China and the Risk to our Daily Lives

Review the Executive Summary Here 

Watch The Policy Circle’s Move the Needle on the threats of China within the United States and how it impacts your daily life featuring Representative Mike Gallagher, Chairman of the Select Committee on China, and Dr. Jacqueline Deal, President & CEO of Long Term Strategy Group and Senior Fellow of the Foreign Policy Research Institute:

Complex Relationship

The relationship between China and the U.S. is fraught with tension and mistrust. Yet, both nations are inextricably linked and interdependent. This Policy Brief focuses on the impact of China’s increasingly aggressive tactics and how they impact our daily lives here in the U.S. 

The Chinese Communist Party (CCP) governs the People’s Republic of China (hereafter referred to as China). The relationship between China and the United States has been characterized by mutual distrust since its inception. This distrust arose in 1949, following the Chinese Civil War, when President Truman acknowledged the Nationalist government of Taiwan as the legitimate ruling body of China. This decision came after the Communists, led by Mao Zedong, defeated the Nationalists. The bilateral relationship between China and the United States is complex and constantly changing. It took several decades for tensions to ease and for a formal diplomatic relationship to be established in 1979. Despite early efforts focused on economic and strategic cooperation, ongoing disagreements regarding trade, human rights, territorial disputes, state-run enterprises, and other issues have continued to strain the relationship. For more on socialism and communism, check out The Policy Circle’s Socialism Brief.  For a detailed timeline of the U.S. – China relationship, see here.

To watch a brief overview of the implications of the U.S.-China relationship, watch this Kite & Key Media video here:

Interlinked Economies

The Chinese and American economies are strongly interlinked. This has only been bolstered by China’s relatively recent ascension from the factory of the world to a technological and military leader today. Though the U.S. and Chinese economies are increasingly dependent on each other, their governments and ambitions are vastly different. According to Jacqueline Deal, “China is now seeking to weaponize this interdependence. That is, as the CCP works to transition China from serving as the world’s factory to dominating the most important technologies, the CCP is also trying to ensure that the United States and its allies depend more on China than China depends on them.”  

The values are ultimately in opposition. China lacks respect for human rights and religious freedoms that we hold dear. China runs a communist government. The state is ultimately in control of commerce, media, land, and most businesses. In stark contrast with the United States, there are few individual freedoms.

Distrust

The aforementioned mutual distrust is sustained in numerous sectors today, including international trade, climate, and military might, but also is a threat here on American soil, where the CCP is waging influence operations and buying up farmland, conducting economic espionage, infiltrating academic institutions, peddling narcotics across our borders, and collecting personal data on American citizens. This poses a direct threat to American intellectual property and national security, in addition to our values and well-being.

Influence

China’s influence in the United States has been bolstered since the reign of President Xi Jinping began in 2013. The Chinese leader strengthened state control and some have said he is the most authoritarian leader since Chairman Mao. Xi abolished term limits, and accelerated longstanding military and economic goals. This has raised serious concerns from U.S. leaders who see China’s “Made in China 2025” program and “the great rejuvenation of the Chinese nation” as a direct threat aimed at undermining the U.S. To further explore the U.S.-China threat, visit this resource from the Vandenberg Coalition.

Case Study

Xu Yanjun, a Chinese intelligence officer, infiltrated GE Aviation in Ohio, soliciting proprietary information from employees with the intention of replicating aviation technology for the Chinese government. He even planted malware on a laptop from a joint venture company of GE Aviation. To further his efforts, Xu recruited an official from a prominent Chinese university to message GE Aviation employees on LinkedIn, offering them fully-funded trips to China and Europe to present to the university. While employees were out at dinner, Xu hacked their computers. In 2018, Xu was arrested and recently convicted of economic espionage.

FBI Director Christopher Wray highlighted the significance of this incident, stating, “The Chinese government tasked an officer of its spy service to steal U.S. trade secrets so it could advance its own commercial and military aviation efforts, at the expense of an American company. This brazen action shows that the Chinese government will stop at nothing to put our companies out of business to the detriment of U.S. workers.”

Unfortunately, this is just one of many examples of Chinese espionage. The FBI notes that Chinese intelligence officials utilize social media, including LinkedIn, to recruit targets. Director Wray warned, “Just using cyber means, Chinese government hackers have stolen more of our personal and corporate data than every other nation combined…While they pull ahead, they push our companies and workers behind. And that harm—company failures, job losses—has been building for a decade to the crush that we feel today.” 

It is crucial for individuals and businesses to remain vigilant against these threats. To see more of this case study watch this video here:

Why It Matters

The Chinese economy differs significantly from that of the United States primarily because of its larger number of state-owned companies. China’s objective to gain control over the global supply chain and make itself less reliant on the world while increasing the world’s dependency on China, as described by Secretary of State Antony Blinken, poses a threat to the United States. Furthermore, the methods employed by the Chinese government to achieve this goal involve breaking trade agreements and jeopardizing the well-being of Americans. The Chinese government aggressively pursues its own initiatives without considering American laws, values, or the safety of the American people.

China aims to replace the U.S. as the world’s superpower and challenge the freedom-based model that the U.S. represents. According to House Intelligence Chair Representative Adam Schiff (D-CA-30), “With an autocratic model it is aggressively seeking to export and a rapidly advancing technological capacity, China represents a substantial challenge to the United States and the future of democratic values.”

Economic espionage, too, is a threat. According to the FBI, “The Chinese government is like a giant company that’s posing as a country… to compete against US companies.”  

The privacy, safety, freedom, and prosperity of American citizens is at stake. FBI Director Christopher Wray stated, “It’s the people of the United States who are the victims of what amounts to Chinese theft on a scale so massive that it represents one of the largest transfers of wealth in human history. If you are an American adult, it is more likely than not that China has stolen your personal data.”

It is important to distinguish the Chinese people from their government as we discuss these threats. As the FBI points out, “The adversary is not the Chinese people or people of Chinese descent or heritage. The threat comes from the programs and policies pursued by an authoritarian government.” 

China’s lack of freedoms in speech, religion, assembly, enterprise, and elections shapes a distinct economy and opposes the values of the U.S. State rule dominates in China, where the political elite wields immense power and the absence of critical freedoms allows the government to control the narrative without being held accountable.

It’s critical that American citizens understand the complex and ever-changing relationship between the U.S. and China. China’s state-driven economy and desire to dominate the global supply chain threaten US economic interests and democratic values. The Chinese government’s disregard for American laws and values puts citizens’ privacy and safety at risk. Moreover, China’s lack of basic freedoms creates an entirely different economy, with values in opposition to those in the U.S. This is why it’s crucial for Americans to be aware of the issues at play and stay informed on the evolving relationship between the two nations.

Putting it in Context

Definitions

PRC: The People’s Republic of China, or “China.” The nation founded on October 1, 1949, by Communist leader Mao Zedong

PLA: The People’s Liberation Army. The military arm of the PRC. 

CCP: The Chinese Communist Party. The founding and ruling political party of China. 

After Mao Zedong’s declaration of victory over the Nationalist party, the Kuomintang, the United States severed diplomatic relations with the Communist government. During World War II, the United States supported the Nationalists, who later became known as the Republic of China. The Nationalists retreated to Taiwan, which influenced the current relationship between the United States, China, and Taiwan. In 1950, the Korean War broke out, and both the United States and China supported different sides, leading to the Taiwan Strait Crisis in 1953.

Mao’s communist policy, embodied in the Great Leap Forward, caused an estimated thirty million people to die of starvation in China in the early ’60s.  Mao’s policies, particularly the Great Leap Forward, caused significant tensions between China and the Soviet Union (now Russia). Mao’s rejection of the Soviet model of communism and his push for China to take a leadership role in the international communist movement led to a split between the two countries. The Soviet Union criticized Mao’s economic policies and condemned China’s Cultural Revolution as a destabilizing force in the international communist movement.

In the late 1960s, border disputes between China and the Soviet Union erupted into armed conflict, and the two countries became bitter enemies. Mao believed that the Soviet Union had become revisionist and betrayed the true Marxist-Leninist cause, while the Soviet Union saw China as a threat to its leadership in the communist world.

See The Policy Circle’s Asia Pacific Brief for more regional history and our Socialism Brief for more background on socialism and communism.

China wanted to balance out Soviet influence and gain access to Western technology and investments, so it sought to improve relations with the United States in the 1970s. Under President Jimmy Carter in 1979, the U.S. recognized the Chinese Communist Party (CCP) as China’s rightful government and established full diplomatic relations. This meant the U.S. no longer treated Taipei as the capital of all of China but adopted its own “One China policy,” which acknowledges Beijing’s “One China principle,” while maintaining a special relationship between the U.S. and Taiwan. Deng Xiaoping, the Chinese leader, implemented economic reforms that opened up China to foreign investments and trade.

In 2012, Xi Jinping became General Secretary of the Communist Party and president in 2013, replacing Hu Jintao in multiple positions. Xi Jinping initiated China’s “rejuvenation” phase. Since then, U.S.-China relations have been marked by trade wars, a global pandemic, humanitarian crises, and other challenges. In 2018, Xi Jinping made a notable decision to remove term limits, allowing him to rule indefinitely.

By The Numbers

Here are some key numbers to know and remember about China in relation to the U.S.:

• Population: China is the world’s most populous country with approximately 1.4 billion people, while the US has a population of approximately 331 million. (Source: World Bank, 2022)
• GDP: China has the world’s second-largest economy with a GDP of approximately $16.1 trillion, while the US has the world’s largest economy with a GDP of approximately $21.4 trillion. (Source: World Bank, 2022)
• The U.S.-China trade deficit in goods was $347 billion in 2020. (Source: U.S. Census Bureau)
• The U.S. national debt held by China was $1.055 trillion as of January 2022. (Source: U.S. Department of the Treasury)
• The U.S. imported $496 billion worth of goods from China in 2020, making China the United States’ largest source of imported goods. (Source: U.S. Census Bureau)
• The U.S. has sold $17 billion in potential arms sales to Taiwan between fiscal years 2019 and 2021, including fighter jets, tanks, drones, and missiles. (Source: U.S. Department of Defense)
• China has spent $280 million to influence U.S. politics over the past six years, more than any other foreign country. (Source: Council on Foreign Relations)

These numbers help provide insight into the complex relationship between the U.S. and China.

Land ownership by the Numbers

A notable economic exchange that threatens Americans here at home is the increasing purchase of  U.S.farmland by foreign entities, particularly those with ties to China. The Chinese government holds 384,000 acres of U.S. farmland, more than twice the size of Chicago and less than 1% of total foreign-held acres. Though other foreign entities own U.S. farmland, the Chinese Government is different. According to the FBI, the Chinese government does not play by our rules. They unleash government-sponsored economic espionage to pursue their interests.

Intellectual Property Theft by the Numbers

According to the FBI, “The annual cost to the U.S. economy of counterfeit goods, pirated software, and theft of trade secrets is between $225 billion and $600 billion.” 

Drugs by the Numbers

Another costly statistic comes from the opioid epidemic that plagues the United States, driven by illicit synthetic fentanyl. Though the drugs often come through Mexico, they are sourced by China. Fentanyl contributed to the dramatic rise in drug overdose deaths in the U.S. which topped 100,000 in 2021. 

Critical Technologies by the Numbers

China led in 37 out of 44 of the critical and emerging technologies analyzed by a new report, including nuclear energy, batteries, biofuels, robotics, advanced explosives and energetic materials, and advanced data analytics. Seven of the globe’s ten research institutions in those areas are in China. The report is from the Australian Strategic Policy Institute and is funded by the U.S. State Department. It found that China excels, more so than the U.S. by their methodology, in space and defense technologies in particular. China has been less successful with advanced semiconductors, and the United States has made concerted efforts to restrict the industry in China.

Role of Government

The Vandenberg Coalition published this resource outlining the dimensions of the threats of China and legislative actions that could be taken by Congress. To better understand potential roles of government, review the various distinctions of each level below: 

Federal

Federal: Military

According to the U.S. Department of Defense (DOD), the Chinese government uses its military might, the People’s Liberation Army (PLA), in support of its global ambitions. The U.S. response to this comes from the federal level. Our nation’s defense is a priority for the federal government according to the U.S. Constitution. National defense is the only mandatory function of the national government. As tensions with the Chinese government appear to be growing, the Department of Defense is laser-focused on China and contentious areas like Taiwan, Hong Kong, the South China Sea, and Ukraine. The DOD found that China is the “only competitor with the intent and, increasingly, the capacity to reshape the international order.” 

In the South China Sea, China has built artificial islands, claimed sovereignty over them unlawfully, and placed radar and air defense weapons there. This extends the CCP’s ability to support PLA aviation forces. 

Since its founding, China has ramped up diplomatic, political, and military pressure against Taiwan according to the DOD, and is ultimately preparing to unify Taiwan with China. China exhibits provocative behavior toward Taiwan to signal displeasure at “deepening Washington-Taipei ties.” Between fiscal years 2019 and 2021, the United States has sold $17 billion in potential arms sales to Taiwan, including fighter jets, tanks, drones, and missiles. According to the DOD, Taiwan has positioned itself as a “beacon of democracy” and the United States’ response is to contribute to peace and stability in the Taiwan Strait by providing Taiwan with materials for self-defense. 

In all of these regions, the DOD states, “the CCP seeks to condition international institutions and public opinion to accept [China’s] narrative surrounding its priorities such as Beijing’s “one China principle” on Taiwan unification, the Belt and Road Initiative, political control over Hong Kong, and territorial and maritime claims in the South China Sea and East China Sea.” 

Russia’s invasion of Ukraine has also raised China concerns among experts and DOD officials. China and Russia are united in their “common rivalry” with the U.S. And though China has not supported Russia in its efforts in Ukraine, they have blamed NATO for provoking Russia. 

Federal: Human Rights Abuses

The U.S. federal government is also involved in combating human rights abuses in China, with a particular focus on the regions of Tibet and Xinjiang. In Tibet, the lack of religious freedom is a major issue as the Chinese Communist Party (CCP) considers Tibetan Buddhism a threat. CCP officials monitor funding transfers in the region, banning Tibetans from sending donations to projects associated with the Dalai Lama or his Tibetan government-in-exile, according to the international nonprofit, Human Rights Watch. In Xinjiang, CCP officials carry out “preventative control,” resulting in the mass detention of Uygher Muslims and other minority groups. These individuals have been subjected to forced disappearance, torture, forced sterilization, sexual abuse, forced labor, and more. Nearly one million children have been separated from their families and forced to learn CCP ideology according to research from 2020, a situation not unlike that described in the dystopian novella, The Children’s Story by James Clavell. 

To hold the CCP accountable, the U.S. has taken measures such as visa restrictions, financial sanctions, and import restrictions, and in December 2021, President Biden signed the Uyghur Forced Labor Prevention Act into law, banning China’s forced labor products from entering the US market. The US has also boycotted the 2022 Beijing Winter Olympic Games. Numerous other human rights abuses, such as China’s Zero-Covid Policy and pro-democracy protests in Hong Kong, continue to occur.

Federal: Illegal Drugs

Stopping drug trafficking is a responsibility of the federal government under the authority granted by the Commerce Clause of the United States Constitution. Specifically, Article I, Section 8 of the Constitution gives Congress the power to regulate commerce with foreign nations, among the several states, and with Indian tribes. This has been interpreted to include the regulation of drug trafficking and other illicit activities that affect interstate commerce. Additionally, Congress has passed laws such as the Controlled Substances Act and the Comprehensive Drug Abuse Prevention and Control Act to combat drug trafficking and drug abuse.

Fentanyl has been the leading cause of death in Americans between ages 18 and 45 since 2019, with China being a key supply source for precursor fentanyl chemical products, especially to Mexican cartels. China categorizes chemical, and drug-making companies as “tech” companies and treats them as such. They receive preferential tax treatment and government grants. Illicit fentanyl exports are directly encouraged by the CCP. 

According to a Heritage Foundation report, “in 2019, authorities from the U.S. and Mexico seized enough fentanyl to kill the entire population of the U.S. more than three times over.” Ben Westoff, an award-winning investigative journalist who performed undercover operations in Chinese fentanyl efforts, in his testimony to Congress said, “the [CCP] has devoted enormous resources to the task, and these incentives have undoubtedly driven innovation and helped expand these industries and their exports. But the rise of fentanyl and NPS [Novel Psychoactive Substances] has been a terrible side effect. Quietly, money intended to spur legitimate innovation has gone to companies exporting deadly drugs that are killing tens of thousands of Americans annually.” Westoff continues saying the Chinese companies’ clients include Mexican cartels and American drug dealers. This is “perfectly legal under Chinese law.” And the Chinese financial system is used to launder money for Mexican drug cartels. 

Federal action has been taken to combat this crisis, including the SUPPORT Act, which invests in addiction prevention, treatment, and protection, as well as the STOP Act, which increases coordination between the U.S. Postal Service and U.S. Customs and Border Protection to curb opioids in the mail system. The National Institutes for Health has also launched the HEAL initiative, investing billions of dollars to speed up scientific solutions to stop the national opioid crisis.

Federal: TikTok

While the US Constitution does not have a specific provision allowing the federal government to ban platforms like TikTok, it does grant broad powers to regulate interstate commerce under the Commerce Clause. This interpretation gives the government authority to regulate social media platforms that operate across state lines, including those posing national security risks. Furthermore, the government can use executive orders and other legal measures to address perceived threats to national security or public safety.

TikTok is a popular social media platform used by 67% of American teenagers, with 16% claiming they are on it almost constantly. However, TikTok’s parent company, Bytedance, is based in Beijing and is subject to the Chinese Communist Party’s censorship and data collection policies, which poses a risk to American users. The algorithm used by TikTok is highly secretive and can track user interests and emotions to push content that is potentially harmful to users, particularly younger audiences. The algorithm pushes people to watch more and more extreme content and TikTok is able to detect the content that is most likely to keep a user on the platform, and more importantly, Communist Party Cells are embedded in TikTok parent company Bytedance’s corporate structure. 

TikTok has faced scrutiny and pressure from both the American public and the government, with many states banning or planning to ban the app on state government devices. In December 2022, Congress banned TikTok on federal government devices, and in March 2023, TikTok CEO Shou Zi testified in Congress defending the app but was met with skepticism from legislators. Senator Marco Rubio (R-FL) and Representative Mike Gallagher (R-WI-08), along with Raja Krishnamoorthi (D-IL-08) in December 2022 introduced bipartisan legislation, the Anti-Social CCP Act, to “protect Americans by blocking and prohibiting all transactions from any social media company in, or under the influence of, China, Russia, and several other foreign countries of concern.”

To learn more watch the videos below:

Federal: Supply Chain 

The Chinese and U.S. economies are deeply intertwined. Jeff Smith, Director of the Asian Studies Center at the Heritage Foundation underscored how China is different from other adversaries: “one of the things that makes [China] much more capable and dangerous is that it is an economic peer of the United States in a way the Soviet Union wasn’t.”

China is our 3rd largest export partner (7% of exports) after Canada and Mexico and our biggest import partner (17% of imports). Our nations are mutually reliant on each other for countless products. China plays a dominant role in global supply chains. And the CCP is trying to expand this further, bringing more of the global supply under itself, with detrimental effects on the U.S. economy. 

The U.S.-China Economic and Security Review Commission’s 2022 hearing on “U.S.-China Competition in Global Supply Chains” detailed the major issues. China is the world’s largest manufacturer, dominating the supply chain in rare earths and certain military defense products but also in a range of household products like dishwasher parts and laptop computers. A State Department-funded report found China is leading in 37 of 44 critical technologies like nuclear energy and advanced aircraft engines. 

Businesses are continuously lured to China because manufacturing is still largely less expensive, yet the CCP’s increasing willingness to “weaponize” its position has risks for the U.S.

The pandemic revealed even deeper dependencies on China for manufacturing. China’s factory price is on average, 30% less expensive than that of the U.S. Harvard Business School professor Willy C. Shih said of China, “If you want to assemble 10 million iPhones in preparation for a launch weekend, there is only one place where you can marshal the labor, enjoy the labor flexibility, and do it at a reasonable cost, at scale.” 

Even so, while there is clearly a vulnerability, some believe “there is a fundamental conflict between China’s policy goals and the structure of global supply chains.” Government efforts to utilize tax policy or reshore manufacturing and structure taxes in a way that encourages businesses to stay could lower the supply chain risk. 

State/Local

State and local governments, too, deal with threats from the Chinese government. CCP police stations in American cities, risky Chinese investments in U.S. pension funds, along with business espionage, academic espionage, and anti-American propaganda threaten Americans in their home states and cities. 

CCP Police in the U.S.

Illegal Chinese Overseas Police Stations have been found in 53 countries around the globe. Though the Chinese government claims these are to oversee Chinese “passport services,” this is untrue. Between April 2021 and July 2022, Chinese police have “persuaded” 230,000 Chinese in foreign countries to return to China. Such persuasion tactics include, “denying the target’s children in China the right to education, and other limitations on family members, punishing those without suspicion of any wrongdoing by “guilt by association” (similar to the North Korean practice)”. Relatives in China that do not assist the police to persuade family members could be punished. 

U.S. Reps Mike Gallagher (R-WI) and Rep. Ritchie Torres (D-NY) have highlighted these affronts to U.S. sovereignty. In a press event held at a former Chinese police station in New York City, Rep. Torres said, “We are here because we’re Americans who believe in the rule of law and human rights and freedom for every single person, including the Chinese dissidents here in the United States,” Torres (D-NY).  

Police stations have been found in major U.S. cities of New York and Los Angeles. Members of the Chinese community were outspoken in their protests outside the NYC Chinese police station that has been since shut down. “We all came here to be free,” Jing Zhang, founder and Executive Director of Women’s Rights in China told the New York Post. 

U.S. Land and Farmland

As mentioned above, China holds 384,000 acres of U.S. farmland, more than twice the size of Chicago and less than 1% of total foreign-held acres. 

The National Association of Realtors found the Chinese bought more than $6 billion of U.S. real estate between March 2021 and March 2022, making it the third top buyer after Canada and Mexico. The top states for foreign (not just Chinese) buyers are Florida, California, Texas, Arizona, New York, and North Carolina. 

The Chinese ownership itself is not cause for concern. Yet China’s interest in U.S. agriculture is not benign. 

China has the largest pig herd in the world, roughly half of the world’s total. Multiple swine fever outbreaks on the Chinese mainland have shaken the industry. China offshores hog herds to the U.S., shifting the environmental and medical impacts to local U.S. communities. A report from the U.S.-China Economic and Security Review Commission states, “Recognizing its challenges with soil and water pollution, China stands to benefit from keeping its hog farms abroad, not to mention avoiding the health impacts these farms can have on surrounding communities.” 

Agricultural espionage is also at large. Chinese scientists have “chosen to simply steal U.S. agriculture IP and technology rather than try to research and develop them themselves” and have been caught countless times for doing so. The potential weaponization of genetically modified seeds in particular poses immense economic and food security threats to the U.S. 

Some states are advocating for the divestment of foreign investments in American farmland. Texas state senator Lois Kolkhorst introduced legislation to ban foreign ownership of Texas land, amid the recent purchase of Texas farmland near Laughlin Air Force base by a former Chinese People Liberation Army member. 

Florida Governor Ron DeSantis is poised to ask the state legislature to ban Chinese purchase of Florida land. Other states are taking action here too. In North Carolina, the NC Farmland and Military Protection Act would prohibit purchases of agricultural and other lands by adversarial foreign governments.

Finance

State leaders are increasingly concerned about Chinese company shares in American state pension funds. While these investments can yield high returns due to China’s high growth history and potential, they are also considered risky investments due to Chinese business ties to the CCP. Infamously, the CCP halted Ant Group Co.’s planned $37 billion initial public offering (IPO). The IPO would have been highly lucrative. Yet the CCP stopped the deal, likely because it could have made the company and Jack Ma, already the country’s richest man, too powerful.

The largest public pension fund in the U.S. California Public Employees’ Retirement System (CalPERS) has “invested $3.1 billion in Chinese companies, some of which have been blacklisted by the U.S. government” according to U.S. Representative Jim Banks (R-IN). Rep. Banks claims the CIO of that pension fund was recruited for that position by the CCP. 

Many state fund managers are reassessing how they deal with Chinese investments. According to The Wall Street Journal, “The board of the $183 billion Teacher Retirement System of Texas, meanwhile, voted last month to cut its target China stock allocation to about 1.5% of the fund from 3%.” Other states are jumping on board. The Indiana Senate recently filed a bill to prohibit the state pension fund from investments controlled by the Chinese government. 

A plethora of other financial concerns surrounds China, especially as its leader declared its ambition to dethrone the U.S. dollar as the primary world currency. 

Private Sector: Civil Society and Business

Espionage

American businesses are at risk of economic espionage from the Chinese government. Businesses of all sizes are at risk, according to the FBI. China’s goal is to “control entire supply chains and manipulate domestic and global market conditions.” The CCP uses businesses to pursue its global goals, The FBI is opening a new China-related counterintelligence case every 10 hours.

In one example, told by the FBI in this video, a small energy company in Charlotte, North Carolina saw massive growth potential in China. They hired a Chinese national and chemical engineer to lead their expansion into China, but he disappeared and was later discovered to have stolen sensitive trade secrets. He had been recruited by the Thousand Talents Plan and had hacked into the company’s systems. The FBI recommends that companies establish relationships with their local FBI field offices to combat this type of economic espionage.

According to the FBI, “The Chinese government is like a giant company that’s posing as a country and they’re fighting this economic war and they’re using all of the tools at a nation’s disposal… to compete against US companies that are limited to traditional business tools.” 

The government of China hopes to undermine hard work by Americans. 

China’s Five Year plans are public. If you run a company that is listed, the FBI warns executives to take note. China will use “whatever means possible” to meet their goals. The FBI encourages companies to establish relationships with their local FBI field offices.

This recurring economic espionage raises questions about the sincerity of the CCP in any conflict. Recently, the CCP claimed the high-altitude balloon spotted over the United States was not in fact a spy balloon. We now know that U.S. military intelligence was transmitted back to Beijing. 

Propaganda and Interference 

Chinese news agencies, including Xinhua, are under the control of the Chinese Communist Party (CCP). Their goal is to shape perspectives on China and misinform audiences on public events in the US. One such news agency, Xinhua, produced a docuseries called “America’s Dark History Trilogy” to smear US leadership, and spread other propaganda including conspiracy theories about the Covid-19 virus and framing the US war in the Middle East around war crimes. The stated goal of Xinhua is to “accelerate China’s discourse power and influence,” according to reporting by Medium

Chinese propaganda efforts are not limited to the media. In Australia, China interfered with elections in an attempt to elect pro-China candidates. Though the efforts were intercepted and stopped by Australian forces, in 2011, a former Chinese military intelligence official was elected to Parliament in New Zealand in 2011. According to the Council of Foreign Relations, “China has spent more over the past six years—$280 million—to influence U.S. politics than any other foreign country. Unlike Russia, which often targets individual politicians or just tries to create chaos, Beijing generally wants to change U.S. views of China more broadly.”

Academia

The Chinese Communist Party (CCP) funds and runs Confucius Institutes, intended to provide Chinese language instruction worldwide. Yet they have attracted significant controversy, leading many U.S. universities to terminate their contracts with the institutes over the past four years. U.S. universities cited numerous reasons for ending the contracts including: concerns about academic freedom, encouragement to terminate by some Members of Congress, the potential for Chinese government influence and risks to national security. Members of Congress have been openly critical of the programs. There are now (as of March 2023) only thirteen Confucius Institutes in the U.S, though China has been rebranding the Institutes.

The FBI warns that the CCP uses students in such programs as “collectors of intellectual property.” If you are involved in an academic institution with technical applications, the FBI says to “expect foreign adversaries to target it.” The FBI details numerous case studies of U.S. students being targeted to gain access to information or persons of interest to the CCP. 

Nonprofit Sector

The nonprofit sector has taken the reins on education and advocacy regarding the Chinese government’s actions and those implications for the U.S. 

Human Rights Watch, for example, dives deep into the CCP’s mass surveillance practices, lack of religious freedoms, lack of First Amendment Freedoms, and discrimination on the basis of sexual orientation.

Other nonprofits that offer expertise on U.S.-China relations include the Rand Corporation, the Council on Foreign Relations, Hudson Institute, The Brookings Institution, and the American Enterprise Institute, and the Vandenberg Coalition. 

Challenges and Areas for Reform

The vast ambitions of the CCP – for example, Made in China 2025 and “the great rejuvenation of the Chinese nation” – face headwinds. First, China’s economy is slowing. The economic growth rate fell to 3% in 2022 after growing 8.1% the year prior. A real estate slump, shrinking workforce, aging population, and growing distrust from the West are a few reasons.

China has more than four times the population of the US, but demographic trends are not in their favor to grow. This has implications for their future economic and military might. Fertility rates and population growth rates are on the decline. According to NPR, “The working-age group as a share of the population of 1.4 billion fell to 62% from 70% a decade ago.”

China owns $981 billion of U.S. debt and is the world’s largest creditor, loaning $1.5 trillion to 150+ countries.

As mistrust continues to brew between China and the U.S., business and political leaders talk of “decoupling” grows. While for the U.S., decoupling involves discouraging imports to protect U.S. jobs and infrastructure, decoupling for China would be a way for the country to leverage its independence for advancement on the global stage according to an in-depth study published by Harvard Business Review.

Conclusion

In conclusion, the relationship between China and the United States is fraught with distrust and conflicting values. The Chinese Communist Party’s (CCP) ambition for global domination and lack of respect for U.S. values and rule of law threaten American citizens and national security. 

Key points to remember include:

• The U.S. Declaration of Independence states that governments “deri[ve] their just powers from the consent of the governed” not the other way around. The CCP believes its power supersedes that of the individual, withholding secrets from citizens, erasing parts of history, and weaponizing people to further its agenda. 
• The CCP’s plan to bring fundamental technologies and resources under its control has far-reaching consequences for everyday Americans, who rely heavily on Chinese products and services.

Understanding the differences between the U.S. and Chinese governments and staying informed on the risks posed by the CCP is crucial for protecting American interests and values.

Ways to Get Involved/What You Can Do

1. Farmland Risk: Identify if your state is allowing Chinese purchase of U.S. farmland. Do you have any sensitive military or government properties near you? Find out what your state is doing to vet foreign purchases of U.S. properties.
2. TikTok Risk: Is your state one of the 27 that bans TikTok on government-issued devices? What are your state’s rules on Tiktok? Contact your member of Congress and ask them to ban TikTok on government devices. Invite them to publicly speak on their reasoning to spread awareness for private families.
3. Financial Risk: Are you investing in Chinese companies? If you are a government employee, is your pension fund invested in Chinese companies? Explore your state Treasurer’s website to see what your state is doing about China risk.
4. Academic Risk: Does your local university have a research arm with technical applications? Are government-funded research projects properly safeguarded? Inquire about your college/university ties with China. Determine how much research is funded by China. Review the foreign adversary techniques detailed by the FBI. Ensure your university is adequately prepared to thwart insider threats. Develop strong risk management procedures with university leadership.
5. Business Risk: Do you have access or connections that would make you a target for CCP adversaries? Do you own a business related to any technologies listed in China’s Five Year Plan? Do you have a security clearance? Ensure your company has a robust security strategy. Review the FBI’s recommended steps to safeguard your company here, including what to look for. If you think economic espionage has occurred, contact the FBI, and review their reporting checklist here. 
6. Personal Risk: What are the signs you might be targeted by a foreign adversary? See the FBI’s list here.