Gordon Chang is an expert on China and a distinguished senior fellow with the Gatestone Institute. He is the author of “The Great US-China Tech War.”
Federal Newswire:
How did you get involved in issues relating to China?
Gordon Chang:
I was practicing law in Shanghai from 1996 to 2000. And when we arrived, I was extremely optimistic about the direction of the country. I can remember my wife Lydia getting on the phone and saying, "Mom, China's not communist anymore," and I agreed with her. I would have my clients buzz into Shanghai, stay at the Grand Hyatt, which is one of the most spectacular hotels in the world, and they'd say, "China's not communist anymore."
But as we lived there, worked there, traveled around the country, spoke to people, we realized it was a very different China than the one that I had first seen, and so that's why I wrote my first book, which is the ‘Coming Collapse of China.’ China didn't collapse when I thought it would, but we are seeing weaknesses today that have to concern everybody when we think about China's place in the world.
Federal Newswire:
China is advancing in terms of science and ingenuity, but at the same time it's got a population in decline. Why should this worry us?
Gordon Chang:
China right now, I think, is past the peak. We see the continuing debt defaults, plunging property market, contracting economy, falling currency, worsening food shortages, deteriorating environment, and of course these fast moving COVID-19 outbreaks. But the most important and fundamental thing is what you mentioned. China faces the steepest demographic decline in history in the absence of war or disease. It's now about 1.41 billion, probably contracted last year so it's a little bit smaller than that.
But two Chinese demographers a couple years ago said that that country would lose about half its population in 45 years. So we're talking about [the] end of this century China could very well be under 500 million people. It's going to be very difficult for the party to navigate that and it's certainly going to be very difficult for Xi Jinping because his form of diplomacy is trying to intimidate everybody, and you can't intimidate people if your country's falling apart.
Federal Newswire:
Wouldn’t 500 million people be easier to control than the larger number of its current population?
Gordon Chang:
Yes, it would be. But to lose two-thirds of your population in eight decades is really unprecedented. It really means that they can't really maintain a society under those circumstances. We just haven't seen this before. So there are a lot of unknowns here, and it means a contracting economy, which means probably worse living standards for people.
Federal Newswire:
Does free trade lead to free societies, and did we misdiagnose what was going on with China's economy and political structure?
Gordon Chang:
Well certainly America misdiagnosed that, especially after the Cold War, and this could very well be the greatest mistake that the United States has made in its history. Because we had this notion, [that at the] end of history, everyone becomes a liberal democracy. We trade with China, they will become benign. But obviously that didn't happen. The regime became more belligerent, more provocative, more aggressive. We did change the Chinese people. But right now, in terms of political outcomes, that might not mean too much.
Federal Newswire:
The average upper middle class Chinese citizen enjoys having access to the latest technologies, but is it also possible they're under very tight control in a way that we've never seen before?
Gordon Chang:
That's right. The Communist Party runs the world's most sophisticated surveillance state. It's got, depending on who you talk to, somewhere between 520 to 610 million surveillance cameras. It's got the social credit system where everybody gets a constantly updated score. The great firewall, which is the most sophisticated set of internet controls cutting off any country…and of course, something we often forget, which is the neighborhood grannies. The winders, the old men and women who just watch every street and report to the Communist Party, and that's very effective.
Federal Newswire:
Can you explain how China’s social crediting system works and what it means?
Gordon Chang:
China is trying to put together a nationwide social credit system. There have been experiments around the country and they're knitting them together. What happens is everybody gets the same score to start out with, but that score is constantly updated based upon observed behaviors.
So if you're caught on a street camera jaywalking, your score will go down. If you are criticizing Xi Jinping, your score will plunge. If you say what the regime wants you to say, your score goes up.
The reason why this makes a difference is because you can't get a mortgage, you can't buy a home, you can't send your kids to school if you get a low score. Chinese officials talk about not letting people even leave their homes if they get a low score. I don't think it's gone to that extent, but it has really crimped the lifestyles of people who are critics of the regime, and this is what they intend to do to make it nationwide and more effective.
Federal Newswire:
Are you talking about an app or email? How do you check your social credit score?
Gordon Chang:
I don't know if you can check your score, the regime has it and what they're trying to do is to take all of these little experiments and to perfect them into a nationwide system. I'm not sure they're entirely there yet. They had a goal of 2020 to put this in place, but it doesn't look like they've actually been able to do that because there's so many complications on all of this. Remember, you're taking all sorts of surveillance camera footage, you're taking test scores from schools, you're doing all sorts of things and trying to put it together in one comprehensive system.
Federal Newswire:
Do they still have cash in China or are all transactions done electronically? How much of that gets monitored by the government?
Gordon Chang:
China still has cash. But they've got two platforms. One is Alipay run by Ant Group, which is affiliated with Jack Ma, and the other one is WeChat Pay from Tencent. These are the world's most sophisticated, commercially available electronic platforms. Beijing is trying to compete with them with a Central Bank Digital Currency.
The Central Bank Digital Currency is not really widely accepted and people are resistant for a number of reasons. You can imagine why, because the government knows all your transactions in real time. Also, they can take all your money away from you with the flip of a switch. So that has not gone as well as Beijing has wanted it to, but China is farther along than the cashless goal than we are.
Federal Newswire:
Have you seen the videos or pictures of drones stopping people and making them hold up their phones to scan QR codes?
Gordon Chang:
Yes, when they still had the zero COVID policy, which was ditched on December 7th of last year, Beijing went to extraordinary lengths to try to control people to prevent any transmission of the disease at all.
What you're referring to is that in certain cities, they would actually have drones above streets and they would be blasting all sorts of messages, but they also could be scanning and then requiring you to hold up your phone and show your QR code. That was either red, green or yellow and that really, depending on the color, [determined] what you could do. The Chinese people actually got a little bit tired of this, and they complained about it. And they protested against it because Beijing used that system to prevent people from complaining, and [from] trying to get their money out of banks in a central Chinese city.
Federal Newswire:
Can you explain the Belt and Road policy and China’s exercising control over other nations through land purchases in places like Africa and South America?
Gordon Chang:
The Belt and Road [policy] started out as two separate initiatives announced by Xi Jinping at the end of 2013. These were initially to tie Chinese factories on the East Coast to Europe. But since then, they've been extended around the world, [and] they've been extended into space. And perhaps most significantly in 2017, China announced the Digital Silk Road, which was an attempt to tie the world's networks together to China. So Belt and Road has become “no limit.”
The only place I guess they haven't talked about recently is Jupiter. But apart from that, they do have their Space and Moon Belt and Road.
Federal Newswire:
What are China’s goals in space? Are they going to be mining for Helium Three on the Moon and use it to go elsewhere, such as beating America to Mars?
Gordon Chang:
Yes, they do want to mine Helium Three; they want to mine everything else. As a matter of fact, in 2017, the head of China's lunar program talked about how the Moon and Mars should be considered sovereign Chinese territory. In other words, part of the People's Republic, Provinces of China and that's their goal. So it's not just economic exploitation, it's not just military, it's just conquest.
Federal Newswire:
Why hasn't the United States realized that China's going to beat us in the space race?
Gordon Chang:
The answer is we're Americans and we believe that we're entitled to be oblivious to what our enemies say. Just to give you an example, in February 1993, terrorists detonated a bomb below the North Tower of the World Trade Center in New York City, which killed six Americans. We didn't pay attention. We didn't pay attention until 9/11 when Osama Bin Laden reached out and killed 2,977 Americans in one day, that's when we took notice.
It's the same thing with China. That's really one of the weaknesses of not only American democracy but democracies in general. You can go back to Tocqueville and he talks about how democracies are very hard to rile.
Federal Newswire:
How does our engagement with Taiwan and our withdrawal from Afghanistan affect our policy towards China or their policy towards us?
Gordon Chang:
That starts in August of 2021, with the catastrophic withdrawal from Afghanistan that convinced Vladimir Putin and Xi Jinping that they could do what they want. We saw the effects of that on February 24 of last year when Putin invaded Ukraine.
The Chinese are watching this very closely because they've got not only Taiwan in mind, but India, Japan, the Philippines, us. This is a one way ticket downhill at least for the present moment.
Federal Newswire:
China is going to continue to test us militarily and they're going to see what our resolve is. How will that affect us in real terms?
Gordon Chang:
In December of last year, a Chinese Navy Fighter approached an unarmed US Air Force reconnaissance plane in international airspace over the South China Sea, flew within 20 or 10 feet, depending on who you believe. But even at 20 feet, that was dangerously close.
Also, on May 26 of last year, something even more provocative, a Chinese fighter flew right across an Australian P-8 reconnaissance plane, again, in international aerospace. The Chinese did something never before observed in history and that is they fired chaff, which is like aluminum foil meant to confuse radar and flares in front of the P-8. Some of the chaff was actually ingested into one of the two engines of the Australian craft. That could have brought the plane down. Fortunately it didn't.
Federal Newswire:
To what extent do the Chinese interfere in our political processes here at home?
Gordon Chang:
Radio Free Asia reports that in 2020 an intelligence unit of the People's Liberation Army actually based themselves in the now closed Houston consulate, and from there they used big data and artificial intelligence to identify Americans likely to participate in violent protests. Then the Chinese sent them videos on how to riot, via TikTok, by the way.
But we know that through TikTok, China has been glorifying drug use, it has been pushing critical race theory. This is just an attempt to take down the US.
Federal Newswire:
What are the Confucius Institutes and what are they doing on college campuses here in America?
Gordon Chang:
China, through the Communist Party's United Front Work Department, which is meant to work with other countries, established Confucius Institutes on college and university campuses, and at their height there were about 115 or so of them. But they've also inserted Confucius classrooms, about 500 of them into our secondary schools.
This has been controversial, [and] they've been rolled back. China's rebranding them. But obviously what they're trying to do is influence our college students, but also discourse at the heart of higher education.
Federal Newswire:
Is this designed to be a soft foreign policy to confuse Americans and get them to throw up their hands?
Gordon Chang:
Yeah, that's absolutely right. Xi Jinping has been pushing the notion that there's only one legitimate state in the world and that is China. This is the imperial era notion that Chinese emperors believe that they had the mandate of heaven to rule what they call 'Tianxia', we're all under heaven. But also, it goes beyond that because the theory is that heaven compels Chinese rulers to rule the entire world. So that makes us nothing more than a colony.
Federal Newswire:
As China has changed over the last several decades, do you believe they’ve formed a hybrid of, for example, Communism and religious authoritarianism?
Gordon Chang:
Xi Jinping has been ruthlessly moving against all faiths. It's not just the Muslim Uyghurs in Kazakhstan and in Northwestern China, what China calls the Xinjiang Uyghur Autonomous Region, and which the locals call East Turkestan, because they believe that they shouldn't be ruled by Beijing. But they've gone against the Christians, and really fascinating, they're going against the Buddhist. And Buddhism is thought by the Chinese to be a local homegrown religion, although it did come from India.
But the point is, there is no faith that they are willing to accept these days because they believe that all faiths are a competition to Communism.
Federal Newswire:
Has the Chinese government really created police stations in places like New York and Canada? This is disturbing.
Gordon Chang:
Well it is disturbing on two levels. First of all, it's disturbing the Chinese would even think to try to do this. But what concerns me more, is why they thought they could get away with it?
The answer to that question is [that] for decades, American Presidents have known about the presence of Chinese Ministry of State Security agents who've been violating our sovereignty. We've known what their Chinese diplomats have been doing to intimidate and blackmail Americans and yet very little, and sometimes nothing was done to it.
So of course the Chinese think, "Well, why don't we open up a police station? We own this country." So really the American people, of course, should be angry at China, but they should be even more angry at their own Presidents.
Federal Newswire:
Were these Chinese police stations posing as American police stations enforcing American laws or were they posing as American police stations enforcing Chinese laws or were they enforcing whatever law they could?
Gordon Chang:
People disagree whether there are one or two of those in the US, but the one that everyone agrees is on the Lower East Side [in New York City], it's in Chinatown. It offers, they say, consular services. But it also has the home to Ministry of State Security agents who regularly contact, intimidate, [and] blackmail Americans. So really what this is, and this was opened without permission of the State Department, so this is not an American police station, this is just China establishing essentially a consulate, but they had no right to do that.
Federal Newswire:
Have you noticed Chinese affiliated and Chinese government adjacent entities buying not just farmland but industrial agricultural companies in the United States, such as Smithfield Foods for example? How does this create problems from a national security perspective, a food security perspective and an economic security perspective?
Gordon Chang:
China did buy Smithfield, and remember that when China needed pork, Smithfield exported it and didn't sell it into the local US market. But there are so many more important things to worry about.
For instance, in North Dakota, within 12 miles of Grand Forks Air Force Base, a Chinese food processing company bought 370 acres and plans to put in a corn milling plant. From that plant, it would be very easy for Beijing to install passive listening devices, but also to disrupt signals that we use to control drones from Grand Forks. We have satellite uplinks there. Beijing could easily disrupt those signals.
So it's not just espionage, it's also sabotage. And we're allowing this in our own country, so this is on us.
This is a great debate among economists who say, "Well, if another country wants to subsidize American consumers, go ahead and let them." But through predatory practices, practices that violate, for instance, China's World Trade Organization obligations, they put Americans out of work.
When they put Americans out of work, there's a sense of hopelessness and that's one of the reasons why we have a fentanyl crisis, a drug crisis in the United States, is because people don't have jobs. People don't have jobs because China didn't want them to have jobs and China is now backing the Fentanyl gang.
So essentially you've got the Communist Party selling fentanyl to Americans and here again, this is a question of Chinese criminality, but it's also a question of American Presidents knowing what's going on and not taking the steps to stop this.
We can stop this, this is our country.
Federal Newswire:
How afraid should we be as a nation because of how much US debt the Chinese government owns or Chinese corporate interests own?
Gordon Chang:
American leaders are afraid of it but they shouldn't be. If China wants to sell our debt to hurt us, they get back dollars because 100% of our debt is denominated in our own currency. Which means if the Chinese want to hurt us, they've got to put that into other currencies, and that's going to drive those currencies through the ceiling.
Central banks in those other countries are going to have to buy dollars in order to bring their currencies back down into some sort of equilibrium, which means that this is not going to hurt us, this is going to hurt China because it's in China's advantage to be able to hold dollars.
Federal Newswire:
As China's population shrinks, what can the United States be doing in order to help them transition into a stable, prosperous, and freer society?
Gordon Chang:
It would be nice if we could do that and we've been trying to do that for decades but it doesn't work. Right now, we've got to protect ourselves, which means cutting trade, cutting investment, cutting technical cooperation. Because, as much as we would like to help the Chinese people, their regime has declared the United States to be its enemy.
In May 2019, People's Daily, the most authoritative publication in China declared a "People's War on America." [But] of course, because we're Americans, because we're oblivious, we didn't pay attention.
Federal Newswire:
Do you think that when Nixon went to China, it reset America's perception of China and we've sort of been asleep at the wheel since?
Gordon Chang:
Well during the Cold War, we certainly needed China's help against the Soviet Union. But after the Cold War, we haven't, and we have not been paying attention to what the Chinese say. We believed… Francis Fukuyama's famous theory that every country would evolve into a liberal democracy, with a free market.
That's a nice theory but the problem is it hasn't worked out so far. What we have done is we have strengthened a hostile regime.
