Were there ever significant social or political movements challenging the Chinese regime?

Yes, in the early 2000s and up to 2011, there were signs of potential political change fueled by environmental movements, intellectual salons, and online calls for reform. However, these movements have since been suppressed.

Which country, the US or China, has better values to lead the world?

The speaker believes the US's fundamental values of basic freedoms and individual rights are better for underpinning the international order than China's. While the US has flaws, its ideals are shared by a larger majority globally.

Why did China ban private English language institutions and tutoring?

China implemented laws prohibiting private educational institutions and tutoring, ostensibly for regulatory reasons to ensure fairness. However, the underlying motive is Xi Jinping's broader agenda to control ideas and limit Chinese citizens' access to diverse information and educational opportunities.

Has the US rejoined international organizations effectively to counter China?

The current US administration is committed to re-engaging with and leading international institutions. However, concerns remain about the sustainability of this commitment beyond the current presidency. China's actions in these bodies often differ from its stated goals.

What is the trend of Chinese investment in US real estate?

While there was a significant influx of Chinese investment in US real estate, particularly by billionaires seeking to move capital, it is likely declining due to China's stricter capital controls. However, interest likely persists among the wealthiest.

How does China use its market leverage to influence other countries and organizations?

China leverages its market access to coerce actors, pressuring businesses and industries (like the movie industry) to comply with its political stances. This can lead to self-censorship within the international community, though awareness and pushback have grown.

Chapter 3: China’s Global Ambition and the US Response with Elizabeth Economy | LFHSPBC

Hoover Institution

Education4 min read21 min video

Jan 17, 2023|37,417 views|21|3

Hoover Institution Hoover Institute Hoover Elizabeth Economy Military War Strategy Xi Jinping National security China Superpower

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Key Moments

TL;DR

US counters China's global ambition via modernized investment controls, tech protection, and by championing liberal democratic values.

Key Insights

The U.S. is modernizing its investment regimes (both inbound and outbound) to prevent China from accessing sensitive technologies and undermining regulations.

A major challenge for the U.S. is distinguishing between economic security and national security to prevent civilian technology from being transferred to China's military.

China's domestic social and political landscape has shifted significantly under Xi Jinping, with a crackdown on dissent and a reduction in previously vibrant political discourse.

While the U.S. faces internal challenges, its foundational values of basic freedoms and individual rights are considered superior for underpinning the international order.

China uses its economic leverage, including market access and critical supplies, to coerce international actors, leading to a growing global awareness and pushback.

The U.S. is re-engaging with international institutions, aiming to lead and bolster the rules-based order, although rebuilding trust will take time.

MODERNIZING U.S. INVESTMENT CONTROLS

The U.S. is implementing a multifaceted strategy to counter China's technological advancement and economic influence. This involves modernizing both inbound and outbound investment regimes to erect barriers against the acquisition of U.S. technology and patents. New regulations aim to capture the full spectrum of Chinese investment, including through sophisticated financial vehicles like SPACs, which China could exploit. Cybersecurity efforts are also being bolstered to prevent the unauthorized transfer of sensitive technologies, particularly those with potential dual-use civil-military applications.

PROTECTING NATIONAL ECONOMIC SECURITY

A significant challenge for the U.S. is delineating the boundary between economic and national security. The focus is on identifying technologies that could bolster China's military capabilities through its civil-military fusion program. This requires a painstaking process of scrutinizing civilian technology transfers to ensure they do not inadvertently benefit the military. The U.S. patent and trademark office is also engaged in ongoing work with China to strengthen intellectual property rights protection, aiming to build support for such measures within China's legal and administrative systems.

CHINA'S EVOLVING DOMESTIC LANDSCAPE

Historically, China experienced periods of significant social and political dynamism, with environmental movements, intellectual salons, and online platforms fostering discussions about political reform. However, under Xi Jinping, there has been a notable crackdown on these movements, including on feminists and the LGBTQ+ community. The once-vibrant internet space has become heavily controlled, limiting access to information and ideas for the Chinese populace. This shift signifies a move towards greater state control over ideological and educational spheres.

U.S. VALUES VERSUS CHINA'S MODEL

From an American perspective, the fundamental values of basic freedoms and individual rights championed by the U.S. are considered more conducive to a global order than those promoted by China. While acknowledging U.S. imperfections, these ideals resonate with a broader segment of the global population, encouraging many nations to support the existing rules-based order. This contrasts with China's approach, which often seeks to align with countries like Russia and members of the Shanghai Cooperation Organization to challenge this order.

CHINESE INVESTMENT AND CAPITAL CONTROLS

Chinese investment in U.S. real estate, once a prominent trend exemplified by acquisitions like the Waldorf Astoria, has faced increasing limitations. China's government has implemented stricter capital controls to curb outbound investment, particularly by individuals. While wealthy Chinese may still find avenues to move capital, the overall trend has likely declined from its peak. This reflects Beijing's efforts to manage capital flight and maintain domestic financial stability.

CHINA'S COERCIVE ECONOMIC DIPLOMACY

China actively leverages its market access and economic power to influence international actors, leading to concerns about self-censorship. This tactic involves pressuring industries, such as the movie or hotel sectors, to align with Beijing's political stances, including the 'One China' policy. The use of critical supplies, like personal protective equipment during COVID-19, as leverage has also been noted. This behavior has prompted increased global scrutiny and a pushback against such coercive economic practices.

RE-ESTABLISHING U.S. LEADERSHIP IN GLOBAL INSTITUTIONS

The U.S. is committed to re-engaging with and leading international institutions, aiming to restore the rules-based international order that China seeks to challenge. Rebuilding trust among allies will require sustained effort, as past U.S. withdrawals from agreements like the Law of the Sea Convention and the ICC have created skepticism. While the U.S. has reasserted its commitment, the long-term durability of this engagement remains a concern for international partners.

CHINA'S ACTIONS VERSUS ITS RHETORIC

Despite its rhetoric within international forums, China's actions often diverge from its stated commitments. For instance, while advocating for climate agreements, it has simultaneously financed the expansion of coal-fired power plants through its Belt and Road Initiative. This disparity between words and deeds highlights skepticism regarding Beijing's genuine commitment to multilateral cooperation and its role within global governance structures.

THE ROLE OF TRANSPARENCY AND SHAMING IN PUSHBACK

Increased transparency regarding China's coercive tactics, coupled with a 'shaming' element, has begun to shift the international dynamic. The Trump administration is credited with drawing attention to how China uses its market leverage to coerce companies and actors, encouraging them to uphold their values instead of sacrificing them for market access. This growing awareness has fostered a pushback, suggesting a potential shift towards a more balanced approach in international economic relations.

Mentioned in This Episode

●Products

●Tools

●Companies

●Organizations

●Concepts

●People Referenced

Common Questions

The US is modernizing investment regimes, both inbound and outbound, to make it harder for China to circumvent regulations. This includes scrutinizing venture capital and financial vehicles, and dedicating more resources to differentiating between civilian and military technology use.

Topics

Technology Transfer Civil-military Fusion Intellectual Property Rights Domestic Dissent In China Political Change In China International Institutions Global Superpower Competition Chinese Investment Market Coercion Self-censorship

Mentioned in this video

personJulia Campbell

A student who asks about Chinese investment in US real estate markets.

productRockefeller Center

Used as a point of comparison for Chinese investment in iconic US real estate, referencing a past purchase by Japanese investors.

organizationCommerce Department

Mentioned as a central focus for US efforts in modernizing investment regimes to counter Chinese influence and protect technology.

toolSPACs

Mentioned as a type of new financial vehicle that China could potentially use to gain access to US technology, requiring new regulations.

productStatue of Liberty

Central to the example of China pressuring Sony regarding the 'Spider-Man' movie, where China demanded its removal or reduction in size.

organizationShanghai Cooperation Organization

Cited as an example of countries China works with at the UN on human rights issues, indicating a bloc that sometimes supports China's positions.

organizationCommittee on Foreign Investment in the U.S. (CFIUS)

Highlighted as an existing regulatory body that reviews major mergers and acquisitions to prevent negative impacts on US national security, with acknowledgement of its strengthening under the Trump administration.

productWaldorf Astoria

Mentioned as an iconic New York landmark purchased by Chinese investors, evoking a comparison to the Japanese purchase of Rockefeller Center.

productPPE

Personal Protective Equipment; mentioned as a tool China used to potentially coerce countries during COVID-19, marking an inflection point in global perception.