model of governance and rolling back its control of the commanding heights of critical technology.
Even without a president effectively using the bully pulpit and aggressively making the case for how we win the new cold war, recent polling suggests Americans are starting to understand the stakes. Perhaps this is because the people are often smarter than their political leaders. They have seen Beijing’s deliberate subsidization of illicit fentanyl precursor exports kill 200 Americans a day and more a year than died in the Vietnam War. They have seen a virus that likely escaped from a Chinese lab kill even more and upend the lives of everyone on the planet.
At a minimum, as we near the end of the beginning of the new cold war, we need to begin a debate about its end.
San Roggeveen, Inside Story, August 23, 2024
Rather than American or Chinese ascendancy in Asia, we’re likely to be facing a “long in-between.” Where does that leave AUKUS?
…
We have seen no substantial change to America’s force structure in Asia since the end of the cold war: troop numbers and equipment levels are roughly the same. Nor have we seen any substantial change in the US-led security architecture in Asia. An “Asian NATO” remains a dim prospect. The US hasn’t retrenched from Europe or the Middle East to reinforce its Asian position. It offered no resistance to Chinese expansionism in the South China Sea in the early 2000s, and under Trump it cancelled involvement in a major regional economic initiative, the Transpacific Partnership.
Finally, no president has addressed the American people to announce that they must gird themselves for a generational struggle against its biggest ever rival. American political leaders do give speeches about China, and countless policy documents put China at the centre of US strategy. But no president has yet sought to persuade the American public that the US needs to launch a national struggle that will be bigger than the cold war.
What about AUKUS? Doesn’t the almost unprecedented transfer of nuclear technology to Australia signal America’s deep commitment to regional hegemony? First of all, AUKUS was an Australian idea, not American. And what a deal for America! It promises to bring hundreds of billions of dollars into the US shipbuilding and arms industries, and will ultimately give US what is effectively an adjunct to its own Pacific fleet.
If we’re looking for evidence of US commitment to the region, we’d want to see costly signals, policy moves that create risk and carry financial burdens. AUKUS is not a costly signal.
In sum, where others see America’s determination to stare down China in a contest for regional supremacy, with Australia by its side, I see mostly inertia.
But inertia works in both directions: it prevents the escalation Keating implies but also the retrenchment Hugh White has forecast. That’s because retrenchment requires a conscious decision — in fact, a series of them, made not just by a president but also by their party, Congress, the Pentagon, the State Department, the rest of the Washington foreign policy establishment, and America’s allies. All would need to be aligned to make this huge shift in American policy.
None of these power centres has a clear interest in supporting US retrenchment, and there is no powerful political force coalescing around this objective. Inertia, on the other hand, only requires that those same institutional forces do nothing. And doing nothing is exactly what large bureaucracies are comfortable with. In fact, nothing is roughly what the US security establishment has been doing in Asia since the 1990s.
Of course, doing nothing doesn’t mean nothing changes. China gets a vote too. So, while the US has chosen inertia over the last thirty-odd years, China has built a huge navy and air force, thus shifting the regional balance of power towards Beijing. And while the US has chosen inertia, China has built military bases in the South China Sea, thus turning that part of the region into a Chinese lake. Someday, the same might happen in Taiwan. China will make a move, and the US will again choose inertia. But even if Taiwan falls, inertia is likely to stop wholesale American retrenchment. The US can maintain its most solid bases of support in Japan, South Korea and Australia because those countries will still prefer to be protected than go their own way.
In these circumstances, what kind of regional order do we get? I would describe it as a steady drift away from American hegemony but stopping short of Chinese hegemony, a “long in-between” if you will. America’s role in the region will become, wholly and solely, a matter of protecting the territorial integrity of its treaty allies.
That’s a limited aim that can be achieved at acceptable risk and cost; all it demands is that the US maintain enough presence in Japan, Korea and Australia to sink Chinese ships and shoot down its aircraft. Such a posture doesn’t demand that the US maintain military superiority over China and doesn’t require that the US be able to defeat China decisively in a war. All it asks is that the US has sufficient forces to blunt any aggressive Chinese intent towards its allies.
Again, the reason to favour this scenario is because it is easy. The US doesn’t have to do much, or say much, to achieve it. Indeed, while it clings rhetorically to maximalist objectives, in practice it has been quietly backing away from them since the end of the cold war, and implicitly conceding a sphere of influence to China. Such concessions cost the US taxpayer nothing, don’t harm the interests of any major interest group, and don’t make America less secure.
Would China accept a more constrained US role of this kind, or would it push for full US withdrawal? The answer depends on how you calculate the benefits China would get from complete American retrenchment. If the consequences of American withdrawal from Asia are large, China has an incentive to fight hard for it and take big risks to achieve it. If the consequences are minor, then China doesn’t have those incentives.
My guess is that if the US continues to drift into the minimalist strategy described here, China will choose to live with that, not because it is content with an indefinite US role in Asian affairs but because even if the US withdrew, Beijing wouldn’t suddenly have free reign over the entire region.
Yes, China is likely to become something like a hegemon in continental Southeast Asia, because no rival power has the will or means to stop it. But in maritime Asia, which is what the US and its allies care about most, Beijing’s ambitions will be blunted because, even with all its resources, projecting power over Asia’s vast seas is so difficult and costly. The American strategist John Mearsheimer calls it “the stopping power of water,” and it will exercise a decisive influence over Asia’s new order.
COMMENT – It pains me to say it, but I see inertia as the primary trend in U.S. policy towards Asia (and the rest of the world), as well.
PRC leaders have made it abundantly clear for nearly two decades that they intend to dissolve the collective security arrangements the U.S. has across the region, make themselves into the regional hegemon, and remake the international order in ways that advantage the CCP. They have allied themselves with both Moscow and Tehran, who wish to achieve similar goals in their own “near-abroad” (this article in the Telegraph adds to my pessimism: “The Houthis have defeated the US Navy,” Tom Sharpe, The Telegraph, August 24, 2024)
Those who stand the most to lose from the realization of those goals (the United States, Europe, Japan, South Korea, Taiwan, Australia, Canada, Singapore, and India) have done very little to respond beyond more forceful rhetoric. Despite two ongoing wars, and a third that threatens to erupt, none of these wealthy countries have made any serious defense investments (moving from 1.5% of GDP to just over 2% of GDP on defense is NOT serious and reducing from 4.5% of GDP to less than 3% of GDP over the last 15 years by the United States is even less serious).
As Sam Roggeveen rightly points out, no U.S. President has made the case to the American people, Congress has been completely unable to overcome its own partisan bickering to provide the resources necessary for the task, and our foreign policy “experts” endlessly debate Beijing’s intentions.
We are in a classic “analysis paralysis”… we don’t like the trends we can plainly see AND we don’t want to pay the cost to address it.
This tempts us to search for an “easy button” to a hard problem (or as Thomas Shugrat recently argued, we hope for “magic beans”, “There Are No Magic Beans: Easy Options to Deter China Militarily Do Not Exist,” Thomas Shugart, War on the Rocks, August 23, 2024).
Some hope the problem will solve itself (PRC economic problems will constrain their ambition, even though we refuse to intentionally make their economic problems worse because we insist on tying our economic prosperity to theirs), others hope that the threat of economic sanctions can fill the gaping hole of hard military power (this is the illusion of “integrated deterrence,” a lie the U.S. Defense Department tells itself so it doesn’t have to insist on a larger defense budget), and still others wish to stick their heads in the sand and assume that “reassuring” the PRC will make them less aggressive and threatening to their neighbors (the fallacy of trying to turn a shark into a dolphin as Matt Pottinger has argued).
We know what deters leaders from launching wars of aggression: sufficient hard military power. If Xi, Putin, Ali Khamenei, and Kim Jong Un believe they can achieve their goals using force at a cost beneath the benefit they think they will gain, they will use force. If those leaders believe that that they can’t, they won’t.
But we don’t want to pay the cost of possessing sufficient hard military power. None of the democracies are programing and resourcing their militaries along the logic of “sufficient hard military power” that would deter those aggressors, each are programming and resourcing their militaries based on domestic political constraints (don’t make me show the chart of U.S. defense spending as a percentage of GDP again).
The hard truth is that Japanese citizens, Taiwanese citizens, German citizens, and American citizens will have to sacrifice more of their treasure to keep the peace… or they will be forced to sacrifice even more blood and treasure to protect themselves.
On second thought, you should see the chart again:
Underlying chart from the Substack “Defense Tech and Acquisition”… additions in red from me.
It is not clear to me that any political leader is willing to make the case that we face a rapidly deteriorating international environment and that we should prepare ourselves for it.
So, we are back to inertia on our part and our adversaries are left to believe that victory is within their grasp, if only they are bold enough to seize it.
That is a really, really dangerous situation.
8. Chinese Aggression in the Taiwan Strait
Noah Barkin, DGAP, August 19, 2024
It is time for Germany to reassess its approach to Taiwan, as part of a broader European response to growing Chinese pressure on the self-ruled island. The start of a new European Commission, and an expected change of government in Berlin following federal elections in 2025, provide an opportunity for Germany to bed down, together with key European allies, a more coherent, coordinated approach to deterring Chinese aggression and preparing for various coercion and conflict scenarios.
Key points:
Cautious approach no longer defensible as Beijing chips away at the “status quo” in the Taiwan Strait
More coordination needed among large EU states, including on sanctions, military signaling, and economic engagement with Taiwan
Recent change of government in Taipei and looming US election raise risk of misunderstandings leading to conflict
As EU country with most to lose, Germany must help shape a more systematic European deterrence and preparedness agenda
COMMENT – We have compounding geopolitical crises, and we appear unwilling to face them.
9. China’s Imaginary Trade Data
Brad W. Setser, Council on Foreign Relations, August 14, 2024
China has a new way of calculating its good surplus in its formal balance of payments data. It is a deeply misleading. It also explains the apparent fall in the current account surplus.
COMMENT – I had to seek out an explanation in layman’s terms for this, let me summarize:
The PRC economy is far more dependent on foreign demand than they are willing to admit, and the obfuscation began in 2022, well before the current economic downturn became public which suggests a degree of foreknowledge by PRC leaders.
As one friend also pointed out, this also begs the question: what the hell does the IMF do for a living and why does that international organization, headquartered in Washington DC, continue to cover up obvious PRC Government lies about its economic performance.
The only reason that the world takes Beijing’s word for a +5% GDP growth for the last two years is because the IMF endorses it… Chinese economic performance was likely 0% GDP growth.
10. Taiwan defence spend to outpace GDP growth as China threat rises
Yimou Lee and Ben Blanchard, Reuters, August 22, 2024
Taiwan's defence spending will rise 7.7% next year, outpacing expected economic growth, the cabinet said on Thursday, as the island adds more fighter jets and missiles to strengthen deterrence against a rising threat from Beijing.
China, which views democratically-governed Taiwan as its own territory, has ramped up military and political pressure over the past five years to assert those claims, which Taipei strongly rejects.
Taiwan's cabinet said following a regular weekly meeting that 2025 defence spending would rise 7.7% year-on-year to T$647 billion ($20.25 billion), accounting for 2.45% of gross domestic product - up from 2.38% this year - and exceeding the government's expectation for economic growth of 3.26% for the year.
The spending includes a special budget worth T$90.4 billion to buy new fighter jets and ramp up missile production. That was part of the military's extra spending worth T$240 billion announced in 2021 over five years.
Hsieh Chi-hsien, head of the defence ministry's comptroller bureau, told reporters defence spending reaching 3% of GDP was a goal they were hoping to reach, and that at the moment Taiwan's defence spending is "growing steadily".
"We will not join in an arms race with other countries. We will increase (spending) steadily according to our needs," he said.
Future spending also depends on whether Taiwan could acquire "key and important" equipment, Hsieh added, without elaborating.
Taiwan's government has made military modernisation a key policy platform and has repeatedly pledged to spend more on its defences given the rising threat from China, including developing made-in-Taiwan submarines.
China's air force flies almost daily missions into the skies near Taiwan, and in May staged war games around the island shortly after President Lai Ching-te took office, a man Beijing brands a "separatist". Lai rejects China's sovereignty claims, saying only Taiwan's people can decide their future.
The budget will still need to be passed by parliament, where the ruling Democratic Progressive Party (DPP) lost its majority in January elections.
Taiwan's main opposition party, the Kuomintang, has repeatedly expressed its support for firming up the island's defences, though it is currently involved in a stand off with the DPP about contested reforms to give parliament greater oversight powers the government says is unconstitutional.
COMMENT – A move in the right direction, but still insufficient to the need. 2.45% of GDP is not an appropriate the level of spending given the threat Beijing poses to Taiwan’s democracy.
It remains to be seen whether Taiwan’s main opposition party, the KMT, will support this proposed increase. The Defense Budget review process will take place in September and October, you can bet that Beijing will use all its powers of persuasion and coercion to derail efforts by Taiwan to improve its military position.
11. ‘I was afraid somebody might run on stage and harm us’: the Taiwanese play that dares to address nationhood
Chi-hui Lin, The Guardian, August 14, 2024
For most performers, the biggest fear about staging a new play is that no one will come. Or that an actor might forget her lines. For Chiayo Kuo, an activist, artist and diplomat, her biggest fear was that someone might shoot the cast.
“During rehearsals, I was so stressed out that I often dreamt that someone would get up from the audience and fire a gun while we were on the stage,” says Kuo.
Considering the subject-matter of her play, Kuo’s nightmares do not seem so far-fetched. Written by Swiss and Taiwanese creators and produced in Switzerland, This Is Not An Embassy deals with Taiwan’s lack of global recognition as a country and the diplomatic challenges it faces as a result.
China, Taiwan’s bigger and more powerful neighbour, claims Taiwan as part of its territory. In service of its aim to influence or coerce the small democracy, the Chinese government has engaged in civil and military campaigns against Taiwan, and well-organised public and private intimidation of dissidents.
“The play will tour around the world, and if any Chinese delegates are not happy to see it, I hope that all the aggression will only be directed towards me, and will not be extended to my family,” says Kuo.
The play imagines three different Taiwanese characters: a retired ambassador, an international organisation worker and a musician from a boba tea merchant family. They debate Taiwan’s withdrawal from the UN in 1971, the controversy over the dictator and military commander Chiang Kai-shek, and the mixed feelings about Taiwan’s official name “Republic of China (ROC)”, and “Chinese Taipei”, a name that Taiwan must use to compete in the Olympics. (In Paris this year, Taiwanese athletes were prohibited from participating under the name “Republic of China (Taiwan), and the Taiwanese flag was banned.) Signs reading “Agree” or “Disagree” are held up during the play to show the difference in Taiwanese opinions.
A sell-out when it was staged in Taipei, This Is Not An Embassy will tour again through Europe from August, despite attempts by the Chinese government to shut it down.
After being performed in Taiwan, the play was praised for representing different voices in Taiwan and showing diverse opinions towards China, the country where many – but not all – Taiwanese people originate, but which is intensifying threats to upend Taiwanese people’s way of life.
China brooks no such nuance. In June, Beijing threatened to impose the death penalty for those it considered to be “diehard” Taiwan independence separatists. In response, Taiwan’s president Lai Ching-te said China has no power to sanction the people of Taiwan. “Democracy is not a crime, autocracy is a sin,” he said.
COMMENT – I hope to see this play in the United States soon.
Authoritarianism
12. China's Spy Agency Warns Students Against Anti-China Rhetoric in College Application Essays
Alexander Boyd, China Digital Times, August 14, 2024
China’s Ministry of State Security has issued a warning to students seeking to study abroad: don’t cast yourself as a regime opponent in your college application essay. An article shared by the WeChat account of the Ministry of Public Security, a top domestic policing body, but attributed to the powerful intelligence service the Ministry of State Security, warned about the alleged risk college consultancies pose to national security.
In the MSS’ telling, college consulting services are illegally inserting “anti-China prejudices” into students’ application essays to make them more attractive to foreign universities. Specifically, the article claims that foreign universities want essays with “run” flavor to them, a reference to content encouraging emigration from China.
The essay further claims that negative information about China is a result of the infiltration of “hostile foreign forces.”
13. Turkey lauds improvement in relations with China after long stagnation
Sinan Tavsan, Nikkei Asia, August 21, 2024
Relations between Turkey and China have been making progress as of late, after years of stagnation mostly due to the thorny issue of China's alleged ill treatment of its ethnic Turkic Muslim minority of Uyghurs.
A recent large-scale investment from Chinese electric vehicle maker BYD in Turkey and the announcement by Turkish President Recep Tayyip Erdogan of possible reciprocal state visits by the Turkish and Chinese leaders herald a sea change in bilateral relations.
COMMENT – Strange bedfellows… unless one understands this as an alliance of anti-liberal authoritarians.
Rumors are that Erdogan will visit Beijing in 2025.
I think we should be honest with ourselves; Turkey under Erdogan is no longer a dependable NATO member and ally. And since there is no way to expel Turkey (or Hungary for that matter) from NATO, they will continue to have a seat at the table (with veto power) while simultaneously providing Beijing and Moscow with intelligence, technology, and influence inside our most critical collective security institutions.
This is what happens when you insist that you can’t make your allies pick sides (side-eye at random U.S. State Department officials, “China tech tensions may turn off U.S. allies, State Dept. official warns,” Nikkei Asia, August 23, 2024). The entire point of an alliance is that the members “pick a side.”
14. Head of int’l legal group hits out at Hong Kong rule of law amid top court judge’s withdrawal from advisory panel
Tom Grundy, Hong Kong Free Press, August 19, 2024
15. Hong Kong’s Ming Pao newspaper urges columnists to be ‘prudent’ and ‘law-abiding,’ or else ‘crisis may come’
Hans Tse, Hong Kong Free Press, August 16, 2024
16. Hong Kong press freedom sinks to record low: Journalist survey
AFP, Channel News Asia, August 20, 2024
17. China's rhetoric turns dangerously real for Taiwanese
Rupert Wingfield-Hayes, BBC, August 15, 2024
18. Iran seeks China’s help with surveillance satellites, officials say
Joby Warrick and Souad Mekhennet, Washington Post, August 16, 2024
19. China fires lawyer who blew whistle on illegal sale of dead bodies
Huang Chun-mei, Radio Free Asia, August 14, 2024
20. China digs up the past to shore up official version of history
Lucie Lo, Radio Free Asia, August 18, 2024
21. Chinese cartoon campaign warns village clans against hindering Communist Party
Yuanyue Dang, South China Morning Post, August 20, 2024
22. U.S. Nasdaq steps up scrutiny of Chinese company listings
Pak Yiu, Nikkei Asia, August 15, 2024
23. South Korea, Japan, U.S. leaders renew pledge to cooperate on regional challenges
Reuters, Asahi Shimbun, August 19, 2024
Environmental Harms
24. China's coal output rises as share of electricity slips
Clyde Russell, Reuters, August 19, 2024
Foreign Interference and Coercion
25. Fury as suspected China spy flees the Philippines
Joel Guinto, BBC, August 21, 2024
An ex-mayor accused of spying for China and having ties with criminal syndicates has fled the Philippines, stirring fury.
President Ferdinand Marcos Jr said Wednesday that "heads will roll" after officials admitted Alice Guo had left the country undetected one month ago and travelled to Malaysia, Singapore and Indonesia.
Mr Marcos said her departure "laid bare the corruption that undermines our justice system and erodes the people's trust".
Ms Guo has been out of public view since July when a Senate panel investigating her alleged links to scam centres and online casinos ordered her arrest for refusing to testify in its enquiry.
She is accused of allowing human trafficking syndicates and scam centres to operate in her town by masquerading as online casinos.
Senators have also accused her of being an operative or spy for China, citing her "opaque" answers to questions about her Chinese parentage.
Police have filed criminal complaints against her, while the Philippines' anti-graft body recently dismissed her from office citing "grave misconduct".
She has denied all the allegations.
Ms Guo left the Philippines "illegally" and skipped border checks, according to the country's Bureau of Immigration, which said it found out about her travels abroad through intelligence sources.
Mr Marcos said he would "expose the culprits who have betrayed the people's trust and aided in her flight."
He also ordered the cancellation of Ms Guo's Philippine passport.
Senator Risa Hontiveros, who has been leading the investigation on the Philippines' scam centres since May, said it is unacceptable for Ms Guo to slip past immigration checks.
"The nerve of this fake Filipino, using a Philippine passport to escape," she said.
Ms Guo came under scrutiny in March after authorities uncovered a huge scam centre and human trafficking operation in her sleepy town of Bamban, north of Manila.
The illegal operations were hidden in Philippine Offshore Gaming Operators, or "Pogo" firms, that stood on land owned by Ms Guo's family.
Prior to that, Ms Guo was relatively unknown and had not held public office before being elected mayor in 2022. She claims she grew up sheltered in the family's pig farm in Bamban.
While Pogos are not illegal, they are increasingly being exposed as cover for other crimes. The firms, which mostly cater to mainland Chinese clients, flourished under former president Rodrigo Duterte, who sought close economic and political ties with Beijing.
26. ‘Great Game’ Unfolds in Pacific as US, China Vie for Backing
Michael Heath, Bloomberg, August 21, 2024
Island nations scattered across the Pacific Ocean are at the center of an intensifying competition between China and the US for maritime routes, deep-water ports and other strategic assets in what the Lowy Institute calls a new “Great Game.”
The countries’ proximity to key shipping lanes and the communication cables that criss-cross the Pacific floor, together with fisheries and seabed minerals, also encourage the rivalry, Lowy said in a report on Wednesday. But it’s the region’s maritime location between Asia, North America and Australia that is set to keep it at the forefront of major powers’ defense strategies.
27. China warns of ‘heavy price’ for Japan after lawmakers visit Taiwan
Yang An, Voice of America, August 16, 2024
China warned Japan on Friday that it should be prepared “to pay a heavy price" if it interferes with Beijing’s plans for Taiwan, the self-ruled island that Beijing considers a breakaway province that must one day reunite with the mainland, by force if necessary.
China’s embassy in Tokyo issued the warning after a visit to Taiwan this week by a bipartisan group of Japanese lawmakers, including former Defense Minister Shigeru Ishiba, a potential candidate to be Japan's next prime minister.
Ishiba, a member of the Liberal Democratic Party, said Taiwan’s President Lai Ching-te and Japan agree that maintaining peace in the Taiwan Strait requires increasing deterrence and resistance against China’s aggression.
Ishiba made the comment at a press conference Wednesday at Taiwan’s Foreign Ministry at the end of the lawmakers’ trip.
After meeting with Lai on Tuesday, he told reporters that the two sides held extensive discussions on avoiding a conflict with China, which some fear could invade and occupy Taiwan as Russia did with Ukraine.
Ishiba noted there is a saying in Japan that "today's Ukraine may be tomorrow's East Asia," which he said the world’s democratic community must prevent by demonstrating the strength of deterrence.
The former defense minister declined to tell the reporters how Japan would react if war broke out in the Taiwan Strait.
Lai said that in the face of China's rise and threat to peace in the Indo-Pacific region, Taiwan would strengthen national defense and economic resilience, support the democratic umbrella with democratic partners, defend the values of freedom and democracy, and maintain regional peace and stability.
Although no specific plan was revealed, the two sides agreed to increase the frequency of exchanges on security issues.
Japan and Taiwan do not have formal diplomatic relations, in order for Tokyo to have formal relations with Beijing, and official interactions between the two remain at the lawmaker level.
But Japan, like most of Taipei’s allies, supports maintaining the status quo between Taiwan and China.
28. Philippines, China trade blame after vessels collide in South China Sea
Reuters, August 19, 2024
29. Singapore PM warns of regional fallout from US-China tensions
Chris Wright, Financial Times, August 19, 2024
30. India's Modi to visit Ukraine on Aug. 23, weeks after rebuking Putin
YP Rajesh, Reuters, August 19, 2024
31. How Chinese investors tried to take over an Australian mining company
Michael E. Miller, Washington Post, August 20, 2024
32. Taiwan sentences 8 military officers to prison for spying for China
Adrianna Zhang, Voice of America, August 23, 2024
The Taiwan High Court on Thursday sentenced eight Taiwanese military officers to prison for spying for China in exchange for financial gain. Experts say the case shows a shift in China's espionage tactics in Taiwan.
The sentences range from 18 months to 13 years in prison, making it one of Taiwan's largest espionage cases in years.
The court said in a statement that the defendants were "willing to collect intelligence for China that caused the leak of important secrets" and that "they were seduced by money."
An individual named Chen Yuxin was found to have contacted and recruited the defendants at key military sites to form a spy network for China. Chen was believed to have fled to China and remained there.
The defendants were also accused of planning to fly a CH-47 Chinook military helicopter to a Chinese aircraft carrier in the Taiwan Strait and of shooting a video indicating they would surrender to Beijing in the event of war, according to Taiwan's official Central News Agency. Beijing used virtual currency to make payments to the defendants, according to Bloomberg.
COMMENT - Its better to be finding these folks, rather than not.
Human Rights and Religious Persecution
33. US clinical trials in China questioned by US lawmakers
Alexandra Alper, Reuters, August 21, 2024
A bipartisan group of lawmakers on Tuesday called on the Biden administration to ramp up scrutiny of U.S. clinical trials conducted in China, citing the risk of intellectual property theft and the possibility of forced participation of Uyghurs.
Republican John Moolenaar, who chairs the House Select Committee on China, and ranking Democrat Raja Krishnamoorthi said U.S. drug companies have collaborated with Chinese military-run hospitals to conduct hundreds of clinical trials over the last decade, including in Xinjiang, home to China's Uyghur minority group.
"Given the historical suppression and medical discrimination against ethnic minorities in this region, there are significant ethical concerns around conducting clinical trials in (Xinjiang)," Moolenaar and Krishnamoorthi wrote in a letter dated Aug. 19 and addressed to Robert Califf, who oversees the FDA.
The letter, also signed by Democrat Anna Eshoo and Republican Neal Dunn, went on: "These collaborative research activities raise serious concerns that critical intellectual property is at risk of being transferred to the (People's Liberation Army) or being co-opted under the People's Republic of China's National Security Law."
34. Li Wencheng Dies at 97: How China Fabricates Religious Leaders
He Yuyan, Bitter Winter, August 20, 2024
35. Jailed Chinese activist faces another birthday alone in a cell, his wife says
Elsie Chen, Associated Press, August 17, 2024
36. 3 ways China is ratcheting up surveillance of Tibetans
Radio Free Asia, August 17, 2024
37. ‘Severely demoralised’: Hong Kong NGOs for sexual minorities suffer gov’t funding cuts and pressure over public events
Irene Chan, Hong Kong Free Press, August 18, 2024
38. CCP Hijacks the Label “Humanistic Buddhism,” Calls for Marxist Interpretation of Buddhist Classics
Zhu Yaozu, Bitter Winter, August 19, 2024
39. A Chinese Memoirist’s Exile in Las Vegas
Ian Johsnon, New Yorker, August 18, 2024
Industrial Policies and Economic Espionage
40. China’s Economy Fails to Pick Up After Worst Stretch in Five Quarters
Bloomberg, August 14, 2024
China’s economic malaise extended into the third quarter, drawing renewed attention to the need for more fiscal stimulus as domestic demand falters under a prolonged housing downturn.
A surprise slowdown in fixed-asset investment to 3.6% in the first seven months of the year was among the biggest takeaways from data released on Thursday. Retail sales beat expectations largely on a seasonal uptick — boosting China’s stock market — though they remained far below pre-pandemic growth. Industrial production softened slightly even as it continued to outpace consumption. The offshore yuan held onto early losses after the data.
41. World’s largest iPhone factory loses momentum amid supply chain diversification away from China
Coco Feng, South China Morning Post, August 21, 2024
The world’s largest iPhone factory, in the central Chinese city of Zhengzhou, is offering higher bonuses to attract workers needed for its busy season ahead of the launch of new models from Apple, but it is “not what it used to be”, according to workers and labour agents at the site.
The Foxconn Technology Group compound in Zhengzhou, capital of central Henan province, is closely watched as a gauge of whether China can maintain its role in the global supply chain. A recent visit to the site found that the factory has lost some of its momentum, as major customer Apple has been shifting production to countries like India. According to local residents, the dramatic disruptions in late 2022 when thousands of Foxconn workers fled the factory in fear of draconian Covid-19 control measures, also dealt a heavy blow to the role of the factory.
COMMENT – Spectacular news! Shifting consumer electronics manufacturing away from the PRC, along with the related supply chains, is what needs to happen.
42. Polen überholt China als Absatzmarkt für deutsche Produkte [Poland overtakes China as a sales market for German products]
Handelsblatt, August 16, 2024 – Original in German
43. China’s IP Protection Development: A Comprehensive Overview
Giulia Interesse, China Briefing, August 13, 2024
44. Youth unemployment in China jumps to 17.1% in July
AFP, Voice of America, August 17, 2024
Youth unemployment in China ticked up to 17.1% in July, official figures showed, the highest level this year as the world's second-largest economy faces mounting headwinds.
China is battling soaring joblessness among young people, a heavily indebted property sector and intensifying trade issues with the West.
Chinese Premier Li Qiang, who is responsible for economic policy, called Friday for struggling companies to be "heard" and "their difficulties truly addressed," according to the state news agency Xinhua.
The unemployment rate among 16- to 24-year-olds released Friday by the National Bureau of Statistics (NBS) was up markedly from June's 13.2%.
The closely watched metric peaked at 21.3% in June of 2023, before authorities suspended publication of the figures and later changed their methodology to exclude students.
45. How China and Japan’s brotherhood of steel, forged by Deng Xiaoping, ultimately corroded
Luna Sun, South China Morning Post, August 21, 2024
A decades-long joint venture between Japanese and Chinese steelmakers has ended, symbolising how much the two countries’ roles have changed
46. China to restrict critical antimony exports as geopolitical tensions target weapons
Ji Siqi and Sylvie Zhuang, South China Morning Post, August 15, 2024
47. Alibaba’s Profit, Revenue Miss Expectations Despite Growth Drive
Tracy Qu, Wall Street Journal, August 15, 2024
48. Fresh Data Shows China’s Economy Stuck in Doldrums
Rebecca Feng, Wall Street Journal, August 15, 2024
49. Argentina’s Milei Finds It Hard to Decouple from China
Ryan Dubé and Silvina Frydlewsky, Wall Street Journal, August 18, 2024
50. Businesses Are Already Girding for Next Phase of the U.S.-China Trade War
Peter S. Goodman, New York Times, August 19, 2024
51. China hits back at EV tariffs with European dairy probe
Edward White, Thomas Hale, and Alice Hancock, Financial Times, August 21, 2024
52. Global Trade Needs a China Alternative. India Needs Better Ports.
Peter S. Goodman and Hari Kumar, New York Times, August 20, 2024
Cyber & Information Technology
53. US Firms Warn Against ‘Unprecedented’ Hong Kong Cyber Rules
Newley Purnell, Bloomberg, August 19, 2024
54. AI Enters the Critical Mineral Race
Christina Lu, Foreign Policy, August 21, 2024
55. California Democrats fear US tech firm 'death spiral' with more China curbs
Reuters, August 14, 2024
56. TikTok disputes US claims on China ties in court appeal
Jody Godoy, Reuters, August 16, 2024
57. Tech war poll shows ‘China against the world’ while US in ‘commanding position’
Orange Wang, South China Morning Post, August 16, 2024
Military and Security Threats
58. Is China conducting 'gray zone' warfare for Russia?
Denny Roy, Asia Times, August 19, 2024
59. Taiwan shows off missile firepower on rare trip to sensitive test site
Reuters, Asahi Shimbun, August 20, 2024
60. The Pentagon Is Planning a Drone ‘Hellscape’ to Defend Taiwan
Jared Keller, Wired, August 19, 2024
61. German warships await orders on crossing Taiwan Strait
Sabine Siebold, Reuters, August 19, 2024
62. Laser weapon spotted on Chinese navy ship as PLA and US race to develop drone defences
Seong Hyeon Choi, Reuters, August 21, 2024
One Belt, One Road Strategy
63. China courts developing nations in its push to build a new world order
Rebecca Tan and Vic Chiang, Washington Post, August 10, 2024
64. Taliban and Chinese partner restart copper project, reigniting worries
Khudai Noor Nasar, Nikkei Asia, August 18, 2024
Opinion Pieces
65. How China is using Silicon Valley
Jacob Dreyer, UnHerd, July 3, 2024
66. Stopping the Next China Shock
Aaron L. Friedberg, Foreign Affairs, August 20, 2024
67. The U.S. Navy Isn’t Ready for Cold War II
Bruce Stubbs, National Security Journal, August 13, 2024
68. China's EV makers can't follow Japan's 'flying geese' offshoring strategy
Alicia Garcia-Herrero, Nikkei Asia, August 20, 202
69. China threat prompts Japan to rethink its security
Alexander Görlach, Politico, August 19, 2024
70. Serbien soll beim Lithium unabhängiger von China machen [Serbia should become more independent from China when it comes to lithium]
Olga Scheer, Handelsblatt, August 18, 2024
71. Harrow’s Chinese outposts bow to Xi’s tyranny
Melanie Phillips, Times, August 19, 2024
Like British judges in Hong Kong, the school is giving legitimacy to a repressive regime.
Harrow School has decided to open a new campus in China. The proposed educational facility in Guangzhou, which is set to receive about 1,500 students from Hong Kong, Macao and Taiwan in 2027, will be the ninth such campus Harrow runs in China.
Not surprisingly, human rights activists are appalled. The past few years have brought a Chinese curriculum clampdown and tougher controls on what is taught in classrooms. This year, Beijing introduced laws requiring all schools to have “patriotic education integrated into all subjects”. Schools must appoint up to five “assistant principals” to ensure children receive instruction in President Xi’s ideology and definition of the “rule of law”.
This makes nonsense of the claim made by Harrow’s international partner, Asia International School Limited (AISL) Harrow, that its schools in China “look to the 450-year old heritage of Harrow School in the UK to anchor its own guiding principles, drive progressive initiatives and inspire a vision that seeks to produce leaders for tomorrow”.
The repressive ideology and propaganda of the Chinese communist party are, one might confidently assume, diametrically opposed to the 450-year-old principles of Harrow School, or indeed any western school. That’s why Rugby School has chosen to open a branch in Japan after shunning offers from China that would restrict the curriculum and compromise Rugby’s core ethos. Other private schools have similarly chosen not to open Chinese outposts.
As Luke de Pulford, executive director of the Inter-Parliamentary Alliance on China, said: “Harrow’s China campus will be unable to criticise totalitarian [President] Xi, unable to call out the Uighur genocide, unable to teach whole swathes of history following the brainwashing diktats of the party-state. And for what?” For what indeed.
The issue of how far to engage with China has become an increasingly vexed one as the regime has tightened its tyrannical grip. This has presented an acute challenge in Hong Kong, where British judges sitting on the territory’s court of final appeal have wrestled for years over whether they would do more good by staying or leaving.
Contrary to China’s (always hollow) commitment to maintain an independent legal system with rights and freedoms in Hong Kong when Britain’s administration there ended in 1997, Beijing has progressively eroded the territory’s autonomy through a series of laws. In 2022, two British judges resigned from the Hong Kong court in protest at a Chinese law that curtailed freedom of speech and made it easier to punish protesters in Hong Kong. The other British judges decided to stay, saying they were satisfied with the court’s independence and that it was more important than ever to support Hong Kong in “maintaining the rule of law and reviewing the acts of the executive”.
At the time, it was a persuasive, if finely balanced, argument. However, as repression has subsequently grown even harsher, the balance has swung the other way. In May, Hong Kong’s pro-democracy media tycoon Jimmy Lai, who has been detained in December 2020 on national security charges and who was incarcerated for two years before his trial began, was separately convicted of “subversion”, along with a number of other pro-democracy activists, for participating in a peaceful protest in 2019.
For two of the remaining British judges, this was the last straw. Conscious of becoming increasingly sidelined as pawns of an oppressive legal system, Lord Sumption and Lord Collins of Mapesbury resigned. Sumption said Hong Kong was “slowly becoming a totalitarian state”; judges were being compromised by an “impossible political environment created by China”.
This has left three British judges who have chosen to remain on the court: Lord Hoffmann, Lord Neuberger of Abbotsbury and Lord Phillips of Worth Matravers. Neuberger, the former president of the UK’s supreme court, was one of the judges who last week unanimously dismissed the attempt by Lai and six other pro-democracy activists to overturn their convictions. Neuberger insisted his role was to decide cases that came before him according to the law. The court, he said, had “fully and impressively” considered the defendants’ fundamental human rights, including freedom of expression and assembly.
But what possible justification can it be to uphold the law when that law denies those rights and freedoms?
Like Harrow School, the three British judges who remain on the Hong Kong court are giving credibility and legitimacy to a tyrannical regime. Any possible benefits for Hong Kong defendants or pupils in China are now heavily outweighed by the damage these British participants are doing through undermining the astoundingly brave people desperately fighting the Chinese regime.
After the Cameron government so disastrously submitted to Beijing’s deadly embrace, British prime ministers have blown hot and cold over the UK’s institutionalised entanglement with a regime that poses such an acute threat to the West. Unlike the Conservatives, whose election manifesto pledged to declare China a security risk on a par with Russia and Iran, the Starmer government has declined to call China a “threat” and is pledging instead to co-operate with Beijing on health matters and “net zero”. As with Harrow and the three Hong Kong judicial stooges, kow-towing to the Chinese communist party is now apparently Labour’s “progressive” answer to tyranny.
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Michael Beckley, New York Times, August 19, 2024
73. China’s Bond Dilemma
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74. Hong Kong arts education must do more than strengthen national identity
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75. China’s Not-So-Secret Economic Weapon
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