Covert, Coercive, and Corrupting: Countering the Chinese Communist Party’s Malign Influence in Free Societies

REMARKS

DAVID R. STILWELL, ASSISTANT SECRETARY

BUREAU OF EAST ASIAN AND PACIFIC AFFAIRS

HOOVER INSTITUTION, STANFORD UNIVERSITY, ASIA SOCIETY

VIRTUAL

OCTOBER 30, 2020

As prepared

Introduction

 

Good afternoon. Thank you to the Hoover Institution, Stanford University, and the Asia Society for inviting me. Thank you to organizers Orville Schell and Larry Diamond. It is an honor to be here today with former Secretary of State Condoleezza Rice.

Our topic today is how the Chinese Communist Party challenges the free and open nature of democratic societies. The prosperity, liberty, and security of the American people, and of our friends around the world, hinges on how we meet this challenge.

To succeed, effort is required not just by policymakers and national-security professionals, but by all elements of society – and not just in America but around the world.

A major, worldwide defensive enterprise of this kind is a difficult but noble undertaking. Its foundation is a common threat assessment that the Chinese Communist Party is highly capable, ambitious, and hostile to our basic political principles: democracy, openness, and individual dignity.

It is important, first of all, that we recognize this challenge. It is also necessary that we give it the priority it deserves, despite the many other pressing matters that inevitably demand attention.

The Trump Administration’s 2017 National Security Strategy centered on the observation that we are in “a geopolitical competition between free and repressive visions of world order.” Secretary Pompeo says that China is the first challenge he thinks about every day.

The Chinese Communist Party’s strategy implicates private as well as governmental targets around the world. That is why it is important for all institutions in our society – private and governmental – to understand that strategy and adopt measures to manage risk, counter coercion, and protect free expression.

The Hoover Institution has been exemplary in this area, including through its 2018 report on “China’s Influence and American Interests: Promoting Constructive Vigilance.”

I will emphasize three points today.

First: Influence and interference operations are fundamental to how the Chinese Communist Party engages with the world – with all of us. We might prefer to think of China as simply a trade partner or the home of a great civilization. But the Chinese Communist Party today has taken an adversarial stance toward its neighbors, the United States, and much of the rest of the world. Its goals are not stability or a live-and-let-live respect for the sovereignty of other law-abiding nations. Its strategy is aggressive and intrusive. It not only rejects our democratic political principles but sees them as a prime vulnerability to exploit. China’s role in the world today cannot be understood without reference to the wide array of malign activities that the Chinese Communist Party undertakes to influence our societies in ways that are covert, coercive, and corrupting.

Second: The principle of reciprocity is vital to understanding the problem and countering it. Reciprocity is basic in international relations. You send your diplomats to my country and I send my diplomats to your country under the same rules; I open my market to your exports, you open your market to mine. Yet for decades we and other countries made exceptions for Beijing. We allowed the Chinese Communist Party to engage with our societies on non-reciprocal terms — and Beijing exploited the imbalance. Now, our insistence on reciprocity is overdue self-defense.

Third: Coordination among allies and partners is imperative. This problem is global. In many ways we and others around the world are still only waking up to it. We benefit from sharing information and ideas. Beijing prefers to exploit its size against individual countries bilaterally. It is often only by acting in concert that other countries can shift the calculus in favor of reciprocity, transparency, and freedom. And so we must.

United Front Work

 

The world is increasingly aware of how the Chinese Communist Party is using its foreign engagements to influence, interfere, and coerce.

The awareness is disturbing and even shocking for many people, because for decades the United States and other countries forged links with China based on the optimistic, good-faith expectation that shared prosperity and trust would result from our diplomacy, trade and investment, and media, academic, and people-to-people exchanges. The sad and dangerous reality, however, is that the Chinese Communist Party has chosen to weaponize these engagements. It uses them as channels for malign purposes.

Beijing officials claim to seek “win-win” exchanges. They claim to practice “non-interference” in other countries’ affairs. In reality, however, their conduct is systematically predatory and hegemonic. The Chinese Communist Party wants control, or at least veto power, over public discourse and political decisions the world over.

This is what guides its foreign interference activities – what Beijing calls “United Front work,” and we can better understand as political warfare.

Xi Jinping calls United Front work a “magic weapon” of the Chinese Communist Party. Mao Zedong saw it the same way.

How does the weapon work? I’ll mention a few visible examples.

Chinese United Front interference in Australia has produced years of cascading news headlines. An up-and-coming senator was forced to resign over improper ties to a Beijing-linked donor. Numerous senior officials retired into jobs with entities controlled by Beijing. Advertising boycotts were organized against Chinese-language newspapers that won’t toe Beijing’s line. An intelligence chief warned of the “catastrophic harm” Australia is subject to as a result of “espionage, interference, sabotage and malicious insider activities.”

At the University of Queensland last year, students demonstrating for Hong Kong’s democratic rights were roughed up by classmates connected to a Beijing-sponsored students association. The PRC Consul General praised the “spontaneous patriotic behavior” of the pro-Beijing bullies. Australia’s defense minister then warned foreign diplomats not to suppress Australia’s free speech.

New Zealand has had similar experiences. After university campus skirmishes over Hong Kong, local PRC diplomats praised the “spontaneous patriotism” of the anti-democracy brawlers. In response, New Zealand’s prime minister asked officials to remind their Chinese counterparts that New Zealand “will uphold and maintain our freedom of expression.”

In 2017, New Zealand media revealed that a Chinese-born member of Parliament had lied about his background when applying for New Zealand citizenship—concealing that he had spent 15 years working for Chinese military intelligence. The parliamentarian, who had previously played a prominent role in bilateral relations with Beijing, lost his seats on the foreign affairs, defense, and trade committees, but remained in Parliament.

Coopting friends and neutralizing enemies are two sides of the United Front coin. In Australia and New Zealand, scholars critical of Beijing have faced burglaries and death threats. In suburbs from New South Wales to New Jersey, Chinese dissidents and activists are hounded by Communist Party agents.

The United Front targets not just people but information, including private data about large numbers of public and private individuals. In the United States and across the world, we see systematic theft on a huge scale of intellectual property and technology from universities, businesses, and medical labs.

At the United Nations and in capitals around the world, Chinese Communist Party agents are behind bribery scandals. Beijing’s overseas infrastructure projects often go hand-in-hand with bribes for local elites and harsh financing terms hidden in secret contracts. Aggressive United Front propaganda work then dishonestly portrays the arrangements as benevolent rather than rapacious.

The Chinese Communist Party is increasing its propaganda on television and in newspapers worldwide, while undermining independent Chinese-language media wherever it is found.

Pop culture, arts, and sports are major battlegrounds too. Americans saw the National Basketball Association thrown into crisis over a single tweet about Hong Kong. Players, coaches, and owners known for strong opinions are cowed into silence when the subject is China. Fans are booted from stadiums for holding signs that say “Google Uighurs” (in Washington, D.C.) or flying a Tibetan flag (in Germany).

We see the conspicuous absence of Hollywood movies willing to depict China critically – or to portray the heroism of the young people of Hong Kong, the leaders of underground Chinese Christian churches, or Tibetans trying to keep their culture alive. There is also an increasing number of Hollywood movies portraying Beijing as a benevolent global leader – even in areas, such as space, where in fact Beijing is the only country to have recently carried out a destabilizing anti-satellite missile test that littered dangerous debris across low-earth orbit.

We see the bullying of corporations – Marriott, Mercedes-Benz, and many more – to parrot Communist Party talking points lest they face a state-backed boycott. Business executives are enticed to toe Beijing’s line, lest long-promised access to the China market never materializes.

COVID-19 disinformation. PPE shakedowns. Wolf Warrior diplomacy.

All these are manifestations of United Front work. All subvert interests and principles that Americans cherish. And all reflect the intertwined dangers of coercive, covert, and corrupting influence.

The “Iceberg” of Influence Actors

 

Beijing’s instruments for exerting this influence are enormous.

In recent years Xi Jinping has added 40,000 cadres to the United Front Work Department, making it four times the size of the State Department’s Foreign Service corps. And that’s without counting the other parts of the Beijing Party-state that help shape foreign opinion and influence foreign officials. These include the Ministry of Foreign Affairs, the Central Propaganda Department, the Ministry of State Security, the Ministry of Education, the International Liaison Department, and the Political Work Department of the People’s Liberation Army.

These entities, in turn, coordinate the work of front organizations that operate around the world, often in and through diaspora communities. Some of these United Front organizations identify as Beijing-backed, but most try to present themselves as independent, grassroots-type NGOs, cultural-exchange forums, “friendship” associations, chambers of commerce, media outlets, or academic groups.

Then there are the Confucius Institutes at colleges and universities and Confucius Classrooms at the K-12 level. These are funded by Beijing and play by its rules. They were launched in 2004 personally by the head of the United Front Work Department. In 2009, Beijing’s ideology czar Li Changchun, a member of the Politburo Standing Committee, called Confucius Institutes “an important part of China’s overseas propaganda setup.”

All told, we face a large and deliberately opaque amalgam of Chinese Communist Party officials, agents, and cutouts seeking advantage in our societies.

Think of an iceberg. Above the waterline are official PRC diplomats conducting legitimate diplomatic activities, for example. Below the waterline is a far larger, murkier mix of actors and entities whose ties to the Communist Party state have long gone ignored, overlooked, or unstudied. These include:

PRC diplomats conducting activities inconsistent with their diplomatic status, such as the espionage tied to the PRC Consulate in Houston. We shut down that Consulate this summer.

PRC state media personnel who masquerade as legitimate news reporters when their real business is propaganda and espionage.

Researchers sent by the People’s Liberation Army (PLA) into our high-tech university labs—especially those who illegally hide their military affiliation on their visa applications.

The iceberg also includes the Confucius Institutes, Confucius Classrooms, and Chinese Students and Scholars Associations that chill academic freedom and free speech in our schools and universities, but pretend to be merely academic.

Also part of the iceberg are United Front organizations working to co-opt state and local governments, diaspora communities, and other targets.

And don’t forget China’s state-owned enterprises, which aren’t just owned on paper by Beijing but are used by Beijing as instruments of its hostile policies. There are also enterprises owned by the Chinese military, many of which operate in this country and around the world. And private Chinese firms too, which just last month received aggressive new guidance from Beijing to follow Communist Party dictates and support United Front work.

This iceberg deserves serious study and scrutiny. Across our society and across the world, we must better track, expose and, when necessary, counter these instruments of improper influence and interference.

That is why the State Department has taken steps recently under the Foreign Missions Act to identify organizations operating in the United States under Chinese Communist Party control. We are designating them as foreign missions of the People’s Republic of China. So far we have tagged 15 state propaganda outlets, the Confucius Institute Center U.S., and the National Association for China’s Peaceful Unification, a key United Front group.

Similarly, the Pentagon this year for the first time identified dozens of companies operating in the United States that are owned by or affiliated with China’s People’s Liberation Army.

Meanwhile the U.S. Justice Department is pursuing a wide range of law-enforcement actions against covert, coercive, and corrupting activity. This includes alleged visa fraud by PLA researchers in U.S. universities; economic espionage by corporate executives, Ministry of State Security agents and others; drug trafficking and money laundering, and more. Just this week, Justice charged eight individuals with acting as illegal agents of Beijing to harass, stalk, and coerce U.S. residents to return to China against their will.

Reciprocity

 

Let’s dwell for a moment on the principle of reciprocity.

President Trump has said repeatedly that reciprocity is his favorite word. It is an especially useful concept when applied to China. Because reciprocity—and the lack thereof—captures so much about the troubled and imbalanced relations that countries all around the world have found themselves in with Beijing.

Now reciprocity isn’t a cure-all, and it doesn’t have to guide our interactions everywhere and always. But it is a basic guide to fairness, prudence, and caution – virtues the world generally failed to practice during years of reckless engagement with Beijing.

We allowed the Chinese Communist Party access to our society that it never extended to us. Diplomatic access. Educational access. Trade access. Investment access. Science and technology access. Data access.

We thought it was worth it. That it wouldn’t cost us much. That it would aid China’s development. That, crucially, it would facilitate Beijing’s political transformation into a responsible and friendly regime. The result, of course, was quite different.

Access to our societies, economies, and technologies certainly helped China develop, but the Chinese Communist Party only doubled down on Leninism, mercantilism, and hostility to the West. Now we are scrambling belatedly to protect our own societies from being transformed by Beijing.

Reviving reciprocity is a fundamental step.

Beijing’s diplomats should not enjoy open access to American society while Beijing prevents U.S. diplomats in China from traveling freely, meeting Chinese people, visiting university campuses, and otherwise conducting normal diplomatic business.

We should not treat Beijing’s state media propagandists as independent journalists in our country while Beijing further restricts the few American and other genuinely independent foreign journalists left in China.

And we should not extend every privilege of the American economy to Beijing’s state enterprises, military companies, and tech national champions while Beijing denies market access to a large share of American firms and certainly disfavors any enterprise that serves our military.

In these areas and more, we are taking policy, regulatory, and law-enforcement action across the U.S. government to correct years of non-reciprocity, imbalance and abuse.

International Coordination

 

As Secretary Pompeo has said, we encourage every leader of every nation to start by doing what America has done – to insist on reciprocity, transparency and accountability from the Chinese Communist Party.

Among the propaganda narratives promoted by United Front work is the notion that scrutiny of Chinese Communist Party activities is somehow a hostile act. But it is not. It is basic prudence.

All sorts of businesses and organizations know how to manage risk, perform due diligence, and ensure they know their clients. It is past time that we all start applying these approaches to engagement with China and the Chinese Communist Party. Indeed one reason why is that under Xi Jinping, it has become effectively impossible to engage “China” without engaging the Party.

We encourage countries to study your own icebergs. Take stock of your own policy toolkits.

Do you have laws like our Foreign Missions Act and Foreign Agent Registration Act? If not, do you need them? What about a “China Initiative” like that of our Justice Department? The sorts of espionage, theft, corruption, visa fraud, coercion and other abuses being uncovered by our law-enforcement investigations exist wherever the Chinese Communist Party operates.

Australia, seeing a few years ago that its laws and government structure were lacking in certain key areas, passed a landmark series of bills on countering foreign interference. Australia helped teach the world how to organize against this threat, and how to think and speak about it. As Prime Minister Malcolm Turnbull said, “We will not tolerate foreign influence activities that are covert, coercive, or corrupt. That is the line that separate legitimate influence from unacceptable interference.”

Let’s learn from each other and let’s coordinate. Not only to compare notes, but also to establish deterrence. Despite the magnitude of the challenge, we have massive leverage, especially as a group.

The Chinese Communist Party wants access to what other countries have. Lucrative markets. Capital. Advanced technologies. World-class universities and laboratories. International prestige.

We must no longer give these away to Beijing easily, in hopes that the CCP will respond to our goodwill in kind. Its record shows that it won’t. Transparency, reciprocity, fairness, accountability, rule of law: These are necessary guides if we are to prevent the Chinese Communist Party from continuing to assault our societies from within.

As we posture for this challenge, it is also important to underscore that our concern is not with the Chinese people, whom we admire greatly, but with the policies of the Chinese Communist Party. Precise language and strategy are vital.

The Chinese Communist Party tries to make itself synonymous with the Chinese people and civilization, but it certainly is not. It also tries to equate criticism of the Party with targeting of Chinese people. We must be clear in rejecting this, and in showing that our free and open societies value the very ethnic, cultural, and political diversity that the Chinese Communist Party seeks to crush.

The Stakes

 

Why is it essential that the free nations of the world exercise vigilance? Simply put, the Leninist Politburo that runs China wants to set the rules for the whole world.

A future Pax Sinica, fully realized, would be aggressive, contemptuous of human liberty, and domineering. Instead of a rules-based international order, peaceful resolution of disputes, and respect for the sovereignty of law-abiding nations, a CCP-imposed world order would require obedience to Beijing. Technological advances in surveillance and control would move the world toward a new dark age of tyranny.

Ask the booksellers of Hong Kong for proof. Ask Jimmy Lai. Ask His Holiness the Dalai Lama. Ask Ai Weiwei. Ask Liu Xia, the widow of Liu Xiaobo. Ask the Uyghurs. Ask the brave citizens of Taiwan. Ask any of China’s neighboring states.

The Chinese Communist Party poses a real risk to our basic way of life—prosperity, security, and liberty all. Our task is to recognize it, alert others, and together take the steps needed to defend our freedoms.

Thank you.