RUTHFULLY YOURS

A new report from the Pentagon paints a chilling portrait of the challenge the Chinese Communist Party poses to the United States and the world.

The annual report to Congress, “Military and Security Developments Concerning the People’s Republic of China,” details the comprehensive effort the Chinese have launched to achieve global military and economic superiority.

The 200-page report tells us the CCP seeks “the great rejuvenation of the Chinese nation,” by which it means to revise the international order and “return” China to global preeminence.

On the military front, China has already surpassed the United States in shipbuilding with the world’s largest navy, land-based conventional and cruise missiles, and integrated air-defense systems.

“China is the top ship-producing nation in the world by tonnage and is increasing its shipbuilding capacity and capability for all naval classes,” the report informs us. The United States largely gave up its shipbuilding and merchant marine industries decades ago.

China’s leadership understands something that America’s leaders forgot: military power flows from economic power. While Washington encouraged the offshoring of America’s industries, Beijing knows its military depends on a growing industrial and technological base.

The integration of civilian industries and military objectives is all-encompassing. The policy is known as military-civil fusion (MCF):

MCF encompasses six interrelated efforts: (1) fusing the China’s defense industrial base and its civilian technology and industrial base; (2) integrating and leveraging science and technology innovations across military and civilian sectors; (3) cultivating talent and blending military and civilian expertise and knowledge; (4) building military requirements into civilian infrastructure and leveraging civilian construction for military purposes; (5) leveraging civilian service and logistics capabilities for military purposes; and, (6) expanding and deepening China’s national defense mobilization system to include all relevant aspects of its society and economy for use in competition and war.

While MCF has broader purposes than acquiring foreign technology, in practice, MCF means there is not a clear line between the PRC’s civilian and military economies, raising due diligence costs for U.S. and global entities that do not desire to contribute to the PRC’s military modernization.

This last point is essential: Every dollar that is invested in the PRC aids its military and techno-totalitarian goals.

Right now, major Wall Street index providers such as MSCI and FTSE Russell, pension funds, university endowments, and other large institutional investors are pouring billions from American investors into the China Communications Construction Company (CCCC), a state-owned enterprise sanctioned by the State and Commerce departments for its role in grabbing territory in the South China Sea in violation of international law.

Meanwhile, some of the biggest names on Wall Street—Citibank, JP Morgan, and BlackRock—announced plans to expand in China. We can expect the LeBron James effect as these firms’ fortunes come to depend more and more on Beijing’s rulers.

Information, psychological warfare, and influence operations are a key part of Beijing’s strategy. The People’s Liberation Army Strategic Support Force (SSF) “is responsible for cyberwarfare, technical reconnaissance, electronic warfare, and psychological warfare. Its current major target is the United States,” the report tells us.

Its influence operations target “cultural institutions, media organizations, business, academic, and policy communities in the United States, other countries, and international institutions.” Beijing pressures these targets to accept Beijing’s narratives. In a glaring example of how this works, China’s ambassador told the president of the Czech Republic’s senate he would “pay a heavy price” for visiting Taiwan. The mayor of Prague told the undiplomatic diplomat to stuff it.

Information technology, particularly artificial intelligence, is central to China’s goal of military supremacy. The People’s Liberation Army “sees emerging technologies as driving a shift to ‘intelligentized’ warfare from today’s ‘informatized’ way of war” through “the operationalization of artificial intelligence and its enabling technologies, such as cloud computing, big data analytics, quantum information, and unmanned systems, for military applications.”

The CCP’s military-civil fusion (MCF) strategy and research and development programs drive the shift to “intelligentized” warfare. It seeks to develop dual-use technologies and steal what it can’t develop on its own.

Beijing’s prioritization of AI is the context for the CCP banning the export of TikTok’s AI algorithm and the Trump Administration’s restrictions on Chinese students studying in the United States. The PLA has direct and indirect ties to numerous universities, and the MCF makes all universities in China answer to military authorities.

The report puts an end to the 40-year-old notion that engagement, dialogue, and investment will reform Beijing’s Marxists.

One need not read all 200 pages to understand there is now no excuse for anyone from Washington, Wilmington, or Wall Street to doubt the Chinese Communist Party poses a serious threat to America and the values we hold dear.

Forget Russia. To paraphrase James Carville, “It’s the CCP, stupid.”