New Op-ed: Countering the Chinese Communist Party’s warfare
The Chinese Communist Party is on the march.
Its goons are crushing Hong Kong's freedoms. It's People's Liberation Army grabs territory in India, it's Navy sinking Vietnamese fishing boats and swarming Malaysian oil rigs in the South China Sea.
Dictator Xi Jinping is daring the free world to respond. He wants to see if we will stand up to the CCP and his move for global supremacy.
After the massacre at Tiananmen Square, when supreme leader Deng Xiaoping killed untold thousands of peaceful protesters, after the horrors of the CCP's concentration camps, its prison labor, its forced abortions, its demolition of churches, mosques and temples, we rewarded the CCP with our money and technology.
President George H.W. Bush sent a groveling letter to Deng apologizing for watered-down legislation he signed limiting sales of equipment to the PLA. "I will leave what followed [the Tiananmen protests] to the history books. … the actions that I took as President of the United States could not be avoided. As you know the clamor for stronger action remains intense. I resisted that clamor."
Wall Street and the global corporations did not want Washington to interfere with their investments in China.
The foreign policy experts justified such appeasement, cautioning "not to respond in a way that played into the hands of the hardliners," as Secretary of State James Baker put it. In fact, it was precisely our spinelessness that "played into the hands of the hardliners," emboldening them to continue, and yes, expand their reign of terror.
We won't make the same mistake again.
President Trump laid out the proper and proportional response to the Chinese Communist Party's affronts: Cut off the blood supply to the CCP tumor. Our money is the lifeblood the CCP needs to survive.
The CCP has been waging economic war, and we should respond in kind.
The president spoke of investigating the hidden risks posed by Chinese companies that don't play by the rules. He was referring to the fact that American regulators cannot examine the books of Chinese state-controlled companies listed on American stock exchanges.
A Memorandum of Understanding (MOU) from May 2013 – negotiated by Joe Biden – allows Chinese corporations selling securities in the U.S. to be exempt from laws such as Sarbanes-Oxley that require companies to meet standard accounting and auditing standards. The Obama-Biden administration's agreement gives preferential treatment to Chinese corporations and state-owned enterprises at the expense of American investors and American companies seeking to raise capital.
We don't need an act of Congress to terminate that agreement now.
American investors are at risk of being defrauded by Chinese-owned and CCP-controlled companies that do not follow U.S. securities laws. Those companies should not be traded in U.S. securities markets, whether directly on the stock exchange, through index funds or any other way.
And there's more that can be done. Right now, the retirement savings of millions of Americans are invested in CCP-controlled companies. The U.S. Department of Labor regulates pension funds. It can update its rules – right now – to prohibit U.S. pension funds from holding these shadowy corporations' stocks in their portfolios. That would protect American investors while cutting off money to Chinese military contractors building weapons and surveillance systems to use against us.
Hong Kong has been a major conduit of Western capital and technology for the CCP. We have treated Hong Kong as if it were a separate country from the People's Republic. Secretary of State Pompeo dispensed with that fiction. If we revoke the city's special trade status we can cut off the money and the technology that flows through Hong Kong to Beijing.
Finally, limiting visas to students from Chinese military-linked universities is crucial to cutting off the CCP's access to our technology. Chinese students represent the largest cohort of foreign students in the United States today, and the CCP uses some of these "students" as spies.
China expert Christopher Balding explains China has a series of military universities, as well as military students attending non-military universities and departments in universities doing a lot of work for the military. We have good information on which research units within specific universities are the problem. Send agents from these schools for spies home.
Access to our capital markets and universities provides the CCP with more than money and technology: it gives them influence. Wall Street financiers, universities and others with interests in China kowtow to the CCP rather than stand up for our values.
The CCP corrupts everything it touches.
Cutting our ties to that criminal organization is imperative and not just for national security reasons – it will restore America's physical, material and spiritual health.
Curtis Ellis is the senior policy advisor for America First Policies.