Chinese Peril

The Chinese threat to U.S. research institutions is real
By Josh Rogin
Sen. Rick Scott questions Department of Justice Inspector General Michael Horowitz during a Senate Committee On Homeland Security And Governmental Affairs.

The Chinese communists are pursuing a comprehensive, well-organized and well-funded strategy to abuse the open and collaborative research environment in the United States to advance their economic and military expansion at our expense.
But now U.S. research institutions are finally waking up to Beijing’s efforts to recruit American scientists for China’s benefit.
On Wednesday, H. Lee Moffitt Cancer Center & Research Institute announced the forced resignations of its chief executive and president, Alan List, Vice President Thomas Sellers and four researchers.
In a news release, the center said the employees committed compliance and conflict-of-interest violations. 
Specifically, the researchers didn’t reveal they had been recruited and paid by the Chinese government under its “Thousand Talents” program, a massive effort controlled by the Chinese Communist Party to recruit foreign scientists for its own purposes.
The Moffitt Center, located in Tampa, essentially fired its leaders after an investigation prompted by the National Institutes of Health, which had warned them “of foreign efforts to influence or compromise U.S. researchers,” the center said. 
The NIH, which is funded by U.S. taxpayers, is the source of more than half of the center’s $71 million in annual grant funding.
Although the center claims it found no evidence its research was compromised, the details of the relationships between its employees and the Chinese government are unknown.
The center is now working with federal officials on the case.
The FBI has been warning research institutions across the country that Chinese talent-recruitment programs are not only a threat to the integrity of the U.S. research environment but also a real national security concern.
In July, FBI Director Christopher A. Wray testified that the Chinese government and the Chinese Communist Party have many “so-called talent plans” that are not illegal but are routinely abused to steal intellectual property and take it back to China to advance Beijing’s various strategic and economic plans. 
The irony is that the U.S. taxpayer is essentially funding China’s economic resurgence, Wray said.
“The Chinese government knows that economic strength and scientific innovation are the keys to global influence and military power, so Beijing aims to acquire our technology — often in the early stages of development — as well as our expertise, to erode our competitive advantage and supplant the United States as a global superpower,” John Brown, the FBI’s assistant director for counterintelligence, testified in November.
FBI investigations have found that the Chinese recruitment programs — and there are more than 200 of them — have been connected to violations of U.S. laws, including economic espionage, theft of trade secrets, circumvention of export controls and grant fraud, according to Brown.
A 2019 report by the Senate Homeland Security and Governmental Affairs Committee outlined several examples of related abuses by Chinese employees at national labs, the Energy Department and graduate schools across the country.
Beijing, in response to new U.S. government and congressional scrutiny, decided to take the Thousand Talents program underground by deleting news articles and other online references to the program and its members, according to the committee’s report. 
Thousand Talents contracts even require the participants to keep their involvement secret.
Congress is pressing for more investigation, more transparency and more compliance in universities and research institutions across the country. 
Sen. Rick Scott (R-Fla.) sent a letter this month to all Florida universities calling on them to investigate and then reveal their researchers’ relationships with Chinese government programs.
“Everyone needs to be incredibly vigilant about Communist China’s growing influence,” Scott told me. “The situation at Moffitt just shows how far China will go to infiltrate American industries and institutions. I think every elected official needs to be sounding this alarm in their states.”
The Moffitt Center case is important also because it dispels the notion that any scrutiny of these programs represents anti-Chinese bias.
After the MD Anderson Cancer Center in Houston ousted three scientists in April over similar failures to disclose relationships with Chinese institutions, some speculated they were targeted due to their Chinese ethnicity.
U.S. research institutions have been asleep to Beijing’s efforts for a long time because they think of themselves as practicing “open science” — rather than “strategic science,” as the Chinese government does. 
Some believe that because the research will eventually be published, the China threat is overblown. But that ignores the huge body of evidence that the Chinese government is using talent programs not for mutually beneficial collaboration but as vehicles to steal non-public research to feed their own national ambitions.
The U.S. government and the U.S. research community must speed up efforts to work together to determine the extent of Chinese government infiltration into the U.S. research environment and neutralize the threat.
Then we need a national strategy for managing international scientific collaboration in a way that preserves the openness that characterizes our system while also protecting our national security.

English Quislings: UK academia's links to Chinese defence firms harmful for national security

Report singles out Britain for unprecedented levels of collaboration with China’s military

By Hannah Devlin and Ian Sample

Imperial College London is among the UK universities hosting labs jointly run by Chinese defence companies. 

Extensive links between British universities and Chinese defence companies, including missile manufacturers, could threaten UK national security interests, the author of a report on China’s research activity overseas has said.
The UK has been singled out as having unprecedented levels of collaboration with Chinese military companies in the analysis by the Australian Strategic Policy Institute (ASPI) which identifies collaborations with scientists from China’s hypersonic missile programme and on research topics ranging from smart materials to robotics.
Sixteen university labs around the world are identified as being run jointly by Chinese defence companies, or have major investments from them. 

Ten are based in the UK, with the University of Manchester and Imperial College London hosting six between them. 

The others are in Australia, Germany, Switzerland and Austria.“[Something] that really alarmed me was the level of collaboration with Chinese missile scientists,” said Alex Joske, the report’s author and an analyst at ASPI, referring to the UK collaborations. 

“I haven’t seen anything like Chinese missile manufacturers setting up these joint labs in other countries,” he added.
Earlier this month, a report by the foreign affairs select committee revealed “alarming evidence” of Chinese interference on UK campuses, adding that universities are not adequately responding to the growing risk of China and other “autocracies” influencing academic freedom in the UK.
The UK labs mentioned in the report include the Sino-British Joint Advanced Laboratory on Control System Technology at the University of Manchester and Imperial College London’s Advanced Structure Manufacturing Technology Laboratory. 

Both are partnerships with the China Academy of Launch Vehicle Technology, which develops space launch vehicles and intercontinental ballistic missiles.

Other labs highlighted in the report are based at the University of Strathclyde and the University of Nottingham. 
Research at the Strathclyde lab includes autonomous rendezvous systems for satellites, which could be used for docking, but also for anti-satellite missions.
Beyond their industrial collaborations with Chinese defence firms, dozens of British universities also work with Chinese military institutes, such as the PLA’s Army Engineering University and the National University of Defence Technology. 

The work ranges from hi-tech materials and design optimisation strategies to 5G networks and artificial intelligence programmes that can identify people in low-resolution surveillance footage, and control swarms of robotic vehicles on military patrols.
Bob Seely, a former Conservative MP and co-author of a critical report on Huawei for the Henry Jackson Society, said some universities appeared to have a “laissez-faire” attitude to the potential risks. 

“We are in danger of being extremely naive about this,” he said.
“We have to draw a line between what is beneficial for us and China and what is not so beneficial for us. I’m incredibly wary considering the amount of IP theft, espionage and cyberattacks that have come out of China. At the moment we haven’t got the balance right at all.”
Joske said that such research was often framed as “dual-use”, but that this concept was questionable when applied to collaborations with defence companies. 

“If you’re dealing with a company like a Chinese missile manufacturer you don’t really need to speculate about the use,” he said.
The analysis revealed what Joske described as a fundamental misalignment between the way universities approach research collaborations and how countries, including the UK, approach security interests. 

“Some of the collaborations that universities are engaged in with China are almost certainly harmful for national security and contributing to things that I don’t think the taxpayer would approve of,” he said.
He added that some laboratories ran risks of inadvertently violating export controls or laws around weapons of mass destruction.
Charles Parton, a China expert at the Royal United Services Institute (RUSI), said Britain had not done sufficient work to understand the issue. 

“People need to wake up. The world has changed and I don’t think academia has kept up with that change or understands the challenge that China represents here. We are just sleepwalking into this.”
“We don’t want a cold war with China, we want to cooperate, but we should cooperate in those areas which are not a threat to our national interests, our national security and our values. You don’t help your potential enemies to produce weapons or techniques which could be used against you,” he added.

Parton said the government should work with UK academics to create a reference list of technologies that are permissible for them to work on with the Chinese military and defence industry. 

He said an equivalent system to List X contractors, who are permitted to do secret work for the government, was needed for UK-based academics “because a lot of this work is very grey”.

China Vows Tougher Security in Hong Kong. Easier Said Than Done.

Communist Party leaders said they would bring in “national security” legal measures to quell unrest in the territory. The pitfalls could catch them out.
By Chris Buckley

Riot police officers and protesters clashing in Hong Kong last month.

BEIJING — Beijing urged Hong Kong’s embattled leader on Wednesday to support a push to impose national security measures in the territory, which has been hit by months of antigovernment protests. The trouble is that what China’s ruling Communist Party has proposed is not clear and could be hard to enforce.
The party hopes that such "national security" measures will head off unrest in Hong Kong that has challenged its authority. 

But Hong Kong’s politicians have little appetite for security legislation that could set off more intense protests. 

Many experts also doubt how much Beijing can directly impose its will on the territory’s legal system without dangerously damaging trust in Hong Kong’s special status both there and internationally.
China’s latest warning to end the protests that have pummeled Hong Kong for 22 weeks was delivered by Han Zheng, a vice premier who oversees Chinese policy toward the territory, when he met Carrie Lam, Hong Kong’s top official, in Beijing on Wednesday.
“This extreme violence and destruction would not be tolerated or accepted by any country or society in the world,” Han told Lam, according to footage of the meeting shown by Phoenix, a Hong Kong-based television service.
Han reiterated the support that Chinese dictator Xi Jinping expressed in Lam in Shanghai on Monday. 

But he underscored the Chinese government’s impatience with the protests, which he described as the worst trouble in Hong Kong since Beijing regained sovereignty of the territory from the British in 1997.
“Stopping the violence and disorder, and restoring order, is the most important task now,” Han said.
He cited a Chinese Communist Party announcement last week of planned "national security" measures for Hong Kong, and pointedly added that the idea had received support.

Hong Kong’s politicians have little appetite for security legislation that could set off more intense protests. 

Throughout the protests, the Chinese government has struggled to match its hard-line rhetoric with effective policies. 

That problem could deter or frustrate the push to drive through "national security" measures covering the territory.
Earlier, China’s suggestions that it could send troops to Hong Kong to help end the protests petered out, dismissed as unrealistic by experts and many Hong Kongers. 

Chinese propaganda outlets, which depicted the protesters as puppets of “hostile foreign forces,” seemed caught flat footed when Lam announced that she would formally drop the draft extradition legislation that ignited the discontent.
The central government has repeatedly expressed support for Hong Kong’s police force, but officers have struggled to drive back crowds of masked protesters by using tear gas, water cannons and live gunfire.
In mainland China, Xi has driven far-reaching changes through the party-controlled legislature. 

But Hong Kong’s British-derived legal system could complicate, even confound, any Chinese attempt to directly impose laws against "national security" crimes, several experts said.
Regina Ip, a pro-Beijing member of Lam’s cabinet, said she expected that Lam would make little progress on national security legislation. 

Ip was the security secretary for Hong Kong in 2003 when the government made an unsuccessful attempt to introduce such measures.
“It’s not something that can happen anytime soon,” Ip said of any new push for national security legislation. 

“But it’s clearly something that weighs heavily on the minds of the Chinese leaders.”
Just how heavily Hong Kong weighs on Xi and other leaders became clear in recent days.
Last week, Chinese Communist Party leaders approved a set of proposals for strengthening government, including one that said China would “build and improve a legal system and enforcement mechanism to defend national security” in Hong Kong.
The full decision from their meeting, released on Tuesday, also laid out proposals to support the city’s police force and expand education intended to promote patriotic loyalty to China, though the party has not issued details of its plans.
Hong Kong’s inability to pass security legislation has long irked Chinese officials. 

Article 23 of the Basic Law, the mini-constitution defining Hong Kong’s status under China, says the territory “shall enact laws on its own to prohibit any act of treason, secession, sedition and subversion” against the Chinese government.
But after the upheaval over the extradition bill, Hong Kong’s leaders and legislators would be reluctant to use Article 23, said Wei Leijie, a law professor at Xiamen University in southeastern China who studies Hong Kong.
“That road has been blocked,” he said by telephone. 

“The obstacles are immense.”
Yet the Communist Party leaders’ decision last week has kindled expectations among some that Xi could push Lam or her successor to enact a national security law. 

Comments in Chinese state-run news outlets have called for quick action, as have Hong Kong commentators loyal to China.
If Hong Kong “does not pass legislation on its own, and this keeps dragging out too long, that would also be intolerable,” said Gu Minkang, a Chinese researcher on Hong Kong law who teaches at a college in Hunan Province in southern China, said by telephone.
He has argued that China could force through national security legislation for Hong Kong if Lam or her successor failed to get the territory’s legislative council to approve a bill.
Although election laws ensure that the council is dominated by pro-Beijing members, they could waver in voting for contentious security legislation, as some did in 2003, when a previous bill failed.

Armored vehicles gathered in August at a sports center in Shenzhen, China, across the border from Hong Kong.

Some experts argue that under another section of the Basic Law, Article 18, China has the power to impose laws against at least some security threats in Hong Kong by putting them into an annex of the Basic Law.
But imposing any laws against political subversion and similar crimes on Hong Kong is much easier said than done, other experts said.
The Basic Law clearly indicates that the power to enact legislation covering major national security crimes, such as treason and seeking secession, belonged in the hands of Hong Kong lawmakers, Danny Gittings, an expert on Hong Kong’s legal status, said in a telephone interview.
Even Chinese laws lodged in the annex of the Basic Law must be approved by Hong Kong’s chief executive or its legislature to come into force, he said. 

That step could prove politically incendiary, and laws would be open to challenge in Hong Kong courts.
“It’s not enough to put it in the Basic Law,” Mr. Gittings said. 

“It’s got to go through the local process.”
Declaring a state of emergency in the territory could blast a hole through such legal concerns, Mr. Gittings said. 

But that step could inflame protests and shake global confidence in Hong Kong as a financial center.
If China declared a state of emergency to impose security legislation, said Professor Wei, the Chinese legal academic, “the situation in Hong Kong could be hard to clean up.”

Republicans Look to Punish Chinese Leaders Over Hong Kong Crackdown

Senior administration officials and lawmakers are brainstorming ways to punish China for the clampdown in Hong Kong.

By Erin Banco


Donald Trump hasn’t exactly gone after China’s chiefs for cracking down on protesters in Hong Kong. 

Trump said earlier this month that he wanted to see the situation “worked out in a very humanitarian fashion.” 

And over the weekend at the G7 meeting in France he praised again Xi Jinping as a “great leader.”
But behind the scenes, senior officials in the Trump administration and lawmakers on Capitol Hill are quietly brainstorming ways to officially punish China for the clampdown in Hong Kong and to deter Beijing from deploying military forces to directly and violently confront protesters in the streets, according to three government sources with knowledge of those efforts. 

The wide-ranging discussions—which include the possibility of imposing travel bans and asset freezes on Chinese leaders—come just two weeks after Beijing’s troops began to amass outside Hong Kong.
“Since Day One of this administration, China has been a national security concern. The protests in Hong Kong are just another example of why we should be focusing our attention on finding ways to push back against Beijing,” said one senior administration official. 

“We’ve been taking other routes to confront China, especially economically. This would be another step in the game plan. The draft legislation is in a lot of ways going to look like some of the sanctions we implemented with Russia.”
Republicans in the Senate and the House of Representatives are in the midst of drafting legislation, after consulting with senior officials in the ranks of the departments of State and Treasury, to introduce legislation that would hit  with sanctions Chinese entities that support the suppression of protests in Hong Kong. 

The legislation would be the first of its kind to address the crackdown head-on by going after some of China’s most influential and well-connected entities. 

Members of Congress have for weeks sought out ways to respond to the Beijing leadership’s role in the clampdown in Hong Kong, fielding expert opinions from experts in the international sanctions and foreign policy fields.
Senator Marco Rubio (R-FL), along with both his Republican and Democrat colleagues in the Senate, re-introduced the Hong Kong and Human Rights Act in June. 

The bill would make it harder for Hong Kong to keep its trade status with the U.S. if it did not maintain autonomy from China. 

Rep. Christopher Smith (R-NJ) introduced the bill in the House of Representatives.
But other lawmakers on the Hill are considering a more direct approach to confronting China.
Three individuals familiar with the effort said lawmakers view the legislation as a way of establishing a “red line” that would deter China from cracking down on protesters in the future by threatening increasingly steep political and financial punishments. 

Two sources said lawmakers are considering a system whereby Congress could review the list of Chinese companies every several years, adding some and losing others depending on the circumstance.
“The administration has been looking at options for some time now,” one senior Trump official said. “But now things are starting to move forward and the legislation on the Hill will crystalize once Congress comes back. We’ve been looking at smart ways to address the crackdown and this is definitely a start.”
Sen. Pat Toomey (R-PA) has looked over draft legislation for new Chinese sanctions and is considering sponsoring some form of it within the next few months, according to two sources familiar.
In July he delivered an 11-minute speech in which he called out the Chinese government for their involvement.
“If the Chinese officials in Beijing, the communists Chinese who rule mainland China, if they have their way, they will extinguish these rights for the people of Hong Kong,” he said. 

Discussions on Capitol Hill are taking place as the U.S. and China continue to engage in a tit-for-tat trade war. 

President Trump said earlier this month that if China used violence in Hong Kong it would “hurt” trade talks.
“For the most part the administration, and the White House in particular, has been trying to keep the trade talks front and center when it comes to China policy,” one senior administration official said. “But really the trade talks and our response to the protests in Hong Kong are tied. The threat of sanctions is really starting to scare China and so we might begin to see trade talks go a little smoother.”

Here are the reasons for President Trump's war with China

On Friday the US president ordered companies to halt business with the “enemy” Xi Jinping

By Dominic Rushe in New York

Even by President Trump’s standards his Twitter rant attacking China on Friday was extraordinary. 

In a series of outbursts President Trump “hereby ordered” US companies to stop doing business with China, accused the country of killing 100,000 Americans a year with imported fentanyl and stealing hundred of billions in intellectual property.
The attack marked a new low in Sino-US relations and looks certain to escalate a trade war already worrying investors, manufacturers and economists.
Not so long ago President Trump called Chinese dictator Xi Jinping “a good friend”. 

Now Xi is an “enemy”. 

How did we get here?

China, China, China
On the campaign trail President Trump railed against China, accusing it of pulling off “the greatest theft in the history of the world” and “raping” the US economy.

President Trump repeated the word China so often it spawned a viral video of him saying it over and over again. 

The attacks were a hit with voters and helped get him elected. 

He has continued lambasting China – to cheers – at rallies ever since.
His main beef? 

The trade deficit.

Trade deficit
The US imported a record $539.5bn in goods from China in 2018 and sold the Chinese $120.3bn in return. 

The difference between those two numbers – $419.2bn – is the trade deficit.
That deficit has been growing for years as manufacturing has shifted to low-cost China and it explains the hollowing out of US manufacturing.

For President Trump, and especially for his adviser Pr. Peter Navarro, who once described China as “the planet’s most efficient assassin”, trade deficits represent an existential threat to US jobs and national security. 

China makes up the largest part of the US trade deficit but those fears are also behind his disputes with the EU, Canada and Mexico.

His pro-Beijing detractors argue these deficit worries are hyperbole and a result of the US’s stronger economy, which allows consumers to buy goods at cheaper prices.
While it’s true that unemployment is at record lows and consumers continue to prop up the economy, manufacturing jobs have been lost and with them wage growth.
But it is not just deficits that concerns Trump.

Thieves
China has a deserved reputation for intellectual property theft. 

On Friday, President Trump estimated China robs the US of “hundreds of billions” a year in ideas.

In March, a CNBC poll found one in five US corporations had intellectual property stolen from them within the last year by China.
According to the Commission on the Theft of American Intellectual Property, the theft costs $600bn a year.

Beijing bucks
Like Tesla, Nio, a Chinese electric vehicle (EV) company, is suffering as subsidies for EVs are phased out. 

Unlike Tesla, Nio has Xi. 

China is pumping $1.5bn into the company to keep it on the road, the latest in a series of handouts that are unfair.
Cheap steel and aluminium, subsidized by the Chinese government, are the origins of this trade dispute. 

According to the White House, last year alone China dumped and unfairly subsidized goods including steel wheels, tool chests and cabinets and rubber bands on to the US market.

Currency manipulator
Earlier this month the US officially accused China of manipulating its currency “to gain unfair competitive advantage in international trade”.
It was the first time since 1994 that such a complaint has been made official and comes as the dollar has strengthened against world currencies. 

The dispute adds another layer of tension to a complex situation.
China disputed the charge accusing the US of “deliberately destroying international order” with “unilateralism and protectionism”.
The International Monetary Fund (IMF) is on China’s side, arguing the devaluation of the yuan is largely in line with worsening economic conditions in China.

What happens next?
The US has now slapped billions of dollars on tariffs on Chinese goods. 

China retaliated, again, on Friday with more levies on US goods. 

China’s economic growth has slowed to levels unseen since 1992; US economic forecasts have also been cut.

So far US consumers have not felt the pinch but JP Morgan estimates the average US household will end up paying $1,000 a year for goods if the latest set of tariffs go through.

The unanswerable question is whether any of this will sway President Trump. 

If the President continues to see a war with China as the necessary price to Make America Great Again, then the answer is probably no.

The Nasty Truth Behind Confucius Institutes

They function as organs for dissemination of Chinese Communist propaganda.

By RACHELLE PETERSON
Senator Josh Hawley (R., Mo.) 

Chinese-government-sponsored Confucius Institutes are “a tool for China to spread influence and exercise soft power,” “a known threat to academic freedom,” and “a danger to our national defense and security,” says Senator Josh Hawley (R., Mo.) in a letter sent last week to the University of Missouri and Webster University.
Both institutions host Confucius Institutes, campus centers that teach Chinese language and culture and are funded and partly staffed and overseen by the Chinese government.
Hawley urges the universities to “reconsider” those relationships.
Hawley’s conclusions aren’t just his own personal notions.
He cites FBI director Christopher Wray, who for the last year and a half has publicly warned colleges about Confucius Institutes.
Just last week Wray testified, in response to questioning from Hawley, that Confucius Institutes are “part of China’s soft power strategy and influence” because they “offer a platform to disseminate Chinese government or Chinese Communist Party propaganda, to encourage censorship, to restrict academic freedom.”
Hawley cites Li Changchun, a senior member of the Chinese Communist Party, who famously declared Confucius Institutes “an important part of China’s overseas propaganda set-up.” 
He cites North Carolina State University, which canceled an event with the Dalai Lama under pressure from its Confucius Institute. 
And he cites the fact that ever-increasing numbers of American colleges and universities — now 24 of them — have cut ties with their Confucius Institutes. (Hawley also cites an article I wrote, based on my 2017 report Outsourced to China: Confucius Institutes and Soft Power in American Higher Education.)
Hawley’s concerns, well grounded and substantial, are nothing surprising.
What is surprising are the reactions of Mizzou and Webster. 
After several years of growing evidence that Confucius Institutes are all-round a bad deal for colleges, they are doubling down in defense of their Confucius Institutes.
University of Missouri spokesman Christian Basi assured the public that all Chinese-government-sponsored teachers on its campus are mere “interns” and that Mizzou, having previously been in touch with the FBI, is “doing the proper things to monitor” possible academic espionage.
Basi also says that Mizzou will review its contract for the Confucius Institute before it expires in 2021 but that the university has already “made some changes to policies and procedures.”
Webster University president Elizabeth Stroble went two leaps further.
One day after receiving Hawley’s letter, she dashed off a response, declaring, “We have no reason to believe that the Confucius Institute at Webster University creates the risks described in your letter.” Stroble demanded of Hawley, “If you are aware of evidence that anyone is using the Confucius Institute at Webster University for a nefarious purpose, please share such evidence with us without delay.”
Mizzou and Webster should take Hawley’s concerns more seriously.
Reflexively declaring that all the FBI’s warnings involve some other university somewhere else reflects poorly on Mizzou and Webster’s commitment to safeguard academic freedom and protect their students from propaganda — let alone from espionage.
Mizzou, where professor Melissa Click called for “some muscle over here” to oust a student journalist from a 2015 protest, and whose system president and campus chancellor resigned rather than face down activists’ demands, is probably outstanding example No. 1 of a poorly run public university. 
In the two years following those events, enrollment dropped 35 percent and Mizzou eliminated 400 positions.
That track record doesn’t inspire confidence in Mizzou’s ability to manage the risks of a Confucius Institute.
Webster in particular has a poor track record of keeping tabs on its Confucius Institute.
One year ago the former director of its Confucius Institute was convicted in federal court of embezzling $375,000 from the university.
Deborah Pierce had directed funds to a separate bank account, from which the federal government recovered an additional $160,000.
That kind of outright illegal behavior is rare.
The greater danger is subtle.
Confucius Institutes teach the Chinese government’s preferred version of Chinese culture, a version whitewashed of Muslim Uighurs, 1 million of whom are currently held in concentration camps in East Turkestan.
Confucius Institute teachers, Chinese nationals hired and paid by the Chinese government, are coached to omit the Tiananmen Square massacre and to represent Taiwan as part of China. 
One Chinese staff member at a Confucius Institute told me that if she were asked about Tiananmen Square, she would “show a picture and point out the beautiful architecture.”
The Hanban, the Chinese government agency tasked with overseeing Confucius Institutes, instructs teachers to focus on lessons that result in “deepening friendly relationships with other nations.” That’s not necessarily harmful — but it leaves students with a remarkably one-sided education.
Confucius Institutes are central players in China’s long-term strategy to gain influence in American institutions.
Colleges and universities see them as financial goody bags: free teachers and textbooks plus ancillary funds to offer Chinese classes, study-abroad funding, sponsored trips to China for the university president and other administrators, access to full-tuition-paying Chinese students.
Webster University operates a campus in China. 
Half of all Mizzou’s foreign students come from China.
Any institute that spreads propaganda has no place on American college campuses.
Too many have eagerly accepted China’s funding without protecting academic integrity.
Senator Hawley deserves credit for calling the University of Missouri and Webster University to account.
It’s time for Confucius Institutes to go.

American Quislings

U.S. Tech Companies Sidestep a Trump Ban, to Keep Selling to Huawei

By Paul Mozur and Cecilia Kang

A Huawei billboard in Shanghai. The deals with United States companies will help Huawei continue to sell its smartphones and other products.

SHANGHAI — United States chip makers are still selling millions of dollars of products to Huawei despite a Trump administration ban on the sale of American technology to the Chinese telecommunications giant.
Industry leaders including Intel and Micron have found ways to avoid labeling goods as American-made, said the people, who spoke on the condition they not be named because they were not authorized to disclose the sales.
Goods produced by American companies overseas are not always considered American-made. 

The components began to flow to Huawei about three weeks ago, the people said.
The sales will help Huawei continue to sell products such as smartphones and servers, and underscore how difficult it is for the Trump administration to clamp down on companies that it considers a national security threat, like Huawei. 

They also hint at the possible unintended consequences from altering the web of trade relationships that ties together the world’s electronics industry and global commerce.
The Commerce Department’s move to block sales to Huawei, by putting it on a so-called entity list, set off confusion within the Chinese company and its many American suppliers, the people said. Many executives lacked deep experience with American trade controls, leading to initial suspensions in shipments to Huawei until lawyers could puzzle out which products could be sent. 

Decisions about what can and cannot be shipped were also often run by the Commerce Department.

American companies like Intel sell technology supporting current Huawei products until mid-August.

American companies may sell technology supporting current Huawei products until mid-August. 

But a ban on components for future Huawei products is already in place. 

It’s not clear what percentage of the current sales were for future products. 

The sales have most likely already totaled hundreds of millions of dollars, the people estimated.
While the Trump administration has been aware of the sales, officials are split about how to respond, the people said. 

Some officials feel that the sales violate the spirit of the law and undermine government efforts to pressure Huawei, while others are more supportive because it lightens the blow of the ban for American corporations. 

Huawei has said it buys around $11 billion in technology from United States companies each year.
Intel and Micron declined to comment.
“As we have discussed with the U.S. government, it is now clear some items may be supplied to Huawei consistent with the entity list and applicable regulations,” John Neuffer, the president of the Semiconductor Industry Association, wrote in a statement on Friday.
“Each company is impacted differently based on their specific products and supply chains, and each company must evaluate how best to conduct its business and remain in compliance.”
In an earnings call Tuesday afternoon, Micron’s chief executive, Sanjay Mehrotra, said the company stopped shipments to Huawei after the Commerce Department’s action last month. 

But it resumed sales about two weeks ago after Micron reviewed the entity list rules and “determined that we could lawfully resume” shipping a subset of products, Mr. Mehrotra said. 

“However, there is considerable ongoing uncertainty around the Huawei situation,” he added.
A spokesman for the Commerce Department, in response to questions about the sales to Huawei, referred to a section of the official notice about the company being added to the entity list, including that the purpose was to “prevent activities contrary to the national security or foreign policy interests of the United States.”

The Idaho-based Micron competes with South Korean companies like Samsung to supply memory chips that go into Huawei’s smartphones.

A senior administration official said that after the Commerce Department put Huawei on the entity list, the Semiconductor Industry Association sent a letter to the White House asking for waivers for some companies to allow them to continue selling components to Huawei. 

But the administration did not grant the waivers, he said, and the companies then found what they assert is a legal basis for continuing their sales.
Administration officials would like to address this issue, he said, but they do not plan to do so before the G-20 summit in Japan at the end of this week. 

Mr. Trump’s top priority is to discuss the general trade dispute with Xi Jinping and get the two sides to resume trade talks that have dragged on since early 2018, the official said.
The fate of Huawei, a crown jewel of Chinese innovation and technological prowess, has become a symbol of the economic and security standoff between the United States and China. 

Chinese companies like Huawei, which makes telecom networking equipment, could intercept and secretly divert information to China. 

Xi Jinping and President Trump are expected to have an “extended” talk this week during the Group of 20 meetings in Japan, a sign that the two countries are again seeking a compromise after trade discussions broke down in May. 

After the talks stalled, the Trump administration announced new restrictions on Chinese technology companies.

Along with Huawei, the administration blocked a Chinese supercomputer maker from buying American tech, and it is considering adding the surveillance technology company Hikvision to the list.
Kevin Wolf, a former Commerce Department official and partner at the law firm Akin Gump, has advised several American technology companies that supply Huawei. 

He said he told executives that Huawei’s addition to the list did not prevent American suppliers from continuing sales, as long as the goods and services weren’t made in the United States.

The SK Hynix plant in Icheon, South Korea. American companies are worried about losing market share to foreign rivals.

A chip, for example, can still be supplied to Huawei if it is manufactured outside the United States and doesn’t contain technology that can pose national security risks. 

But there are limits on sales from American companies. 

If the chip maker provides services from the United States for troubleshooting or instruction on how to use the product, for example, the company would not be able to sell to Huawei even if the physical chip were made overseas, Wolf said.
“This is not a loophole or an interpretation because there is no ambiguity,” he said. 

“It’s just esoteric.”
After this article was published online on Tuesday, Garrett Marquis, the White House National Security Council spokesman, criticized the companies’ workarounds. 

He said, “If true, it’s disturbing that a former Senate-confirmed Commerce Department official, who was previously responsible for enforcement of U.S. export control laws including through entity list restrictions, may be assisting listed entities to circumvent those very enforcement mechanisms.”
Wolf said he does not represent Chinese companies or firms on the entity list, and he added that Commerce Department officials had provided him with identical information on the scope of the list in recent weeks.
In some cases, American companies aren’t the only source of important technology, but they want to avoid losing Huawei’s valuable business to a foreign rival. 

For instance, the Idaho-based Micron competes with South Korean companies like Samsung and SK Hynix to supply memory chips that go into Huawei’s smartphones. 

If Micron is unable to sell to Huawei, orders could easily be shifted to those rivals.
Beijing has also pressured American companies. 

This month, the Chinese government said it would create an “unreliable entities list” to punish companies and individuals it perceived as damaging Chinese interests. 

The following week, China’s chief economic planning agency summoned foreign executives, including representatives from Microsoft, Dell and Apple. 

It warned them that cutting off sales to Chinese companies could lead to punishment and hinted that the companies should lobby the United States government to stop the bans. 

The stakes are high for some of the American companies, like Apple, which relies on China for many sales and for much of its production.

A FedEx warehouse in Kernersville, N.C. “FedEx is a transportation company, not a law enforcement agency,” the company said in a complaint against the government.

Wolf said several companies had scrambled to figure out how to continue sales to Huawei, with some businesses considering a total shift of manufacturing and services of some products overseas. 

The escalating trade battle between the United States and China is “causing companies to fundamentally rethink their supply chains,” he added.
That could mean that American companies shift their know-how, on top of production, outside the United States, where it would be less easy for the government to control, said Martin Chorzempa, a research fellow at the Peterson Institute for International Economics.
“American companies can move some things out of China if that’s problematic for their supply chain, but they can also move the tech development out of the U.S. if that becomes problematic,” he said. 

“And China remains a large market.”
“Some of the big winners might be other countries,” Mr. Chorzempa said.
Some American companies have complained that complying with the tight restrictions is difficult or impossible, and will take a toll on their business.
On Monday, FedEx filed a lawsuit against the federal government, claiming that the Commerce Department’s rules placed an “impossible burden” on a company like FedEx to know the origin and technological makeup of all the shipments it handles.
FedEx’s complaint didn’t name Huawei specifically. 

But it said that the agency’s rules that have prohibited exporting American technology to Chinese companies placed “an unreasonable burden on FedEx to police the millions of shipments that transit our network every day.”
“FedEx is a transportation company, not a law enforcement agency,” the company said.
A Commerce Department spokesman said it had not yet reviewed FedEx’s complaint but would defend the agency’s role in protecting national security.

Tech War

U.S. Blacklists More Chinese Tech Companies Over National Security Concerns

By Ana Swanson, Paul Mozur and Steve Lohr


WASHINGTON — The Trump administration added five Chinese entities to a United States blacklist on Friday, further restricting China’s access to American technology before a planned meeting between President Trump and Xi Jinping in Japan next week.
The Commerce Department announced that it would add four Chinese companies and one Chinese institute to an “entity list,” saying they posed risks to American national security or foreign policy interests. 

The move essentially bars them from buying American technology and components without a waiver from the United States government, which could all but cripple them because of their reliance on American chips and other technology to make advanced electronics.
The entities are one of China’s leading supercomputer makers, Sugon; three subsidiaries set up to design microchips, Higon, Chengdu Haiguang Integrated Circuit and Chengdu Haiguang Microelectronics Technology; and the Wuxi Jiangnan Institute of Computing Technology. 

They lead China’s development of high-performance computing, some of which is used in military applications like simulating nuclear explosions.
Other Chinese companies that have been barred from access to American technology include the telecom equipment giant Huawei, which was added to the entity list in May. 

The Trump administration is also considering adding Hikvision, a surveillance-technology company, The New York Times has reported.
The restriction of additional companies could further complicate efforts to reach a trade deal. American and Chinese officials recently restarted talks after negotiations collapsed in May, with President Trump accusing China of breaking a previous deal and the two countries intensifying their tariff fight.
This week, President Trump said he would have an “extended meeting” with Chinese Xi at the Group of 20 summit next week in Osaka, Japan — a conversation that could determine whether the trade war ends or persists indefinitely.
A fast resolution to the trade war was already looking unlikely. 

Both sides have escalated their language on remaining tough in trade talks, and China has said it is putting together its own “unreliable entities list” of foreign companies and people, an apparent first step toward retaliating against the denial of vital American technology to Chinese companies.
The United States has begun targeting Chinese tech companies that rely on American products as it seeks to thwart China’s efforts to dominate advanced technologies that could have military applications.
Supercomputing is one of the key technologies of the future that China is seeking to dominate, in addition to artificial intelligence and quantum computing. 

America is home to the world’s fastest computer, at the Oak Ridge National Laboratory in Tennessee, but China is building more of the ultrafast machines than any other country.
Sugon is one of China’s most important makers of high-performance computers and servers. 

The machines serve China’s government and its largest technology companies, powering everything from military simulations to weather prediction.
In most cases, Chinese computers rely on a mix of microchips from the American manufacturers Intel and Nvidia. 

By placing Sugon on the list, the Trump administration is effectively cutting it off from the tiny brains it needs to make the billions of calculations required to model weather patterns and support video apps and online shopping.
One of the blacklisted subsidiaries had formed a partnership with the American chip maker Advanced Micro Devices to create microchips that could satisfy security demands for Chinese government customers. 

Some Chinese officials said the chips could be used in a new generation of faster supercomputers. 

By relying on chips made by AMD and Intel, Sugon’s supercomputers can run a wider array of software than some of the country’s faster computers built around domestically produced chips.
With just over $1 billion in revenue last year, Sugon is tiny compared with the previously blacklisted Huawei. 

Still, its exclusion from American technology is an especially bitter pill for Beijing to swallow, as its supercomputers form the core of some of the Chinese government’s most sensitive and important systems.
Sugon supercomputers support State Grid, the monopoly that runs China’s electric grid; China Mobile, the country’s largest telecom services provider; and the China Meteorological Administration. 

It also makes data centers for companies like the e-commerce giant JD.com and Bytedance, the owner of the social media app TikTok.
The companies could petition the United States government for a license to buy American technology, but their addition to the list suggests that they would receive intense scrutiny and that approval might be unlikely.
For years, chip companies like Intel have sold widely available microchips to supercomputer makers in China, even some with close ties to the military. 

In 2015, the Commerce Department moved to add China’s National University of Defense and Technology to the entity list, to cut it off from using Intel chips in supercomputers that were being used to model nuclear detonations.
On Friday, the list was updated with a number of new addresses and names through which the National University of Defense Technology was procuring chips. 

According to China’s official list of its fastest supercomputers, the institute still runs two of China’s three fastest supercomputers on Intel processors.
In its current order, the Commerce Department highlights the next frontier in supercomputing: “exascale” machines, which China, the United States and other nations are racing to build. 

They will be five times as fast as the fastest machine today — the Summit, which is housed at Oak Ridge and was built by IBM in a partnership with Nvidia.
The Commerce Department order cites the three groups “leading China’s development of exascale high-performance computing”: Sugon, the Wuxi Jiangnan Institute of Computing Technology and the National University of Defense Technology.
These three companies are all developing prototype exascale machines in China that are powered by Chinese-made microprocessors, said Jack Dongarra, a supercomputer expert at the University of Tennessee and a co-creator of the Top 500 list of the swiftest machines.
But other key technologies in the fastest supercomputers will be affected. 

Supercomputers are made by lashing together thousands of processors, linked by a specialized fabric of digital circuitry known as interconnect technology. 

The leading producer of high-performance interconnect technology is Mellanox, an Israeli company that Nvidia agreed this year to buy for $6.9 billion.
“The interconnect technology is as important if not more important than the processors,” Mr. Dongarra said. 

“The impact of this government order is going to be far-reaching.”
It is likely to hamper the Chinese in the short run, he said, but also encourage China to redouble its efforts to replace American technology.

Next Target: DJI Technology

'We're Not Being Paranoid': U.S. Warns Of Spy Dangers Of DJI Drones
By BRIAN NAYLOR

Chinese spy: A DJI Technology drone flies during a demonstration in Shenzhen, China, in 2014. DJI sells the majority of Chinese-made drones bought in the United States.

Drones have become an increasingly popular tool for industry and government.
Electric utilities use them to inspect transmission lines. 

Oil companies fly them over pipelines. 

The Interior Department even deployed them to track lava flows at Hawaii's Kilauea volcano.
But the Department of Homeland Security is warning that drones manufactured by Chinese companies pose security risks, including that the data they gather could be stolen.
The department sent out an alert on the subject on May 20, and a video on its website notes that Chinese drones in general pose multiple threats, including "their potential use for terrorism, mass casualty incidents, interference with air traffic, as well as corporate espionage and invasions of privacy."
"We're not being paranoid," the video's narrator adds.
Most drones bought in the U.S. are manufactured in China, with most of those drones made by one company, DJI Technology. 

Lanier Watkins, a cyber-research scientist at Johns Hopkins University's Information Security Institute, said his team discovered vulnerabilities in DJI's drones.
"We could pull information down and upload information on a flying drone," Watkins said. 

"You could also hijack the drone."
The vulnerabilities meant that "someone who was interested in, you know, where a certain pipeline network was or maybe the vulnerabilities in a power utilities' wiring might be able to access that information," he noted.
DJI offered a bounty for researchers to uncover bugs in its drones, although Walker said Johns Hopkins didn't accept any money.

There are other, more covert, ways that the Chinese government could obtain the type of information gathered by drones, said John Villasenor, a fellow at the Brookings Institution who teaches at the University of California, Los Angeles.
"[If] you fly a drone above a pipeline, there's a pretty good chance someone is gonna see it up there," he said, but "a spy satellite just takes a picture from 120 miles up or whatever. Then, of course, no one's going to know what happened."
This is not the first time the U.S. government has expressed concern over the use of Chinese-made drones. 

In 2017, the U.S. Army barred use of DJI's drones.
Villasenor said the government's concern over Chinese drones "is not new, although the fact that it has surfaced now may or may not be tied to these broader trade tensions which have flared up in recent months."
The Department of Homeland Security's warning about Chinese drones coincides with the Trump administration's campaign against tech manufacturer Huawei, which also coincides with the ongoing trade war between the two countries.
It also comes as officials are warning transit agencies in New York and Washington, D.C., against buying new subway cars made by a Chinese manufacturer.
Sen. Mark Warner, D-Va., along with the region's other Democratic senators, has introduced legislation prohibiting the Washington Metropolitan Area Transit Authority from buying the Chinese-made cars because of security concerns.
"A rail car might have a whole host of sensors [and] communication tools, and when that equipment is manufactured in China," Warner said, "and when that equipment sometimes can be upgraded on a remote basis in terms of a software upgrade, there are national security implications."
Underlying the tech concerns is the Chinese government's control over all Chinese companies.
"The Communist Party of China now has in their law the ability to interfere and take information from every Chinese company," Warner warned. 

"And as long as that exists, that provides a whole set of vulnerabilities I think American business has to consider on a going-forward basis."
The bottom line, the Department of Homeland Security said, is that customers should be cautious when buying Chinese technology.

National Security

Huawei is a risk so Britain must change course on 5G, ex-MI6 spymaster says

By Guy Faulconbridge, Paul Sandle
Richard Dearlove was chief of the Secret Intelligence Service from 1996 to 2004.

LONDON -- China’s Huawei poses such a grave security risk to the United Kingdom that the government must not allow it to have even a limited role in building 5G networks, a former head of Britain’s MI6 foreign spy service said on Thursday.
The United States is worried that 5G dominance would give China an advantage Washington is not ready to accept.
The Trump administration, which hit Huawei with severe sanctions on Wednesday, has told allies not to use its technology because of fears it could be a vehicle for Chinese spying.

But British ministers have discussed allowing Huawei a restricted role in building parts of its 5G network. 

The final decision has not yet been published.
“I very much hope there is time for the UK government, and the probability as I write of a new prime minister, to reconsider the Huawei decision,” said Richard Dearlove, who was chief of the Secret Intelligence Service from 1996 to 2004.
“The ability to control communications and the data that flows through its channels will be the route to exercise power over societies and other nations,” Dearlove wrote in the foreword to a report on Huawei by the Henry Jackson Society.
U.S. Secretary of State Mike Pompeo told Britain on a visit this month that it needed to change its attitude toward China and Huawei, casting the world’s second largest economy as a threat to the West similar to that once posed by the Soviet Union.
Asked whether the government would reconsider its stance on Huawei, Prime Minister Theresa May’s spokesman said: “As you know, in relation to Huawei, we are reviewing the right policy approach for 5G and when an announcement is ready the culture secretary will update parliament.”

Dearlove, who spent 38 years in British intelligence, said it was deeply worrying that the British government “appears to have decided to place the development of some its most sensitive critical infrastructure” in the hands of a Chinese company.
“No part of the Communist Chinese state is ultimately able to operate free of the control exercised by its Communist Party leadership,” said Dearlove.
“We should also not be influenced by the threat of the economic cost of either delaying 5G or having to settle for a less capable and more expensive provider,” he said.

National Emergency vs. Huawei

President Trump Takes Aim At Huawei, Paves Way For Ban Of Chinese Telecom Equipment

By RICHARD GONZALES

President Trump signed an executive order Wednesday designed to bar U.S. telecommunications networks from using equipment from foreign suppliers, a move apparently targeting Chinese telecom giant Huawei.
The order declares a "national emergency" and says that "foreign adversaries are increasingly creating and exploiting vulnerabilities in information and communications technology and services" and committing economic and industrial espionage against the U.S.
Trump's order directs Commerce Secretary Wilbur Ross to draft rules to restrict the purchase of information and communications technology from companies "owned by, controlled by, or subject to the jurisdiction or direction of a foreign adversary."
A senior administration official says the order is not directed at any particular country or company, but the order appears to be aimed at Chinese telecom manufacturer Huawei.
Separately, the Commerce Department said Wednesday it was adding Huawei to its "Entity List," preventing it from buying components from American companies without U.S. government approval.
The administration says Huawei's technology could become a conduit for snooping or sabotage by the government in Beijing. 

The U.S. federal government itself is already barred from doing business with Huawei and another Chinese telecom firm, ZTE. 

The administration has also been discouraging allies from using Huawei equipment as they build out 5G networks.
The executive order gives the Commerce Department 150 days to write regulations implementing it.
The Trump administration "will do what it takes to keep America safe and prosperous, and to protect America from foreign adversaries" targeting vulnerabilities in American communications infrastructure, White House press secretary Sarah Sanders said in a statement.
The president's action was described by a senior administration official as "company and country agnostic." 

Even so, it was greeted with bipartisan endorsements on Capitol Hill as strong action against China amid American fears of technological vulnerability.
"This is a needed step, and reflects the reality that Huawei and ZTE represent a threat to the security of U.S. and allied communications networks," said Virginia Sen. Mark Warner, the top Democrat on the Senate Intelligence Committee, in a statement. 

"Under current Chinese security laws, these and other companies based in China are required to provide assistance to the Chinese state."
Republican Sen. Ben Sasse of Nebraska, also a member of the Senate Intelligence Committee, said in a statement, "Let's cut to the chase: China's main export is espionage, and the distinction between the Chinese Communist Party and Chinese 'private-sector' businesses like Huawei is imaginary. The Trump Administration is right to recognize this reality and issue this order."
The president's executive order comes as the U.S. and China are locked in a trade war, with both nations imposing tariffs on products from the other.

Rogue Company

U.S. officials and lawmakers say China is the problem not only Huawei
By Joseph Marks

Senate Judiciary Committee Chairman Lindsey Graham (R-S.C.)
Trump administration officials have warned for months that Huawei’s global expansion into next-generation 5G wireless networks would amplify the threat of Chinese digital spying.
But now they’re taking the gloves off, accusing the Chinese government of running roughshod over international norms and its own laws to steal Western innovations. 

The stepped up rhetoric comes as President Trump imposed high tariffs on a wide range of Chinese imports, leading to a major escalation in trade hostilities between the two countries.
The move to 5G makes concerns about spying and sabotage significantly more pressing because its super-fast speeds will allow far more systems critical to public safety to run on wireless internet connections, such as high-tech medical equipment and driverless cars.
If Huawei gains a foothold in U.S. allies’ 5G networks, the Chinese government could force the company to send software updates to spy on Western companies or sabotage critical infrastructure, Chris Krebs, director of the Homeland Security Department’s Cybersecurity and Infrastructure Security Agency, warned lawmakers during a Senate Judiciary Committee hearing Tuesday.
Beijing could also exploit hidden vulnerabilities that already exist in Huawei products to hack adversaries or it could plant spies inside Huawei teams that work abroad servicing the company’s technology, Krebs said.
“It’s not about overseeing Huawei. It’s about overseeing China,” Judiciary Committee Chairman Lindsey Graham (S.C.) said during the hearing.
Administration officials formerly attributed their concerns about Huawei to a 2017 cybersecurity law they said would force the company to cooperate with Chinese intelligence requests. 

But Krebs abandoned that nicety Tuesday.
“This is a single-party government. Everything that flows from the central party is a manifestation of their philosophy,” he said. 

“The [cybersecurity] law is important because it is telling you what they want to do. But they’re going to get what they want anyway, law or not.”
The U.S. and China stepped away from trade negotiations last week amid recriminations, and the heightened rhetoric on digital spying probably will make tensions worse.
The White House, which has struggled to convince allies to restrict Huawei from their 5G networks, may also impose its own ban on Huawei as soon as this week, Reuters reported Tuesday.
Lawmakers are also taking a cue from the administration and moving to restrict China from access to U.S. technological innovations.
On Tuesday, Sen. Josh Hawley (R-Mo.) introduced a bill to bar exporting large categories of technologies to China including artificial intelligence, robotics, semiconductors and advanced construction equipment.
Hawley and five other Republicans also proposed another bill to bar Chinese students from science or engineering schools connected with the People’s Liberation Army from receiving U.S. visas.
“This is a strategy with multiple tentacles,” Sen. Thom Tillis (R-N.C.) said, describing Chinese digital spying efforts, “and we as members of Congress need to understand every one of those and chop them off.”

National Security

Huawei, 70 affiliates placed on U.S. trade blacklist

By David Shepardson, Karen Freifeld

WASHINGTON/NEW YORK -- The U.S. Commerce Department said on Wednesday it is adding Huawei Technologies Co Ltd and 70 affiliates to its so-called “Entity List” -- a move that bans the telecom giant from buying parts and components from U.S. companies without U.S. government approval.
U.S. officials told Reuters the decision would also make it difficult if not impossible for Huawei, the largest telecommunications equipment producer in the world, to sell some products because of its reliance on U.S. suppliers.
Under the order that will take effect in the coming days, Huawei will need a U.S. government license to buy American technology.
Commerce Secretary Wilbur Ross said in a statement President Donald Trump backed the decision that will “prevent American technology from being used by foreign owned entities in ways that potentially undermine U.S. national security or foreign policy interests.”
The dramatic move comes as the Trump administration has aggressively lobbied other countries not to use Huawei equipment in next-generation 5G networks and comes just days after the Trump administration imposed new tariffs on Chinese goods amid an escalating trade war.
The Commerce Department said the move comes after the U.S. Justice Department unsealed an indictment in January of Huawei and some entities that said the company had conspired to provide prohibited financial services to Iran. 

The department said it has a reasonable basis to conclude that Huawei is “engaged in activities that are contrary to U.S. national security or foreign policy interest.”
In March 2016, the Commerce Department added ZTE Corp to the entity list over allegations it organized an elaborate scheme to hide its re-export of U.S. items to sanctioned countries in violation of U.S. law.
The restrictions prevented suppliers from providing ZTE with U.S. equipment, potentially freezing the Huawei rival’s supply chain, but they were short-lived. 

The U.S. suspended the restrictions in a series of temporary reprieves, allowing the company to maintain ties to U.S. suppliers until it agreed to a plea deal a year later.
In August, Trump signed a bill that barred the U.S. government itself from using equipment from Huawei and ZTE.
Senator Ben Sasse, a Republican, said “Huawei’s supply chain depends on contracts with American companies” and he urged the Commerce Department to look “at how we can effectively disrupt our adversary.”

The Coming Collapse of China

PREPARING FOR CHINA’S RAPID RISE AND DECLINE
By COLLIN MEISEL AND JONATHAN D. MOYER

China’s rise, one of the defining U.S. national security challenges of our time, has deservedly received attention in each of the last decades-worth of unclassified U.S. government strategies. Unfortunately, China’s pending decline — the one that is likely to occur soon after its rise — has received significantly shorter shrift, earning brief references to an aging population in Northern Asia in the 2015 and 2011 versions of the National Military Strategy.

And yet, China’s rapid transition toward a downward trajectory will pose a unique set of national security challenges for the United States that could prove even more difficult than those posed by China’s rise. 

If this lack of high-level public discussion translates to lack of action, it will be to the detriment of U.S. national security. 

The time to prepare for China’s descent is now, while the challenges that come with it still sit at the edge of the discernible future, and not at the edge of American shores.
By the discernible future, we are not speaking of determinism or an inevitable consequence of events set in motion long ago. 

These are the wares of soothsayers and snake oil salesmen. 

Rather, we are speaking of long-term trends that can readily be forecast — trends such as shifting demographics, economic growth, and government spending — which can be persistent and generally follow long-standing patterns that have been common around the world and across time.
Through this lens, long-term trends indicate that China’s development is on a positive trajectory in one sense. 

The Chinese economy has enjoyed consistent growth for the past several decades and, according to International Monetary Fund estimates, it is on track to claim the title as the world’s largest economy in terms of market exchange rates by 2030. (In terms of purchasing power parity, China already holds the top spot.) 

Barring any unforeseen catastrophes, PricewaterhouseCoopers projects that China’s economy will continue along this path, accounting for 20 percent of the world’s gross domestic product at purchasing power parity by 2050. 

This long upward economic path has in part been driven by China’s one- and two-child policies, which have allowed the nation to avoid the burdens accompanied by the burgeoning population and destabilizing youth bulge common among other developing countries.
As the long-term consequence of its one- and two-child policies, however, China will soon be confronted with an aging working population. 

This is likely to translate into declines in annual gross domestic product growth, increases in health expenditures both per capita and as a share of gross domestic product (perhaps as much as 10 percent by 2030 when pensions are included), and, ultimately, potential declines in material power. 

Indeed, forecasts of the Global Power Index, a measure developed in coordination with our own Frederick S. Pardee Center for International Futures and used in one of the National Intelligence Council’s Global Trends reports, suggest Chinese general capabilities will peak and immediately begin to decline near the year 2050 — just two decades after its material power surpasses the United States in approximately 2030. 

This decline is forecast to continue through the end of the century, and, while China is likely to remain the single-most powerful country during this time (with a forecasted 19.2 percent of the world’s power in 2100 relative to India’s 14 percent and the United States’ 13.2 percent), its material power is never forecast to exceed the likes of NATO (with a forecasted collective share of world power at 29 percent in 2100).
Notably, these measures capture general material capabilities, but are not so refined as to be used to understand how effectively these capabilities are expressed. 

To be sure, nations with different resource availability can leverage their material capabilities in more or less effective ways. 

Thus, while China is expected to have the potential for growing material superiority in the coming 30 years followed by a sudden, swift atrophy, its strengths in some areas are likely to persist (e.g., supply-chain and debt dependencies stemming from One Belt, One Road) while experiencing continued — and perhaps growing — weakness in other areas.
For example, China’s military has yet to accrue combat and other technical and leadership experience to anywhere near the breadth and degree of the U.S. military or that of many U.S. allies. 

Even subtracting this human element, the tremendous capital stock in high quality materiel and technological expertise the likes of that possessed by the U.S. military cannot be built overnight — certainly not with China’s military spending having held at only 2 percent of gross domestic product over the last 17 years — nor can it be stolen. 

Acquisition and mastery of technology is often an expensive, decades-long process — one that may require more time than China has as it grows old before it gets rich.
Meanwhile, the United States enjoys several relative structural advantages. 

Demographically, the median age of the U.S. population has grown and is forecast to grow at a much lower rate than China’s in the coming decades. 

Specifically, the U.S. population’s median age is expected to grow from 38 to 43 from now to 2050, as compared to the Chinese population’s transition from and 38 to 48, according to Pardee Center forecasts. 

To place these numbers in context, the U.S. population in 2050 will have an average age similar to Japan nearly two decades ago while the Chinese population will have an average age similar to Japan today, which Prime Minister Shinzo Abe states is facing a “national crisis” due to an aging society. As for the material wealth of the average Chinese and American in 2050, the Pardee Center projects that China’s gross domestic product per capita at market exchange rates will be roughly equivalent to the United States’ gross domestic product in 1992, at $37,200 in constant 2011 U.S. dollars. Meanwhile, the average American is expected to be more than twice as wealthy, with a forecasted gross domestic product per capita of more than $80,500.
Militarily, the United States possesses an entire generation, arguably two, of seasoned combat veterans. 

Even among non-combat veterans, the U.S. military’s pipeline for training technically skilled warfighters across an array of specialties continues to be the envy of nations the world over, including China. 

And while health care costs in the United States are exorbitant and continue to rise, this is the result of regulation-related policy choices that are not bound to America’s demographic structure, with similarly developed nations spending half as much per capita. 

In other words, structural advantages tell us that the United States is likely to stick around at the top of the global pecking order as China is on its way back down.
While power transitions in and of themselves are contentious business, one can imagine the added drama injected by the Chinese Communist Party as it strives to maintain power — both internally and on the world stage — wary of seeing China return to its much lamented 19th century status as “the sick man of Asia.” 

To be sure, even as the nation declines, Chinese leaders will have extensive material capabilities and a vast network of relational influence at their disposal should a power struggle ensue. 

As Vladimir Putin’s Russia has illustrated from the Donbass to the Democratic National Committee, declining material powers can still wreak havoc in the international system and stymie U.S. strategists’ goals. 

Thus, none of this is to say that China’s decline will be uniform across all fronts material and relational. 

Rather, China’s decline in the material sense may embolden its leaders to strive to achieve its foreign policy objectives by aggressively employing other means (again, see Putin’s Russia), possibly leading to miscalculations and misperceptions that war between a materially-declining China and a relatively materially-steady United States is somehow inevitable.
As Great Britain illustrated at the turn of the 20th century, blood-free great power transitions can in part be assured by the declining hegemon tactfully ceding leadership to its aspiring successor. 

As China rises, the United States can do the same. 

While China can choose to cede its eventual leadership as well, will it? 

The rapidity of the transition between China’s swift growth and subsequent atrophy is virtually unprecedented for a major peacetime power, leaving strategists pondering this question in uncharted waters.
Still, long-term strategy requires thinking about such questions now, as whatever set of answers strategists devise will likely require the establishment or strengthening of relational influence via resilient bilateral and multilateral economic and diplomatic ties, or perhaps a continued U.S. military build-up “like we never have before” to correct for the United States’ presently weakening hand. Specific economic policy options include rejoining the Trans-Pacific Partnership — a move which a few remaining members of the renamed Comprehensive and Progressive Agreement for Trans-Pacific Partnership have actively encouraged but admittedly faces immense hurdles at this point in time — and embracing rather than further weakening the World Trade Organization. 

Both would bake-in structural economic advantages for the United States relative to China in the Indo-Pacific and the world more generally, with the former coming with the added benefit of signaling continued U.S. strategic interest in the region. 

On the military front, the United States would be wise to continue to further deepen ties with India and encourage a transition from Russian to American weapons systems, moves that would help de-conflict the United States’ and a rising India’s foreign policy interests (thus avoiding dual power struggles with one current and another rising power in the Indo-Pacific).
Given that these and similar policy options require sustained execution, they would also greatly benefit from codification in future U.S. national security strategy documents by sending signals to both internal and external actors of their continued importance.
Perhaps more boldly, strategists could work to convince policymakers that that the U.S. Department of Defense’s desire for three to five percent real growth in its budget through 2023 would in fact likely be counterproductive in the long-term struggle between U.S. and Chinese hegemony.
This does not mean that the U.S. military should cease investing in emerging technologies or attempting to retain its competitive edge.
Rather, it simply means that U.S. policymakers must balance these priorities with other concerns that could erode America’s structural advantages relative to China, such as the need for sustained inward migration in the United States to avoid an aging crisis, and pension reform to sustainably manage the aging that will occur, avoiding Social Security’s possible insolvency by 2035.
Likewise, policymakers might be urged to increase rather than cut foreign aid, which would enhance developing nations’ stability and decrease their dependence on Chinese investments.
The great deal of political and real capital necessary to achieve these goals could require redirecting the increases currently being requested by Department of Defense officials, but these reforms’ long-term impact would underwrite American power in ways that are unlikely to risk becoming obsolete.
More generally, U.S. strategists should adopt what B. H. Liddell Hart coined an “actively conservative” mindset.
Neither a strategy emphasizing military dominance nor complacency nor appeasement, an actively conservative foreign policy appreciates that preparation for conflict is necessary while also recognizing that self-exhaustion — perhaps through unsustainable increases in military spending or failure to address other pending fiscal crises — is as potent an enemy as any external foe. Furthermore, in dealing with external foes, active conservatism requires suppressing the “immoderate desire for the immediate satisfaction of outright victory.”
In other words, it is taking the long view.
China’s rise is, at this point, glaringly apparent.
The discernible future suggests that the same is true of China’s subsequent decline.
Preparation for this reality must begin now so tomorrow’s strategists may reap the benefits that strategists managing China’s rise lack today.