Shane Leary joins Miles Yu to discuss the pending legislation to ban TikTok and the broader picture of Chinese Communist Party influence on American domestic politics. They then turn to a recent flare-up of tensions between India and China, caused by Prime Minister Narendra Modi’s visit to Arunachal Pradesh, and discuss the roots of China’s antagonism toward its neighbors. Finally, they discuss a curious development in Russia-China relations: Russia’s commemoration of the Damansky Island conflict, a military confrontation with China that occurred 55 years ago.
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 along with my colleague, Shane Leary, for our analysis of the major events concerning China, China threat, and their implications to the US and beyond.
Shane Leary:
It's Tuesday, March 19th, and we have three topics this week. The first is Miles’ reflections on recent efforts to ban TikTok and how this fits into the broader picture of CCP influence in American politics. Second, we discuss a recent flare up of tension on the India-China border and the cause of China's longstanding tradition of border disputes with its neighbors. Finally, we discuss a curious development in Russia-China relations in which Russia recently commemorated a military confrontation with China 55 years ago. Miles, how are you?
Miles Yu:
Very good, Shane. Nice to be with you again.
Shane Leary:
Yeah, great to be here. So for our first topic, Miles, we've spoken a lot about concerns surrounding TikTok on this podcast in the past, but just this past week we finally saw some momentum on that front. The US House of Representatives has passed a bill which would see TikTok banned in the United States unless its Chinese parent company, ByteDance, sells the app. It will still have to go through the Senate, although President Biden has made it clear he's eager to sign the bill. But Miles, we've talked about this before. I want to zoom out a bit and place this in the broader context of US-China relations. So what are your thoughts on this development and perhaps what are the larger issues that can be gleaned from the tension over TikTok?
Miles Yu:
Well, we also often say that this is the tip of the iceberg. TikTok reflects something much larger, much more significant. Number one, it really highlights the undeniable fact that China is fundamentally a non-market economy. The United States of America is part of the global free trading system. China is not. Therefore the fundamental issue in its TikTok fight is not about the free speech at all, its really about the clash of the two fundamentally different economic and political systems. That's why we cannot really approach from a transactional point of view. There are some people opposing this TikTok legislation on ground of free speech. If they understand the nature of this fight, they should be doubly animated by the sheer differences between the two economic systems and endorsing legislation on TikTok because TikTok symbolize the enemy of free speech, TikTok is owned by the enemy of the free speech in China.
So that's why issue is much larger on this. But I will say this, the TikTok debate and fight in the United States of late shows something that's really astonishing. That is how powerful Chinese Communist Party lobbying efforts in the United States are. China by far is the number one spender on lobbying the US government. So there is an NGO organization called Open Secrets. By their data, since 2016, China has been the number one country in the whole world that has spent the most amount of money in the United States on lobbying, more than 400 million US dollars. The TikTok fight alone, last year, the Congress began to considering legislation. In this whole process, since last year, the Chinese government has spent $100 million on lobbying every sector of the US government, including some politicians on this piece of legislation alone. This is not just my fancy number. This is from the chairman of the Senate Intelligence Committee, Senator Mark Water from Virginia.
So this is an astonishing accomplishment by the Chinese government. So to the degree that how much our society has been penetrated by the China lobby. There is some good news recently, however, in the last couple months in particular, mostly as a result of the TikTok fight. So Americans get education and there's much more exposure about TikTok and its connection with the Chinese Communist Party. Some major K Street lobby firms got scared by possible congressional move to propose legislation to further curb CCP’s rampant lobbying activities in the United States harming US national security. And here I must give a shout out to various congressional committees dedicated to exposing the national security threats posed by the CCP, particularly the House-led Committee on the CCP chaired by the great Congressman from Wisconsin, Mike Gallagher. And that committee had this phenomenal bipartisanship, they're revealing hearings, educating the public as well as scared the China lobby.
Several major K Street lobby firms in the last month or so had to abruptly end their contracts with their CCP clients. I'll give you a few examples. Vogel Group, which is a large PR firm in Washington DC that represents DJI, that's the world's largest drone maker and also the Chinese biomedical firm of Complete Genomics. So they end the contract recently. Now one of the largest PR firm in Washington DC called Brownstein, Hyatt et al., they represented the Chinese version of Raytheon, which makes laser radars for military users. Hesai Group, which is also represented by another PR firm on K Street, Akin, Gump, Straus, Howard and Field. Both firms had to end their contract with the Hesai Group in China. And finally there is another example. I can see, one of the world's largest bio-genome company, which is based in Shenzhen China called the BGI. That company was represented by another major PR firm on K Street called Steptoe LLC, and they had end that contract with them too.
So there's some good news. However, overall, the main problem remains, all of the sanctioned PRC companies and particularly the Chinese military companies on the US Department of Defenses’ Section 1 260H list have US lobby firm's representation. So the major problem still remains. You were asked what is the Section 1260H list? Well, since the Trump administration, there are several hundreds of PRC companies have been sanctioned by the Department of Commerce, treasury, and state and even DoD. And they're on a sanction list for violation of human rights, mostly in Xinjiang, for violation of basic freedom in Hong Kong and several other egregious atrocities committed by the Chinese Communist Party. But most importantly, in the National Defense Authorization Act of 2021, about four years ago, there was a Section 1260H.
That section mandated the Department of Defense to provide a list of Chinese military companies. And this year, for example, there are about 50 of them, known CCP military conglomerates. Those companies are working inside US with hundreds of subsidiaries all over US sensitive sectors, including defense, biomedical data, digital and space sciences, and of course armament, aviation, railway, nuclear, telecommunication networks, and so on and so on. So these are the Chinese state-owned, most likely military connected, because DoD said there are military companies, they're working inside the United States and in our critical sectors of defense and national security, this is pretty scary. So this is why the main problem is still there and we have to be very alarmed.
Shane Leary:
That is astonishing. Could you talk a little bit more about what existing laws and regulations we have to limit foreign influence in our lobbying today?
Miles Yu:
Well, we have some laws, but those laws were not working at all. Most likely I think working very poorly. There are a lot of loopholes in restricting foreign lobbying activities in the United States. As you know, I worked in the Trump administration at the State Department in Mr. Pompeo's office and some very powerful former US officials representing CCP companies and entities that came to see Secretary Pompeo and me. And those people certainly did not do enough due diligence on me and where I stood on issues related to CCP, but the fact that they came to the US government to lobby on behalf of an adversary, it's just astonishing. There are basically two regulatory tools over foreign lobbying in the United States. Both need urgent upgrades. Number one is the FARA, the Foreign Agents Registration Act, which was passed in 1938 for mostly the purpose of fighting against the Nazi propaganda in the United States.
And also in 1995, Congress passed a law which is signed by the US President. That is the Lobbying Disclosure Act, LDA. So you have FARA and LDA. Those are two. Now, there are a lot of loopholes in both of these legislatures that render them pretty much useless. First, FARA, it only requires agents, mostly US nationals, representing foreign governments, or “foreign principles” to register for fraud disclosure. Nearly all Chinese state owned companies claim they are private, non-state owned, which is all false. So far, only two Chinese companies are required to file full disclosure to the Justice Department in the United States. One is Huawei, another one Hik Vision. Now Huawei as we all know, is the Chinese government arm of global penetration to control the world's critical telecommunication networks. Hik Vision is based in Hangzhou China. It's the world's largest surveillance equipment maker. And this is basically if the world ever become a surveillance world, much worse than 1984, Hik Vision will be given most of the credit.
So that's why the only two companies are required to make a full disclosure to the US Department of Justice following the FARA Act. Many CCP companies register outside of China as well in places like Singapore and Cayman Islands. They've penetrated the United States but disguised as non-Chinese entities. So this is a loophole that the FARA really could not cover. FARA and LDA register only about 2% of Chinese government owned or controlled entities operating in the United States. So you can see FARA and LDA are almost completely useless. We must do something much more enforceable and much more meaningful the United as a free and open society and leading democracy in the world. If the United States has to prevail, we must start with a complete overhaul of our national security laws. So I'm a little bit uncomfortable with the national focus on TikTok because the problem is much, much larger and we should do something more systemic and comprehensive. The TikTok abomination is just a tiny tip of the gigantic iceberg of the uninterrupted and unhinged penetration of our industry. Our sciences and technologies, our cultural, educational and financial institutions and to a certain degree our political system by the Chinese Communist Party.
Shane Leary:
So I guess a natural follow up to that would be if we were to do some sort of systemic overhaul to our lobbying disclosure processes and things like that, what would your proposal be, Miles?
Miles Yu:
Before we take any meaningful actions, we must change two critical conceptual and policy mindsets. Number one, we must designate the PRC not just as a competitor but as a enemy state hellbent not on competing with the United States, but on destroying the United States. In the same category of countries like Iran and North Korea, only many times more capable and formidable. That's because by calling China a competitor, we imply incorrectly that China and the United States operate in the same economic and the political ecosystem. But as we all know, the opposite is true. The narcissistic Washington blamed the US-first thinking that if we're nice to China, China will cease it's being hostile to the United States. It's just that narcissistic, if not for any other reasons, simply because the CCP has always regarded the United States as its mortal enemy. The more our diplomats and national leaders tell the CCP that we're not going to do a regime change to the communist system, the more the CCP thinks that you are faking it, not sincere.
The truth is that long, long time ago, the CCP has already decided that in order that the CCP regime not be changed, the CCP must change the regime of the United States and for that matter, the democratic regimes of the rest of the world. Therefore from Mao to Deng to Xi Jinping, what we now call the strategic competition with China is in fact in their eyes an epic struggle of life and death that the CCP must prevail. In other words, we are China's enemy number one, no matter what we do, what we say. So the second thing I think that's conceptual and a policy-wide we must really consider is we must consider and get ready for a complete separation with the Chinese economic and industrial systems. Yes, it will be painful in the short run as China has already had us hooked on key supply chains. But this has to be done because a communist owned and controlled economic system without constitutionally guaranteed private property rights, will do us in soon if we continue to treat China as if it was a qualified member of the international free market system. So failing to change these two conceptual frameworks is tantamount to being suicidal in my view.
Shane Leary:
For our next topic, tensions at the India China border flared again recently, when Prime Minister Narendra Modi visited the contested region, India knows as Arunachal Pradesh, but Beijing claims is part of South Tibet. The visit prompted a statement from Chinese foreign ministry spokesperson Wang Wenbin saying China strongly deplores and firmly opposes the Indian leaders' visit to the east section of the China-India boundary. Can you give us some background on this particular dispute? How far does this go back and how significant is this recent spat?
Miles Yu:
The Chinese communist regime and the independent India were born pretty much at the same time. India declared independence in 1947. China Communist Party took over China in 1949. So for the first 10 year or so, the two countries had no border dispute. They are sort of buddy buddies in a way. Until 1959. In 1959, several things happened. Number one, the China brutally cracked down on the Tibetan uprising led by the Dalai Lama. So Dalai Lama had been defeated by the Chinese Communist Party and the fled to India. And India gave Dai Lama and his followers a refuge. So they settle in the area is called the Dharmsala, which still existed today. So that's where the Tibetan government in exile is and has been. And China basically began to use the border as an issue to basically dispute with India. Now, 1959 is also about the beginning at the very beginning of the China-Soviet split because the Chinese communist leadership believe the Soviet Union had betrayed communism.
They had denounced their good comrade, Joseph Stalin, and that the Soviet Union under Kruschev had gone revisionist. And so China and the Soviet Union tension just rose. And one of the concomitant result is that India and Soviet Union getting much closer. So this is why this border issue has become a much more importance for China to continue. And ever since the border dispute with India has become a persistent major roadblock in improving China-Indian relationship, which led to the 1962 all out invasion of India by China. So in a very brief war during which India was defeated, that sense of humiliation, it has been indelibly imprinted on the minds of many Indians today, so much of a military modernization today in India is driven by that humiliation of 1962. Let me just make it clear.
China's border problem with India is not alone. China has the most neighbors in the world. It has 14 land neighbors and about half a dozen maritime neighbors. And China at some point in the last a hundred years has had a border dispute with every one of them. Communist China was created in 1949 with this legacy of dealing with all these border issues. That's because for over 2000 years there's no clear concept of border because according to the Chinese system, all land under heaven (天下) it belong to the Chinese emperor. So China is the Middle Kingdom. So everybody else is in a sort of a hierarchical relationship with China where the emperor is superior to everybody. Everybody has to pay tribute to China, become a tributary states, so to speak. So the Chinese Communist Party, when they took over China, 1949, they're sort inherited that kind of legacy. They were given their opportunity to settle all the border disputes with many countries.
And so that's where the border issue has become very, very strange because the Chinese Communist Party over the several decades since 1949 has been dealing with the border issues using different kind of very unusual approaches. Number one, China has basically ideologicalized this border issue. It's a part of the Chinese Communist Party’s global ideological struggle. For example, for those ideologically aligned countries like Soviet Union in old times, Mongolia, it's called People's Republican of Mongolia, North Korea, even the socialist country of Burma, China have no problem settling the border issue with them. And give and take, China lost some territories, gained some territories. So it's amicable settlements. So there's no border issue with those countries that ideological align to the Chinese Communist Party. However, other countries that are not ideologically aligned with China or even they're allied with the ideological enemy of China like the United States.
And then you have border issues. I mentioned India, right? That's one. And secondly, Taiwan. The Taiwan issue is really not about the unification with the motherland. Even if CCP really cares about territory integrity of China, they would not have given a large chunk of land to the Soviets through the Mongolians and those territory China conceded since 1949 are 30-40 times bigger than the size of Taiwan. So this is basically the nonsense when they say the Taiwan issue is really about the unification of the motherland. A Taiwan issue, tensions down its core is really is a part of the ideological struggle because Taiwan is a friend of the United States. That's all. China has always been anti West. South Korea is the same thing. South Korea and Japan, Philippines, those were four countries in the region that have a very strong relation with the United States. Those four countries happen to be the only four countries in East Asia that have mutual defense treaties with the United States.
Now, our mutual defense treaty with Taiwan was ended by President Carter in 1980, but still today we still have mutual defense treaties with South Korea, Japan, and Philippines. Those were the targets of China's border disputes. That's why it's so intense. Also, those problems with Vietnam. You might say, oh, Vietnam is also communist country. Yes, that's also ideological because China its primary ideological enemy was the Soviet Union. Soviet Union eventually fight with China for the ideological correctness over the Cold War. Vietnam, however, initially were friendly to both China and the United States. But in 1975 the Vietnamese communist took a move and they gradually moved to the camp of the Soviet Union basically, which humiliated China. And in November 1978, Vietnam and the Soviet Union signed a mutual defense treaty that would freak out the Chinese. The China played the US card. And several months later in February 1979, China invaded the Vietnam full scale and thats the famous China called the punitive war against the Vietnamese traders.
So China called Vietnam the regional hegemon. With India the same thing because India, as I said earlier, was ideologically closer to the Soviet Union and to China since 1979. But also this whole mess of China's a border strategy has also something to do with Chinese Communist Party is a traditional negotiation strategy. Every time China wants to negotiate it with anybody, they always try to create a tension. They always try to create a crisis, border issue is the best way to do it. This strategy is called the Using Confrontation to Extract Cooperation. You can see this from Korean War. Korean War for three years, but mostly the real fighting took place in the first year, 1950. 1951, 1952, and a little bit of 1953 is all about negotiation of one key issue that is under what condition the POWs should be returned.
In order to gain unconditional return of the POWs, China conducted all the wars to create the tension, and then they tried to win battlefield advantage before the negotiation started with the United States and United Nations as well. So you see this is very, very important over there. And also there's another factor that is many of the Chinese border problem were created by the Chinese Communist Party in Beijing for the sole purpose of claiming legitimacy because the Republic of China in Taiwan, they're the ones who insisted that, for example, South China Sea should belong to Taiwan. China say, oh, Republic of China in Taiwan, they don't represent China. We represent China. So we're going to jump in. So if Taiwan did not claim South China Sea and the probably PRC wouldn't care because this is a political issue, right?
The same thing goes with the Senkaku Island. Chinese government showed no interest at all on the Senkaku Island (Chinese called it 钓鱼岛 Diaoyu Dao) until 1971 when Richard Nixon administration decided to return their Ryukyu Island, Okinawa back to Japan. And then there was a dispute between the ROC Taiwan government and Japan over the issues of Diaoyu Tai, Taiwan called, or Senkakus. So China said, Hey, Taiwan cannot represent China in negotiating territory issue. So we jump in, all of sudden China got in. So that's the beginning of China's claim of Senkaku. So it had a lot to do with ideological fight with the Taiwanese government. Taiwan also try to compete with China for the legitimate right to represent what China is. The one remaining issue still is over the issue of Mongolia. The Chinese Communist Party recognized Mongolia as an independent state, but in the Taiwanese constitution, Mongolia is still part of the Republic of China in Taiwan. So this is kind of the legacy of the Cold War, but the problem is not part of the legacy. It's really right there in our face right now.
Finally, I want to point out Chinese border issue really has also to do with the Chinese Communist Party overall sense of awesomeness. They feel themselves as invincible, so they want to demonstrate it to the Chinese people and to the world. The Chinese Communist Party alone has the capability to conquer, to unify China, and that's one of the reasons why they march into to Tibet and the Xinjiang because the previous government want to occupy this area, but they couldn't. So that's one reason why Chinese Communist party to demonstrate it power its invincability and it's also intensified and aggregated problem of the Chinese border issue. And you create all those border problems, it also has some kind of a psychological impact on Chinese leadership as well, because no country in the world is more paranoid than China. Chinese government has a security paranoia because they believe there are besieged by everybody. Well, who is to blame? China created so many enemies along its periphery. So of course people were guarded against China. That reinforced China's sense of insecurity and paranoia, I think, of their own making
Shane Leary:
Related to these border tensions. This fits nicely into the last topic, which is Russia recently commemorated with national fanfare, a military confrontation they had with China 55 years ago. It seems a little strange at this time. Can you tell us what's going on here? What is the Damansky island conflict or the Zenbao island battle, as the Chinese would call it, and why would Russia choose to commemorate these events at this time?
Miles Yu:
Okay, during the height of the China's crazy madness called cultural revolution in March, 1969 and during the height of the Chinese-Soviet split confrontation, this border clash, actually it's a border war, broke out between the Soviet Union and the PRC in March, 1969. It's over an island, the Russian called Damansky Chinese called the Zhenbao Dao, the Zhenbao Island. It's an island in the middle of the river that bordered Russia and China in Chinese northeast in today's Manchuria. Over the occupation of the island, the two sides had the very nasty war going on, and China eventually took it back and the Soviet Union suffered heavy casualty. So this is basically the reason why the Soviet Union thought China was crazy and the Brezhnev regime actually threatened to use to wage the war against China. There was a threat of nuclear war against China. So this is the primary incident that prompt China to consider the Soviet Union would become a much more dangerous threat to China.
That's one of the reasons why the Chinese were so receptive to Nixon and Kissinger’s treaties to form anti-Soviet alliance two years later in 1971. So this is very important. Obviously it's really odd right now, 50 years later when China and Russia pretty much united front on global politics and then Russians were nationwide commemorating this incident in which virtually every meeting, every commemoration site, the Russians labeled China as an aggressor, this is last week. Russia and China today are united on one major issue that is anti west. Both were claimed to anti West. That's why China aligned with Russia over the issue of Ukraine. China has told Russians, they were decided on the Russian side, but why do Russia still keep this memory alive? My case is that there's a clash of ambitions. China and Russia, they were both pretty aggressive, but aggressors, they have to form some contemporary alliance too.
Pretty much look at what the Hitler did with Stalin in 1939, right? So they signed the non-aggression Pact, and of course they're mutually hostile to each other ideologically, but for temporary expediency, they might just form some kind of alliance that looks pretty powerful and alarming to the rest of the world. And I also think Russia right now is very frustrated and angry at China's massive penetration into Russia's defense military system. I mean, Russia, if you look at the world, Russia has caught many spies for China in recent years. They punish them mercilessly. Russia knows this threat. At the risk of being the absolute minority voice here in our national debate about the war in Ukraine, Russia has been upset about Ukrainian-Chinese relationship. Ukrainian Chinese relationship has been very, very close. In eyes of Moscow. Ukraine has been nothing but the rogue country that sold Russia designed weapons, which is leftover from the Soviet Union, to China at a fraction of the price that Russia would charge China.
That's why for a long time before Zelensky, by the way, the Ukrainian government has been very, very corrupt. They were very close to China. They gave Chinese a lot of weapons, almost all of them Russian design, the Chinese claim that since independence of Ukraine in early 1990s, there are more than 2000 Ukrainian Russian-trained weapons experts have been hired by China. There are still many of them in China today as we speak there were in the Chinese military aircraft manufacturer plants in Chengdu, in Shenyang, many places. So Ukrainians, there's a bitterness over there. I think Russia here tried to send a message the Ukrainian-Chinese relationship. Listen, it is not really Russia friendly, particularly the Ukraine leadership even today still harboring this illusion about China could play a positive role in the settlement of the war in Ukraine, as Zelensky actually sent his foreign minister to talk to Wang Yi in Munich a couple weeks ago.
So this is all something that the Russia has to vent. So this is a reason. But I'll also say this, there might be an even more subtle message here. You all watch that Tucker Carlson interview with the Vladimir Putin several weeks ago, and I watched the whole thing, and there's something that's very, very subtle. I think Vladimir Putin one point was asked Russia's threat to the West and Vladimir Putin's response, I don't know if you recall, he said, well, listen, you may not like us, but the west enemy is not Russia, it's China, right? China is much more formidable over there. So maybe through this commemoration activities, all through Russia, maybe Vladimir Putin wants to send the message to the West that precisely that. Russia may not be your ultimate enemy. Your enemy is China. So we agree with that. That's why he seemed to say that. So all in all, it's an intriguing event, but I think the implication could be very complicated.
Shane Leary:
Yeah, that's fascinating. Well, Miles, I think that's all the time we have for today. Once again, thanks so much for coming on and look forward to doing it again next week.
Miles Yu:
Thank you very much Shane, and I look forward to seeing you next week. Thank you for listening to this episode of China Insider. I'd like to thank my colleague Shane Leary, for taking part in this undertaking every week. I'd also like to thank our executive producer, Philip Hexeth, 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 words. For Chinese listeners, please check our monthly review and analysis episode in Chinese. We'll see you next time.