1 00:00:00,040 --> 00:00:02,880 Speaker 1: Been looking forward to this conversation. We're joined by author 2 00:00:02,880 --> 00:00:06,920 Speaker 1: and columnist Gordon Chang, widely recognized authority on what's happening 3 00:00:06,960 --> 00:00:09,520 Speaker 1: in China, Chinese American relationships and that sort of thing. 4 00:00:09,720 --> 00:00:12,760 Speaker 1: Gordon's recent column caught my eye. China's economy is collapsing. 5 00:00:12,800 --> 00:00:15,280 Speaker 1: Here's why you should worry, Gordon. Welcome, How are you, sir? 6 00:00:16,440 --> 00:00:18,960 Speaker 1: I'm fine, thank you, and thank you so much. Joe, Oh, 7 00:00:18,960 --> 00:00:22,680 Speaker 1: it's it's my pleasure. So it's funny Jack and I 8 00:00:22,760 --> 00:00:27,360 Speaker 1: and Jack's off today, but we're both really into Chinese 9 00:00:27,360 --> 00:00:29,920 Speaker 1: American relations, the rise of China, China's future, and that 10 00:00:30,040 --> 00:00:33,519 Speaker 1: sort of thing. While as Rush Limbaugh might have put it, 11 00:00:33,600 --> 00:00:36,559 Speaker 1: the drive by media just always repeats China is the 12 00:00:36,560 --> 00:00:39,360 Speaker 1: great rising economic power. China will soon eclips us. They'll 13 00:00:39,360 --> 00:00:41,120 Speaker 1: soon have the biggest economy on Earth, and a lot 14 00:00:41,159 --> 00:00:43,320 Speaker 1: of us are over here shouting whoa, whoa, whoa. China 15 00:00:43,360 --> 00:00:46,760 Speaker 1: has some serious problems going on, so glad to hear 16 00:00:46,800 --> 00:00:49,080 Speaker 1: you writing about it. Tell us about the current state 17 00:00:49,360 --> 00:00:51,600 Speaker 1: of China economically, and then we'll get to what it 18 00:00:51,680 --> 00:00:55,200 Speaker 1: might mean down the road. Yes, China right now has 19 00:00:55,240 --> 00:00:59,720 Speaker 1: an economy which is perhaps zero growth. Maybe negative. If 20 00:00:59,720 --> 00:01:02,360 Speaker 1: there is any sort of positive growth at all, it's 21 00:01:02,400 --> 00:01:06,039 Speaker 1: probably less than one percent. And the reason is, of 22 00:01:06,080 --> 00:01:09,480 Speaker 1: course the COVID lockdowns, which still are plaguing in the country, 23 00:01:09,560 --> 00:01:13,360 Speaker 1: including still plaguing Beijing and Chinhai where they're putting new 24 00:01:13,400 --> 00:01:17,679 Speaker 1: neighborhoods into restrictive measures all the time. But they're more 25 00:01:17,720 --> 00:01:21,280 Speaker 1: fundamental problems. The most fundamental problem is that siege and thing. 26 00:01:21,280 --> 00:01:24,840 Speaker 1: The Chinese ruler is moving back to a state dominated economy. 27 00:01:25,080 --> 00:01:27,880 Speaker 1: We know that doesn't work. Also, they've got too much 28 00:01:28,040 --> 00:01:32,120 Speaker 1: debt um and that debt problem is is something that 29 00:01:32,160 --> 00:01:35,480 Speaker 1: they can't solve. But it's not just the economy. This 30 00:01:35,560 --> 00:01:37,840 Speaker 1: is in the context of a country which really is 31 00:01:37,840 --> 00:01:42,640 Speaker 1: in distress. Uh, tell us more about that sort of distress. 32 00:01:42,680 --> 00:01:44,440 Speaker 1: I mean, because the COVID will come and the COVID 33 00:01:44,440 --> 00:01:46,440 Speaker 1: would go. But I know a lot of problems are 34 00:01:46,520 --> 00:01:51,840 Speaker 1: are structural. If you will, yes, but the problems are structural, 35 00:01:51,960 --> 00:01:55,400 Speaker 1: and the most structural problem of all is demography. China 36 00:01:55,600 --> 00:01:58,400 Speaker 1: right now has a population of let's say one point 37 00:01:58,480 --> 00:02:00,720 Speaker 1: for one billion, which is the numb were from the 38 00:02:00,760 --> 00:02:05,520 Speaker 1: most recent reporting of the National Bureau Statistics UM. Most 39 00:02:05,560 --> 00:02:08,639 Speaker 1: people expect China by the end of the century will 40 00:02:08,680 --> 00:02:13,680 Speaker 1: have a population of maybe five million, maybe six hundred 41 00:02:13,720 --> 00:02:17,280 Speaker 1: million if they're lucky. Um So, really this is the 42 00:02:17,320 --> 00:02:20,440 Speaker 1: biggest demograph that fall in history and the absence of 43 00:02:20,480 --> 00:02:24,040 Speaker 1: war or disease. No country has ever gone through that before. 44 00:02:24,400 --> 00:02:27,160 Speaker 1: So we don't know how China will navigate it. But 45 00:02:27,480 --> 00:02:30,560 Speaker 1: all of its other problems, um, and there are a 46 00:02:30,639 --> 00:02:33,160 Speaker 1: lot of them, have to be seen in the context 47 00:02:33,320 --> 00:02:37,560 Speaker 1: of a rapidly shrinking country. Well, and you couple that 48 00:02:37,639 --> 00:02:40,360 Speaker 1: with j and Ping and when you know, I can't 49 00:02:40,360 --> 00:02:42,600 Speaker 1: remember when it was, but Jack and I had long 50 00:02:42,639 --> 00:02:47,079 Speaker 1: assumed that JN Ping Stalin. A lot of the communist 51 00:02:47,240 --> 00:02:51,520 Speaker 1: leaders just wanted the legitimacy, the promises of communism, but 52 00:02:51,560 --> 00:02:55,160 Speaker 1: we're really running kind of an old fashioned dictatorship behind 53 00:02:55,160 --> 00:02:58,000 Speaker 1: the scenes. They didn't believe their own rhetoric. But it seems, 54 00:02:58,160 --> 00:03:01,280 Speaker 1: you know, that Jan Ping actually believes in communism, that 55 00:03:01,480 --> 00:03:03,760 Speaker 1: it will work, and that it's time to run in 56 00:03:03,840 --> 00:03:09,839 Speaker 1: this unruly capitalist thing that's that's bought them everything they have. Yes, 57 00:03:10,040 --> 00:03:13,560 Speaker 1: and we never know, of course, within someone's mind, but 58 00:03:13,639 --> 00:03:18,160 Speaker 1: it's clear that siegent Ping revers Mousedong. He's consistently felt 59 00:03:18,200 --> 00:03:21,240 Speaker 1: that way over the course of decades, and we've seen 60 00:03:21,320 --> 00:03:24,239 Speaker 1: his actions as a ruler, which is to move away 61 00:03:24,240 --> 00:03:27,640 Speaker 1: from the liberalization of the economy in China which created 62 00:03:27,639 --> 00:03:30,760 Speaker 1: all that growth during three and a half decades. Also, 63 00:03:30,880 --> 00:03:34,679 Speaker 1: he believes in totalitarian social controls and we're seeing the 64 00:03:34,840 --> 00:03:38,360 Speaker 1: return of those, so that China has really moved back 65 00:03:38,440 --> 00:03:42,440 Speaker 1: to a society that he's starting to resemble the nineteen fifties, 66 00:03:42,640 --> 00:03:47,960 Speaker 1: only with high speed railroads and buildings and skyscrapers. Um. 67 00:03:47,960 --> 00:03:50,640 Speaker 1: But really what he's doing is he's taking the vitality 68 00:03:50,720 --> 00:03:54,320 Speaker 1: out of China, and that ultimately is something that has occurred. 69 00:03:54,840 --> 00:03:57,200 Speaker 1: It occurred in the first years of the People's Republic, 70 00:03:57,240 --> 00:04:00,360 Speaker 1: of course, but it's also occurred during the Imperial Error 71 00:04:00,360 --> 00:04:02,720 Speaker 1: from time to time where China's leaders closed up their 72 00:04:02,760 --> 00:04:06,640 Speaker 1: country and it's always resulted in disaster at Joel and 73 00:04:06,960 --> 00:04:09,080 Speaker 1: in your piece which folks can read it Armstrong and 74 00:04:09,120 --> 00:04:13,240 Speaker 1: Getty dot Com link to the Daily Caller. Um, it's uh. 75 00:04:13,400 --> 00:04:15,600 Speaker 1: You mentioned there have been a handful of run on 76 00:04:15,720 --> 00:04:20,000 Speaker 1: the runs on banks. There's a very very fragile situation 77 00:04:20,120 --> 00:04:23,040 Speaker 1: with the real estate market. So I mean, if all 78 00:04:23,080 --> 00:04:25,400 Speaker 1: of those birds come home to roost and and China 79 00:04:25,440 --> 00:04:29,560 Speaker 1: goes into a severe state of unrest or or recession, 80 00:04:30,040 --> 00:04:33,400 Speaker 1: obviously that will affect the world economy. Do you want 81 00:04:33,400 --> 00:04:35,039 Speaker 1: to talk about that just a little bit before we 82 00:04:35,080 --> 00:04:40,480 Speaker 1: get into other geopolitical questions. Sure, um, it will affect 83 00:04:40,520 --> 00:04:43,320 Speaker 1: the global economy, but much less than we think. You know, 84 00:04:43,360 --> 00:04:46,719 Speaker 1: everyone says China is an engine of global growth. And yes, 85 00:04:46,800 --> 00:04:50,239 Speaker 1: China does have and has had growth. But the point 86 00:04:50,360 --> 00:04:53,000 Speaker 1: is China's growth has come at the expense of other 87 00:04:53,040 --> 00:04:56,800 Speaker 1: countries because of their stealing of intellectual property and their 88 00:04:56,839 --> 00:05:00,240 Speaker 1: predatory trade practices. So if China were, for an since 89 00:05:00,360 --> 00:05:03,000 Speaker 1: just a magically disappear off the face of the earth, 90 00:05:03,480 --> 00:05:06,360 Speaker 1: it actually would be good for growth of other countries 91 00:05:06,680 --> 00:05:09,120 Speaker 1: because to be an engine of global growth, you've got 92 00:05:09,120 --> 00:05:11,320 Speaker 1: to buy the goods and services of other countries to 93 00:05:11,400 --> 00:05:15,440 Speaker 1: create growth elsewhere. And the engine of global growth today, 94 00:05:15,560 --> 00:05:18,560 Speaker 1: as it's been consistently since the end of World War Two, 95 00:05:18,920 --> 00:05:21,440 Speaker 1: is the United States. Because we run these enormous trade 96 00:05:21,480 --> 00:05:24,919 Speaker 1: deficits with others, We're creating growth around the world. The 97 00:05:25,000 --> 00:05:29,400 Speaker 1: Chinese are taking away growth from other countries. Author and 98 00:05:29,440 --> 00:05:33,039 Speaker 1: columnist Gordon Chang is online. We're talking about China's economic 99 00:05:33,160 --> 00:05:36,159 Speaker 1: fragility and what it might mean. And then you you 100 00:05:36,279 --> 00:05:38,160 Speaker 1: hit me with You hit us with a sentence, a 101 00:05:38,200 --> 00:05:40,600 Speaker 1: couple of sentences that I thought were just terrific and 102 00:05:40,600 --> 00:05:42,880 Speaker 1: I did not see coming. In your peace, you ask 103 00:05:42,920 --> 00:05:46,039 Speaker 1: why should we care? Well, for decades, the primary basis 104 00:05:46,160 --> 00:05:48,920 Speaker 1: of legitimacy the Communist Party has been the continual lead, 105 00:05:49,400 --> 00:05:53,760 Speaker 1: continual delivery of prosperity. Now, because of the accelerating downturn, 106 00:05:53,839 --> 00:05:58,520 Speaker 1: the party's only remaining basis of legitimacy is nationalism. That 107 00:05:58,680 --> 00:06:01,120 Speaker 1: was the twist that I did not see coming. What's 108 00:06:01,160 --> 00:06:04,680 Speaker 1: that likely to look at like? Well? Si jun Ping 109 00:06:05,120 --> 00:06:07,400 Speaker 1: believes that the Communist Party has a right to rule. 110 00:06:07,800 --> 00:06:11,760 Speaker 1: He knows that his primary basis of legitimacy is gone. 111 00:06:11,880 --> 00:06:15,360 Speaker 1: He can no longer assure prosperity, which means that he's 112 00:06:15,360 --> 00:06:18,239 Speaker 1: got to show a strong China. Now, a strong China 113 00:06:18,360 --> 00:06:24,359 Speaker 1: means military misadventure abroad. It means, for instance, going after India, Japan, 114 00:06:24,440 --> 00:06:28,680 Speaker 1: the Philippines, Taiwan, even US. We've seen some very hostile 115 00:06:28,720 --> 00:06:31,320 Speaker 1: maneuvers by the Chinese Air Force and Navy over the 116 00:06:31,400 --> 00:06:34,040 Speaker 1: last couple of months. These guys are just sort of 117 00:06:34,040 --> 00:06:36,760 Speaker 1: looking for a war. Um you know, they may say 118 00:06:36,800 --> 00:06:39,440 Speaker 1: they don't want it, but they're taking actions that can 119 00:06:39,560 --> 00:06:42,000 Speaker 1: lead to it, and so therefore we've got to be 120 00:06:42,040 --> 00:06:45,320 Speaker 1: prepared that not as the Pentagon says that if war 121 00:06:45,400 --> 00:06:48,320 Speaker 1: comes with China it'll be next decade, We've got to 122 00:06:48,360 --> 00:06:51,680 Speaker 1: be prepared for the here and now. So you think 123 00:06:51,680 --> 00:06:55,719 Speaker 1: it's a putent like effort to provoke outsiders to attack 124 00:06:55,839 --> 00:06:59,520 Speaker 1: China to rally the people to the party, it would 125 00:06:59,520 --> 00:07:02,960 Speaker 1: probably to be attacking others. In the first instance. We 126 00:07:03,000 --> 00:07:06,719 Speaker 1: saw this in June with the sneak attack on India. 127 00:07:07,400 --> 00:07:10,560 Speaker 1: We have seen this, of course with these very provocative 128 00:07:10,640 --> 00:07:14,400 Speaker 1: air maneuvers um, not only with regard to Taiwan, but 129 00:07:14,520 --> 00:07:20,160 Speaker 1: also last month they almost tried to uh they almost 130 00:07:20,200 --> 00:07:24,880 Speaker 1: brought down in Australian reconnaissance playing in international airspace. So 131 00:07:25,160 --> 00:07:28,440 Speaker 1: this is really dangerous stuff that they're doing. And so 132 00:07:28,560 --> 00:07:30,480 Speaker 1: you know, the law of averages says that there's going 133 00:07:30,520 --> 00:07:33,040 Speaker 1: to be a collision or there's going to be deaths, 134 00:07:33,160 --> 00:07:36,280 Speaker 1: and that could lead to the spiral downward from which 135 00:07:36,320 --> 00:07:39,960 Speaker 1: there is no recovery. If you are to advise the 136 00:07:40,000 --> 00:07:44,120 Speaker 1: Joe Giddy administration on dissuading the Chinese from from pushing 137 00:07:44,240 --> 00:07:46,960 Speaker 1: too far and provoking the sort of conflict you're talking about. 138 00:07:46,960 --> 00:07:50,840 Speaker 1: What would you suggest, is there any dissuading them. I 139 00:07:50,920 --> 00:07:53,360 Speaker 1: think that there is, because they realized that we're a 140 00:07:53,400 --> 00:07:56,560 Speaker 1: stronger country. Um. What they don't believe is that the 141 00:07:56,640 --> 00:07:59,320 Speaker 1: United States has the political will to defend our friends 142 00:07:59,320 --> 00:08:02,280 Speaker 1: and allies. And a matter of fact, Ukraine is a 143 00:08:02,280 --> 00:08:06,640 Speaker 1: great demonstration of a failure of deterrence. We were far stronger, 144 00:08:07,080 --> 00:08:10,880 Speaker 1: our allies, were far stronger than Russia, and yet we 145 00:08:11,080 --> 00:08:14,440 Speaker 1: failed to stop the Russians from attacking on the Chinese. 146 00:08:14,440 --> 00:08:16,560 Speaker 1: Look at that, and I think the way that we 147 00:08:16,680 --> 00:08:19,720 Speaker 1: stopped them from going after Taiwan or whatever is we 148 00:08:19,800 --> 00:08:22,480 Speaker 1: make it clear that we will fight. And the way 149 00:08:22,560 --> 00:08:25,480 Speaker 1: to do that is, for instance, to stay to Taiwan. 150 00:08:26,080 --> 00:08:29,200 Speaker 1: We will defend you, will give you a mutual defense treaty, 151 00:08:29,520 --> 00:08:32,160 Speaker 1: will put our soldiers on the island as a trip wire, 152 00:08:32,320 --> 00:08:37,000 Speaker 1: will preposition um military supplies. We will do those things 153 00:08:37,000 --> 00:08:40,439 Speaker 1: that make it clear that we will fight. People will 154 00:08:40,480 --> 00:08:43,640 Speaker 1: say that that's extraordinarily risking, and I say, yes it is. 155 00:08:44,120 --> 00:08:47,480 Speaker 1: But because of misguided policy, over the course of decades, 156 00:08:47,600 --> 00:08:52,800 Speaker 1: our policies, we've created a situation where every option is 157 00:08:52,920 --> 00:08:56,400 Speaker 1: exceedingly dangerous, and the most dangerous option is to continue 158 00:08:56,440 --> 00:08:59,160 Speaker 1: with policies that have put us into this predicament in 159 00:08:59,160 --> 00:09:03,880 Speaker 1: the first place. Gordon Chang is an independent voice taking 160 00:09:03,880 --> 00:09:07,800 Speaker 1: a look at China. We always are interested in his opinion. Uh, 161 00:09:07,840 --> 00:09:10,040 Speaker 1: he's the author of the Coming Collapse of China. You 162 00:09:10,040 --> 00:09:13,400 Speaker 1: can follow Gordon on Twitter at Gordon g Chang. Gordon 163 00:09:13,520 --> 00:09:15,760 Speaker 1: is always interesting to catch up. Thanks so much for 164 00:09:15,800 --> 00:09:19,480 Speaker 1: the time. Well, thank you, Joe, I really appreciate it. Yeah, 165 00:09:19,559 --> 00:09:23,040 Speaker 1: no problem. Again, it's a little frustrating, and you don't 166 00:09:23,080 --> 00:09:24,560 Speaker 1: need to be an authority. I don't claim to be 167 00:09:24,559 --> 00:09:27,360 Speaker 1: an authority, but you just hear the same cliches about China, 168 00:09:27,480 --> 00:09:30,960 Speaker 1: repeat it over and over again, and and uh, it's 169 00:09:30,960 --> 00:09:33,959 Speaker 1: a behemoth. I mean obviously the population, the economy and 170 00:09:34,000 --> 00:09:38,920 Speaker 1: the rest of it. But it is an enormous, complicated, troubled, 171 00:09:39,679 --> 00:09:45,800 Speaker 1: aging country and and not the you know, the plucky, 172 00:09:45,880 --> 00:09:49,199 Speaker 1: young upstart that it's been portrayed as in the mainstream 173 00:09:49,240 --> 00:09:53,400 Speaker 1: media for the longest time. They are well. All international 174 00:09:53,440 --> 00:09:56,240 Speaker 1: politics is an extension of domestic politics, as we try 175 00:09:56,280 --> 00:09:59,440 Speaker 1: to remind you all from time to time, and countries 176 00:09:59,480 --> 00:10:04,840 Speaker 1: often ex rest there Uh, their difficulties domestically by reaching 177 00:10:04,840 --> 00:10:07,920 Speaker 1: out and poking somebody in the eye or or you know, 178 00:10:08,000 --> 00:10:10,920 Speaker 1: forming an alliance or writing a treaty or something like that. 179 00:10:11,400 --> 00:10:15,800 Speaker 1: But man, never forget domestic politics or what drive international 180 00:10:15,840 --> 00:10:18,360 Speaker 1: politics in China matters these days, so you've got to 181 00:10:18,440 --> 00:10:20,960 Speaker 1: keep an eye on what's going on internally. So I 182 00:10:20,960 --> 00:10:23,920 Speaker 1: hope you enjoyed that I did Armstrong