On October 1, the Chinese Communist Party commemorated its National Day and 75 years of its rule over mainland China. Meanwhile, October 10 serves as Taiwan’s National Day. Having these celebrations so close together creates an obvious political rivalry. Miles Yu lays out how this National Day rivalry manifests itself. Next, he analyzes President Lai Ching-te’s recent refusal of a “peace agreement” with Beijing, deciding instead to publicly push for “peace through strength and self-defense.” Lastly, with the one-year anniversary of the October 7 terror attacks in Israel upon us, Miles reflects on China’s role and goals in the Middle East.
China Insider is a weekly podcast project from Hudson Institute’s China Center, hosted by Miles Yu, who provides weekly news that mainstream American outlets often miss, as well as in-depth commentary and analysis on the China challenge and the free world’s future.
Episode Transcript
This transcription is automatically generated and edited lightly for accuracy. Please excuse any errors.
Miles Yu:
Welcome to China Insider, a podcast from the Hudson Institute's China Center. I am Miles Yu, senior fellow and director of the China Center. Join me each week for our analysis of the major events concerning China, China threat and their implications to the US and beyond.
Phil Hegseth:
It is Tuesday, October 8th. I'm Phil Hegseth alongside Hudson Institute's Miles Yu. Today we start with two national holidays, October 1st and October 10th. The first being China's National Day marking 75 years of CCP rule over mainland China and the 10th serving as Taiwan's National Day. For two countries so geographically close and so historically tied, to share national days so close and historically tied, creates an obvious political rivalry. Miles lays out for us how this National Day rivalry manifests itself in the region. Second, we stay with Taiwan and analyze President Lai's recent refusal of a quote on quote “peace agreement" with China, deciding instead to publicly push a desire for peace through strength and self-defense. And last, with the one year anniversary of the October 7th terror attacks in Israel, Miles reflects on China's role and goals in the Middle East. Alright, Miles, we are here. How are you?
Miles Yu：
Very good. I feel glad to be here with you again
Phil Hegseth:
For everybody's context. We had some technical difficulties this morning and then we realized it stemmed from equipment made in China, and so that was our explanation for the late start, but we're ready to go now. So thanks for getting through that, Miles. We start today with China and Taiwan's rival National Day. So China's is on October 1st, Taiwan's is on October 10th. They are right next to each other on the calendar. This has got to cause some frustration and maybe some political rivalry. Miles, can you give us the context for these holidays? What they mean, how they celebrate them. But let's just start with the historical context and why they're important.
Miles Yu：
Somebody should write a book about the politics and the history of the National Day rivalry between China and Taiwan. Both country called the GuoQing（国庆), which means National Celebration Day. As you said, October 1st for mainland China and for the 10th for Taiwan, commonly known as double 10. For decades since 1949, this kind of a rivalry of celebration is about one thing: that is who has the legitimacy to represent what we call China. Of course that's changed quite a bit, because since the 1970s mainland China was given the international recognition of representing China. But then comes the question of Taiwan. So Taiwan's official name is Republic of China in Taiwan. It still has [China] in its name. So the celebration of the national days in both countries now carry very different meanings. So that's what it's all about.
Phil Hegseth：
What meanings do those days carry in each place? So we can start with mainland China and the CCP. What does it mean for them? The National day this year, marking 75 years.
Miles Yu:
I'm sorry, mainland China, October 1st is basically normally the main occasion for the Chinese Communist Party to show off the invincibility of the party and the power of the party. Usually it is accompanied with a huge military parade, long period of holiday. And essentially what it is for China, the National Day, is an orgy of communist triumphalism. It's a very glorious display of arms, nukes and ICBMs to legitimize the regime. Very much likely what's going on in North Korea and all other communist regimes. So this is basically what the National Day means for mainland China. For Taiwan, basically right now, since 1970, it's a [inaudible] occasion for pronouncements of a main national policy by the Taiwanese government. The reason is simple, that normally, particularly during the presidential election year, like this year, for example, in January you had the presidential election. You got a new president, and however, the inauguration would not take place until almost like four months later, more than four months later on May 20th usually. May 20th of course is a time for the newly elected president to pronounce the new policies, but then they don't normally do that as much.
So the main policy announcement would take place on double 10 on the Taiwanese National Day. So that's why everybody's looking forward to the National Day celebration and how the newly elected president will basically describe his priorities of policy. This year is slightly different because the Taiwanese government right now is relatively low key. President Lai, however, did show up at an indoor rally to celebrate the National Day. He made a brief spontaneous remark, but it was explosive and actually very funny because he said, "Hey, listen, the Republic of China in Taiwan was born 113 years ago. PRC was born only 75 years ago, so we're older. So there's no way for people in Taiwan to call mainland China, which was born several decades later as a motherland, because it's younger. So that remark really caused a firestorm and China has no way to respond to that because it is commonsensical, but there's no major policy pronouncements, and he already made his policy very, very clear.
Phil Hegseth:
Gotcha, gotcha.
Miles Yu:
Yeah.
Phil Hegseth:
And on the other side of it, what did Xi Jinping come out and say, especially on this day in regard to Taiwan as well? Give us some insight there.
Miles Yu:
This year there's no major parade because China is in a difficult situation. Almost a moment of crisis, because of the economic downturn and its political instability. Xi Jinping is a perjure in chief. He got rid of so many of his enemies, so he's really living paranoia of some sort. Normally you celebrate big time on the fifth or the 10th anniversary of something.
That's why every time in China, say 1954, 1959, on 10th and 5th anniversaries, they are a big, big deal. 1959 was very interesting because you got Khrushchev, you got Ho Chi Minh Ang, all those communist dictators and comrades showed up in Beijing to celebrate the 10th anniversary of PRC. Now, during the cultural revolution that lasted from 1966 to 1976. And the celebration of a national day was absolutely sort of crazy. It was an orgy of the extreme, and so it is a showcase of Mao's power. So rich, the zenith of madness. This year's celebration, however, is slightly different because it had a very strong economic tone to it.
China's non-market economy had a major problem of consumer confidence. So people basically do not want to spend money. So the party, in order to solve this problem in the last 25 years, have come up with the idea of prolonging the national holiday. The National Day holiday from one day in the past to essentially seven days. Officially it is three to four official holidays. But then coupled with the weekend, so you got seven days since 1999. It's called a golden week. The main purpose is to promote domestic consumption and by way of domestic tourism, I mean government products, all these promotional deals and urge people to go out to spend money and the money people spend is literally staggering. Let me just share some statistics with you. In 1999, the year this new golden week, seven day prolonged holiday started, domestic travelers in China were about 28 million. In 2007, eight years later 120 million. Geez, 2015 it was 526 million travelers that day, that year. So the most interesting thing is, it reached its peak in 2017. The domestic travelers during this week reached 705 million. It dropped a little bit next year, but it's still really, really high. The second highest in 2020 domestic travelers during this golden week in October reached 637 million. Now this is very interesting. This is also very shocking, because as you recall, 2020 is at the peak of Covid
Nationwide, you had a pandemic going on, yet the government promoted tourism. You had 637 million travelers all across the country generating about 68.6 billion dollars in the middle of Covid. The Chinese government, by the way, had never published the death toll of covid inside China. So based upon this statistic, you might imagine that during that year it must be staggering, because there's so many people going around carrying viruses from one human being to another. Now, there's also another issue. If you have so many people going out and going to the tour sites, you got really a miracle of stupidity in China. That is, during this week, every public park, every tourist park is grossly over capacity. You go to the
Great Wall of China, which is an all time favorite. You have people you couldn't barely move. So the Great Wall of China literally becomes a great human sardine walk. Packed! So that really created several sorts of unintended consequences. That is people who are relatively well off, they just don't go there to join the great human sardine wave. So they go abroad. The top tourist destinations during this golden week are Japan, South Korea and Thailand. And of course the shopkeepers in those countries were really, really welcoming these Chinese tourists. On the other hand, the Chinese tourists, basically they're mobs, they just ransack the shelves and they created some kind of cultural shock of some sort to those various countries.
Phil Hegseth:
It wasn't as grandiose as maybe we would've thought, but Xi did come out and make some remarks. And so what did he speak about most? Could you give us some insight into that?
Miles Yu:
Okay, so he had this huge banquet in the gray heart of the people. We usually call it the G-hub. So in the great hall of the people, his main focus is to sort of cover the loyalty of the senior CCP leaders, because those retired CCP leaders could be a major focus of challenge to his rule. These guys have a lot of subordinates. They're old people. So if you want to register your displeasure with Xi Jin Ping (习近平), and you go to those guys of prominence, who served in the government before. So that's why he got all those people he liked to show up and parade them one by one. On the other hand, you look at these guys, every one of them has a long face. No one showed any sign of a smile. They look very serious, probably scared, if not disdained. And of course, what's interesting is that there are many people who were sort of marginalized by him who have not yet been purged, and didn't show up. Like a former prime minister and former ministerial officials. So I mean none of them showed up. One of the most interesting absences, which is kind of conspicuous, is the guy who dealt with the United States the most. That is vice premier of China, Liu He (刘鹤), who was the chief negotiator with the American government on trade.
He's rumored to be purged.
Phil Hegseth:
So just honing in on Xi's specific remarks, he came out during his speech and according to VOA news in reference to China's desire for reunification with Taiwan. And he said it is an irreversible trend, a matter of justice, and it is in accordance with the popular will. No one can stop the march of history. How seriously should we take these statements, Miles? Is this more of the same? Is this new or is he blowing smoke?
Miles Yu:
It's basically hot air. Gobbledygook. I mean, he's been saying this all along, every single speech he must say this kind of stuff. On the other hand, people in Taiwan don't take him seriously because the wolf cry has been going on for a long time.
Phil Hegseth:
Yeah. Well, and that leads perfectly into our second topic, which is Taiwanese President Lai's rejection of the idea of signing a peace agreement with China. And give us the full picture here, Miles of what this peace agreement was and what President Lai had to say about it.
Miles Yu:
Well, President Lai basically said, this is a no brainer, no, no soup for you, because clearly this is China's peace offensive aimed to influence the American election.
Phil Hegseth:
How so?
Miles Yu:
Well, both campaigns are saying we're going to create world peace. We're going to solve this problem and we're going to force all sides to sit down and talk peace, right? Vladmir Putin and Zelensky, you talk peace. China and Taiwan you sit down and talk peace. So China saw this opportunity and launched its peace offensive through its proxies and also lobbyists. They try to influence American campaigns on both sides, particularly on the GOP side. This is why they want to tell the Americans, "Hey, listen, we want peace, it's Taiwan that is anti peace." So they're casting PRC as a pro peace, Taiwan as anti peace. So because the PRC has noticed the campaign's pledge to settle the Taiwan crisis. This is basically an interesting phenomenon because it created a no-win situation for President Lai in Taiwan. If he signed the peace deal, the PRC will insist on one China policy, one China principle rather, and insist on Taiwan's part of China, which definitely would subjugate Taiwan as part of China. And that basically means surrender annexation. So it is unacceptable. If they reject it, PRC will say, ah, you see, it's Taiwan that hates peace.
So that's why President Lai rejected China's peace offer, because it was not really a peace offer of genuine intention to solve the issue peacefully. Also, it's because of history. Peace agreements that the Chinese government has signed, is basically nothing but a sham. China has signed a peace agreement with the Tibetans. They have signed a peace agreement with the Brits on Hong Kong, solemnly signed it and registered at the UN as an international treaty. They have signed a peace agreement with Vietnam. They have signed a peace agreement with the Soviets. They have signed an agreement of security guarantee with Ukraine. None of them has been fulfilled by the PRC. So I'm going to make a major statement here: PRC has never honored its international agreements with anybody.
You can't find a case that is outside of this pattern. As a matter of fact, for the United States to pressure
Taiwan to sign a peace agreement with China is also a very clever strategy that would force the United States to abandon its solemn pledge. For several decades, the US-China, US-Taiwan relationship are guided by a couple of very fundamental documents. Two of them, or actually one is the Taiwan Relations Act. Another one is so-called Six Assurances, which was established by the Reagan administration. Now the six assurances are very important. If China pressures Taiwan to sign a peace agreement through the United States government, that would violate at least two of the six assurances, which is foundational in US Taiwan relationship and US channel relationship. The six assurances, number three, it says, I quote:
"US will not play a mediation role between Taipei and Beijing."
Phil Hegseth:
Oh, interesting.
Miles Yu:
And number six, which is very important of the six assurances, I quote: "The US will not exert pressure on
Taiwan to enter into negotiations with the PRC." This is the very, very pernicious tactic to force the United States to break a long pledge. If the US government pressures Taiwan, press Taiwan to sign a peace agreement that would fundamentally shatter allies' confidence in the United States leadership globally.
Phil Hegseth:
Yeah. So what should the US do hypothetically? You have a direct line to either party, either candidate campaign. What is your message for how the US acts and exerts itself in this kind of situation?
Miles Yu:
The Chinese government is notorious for deploying its proxies. Its lobbyists influence American government policies. And this is even worse because this is election season. This is blatant election interference by a regime that is hostile to the United States. So the most important thing we have to do is the US should absolutely cleanse the PRC's election interference by rooting out any channels of PRC communications with both campaigns. That is a must do.
Phil Hegseth:
How about the larger issue?
Miles Yu:
China is poised to invade Taiwan at any given moment. Sign a peace deal with that country means that you capitulate. No more, no less.
Phil Hegseth:
You drop your guard right. Now you have reason to drop your guard.
Miles Yu:
Yeah, China is saying, you know what? Peace or not, we're going to invade you. We're going to conquer you. That's it.
Phil Hegseth:
Finally, our last topic today. Yesterday was October 7th. It was the one year anniversary of the terrorist attacks in Israel by Hamas. We've covered this kind of thing before, but just in reflection, what is China's strategy in the Middle East? They have involved themselves in this conflict. But just taking a minute on the anniversary to step back and say, what is China's role and goals in this region right now?
Miles Yu:
Well, let's just talk about the tragic event that occurred a year ago yesterday. China has never condemned Hamas for its crime against Israelis and peaceful innocent Israelis, and also many Americans too lost their lives in that tragic event. Whenever Israelis launch a counter strike against a terrorist, you know Hamas, China then jumps in and says, oh, you know what? We are against all forms of terrorism, including state sponsored terrorism, meaning that Israel's counter strike is considered a terrorist act. So China's always doing this kind of a thing. China, yes, it's not necessarily anti-Israel. China is anti-US
Because the Middle Eastern policy of China has one purpose. That is to use Middle Eastern chaos to completely discredit America's leadership role. America’s role as a global leader. So that's what they do. That's why they jump into broker, a rapprochement between Hamas and the Palestinian authorities under Abbas, because China wants to replace the United States as the most influential, most consequential leader in the region. So they all aim at discrediting the United States, kicking the US influence out of that area.
Phil Hegseth:
Right to your point there, how are you going to influence the region if the only rapprochement that you're talking about is just on the Palestinian side? I mean, Israel wasn't at the table. They're not hosting Israel for these things. So how do they view Israel in the region as a player as well?
Miles Yu:
They view Israel as a potential partner in the economic arena – trade and a particularly technological transfer. So they're working really hard on Israelis, because Israel is playing a leading role in some of these fronts. On the other hand, they view Israel as a staunch ally of the west. So from that point of view, they want Israel to be subjugated. They want Israel to be entangled in this constant nonstop crisis. So the Middle East is in chaos is China's advantage, because that would be a major distraction for the United States, which has shifted its focus on China in the Indo-Pacific region. So that's basically China's grand strategy. Now, operationally, you cannot say China is not really involved at all. Because even though China has never openly admitted it, Israeli IDF soldiers did find a large cache of Chinese made weapons in the Hamas holdouts in Gaza and elsewhere. So you did have this Chinese cozy relationship with the leadership of Hamas, and most importantly, China did and has been bankrolling Iran and Iran's war machine with the 400 billion infusion of Chinese money. That was a deal signed in the spring of 2021. So Iran is the ultimate culprit of the Middle Eastern chaos. So China is behind that. So from this point of view, I don't know if China's just using some rhetoric to discredit the United States inference in the Middle East.
China actually is heavily involved operationally.
Phil Hegseth:
Would you say Iran is their biggest partner in the Middle East or is that among a smaller list?
Miles Yu:
Oh, definitely. China is backing Iran a hundred percent. I mean, China was dying to sign the strategic partnership, a huge deal with Iran. But that sort of pipe dream was disrupted during the Trump administration, because we got rid of the J-C-P-O-A and prevented China from doing business openly with the Iranian regime. So they did it covertly and we caught them with the Huawei case. That's why the chief financial officer of Huawei, Ms. Meng Wanzhou (孟晚舟) was arrested in Canada. She was supposed to be indicted to the United States, which caused a lot of friction between the US and China. Because Huawei was doing secret covert business with the Iranian regime in violation of US sanction policies. But then when Biden was elected, six weeks after President Biden came to the White House, and the J-C-P-O-L was gone, and then China signed this $400 billion deal with the Iranian regime. That's $400 billion. That's a lot of money. With which the Iranians could do a lot of damage to peace and stability, not just in the Middle East, but maybe globally.
Phil Hegseth:
Yeah, I don't think a lot of that money is making it to Iranian civilians. I think it's fueling things like Hezbollah, Hamas, and its proxies in the region. Well, it means that China is indirectly, it could be argued, responsible for some of the chaos in the region and giving it financial viability.
Miles Yu:
Phil, you just made such a brilliant point. That is the distance between the Iranian regime and Iranian people. The leader that is very, very keen on making this point was Israeli prime minister Netanyahu. On the anniversary of the October 7th atrocities against Israelis. Prime Minister Netanyahu made this amazingly powerful video just for the Iranian people telling them that your government has betrayed you, your government has put you in danger, your government has no interest in you, except its own regime's longevity. And that powerful talk actually is something that the United States government leaders should do to the people of China.
Phil Hegseth:
Oh, that's an interesting point. Yeah.
Miles Yu:
Because the Chinese regime and Chinese people are completely different things, and I think more and more people in China understand that. Look at the wars China is crying to fight. I mean, they don't care how many millions, hundreds of millions of Chinese people's lives might be lost and they just want to prolong its own regime, at the expense of Chinese people's wellbeing.
Phil Hegseth:
Well said. I'll close with one last question. So we're on the anniversary. This conflict doesn't seem like it's slowing down. If anything, Israel has opened a second front with Lebanon, or in Lebanon, with Hezbollah. How do you see China's influence going forward in the Middle East? Do you see it continuing to ramp up involvement, continuing to fuel financially chaos in the region? What do you see as their ambitions going forward?
Miles Yu:
Oh, China definitely is going to continue its policy and bankrolling all these disruptive forces to break the
Middle Eastern peace and stability. It is in China's national interest, as I said before. On the other hand, Israel is surrounded by enemies, who want to destroy Israel. So Israel right now, as we speak today, is fighting for its own survival on seven fronts, on seven fronts. So the world should stand by Israelis and give them support. Otherwise, Israel as a nation might have a problem to even exist. And the right to exist is precisely what Israelis want to do. And once the neighbors recognize, more and more people, more and more countries surrounding Israel used to be really hostile to Israel, refuse to recognize Israel's right to exist. But because of the Abraham accords brokered by the Trump administration, continued on by the Biden administration and the more and more significant countries in the Middle East recognize, acknowledge Israel's right to exist. That's a very historical new beginning.
Phil Hegseth:
Good note to end on. Thank you Miles as always for your insight and your time. We appreciate it.
Miles Yu:
Thank you very much. I look forward to being with you again next week. Thank you for listening to this episode of China Insider. I'd also like to thank our executive producer, Philip Hegseth, who works tirelessly and professionally behind the scenes for every episode. To make sure we deliver the best quality podcast to you, the listeners. If you enjoy the show, please spread the word for Chinese listeners. Please check our monthly review and analysis episode in Chinese. We'll see you next time.