Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.
Speaker 2: Hey everybody, this is the last episode of our show.
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Speaker 4: Let me just last Tree Engine. It might actually be
Speaker 4: this one. I'm three nine when ye had two Communia
Speaker 4: Tree Engine.
Speaker 3: Just we have butterflies a little bit.
Speaker 5: Yeah, this is an empty number.
Speaker 6: Valid.
Speaker 3: Jordan and I are in Bloomberg's New York headquarters. It's late,
Speaker 3: late enough that it's mid morning and Nanjing. We're here
Speaker 3: because we're trying to call Shoe Yan June, and we're
Speaker 3: with our producer and Amandarin speaking colleague to help us
Speaker 3: with translation.
Speaker 5: Is invalid.
Speaker 3: We have a bunch of phone numbers we found in
Speaker 3: the court documents for Shoe and all his aliases, as
Speaker 3: well as a bunch of his associates.
Speaker 4: Three eight eight, two threes one six.
Speaker 3: We've been going down the list, making these calls and
Speaker 3: getting nowhere for over an hour.
Speaker 2: And then something funny happens with one of the shoe numbers.
Speaker 2: Instead of getting a recording that says the line has
Speaker 2: been disconnected, this number does something different. It rings a
Speaker 2: few times and then nothing, almost as if someone's picked
Speaker 2: up and is just sitting there without saying anything. It's
Speaker 2: just blank space, silence.
Speaker 5: H it's weird.
Speaker 7: That was weird.
Speaker 5: Yeah, literally silence.
Speaker 1: Yeah, it's getting weird.
Speaker 3: Yeah.
Speaker 2: Then the call ins whoever's on the other end hangs up,
Speaker 2: so we call again and the same thing happens. A
Speaker 2: few rings, then nothing. There's twenty six seconds of silence,
Speaker 2: and then finally our colleague stepts in and says, shoot, you.
Speaker 8: Know what you want to s and juma uh ninshu
Speaker 8: the thing that's dumas PM go downham.
Speaker 9: Wow.
Speaker 8: So we just a call number that associated with Shrian Jing.
Speaker 8: Somebody picked up the phone and I asked him if
Speaker 8: he's Shuan Jin. He said who are you? I repeated,
Speaker 8: I'm looking for Shuan Jing, and uh he said again,
Speaker 8: who are you then I said, I'm a reported from
Speaker 8: Boomberg News.
Speaker 5: He hang up on me.
Speaker 2: What Wow, Well, I'll tell you what he didn't say
Speaker 2: is I'm not sure. Yeah, yeah, from Bloomberg New and
Speaker 2: iHeart podcasts. This is the sixth Bureau. I'm Jordan Robertson.
Speaker 3: And I'm Drake Bennett. I did not expect that at all.
Speaker 2: I didn't either. I don't think any of us. I
Speaker 2: don't think any of us. We don't know that that
Speaker 2: was Shoe on the phone, but it was his number
Speaker 2: and it sounded like him. We've heard Shoe's voice. You
Speaker 2: have two plus Taking a call from an unknown US
Speaker 2: number which was actually attached to a burner phone Bloomberg
Speaker 2: gave us solely for the purpose of making these calls.
Speaker 2: Seems a little like something he do. And our colleague
Speaker 2: mentioned another thing.
Speaker 8: He has a little bit of local accent. I assume
Speaker 8: from jung Su area.
Speaker 2: Jung Su Province is where Shoes from.
Speaker 8: He's a little bit guarded like. He didn't confirm, neither
Speaker 8: deny or confirm who he is, just asked him, repeating
Speaker 8: the question.
Speaker 5: Why are you?
Speaker 2: Of course, this wasn't the first time we tried to
Speaker 2: reach him. Him two letters while he was incarcerated, and
Speaker 2: he'd responded by telling his lawyers to tell us that
Speaker 2: he didn't want to talk to us or ever hear
Speaker 2: from us again. But by the time we called this
Speaker 2: number from our offices, Shoe wasn't in an American prison anymore.
Speaker 2: He wasn't even in America. We'll get back to that first,
Speaker 2: we need to catch you up on the fall up
Speaker 2: from his arrest, which profoundly shook the MSS.
Speaker 3: One place we can trace the ripple effects of Shoe's
Speaker 3: arrest is Chicago with G Chao Chun, the engineering grad
Speaker 3: student who still texted his parents for grocery shopping tips.
Speaker 5: That is good c cucumber available now.
Speaker 3: The boy spy who texted pictures of his MSS cash
Speaker 3: to his friends.
Speaker 10: Fucker, are you even there to photograph this?
Speaker 11: Photographed this sneakily delete after you see it, And.
Speaker 3: Who worked as a spotter for Shoe Yen June.
Speaker 7: Are you there?
Speaker 8: I have a favorite to ask.
Speaker 7: I'm here.
Speaker 12: Please go ahead, brother Shoe, which.
Speaker 3: Is why an undercover FBI agent approached him on the
Speaker 3: street in Chicago after she was arrested. Parker Wow, the
Speaker 3: undercover told G that was she arrested. He was his
Speaker 3: new MSS handler, and G believed him. The two of
Speaker 3: them met three times in that same Hyatt hotel room.
Speaker 3: Each time the FBI learned more about what G was doing,
Speaker 3: until they decided they'd learned enough. On September twenty fifth,
Speaker 3: twenty eighteen, G in the undercover's final meeting ended abruptly.
Speaker 3: This is wrong. Two FBI agents, very much not undercover,
Speaker 3: burst into the hotel room. That panic voice yelling wait wait,
Speaker 3: that's actually the undercover, still in character as an MSS
Speaker 3: handler getting busted as part of the plan. He's handcuffed
Speaker 3: and led out of the room, and then the two
Speaker 3: FBI agents turned to their real target.
Speaker 11: What's here, Copeland chief? Yes, yes, okay, So you.
Speaker 3: Want a lawyer, a mind tuble, Well, that's what we
Speaker 3: want to talk about. Yeah, he was. He was arrested
Speaker 3: and went on trial in the fall of twenty twenty two,
Speaker 3: roughly a year after Shoe, and was convicted of acting
Speaker 3: as an agent of a foreign government and making a
Speaker 3: material false statement to the army. He was sentenced to
Speaker 3: eight years in prison.
Speaker 2: G wasn't the only one in this roundup. There were
Speaker 2: other arrests and prosecutions of people connected to Shoe. A
Speaker 2: Chinese hacker who worked with the sixth Bureau was apprehended
Speaker 2: as he arrived in Los Angeles for a cybersecurity conference.
Speaker 2: An engineer working for Apple's self driving car effort was
Speaker 2: arrested in charged with theft of trade secrets. He was
Speaker 2: one of the engineers Shoe and g had done a
Speaker 2: background check on. Shoe's boss. Joh Wrong and other MSS
Speaker 2: colleagues were indicted in absentia for a series of cyber
Speaker 2: attacks on Aviation Company and Arthur Gow, the Honeywell engineer
Speaker 2: who Shoes secretly recorded when he came to give a
Speaker 2: talk in Nanjing. He was indicted too. He pled guilty
Speaker 2: to export control violations and testified at Shoe's trial.
Speaker 3: These cases were like tracers marking the outlines of networks
Speaker 3: that had previously been hidden, but innocent people would also
Speaker 3: get caught up in that hunt. A few weeks after
Speaker 3: Sho's extradition in late twenty eighteen, then Attorney General Jeff
Speaker 3: Sessions announced what he called the China Initiative, a Justice
Speaker 3: Department campaign to counter trade secret theft.
Speaker 13: We are here today to say enough is enough. We're
Speaker 13: not going to take it any more. It's unacceptable. It's
Speaker 13: time for China to join the Community of lawful Nations.
Speaker 13: International trade has been good for China, but cheating must stop.
Speaker 3: That led to a wave of aggressive, controversial prosecutions. Most
Speaker 3: of the defendants were ethnically Chinese academics working at American
Speaker 3: research institutions, and in most instances, there was no evidence
Speaker 3: that anyone was actually sharing trade secrets. As a result,
Speaker 3: many of the charges were for paperwork violations like failing
Speaker 3: to report ties to Chinese universities. Some of the cases
Speaker 3: were so weak that prosecutors would end up dropping the charges.
Speaker 3: It all looked to a lot of people like ethnic profiling,
Speaker 3: and the Biden administration would formally end the program.
Speaker 14: We have heard concerns from the civil rights community that
Speaker 14: the China Initiative has fueled the narrative of intolerance and bias.
Speaker 7: To many.
Speaker 14: That narrative suggests that the Justice Department treats people from
Speaker 14: China or of Chinese descent differently.
Speaker 13: The rise in anti Marria.
Speaker 2: But as we know, Shoe was an actual spy and
Speaker 2: when he was taken off the chessboard, it had ramifications.
Speaker 2: Perhaps the most striking one was what stopped happening. Right
Speaker 2: after Shoe's arrest, the FBI noticed that the MSS Industrial
Speaker 2: Espionage Machine essentially shut down.
Speaker 15: The arrest of ju scared them into stopping what they
Speaker 15: were doing, essentially where they had to basically make it
Speaker 15: this large countrywide operational pause to try and figure out
Speaker 15: where or how you got caught.
Speaker 2: Alan Kohler, the FBI's former head of counterintelligence.
Speaker 15: They didn't want to put any other sources at risk,
Speaker 15: They didn't want to put any more intelligence officers at risk,
Speaker 15: so they just stopped to try and figure out what
Speaker 15: was happening. And that was incredibly beneficial to us because
Speaker 15: China wasn't luring Americans out of the US to meet
Speaker 15: them overseas anymore. At the time, that was our biggest
Speaker 15: unknown risk. We just didn't know how much and how
Speaker 15: often this was happening, but we knew it stopped in
Speaker 15: the aftermath of Hue.
Speaker 2: From the US government's perspective, what was China doing in
Speaker 2: those moments of pause, What actually happens?
Speaker 15: They're probably doing exactly the same thing that we would
Speaker 15: do whenever we experience a copper rise, right, And I
Speaker 15: can tell you I've been in the room. When that's
Speaker 15: happened a lot where let's say you have ten operations
Speaker 15: that you launch throughout the US and overseas, and one
Speaker 15: of them dramatically goes south, we would stop what we're
Speaker 15: doing for fear of putting those other operations at risk.
Speaker 15: Un Two, we figured out what the heck happened in
Speaker 15: this one operation that blew up in our faces, and
Speaker 15: China was absolutely doing that. They didn't know where the
Speaker 15: hole was, and so that there therefore they had to
Speaker 15: pause until they could try and figure it out.
Speaker 2: Alan says. The MSS hit pause for roughly three years
Speaker 2: as it struggled to pinpoint what exactly had gone wrong.
Speaker 2: That's a really long time to shut down an intelligence effort.
Speaker 2: And it stayed that way until Shoes trial.
Speaker 15: The United States government had to show everything that they
Speaker 15: did in the case, and China is able to understand, Okay,
Speaker 15: here's our weak spots. Here is the person that lured
Speaker 15: him to Belgium. We see how that happened. Okay, you
Speaker 15: you shouldn't have recorded yourself and you shouldn't have put
Speaker 15: all this personal information into the.
Speaker 7: Ice that you took that the FBI got access to.
Speaker 3: No to self, do not record secrets by stuff on
Speaker 3: iPhone that you get arrested.
Speaker 15: Withl This is where we know this case went sideways.
Speaker 15: We're just not going to make those mistakes again.
Speaker 2: So they learned from the trial too. China learns from
Speaker 2: the trial as well.
Speaker 15: Oh sure, and they may drag the process out to
Speaker 15: find out exactly what the US government has, how they
Speaker 15: got it, what the sourcing is, et cetera. And in
Speaker 15: this U case, it was just that on steroids.
Speaker 2: So the pause ended and the machine started back up.
Speaker 15: You know, green light go back at them again. They learned,
Speaker 15: they understood exactly what was happening, and they did what
Speaker 15: we do, right. You get smart, you understand what the
Speaker 15: adversaries are doing. You adapt, and you get better.
Speaker 3: So, Jordan, you and I published a magazine feature about
Speaker 3: Shoes case back in twenty twenty two for Bloomberg Business Week.
Speaker 2: Yeah, we did.
Speaker 3: But even after the story came out, we couldn't stop thinking.
Speaker 2: About it or talking about it or.
Speaker 3: Reporting on it, and we kept finding more and more
Speaker 3: great stuff like ga June's not in the print story
Speaker 3: at all.
Speaker 2: Right, I mean we learned about him after the fact.
Speaker 3: Yeah, and Shoe's phone calls we had transcripts of the
Speaker 3: recordings when we were at the print story, but it
Speaker 3: wasn't until after that that we got the actual audio.
Speaker 2: Which of course sparked the idea for this podcast.
Speaker 3: Right. And while we were working on the pitch for
Speaker 3: the pod, like late twenty twenty four, you got a tip.
Speaker 2: Yeah, it was quite a tip. So I get a
Speaker 2: call one day kind of late November from a source
Speaker 2: who suggested that I look at the Bureau of Prisons
Speaker 2: website and they said you should look up shoe Yen
Speaker 2: June there. And like so many of these calls, it
Speaker 2: was like unnecessarily crypto. I'm like, what am I gonna
Speaker 2: what am I gonna see? This man got sentenced to
Speaker 2: twenty years, Like I don't need to see it again.
Speaker 2: I know what happened. And so I go and look
Speaker 2: and like he's gone. Shoe Ya June was not there.
Speaker 2: He was not in the system. And at first I
Speaker 2: was like, did shee escape? Did he break out of prison?
Speaker 3: It wouldn't be the first time he tried that.
Speaker 2: Yeah, Like I thought, maybe this time he'd actually succeeded.
Speaker 2: So I called the source back and the person was like, no,
Speaker 2: he didn't escape. He's been swapped.
Speaker 3: Shu Yen June had been swapped, pardoned by President Biden,
Speaker 3: released from prison, and sent back to China. So Hadji
Speaker 3: Chau Chun and a third Chinese man convicted on unrelated charges.
Speaker 3: In exchange, three American citizens in Chinese prisons had been
Speaker 3: released and sent home to the US.
Speaker 2: It was a prisoner swap, and it's how real life
Speaker 2: spy stories often end.
Speaker 7: It was bound to happen. It's part of the deal making.
Speaker 2: Federal Prosecutor Tim Mangan.
Speaker 15: Even if we hadn't gotten a chance to indict him
Speaker 15: and we just caught a spy, this is what happened
Speaker 15: with spies.
Speaker 16: I don't think anyone on our team was shocked.
Speaker 2: Federal prosecut Emily Gruttfield.
Speaker 16: You're always surprised to hear it at that moment, but
Speaker 16: it wasn't a shock that overall to think that this
Speaker 16: was something that might occur. Because he was such a
Speaker 16: valuable asset to the Chinese government.
Speaker 15: I always thought it was inevitable that he was going
Speaker 15: to be traded, and its just a matter of when
Speaker 15: Alan kohlergan. What the case team did is they gave
Speaker 15: the United States a chip that we could play in
Speaker 15: the world stage. We put you in jail, we arrested
Speaker 15: his network, We learned a whole lot about how China
Speaker 15: targets Americans. We were able to tell the world how
Speaker 15: it happens. And then we actually had this intelligence officer
Speaker 15: in prison that we gave our president the opportunity to
Speaker 15: bargain with someone inside China to get Americans back. And
Speaker 15: to me, that's worth letting him out of jail every time.
Speaker 3: But not everyone feels that way, even other spies.
Speaker 10: I was disappointed. No, I was more than disappointed. I
Speaker 10: was angry.
Speaker 3: James Olsen, former CIA clandestine officer Encounterintelligence chief.
Speaker 10: By releasing Hu and his co op d G, I
Speaker 10: felt that much of their work was for naught by
Speaker 10: letting him go free. This trial, all that hard work,
Speaker 10: this brilliant operation that Bradley Hope pulled off, had no
Speaker 10: lasting impact.
Speaker 3: And some people aren't sure exactly what to think.
Speaker 17: Yeah, I was unhappy with that.
Speaker 3: Art Cummings, former head of security at GEED.
Speaker 17: He was very unhappy with that.
Speaker 2: Why is that?
Speaker 17: I just think it sets the wrong message again, you know,
Speaker 17: But again I'm contradicting myself a little bit because he
Speaker 17: was actually a representative of their government. So I don't
Speaker 17: like the fact that it was kind of a paper
Speaker 17: tiger moment. Yeah, he made all that effort and now
Speaker 17: bye bye, he's back. Kind of like wow, really, But
Speaker 17: at the same time, as a loyal Chinese citizen, I
Speaker 17: mean yeah, I always draw the equivalents. The CIA officer
Speaker 17: is lord to Europe and then extradited to a country
Speaker 17: and then put in prison, we would be out of
Speaker 17: our minds.
Speaker 3: Art saying if the situation was reversed, we would do
Speaker 3: everything we could to get that CIA officer back. And
Speaker 3: that's basically what China says they did. In a press
Speaker 3: conference at the time right after the swap, a spokesperson
Speaker 3: for the Chinese Ministry of Foreign Affairs made their message clear.
Speaker 3: Through the unremitting efforts of the Chinese government, three Chinese
Speaker 3: citizens wrongfully detained by the US have returned safely to China.
Speaker 3: It once again shows that never ever will China give
Speaker 3: up on its citizens. The motherland will always have their back.
Speaker 2: So once you're back in the motherland, what does that
Speaker 2: actually look like. Well, when it comes to g we
Speaker 2: know a little. He had a life in the US,
Speaker 2: he made personal connections, and he hasn't totally abandoned them.
Speaker 1: They just told me about how he was quote unquote
Speaker 1: rescued from the China US prisoner swap.
Speaker 2: Naomi Lyman met Ji chow Chun in Chicago when he
Speaker 2: joined the Church of Jesus Christ of Latter day Saints.
Speaker 2: This isn't something he seems to have discussed much with
Speaker 2: either his real or fake MSS handlers, but it became
Speaker 2: a very important part of his American life, and so
Speaker 2: is Naomi.
Speaker 1: I only ever saw him being gentle and kind. He
Speaker 1: would sit next to people on the train who just
Speaker 1: looked lonely, and he would just talk to them, just
Speaker 1: in a loving way, just how's your day going, where
Speaker 1: are you headed to?
Speaker 2: They were really close friends. G was at Naomi's wedding
Speaker 2: and was the only person she invited into the Mormon
Speaker 2: temple for the ceremony.
Speaker 1: My best friends weren't there. I had nobody in there
Speaker 1: with me that I chose, except for Chow Choon.
Speaker 2: A month after the wedding, Naomi got a message from
Speaker 2: a reporter asking for comment on Gee's arrest. That's how
Speaker 2: she found out about it.
Speaker 1: I got this message asking to be interviewed because they
Speaker 1: could see that I knew him really well based off
Speaker 1: of Facebook, and I was just shocked and really confused.
Speaker 1: I went on to Google and I just typed in
Speaker 1: his name and then arrest and started reading article after
Speaker 1: article after article that had been published about him, and
Speaker 1: watching all the videos, and I honestly was so devastated.
Speaker 2: She put those feelings into a long letter and sent
Speaker 2: it to g while he was in jail awaiting trial.
Speaker 1: And they did not have and read it because I
Speaker 1: didn't write it on white paper, and so they sent
Speaker 1: it back to me. And this was it was like
Speaker 1: a ten page letter that I poured my heart out
Speaker 1: to him in and I was so too straw I
Speaker 1: didn't even rewrite it and resend it to him.
Speaker 2: But she kept wondering how he was doing.
Speaker 1: Every once in a while, I don't know, maybe every
Speaker 1: other two or three months, I would go and google
Speaker 1: his name.
Speaker 2: And then six years later, still doing her googling, something
Speaker 2: new finally pops up.
Speaker 1: I saw that he had been released in a prisoner
Speaker 1: exchange program. And it was really just a week later
Speaker 1: that he messaged me saying hi, and that he knew
Speaker 1: that I sent him a letter, but he never got
Speaker 1: to see it because it wasn't on that white paper,
Speaker 1: and thank you for writing me a letter, even though
Speaker 1: I never got to read it.
Speaker 2: He also told her a little bit about what he
Speaker 2: was up to.
Speaker 1: Let's see, I'll look at his messages right now. I'm
Speaker 1: doing great. I'm in China now, just enjoying my time
Speaker 1: with my family. Dot dot dot dot dot. Will go
Speaker 1: to work in July, which we know where he's going
Speaker 1: to be working at because we know who rescued him.
Speaker 1: So I did ask. I did ask. I was like,
Speaker 1: where are you going to be working at? Just to
Speaker 1: see if I would get an answer, But there was
Speaker 1: no response.
Speaker 3: As for Sho we know even less. He didn't live
Speaker 3: in the US, he didn't make friends here, and there's
Speaker 3: really no way of knowing what happened to him when
Speaker 3: he went back to China, but we can speculate.
Speaker 9: I don't know. On the one hand, he was loyal,
Speaker 9: you know, he could have come knocking on our door
Speaker 9: and saying, hey, I'll tell you everything. I know. He didn't.
Speaker 3: Former Federal Prosecutor Matt McKenzie.
Speaker 9: But on the other hand, he was a catastrophic failure,
Speaker 9: an epic epic failure for them. The amount of information
Speaker 9: that we were able to gather about how China actually
Speaker 9: operates is mind boggling. And it's all because he was
Speaker 9: sloppy and greedy and we were able to catch him.
Speaker 9: And now the whole world can see how they operate
Speaker 9: because we put it all out in a trial. So
Speaker 9: I think you have to put him in a back room,
Speaker 9: give him a decent paying job, but don't trust him
Speaker 9: with anything because you know he can't be trusted. He's
Speaker 9: kind of incompetent.
Speaker 2: No iPhones, Right, Yeah.
Speaker 3: It's easy to laugh at she's carelessness and his mistakes.
Speaker 3: But we all do stupid stuff, don't we. We all
Speaker 3: cut corners. Most of the time we get away with it,
Speaker 3: and most of the time she did too.
Speaker 7: Spies or people and people are lazy.
Speaker 15: It's absolutely a truth throughout all Espnach cases. And I've
Speaker 15: got this little thing that I keep on me.
Speaker 3: At this point and I interview with Alan, he pulls
Speaker 3: out a piece of paper.
Speaker 7: I don't know if you're a George Smiley fan.
Speaker 3: It's a quote from Smiley's People, a John Lecarrey novel
Speaker 3: that's part of the same trilogy as Tinker Taylor Soldier Spy.
Speaker 3: Alan keeps this quote with him, the way someone else
Speaker 3: might keep a scrap of scripture or a pocket constitution.
Speaker 7: For the longest time.
Speaker 15: I would have a copy of the book which is
Speaker 15: behind me on my shelf, dog eared. And I was
Speaker 15: just in a Marriott at one point, and I took
Speaker 15: a piece of Marriott stationary and I wrote this quote down.
Speaker 15: This is the kind of a kind of intelligence geek
Speaker 15: that I am.
Speaker 3: He keeps it close as a kind of reminder, a warning.
Speaker 7: So this is a quote from Smiley's people.
Speaker 15: It's referring about a truth throughout all sponache cases.
Speaker 7: Is it okay if I just share this part with you? Yeah? Absolutely.
Speaker 15: He knew that sometimes old spies, even the best of them,
Speaker 15: were little like old lovers.
Speaker 11: So the time twenty new peach as.
Speaker 15: Age crypt up on them, they began to cheat out
Speaker 15: of fear that their power were deserting them.
Speaker 11: Tech goal, maybe you can't head back first, Thank you
Speaker 11: so much.
Speaker 15: They pretended they had it all in the memory, but
Speaker 15: in secret they were hanging on to their virility. In
Speaker 15: secret they wrote it down, often in some homemade code, which,
Speaker 15: if they had only known it, could be unbuttoned in
Speaker 15: hours or minutes by anyone who knew the game.
Speaker 11: June twenty second through to Paris.
Speaker 15: Names and addresses of contacts subagents.
Speaker 11: June eleventh, met g Chiltring.
Speaker 15: Nothing was holy. Routines, times and places of meetings.
Speaker 11: Let's try our best to meeting in Europe.
Speaker 7: Work names, phone numbers.
Speaker 11: John rejected meal receipt. Today, I will have my revenge.
Speaker 15: Even safe combinations written out as social security numbers and birthdays.
Speaker 11: Send me the name of the coffee shop we're here.
Speaker 15: In his time, Smiley had seen entire networks put at
Speaker 15: risk that way because one agent no longer dared to
Speaker 15: trust his head.
Speaker 8: And put a USB drive in the eye glass box
Speaker 8: in the middle of the bookcase.
Speaker 11: Happens, someone will come to you and tell you the password.
Speaker 15: And to me, that is exactly what espionage is. If
Speaker 15: people execute flawless tradecraft, they will never be caught, but
Speaker 15: because they're people, they will always be caught.
Speaker 11: Your honor, I'm just an ordinary Chinese citizen who knows
Speaker 11: nothing about politics, nor do I know anything about secrets.
Speaker 11: I stand by my innocence. Thank you.
Speaker 2: China is still behind the US when it comes to
Speaker 2: aviation technology. Ge'z jet engine is still the most advanced
Speaker 2: out there. China's engines are five or ten or fifteen
Speaker 2: years behind, but they're probably not going to stay there.
Speaker 2: I mean there used to be similar gaps in other sectors,
Speaker 2: like electric vehicles, but not anymore.
Speaker 6: Yeah, so twenty years ago things were very different for China.
Speaker 2: This is Juliana Lu, a global business column for Bloomberg Opinion.
Speaker 2: She's been covering China for over two decades.
Speaker 6: Twenty years ago, nobody expected Chinese evs to be the
Speaker 6: world beatles that they are today. I think it was
Speaker 6: even that long ago when Elon Musk was laughing and.
Speaker 4: As you're familiar with BYD the ramping up production of
Speaker 4: their electric vehicles.
Speaker 2: Warren Buffet owned ten percent stake in that.
Speaker 10: Why do you laugh.
Speaker 1: Trying to compete?
Speaker 10: Why do you last?
Speaker 7: Have you seen their car?
Speaker 6: I have been like literally laughing at BYD during a
Speaker 6: Bloomberg TV interview.
Speaker 4: Tell me why you're laughing.
Speaker 2: You don't see them at all as a competitives.
Speaker 10: Why is that?
Speaker 3: I mean they offer a lower price point. I don't
Speaker 3: think they have a great product.
Speaker 2: Elon Musk may have considered the Chinese electric car maker
Speaker 2: BYD something to laugh about. Back in twenty eleven when
Speaker 2: he gave that interview. But BYD is now one of
Speaker 2: the fastest growing car companies in history and ranks among
Speaker 2: the biggest automakers in the world. They're not a joke.
Speaker 2: They're a threat, which is why the US government has
Speaker 2: made it basically impossible to sell them in the US.
Speaker 2: The Biden administration slapped a one hundred percent tariff on
Speaker 2: Chinese evs, so most Americans have never even seen one
Speaker 2: in person.
Speaker 3: Yeah, I mean I haven't, and I have.
Speaker 2: But that's because I live in London, where there are
Speaker 2: plenty of byds driving around. China is getting so good
Speaker 2: at so many things quickly, evs, AI drones that they're
Speaker 2: starting to have their own fears that their tech will
Speaker 2: get poached.
Speaker 6: In the case of BYD, it had kind of long
Speaker 6: expressed a desire to open up a factory in Mexico,
Speaker 6: and about a year ago the reports that that permission
Speaker 6: was being delayed by the Chinese side because Beijing was
Speaker 6: concerned that this technology would be kind of diffused out
Speaker 6: of Mexico and into the US into the so called
Speaker 6: wrong hands.
Speaker 2: Recently, the Chinese government has started taking steps to guard
Speaker 2: intellectual property in other realms like AI The government now
Speaker 2: discourages top Chinese AI researchers from traveling abroad, warning that
Speaker 2: they might potentially be targeted in some way. It's also
Speaker 2: recently launched an investigation into a deal between Meta and
Speaker 2: the Chinese founded AI firm Mannas for potentially putting Chinese
Speaker 2: tech secrets at risk, maybe for.
Speaker 6: The first time in kind of modern history. The shoes
Speaker 6: on the other foot, it's not a very comfortable position
Speaker 6: to be in, but at least US officials are being
Speaker 6: pretty honest with you about how they see the current situation.
Speaker 18: Good morning Today, the Select Committee on China meets to
Speaker 18: examine the rise of China's auto industry and what it
Speaker 18: means for America's economy and national security.
Speaker 19: The release of Deepseek AI from a Chinese company should
Speaker 19: be a wake up call for our industries that we
Speaker 19: need to be laser focused on competing.
Speaker 18: In just five years, China has gone from a minor
Speaker 18: exporter to the world's largest auto exporter at below market
Speaker 18: prices that US and allied automakers cannot match.
Speaker 12: They've already exceeded our military capabilities. They have more planes,
Speaker 12: more ships, more summaries, more bistles, more bombs, more soldiers.
Speaker 7: They have the ability to build.
Speaker 12: Ships two hundred and thirty times faster than we do.
Speaker 12: They have an air force that out numbers ores. Previously
Speaker 12: was a technological gap that we're able to depend on.
Speaker 12: That technology gap has evaporated, and.
Speaker 6: I would imagine the rationale is not that different from
Speaker 6: the Chinese side, right, the rationale that kind of supported
Speaker 6: the kinds of acts that you're reporting about. It's a mirror, right,
Speaker 6: places a mirror to what China has allegedly been doing
Speaker 6: and what the West may be willing to do.
Speaker 3: But what is the West willing to do? Everyone we
Speaker 3: interviewed for this series has insisted over and over again
Speaker 3: that we don't do what China does. The US government
Speaker 3: does not steal trade secrets. Companies might spy on other companies,
Speaker 3: but our intelligence services do not spy on foreign firms
Speaker 3: to steal their tech.
Speaker 9: Governments spy on other governments. Our governments should not be
Speaker 9: stealing using the state apparatus to steal trade secrets for
Speaker 9: commercial purposes. And it's just it's outside the boundaries. Can
Speaker 9: I just ask why? It's kind of like Omar in
Speaker 9: the wire, you know, you got to have a code.
Speaker 12: Or trifling basically kill it every day working man and
Speaker 12: all I mean, don't get a twisted.
Speaker 14: I do some dirt too, but I ain't never put
Speaker 14: on nobody who wasn't in the game.
Speaker 5: A man must have a code, no no.
Speaker 9: Doubt, and the code is we don't steal trade secrets
Speaker 9: for commercial purposes. We're here to spy on each other
Speaker 9: for the needs of our state. Everyone has our state
Speaker 9: purposes that we're going to be conducting espionage. But there
Speaker 9: are certain lines we don't cross them. You don't see
Speaker 9: the NSA out there stealing secrets to help coke or PEPSI.
Speaker 9: It's just not how we do things. And the Chinese
Speaker 9: just blur all those lines.
Speaker 10: We need to see. I do not do industrial espionage.
Speaker 10: We do not steal foreign technologies. That's not our job.
Speaker 10: We don't do that. So that is a major distinction.
Speaker 10: In fact, many, many foreign intelligence services trend in full alike,
Speaker 10: do have that responsibility of acquiring technology that they cannot
Speaker 10: get in any other way. But no, we don't do.
Speaker 2: That, at least not since we became the world's dominant superpower.
Speaker 2: But if that changed, would we what lines would we blur? Well,
Speaker 2: we're already blurring plenty of them. The government is taking
Speaker 2: ownership stakes in different companies, inserting itself into the private
Speaker 2: sector in ways it hasn't before.
Speaker 7: The leader of.
Speaker 2: Venezuela was taken from his capital city and is not
Speaker 2: sitting in a Brooklyn prison. FBI and DOJ are being
Speaker 2: used to investigate the president's perceived political enemies. So, honestly,
Speaker 2: what's so precious about trade secrets? Why wouldn't the US
Speaker 2: start sending out spies to try to steal them, especially
Speaker 2: if it had a new motive to catch up.
Speaker 3: And let's not forget the US has done it before.
Speaker 3: Earlier in the series, we mentioned how the United States,
Speaker 3: back when it was a very young nation, paid people
Speaker 3: to smuggle loom designs out of Great Britain, the global
Speaker 3: industrial power of that age. The question is would we
Speaker 3: do something like that again today? We wanted to ask
Speaker 3: our espionage expert, James Olsen, who spent three decades in
Speaker 3: the CIA, the one who took the stand against you,
Speaker 3: who was crushed by the news of the swap, who
Speaker 3: you just heard say.
Speaker 10: Weed, CI do not do industrial espionage.
Speaker 3: We wanted to know what James thought about this, about
Speaker 3: whether the US is official approach it's code if you
Speaker 3: will could change. The last thing I want asking is
Speaker 3: just whether this insistence on our spying being sort of
Speaker 3: defensive rather than offensive is a luxury of the fact
Speaker 3: that we're the sort of preeminence of a power in
Speaker 3: the world. Do you think there's any evidence or likelihood
Speaker 3: that if the United States were to lose that position,
Speaker 3: whether there's any possibility we'd change that stance, whether we
Speaker 3: would resort to more offensive spying in the way that
Speaker 3: China and other countries do.
Speaker 10: I think conceivable that if the United States lost its
Speaker 10: premi andive position in the world, that we would be
Speaker 10: more offensive in our intelligence efforts to strengthen ourselves at
Speaker 10: the expense of our adversaries, rather than the primarily defensive
Speaker 10: mode that I think we're in now. That's conceivable to me.
Speaker 10: I hope that day never comes.
Speaker 2: A huge thanks to everyone who made this possible, our
Speaker 2: production team, editors, engineers, composers, translators, voice actors, voice coaches,
Speaker 2: fact checkers, the many people we interviewed on and off
Speaker 2: the record, and everyone at Bloomberg and beyond who contributed
Speaker 2: to and supported this project with their advice, suggestions, and
Speaker 2: time and again.
Speaker 3: Please share rate, and review our show if you liked it.
Speaker 3: If you're still listening, then you should also check out
Speaker 3: our homepage, where we have two print pieces and a
Speaker 3: video documentary that we made about the boy spy gchat
Speaker 3: Chune that's at Bloomberg dot com Forward Slash the sixth Bureau.
Speaker 2: Thanks so much for listening, Bye
Speaker 13: Spott