Full Comment - Chinese spy balloons are taking over

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00:01:58.720 I haven't seen anybody so excited about balloons in quite a long time.

00:02:08.100 It was like the whole country, the whole continent was like a kid at a birthday party.

00:02:12.800 Just looking up at the sky, talking about balloons, excited about balloons, wondering when or if it would pop.

00:02:19.620 I'm talking, of course, about the Chinese spy balloon that floated across the continent a week or so ago.

00:02:24.760 And I want to talk about the political consequences of it.

00:02:29.680 Hi, I'm Brian Lilly, host of the Full Comment Podcast here at Post Media.

00:02:33.620 And before we get to our next guest who can explain much of not only the balloon, but China and COVID and the economics and the politics of what's going on, I want to remind you that you can subscribe to this podcast.

00:02:46.480 Please do anywhere that you listen to podcasts, whether it's Amazon, whether it's Spotify, Apple, hit the subscribe button, leave a comment, share it on social media.

00:02:57.760 We'd appreciate it very much.

00:02:59.080 But back to this balloon, which lazily floated across the Aleutian Islands in Alaska, down across British Columbia, and I think the bottom corner of Alberta.

00:03:10.620 And then we heard about it once it was over Montana.

00:03:13.320 And for days, the balloon was the biggest topic in the news.

00:03:18.900 And was the government taking this seriously enough?

00:03:23.240 Bill Bishop is someone who lived in China from 2005 to 2015.

00:03:27.420 He writes the highly popular and very readable Sinusism newsletter on Substack.

00:03:33.820 And he joins me now from Washington.

00:03:36.040 Bill, thanks for the time.

00:03:37.540 And what were your thoughts when you first heard about the big balloon in the sky that was the size of, what, three school buses?

00:03:44.720 I think so.

00:03:45.640 Hi, thanks for having me.

00:03:46.880 And yes, I have kids.

00:03:49.660 They're older now, but I remember balloons in happier times, and especially when they have lots of clowns around.

00:03:55.780 I think that this, you know, the Chinese call it an unmanned civilian airship, mostly for meteorological research purposes, which it does not sound like the U.S. government or the Canadian government buy.

00:04:10.940 They both seem to be pretty clear that it was a surveillance, some sort of a surveillance platform.

00:04:15.740 And, you know, big countries spy on each other.

00:04:20.360 I don't think that that should be a surprise to anybody.

00:04:23.400 The real issue here, I mean, there are several, but I think the biggest issue was that you had this large surveillance, PRC surveillance platform that lazily floated and may or may not be steerable, depending on which side you listen to,

00:04:37.740 over, you know, a large swath of Canada and then, you know, large swath of the continental America.

00:04:47.400 And I think what we've learned subsequently is that this is an ongoing surveillance program by the PRC, appears to be run globally.

00:05:02.720 This is not the first time that the U.S. government has detected one of these platforms in U.S. airspace.

00:05:10.100 This, though, is the first time that it became public.

00:05:14.720 And one of the controversies here in D.C. from a domestic political perspective is, was the Biden administration, you know, the Republicans, of course, say,

00:05:25.060 well, the Biden administration appears to have been trying to basically not make this public and let it float across the country, keep it under sort of under wraps,

00:05:34.100 go forward with the Secretary of State Blinken's planned visit last weekend to Beijing.

00:05:38.120 But what happened, of course, is once this balloon floated over into Montana, somebody saw it, took a picture or a video and posted it to Twitter.

00:05:49.960 And then it was picked up by local media and then it became a national story.

00:05:52.880 And once it became public, the U.S. government had to respond.

00:05:55.260 And then, of course, we've had this frenzy through last weekend, through the shoot down last Sunday, right off the coast of South Carolina, over the Atlantic Ocean.

00:06:03.680 And now this over the last five days, we've had regular briefings from the U.S. government to media, academics, think tanks, other governments making public sort of the findings they're getting so far about what this platform was.

00:06:20.220 And really, I think, trying to make a very assertively declare that this is part of a large and ongoing PRC global surveillance program.

00:06:33.280 And so this is, you know, the idea is that this is a real problem in countries.

00:06:36.640 Lots of countries should be concerned about this.

00:06:38.380 And so it has turned from, you know, a mockable thing, I think, a week ago where people sort of said, what's the big deal?

00:06:45.380 It's a balloon to now perhaps one of the biggest crisis in U.S.-China relations in quite some time and certainly has over the last five or six days, I think, left the state of U.S.-China relations in perhaps the most tense state that I remember it in several decades.

00:07:04.700 And frankly, even worse than it was, I think, during the sort of the most difficult U.S.-China bits of the previous Trump administration.

00:07:14.460 Let me ask you who you believe, if you believe any of them.

00:07:18.160 There's a lot of spin.

00:07:19.020 There's a lot of propaganda.

00:07:21.300 And I mean that for both sides.

00:07:23.820 That's what governments do.

00:07:25.080 You don't blame the scorpion for staining you.

00:07:27.900 But we'll start with the Chinese government.

00:07:29.620 Do you put any stock in their claim that this is a weather balloon, that it belongs to a private company, that they might, you know, that the U.S. government owes this company for shooting down its balloon?

00:07:42.640 Do you put any stock in the claims coming out of Beijing?

00:07:46.200 So I do think it is unmanned, which is one of the key claims from Beijing.

00:07:49.700 I do think that it is quite possible that the balloon itself, the actual sort of thing that keeps it afloat, was built by a private or, you know, in China, maybe a state-owned company that is not a military company.

00:08:09.880 But I don't believe that it's for civilian purposes.

00:08:16.540 And I also do believe that regardless of who built the thing, this is part, operated as part of a PLA global surveillance program, I think would be my best guess at this point.

00:08:31.900 So even if it is a civilian-owned or built, you think the People's Liberation Army was directing it or in some way benefiting from the balloon being there?

00:08:41.740 I think this is part of an ongoing program that the PRC has developed under the auspices of the PLA, of the People's Liberation Army, over the last several years to increase their global surveillance capacity, yes.

00:08:56.740 The American government, and we haven't heard much from the Canadian government other than, oh, yeah, we knew it was there.

00:09:04.320 You know, we weren't alerted until, as you say, somebody in Montana looked up at the sky and said, oh, that's not normal.

00:09:11.980 What's that?

00:09:13.280 Until that, none of us had heard of this.

00:09:16.240 So we've since heard several claims from the American government.

00:09:20.200 One, that they knew about it all along and that they'd always planned to shoot it down.

00:09:26.160 One, they just had to wait until it was in a safe space.

00:09:29.380 And two, that this had happened multiple times under the Trump administration, as many as three times I've heard.

00:09:36.440 What do you think is fact?

00:09:38.120 What's fiction?

00:09:38.900 What's the government trying to put itself in the best light?

00:09:43.500 So I think there's a fair amount of rear-end covering.

00:09:46.840 I'm not sure what the Canadian phrase for that is, but it's…

00:09:50.000 It's the same.

00:09:50.980 It's the same.

00:09:51.540 Okay.

00:09:52.360 Begins with an A, ends with an S.

00:09:53.920 But I think that it's quite possible that the U.S., you know, the story now is that it was picked up when it was crossing over the Aleutian Islands in Alaska.

00:10:03.180 Then it crossed into Canada, then came down to the U.S.

00:10:07.700 Subsequently, there were anonymous, you know, sourcing from a U.S. government official that, oh, well, actually, this has happened before and that happened in the Trump administration three different times.

00:10:15.820 Then, of course, you had a whole bunch of Trump officials come out and say, we never heard about this.

00:10:20.360 And then, of course, you had some backfilling by, again, anonymous, I think, anonymous sources from the Biden administration that, well, actually, we only realized that it has happened three times in the Trump administration after we took a look at this program once, you know, the Biden administration was in.

00:10:35.820 So the Trump guys may not have actually known it had happened, which, again, raises a whole separate set of questions about, I mean, I think the U.S. and Canada with NORAD have spent many, many billions of dollars for this system that's supposed to detect threats over the, you know, Canada and the U.S.

00:10:50.840 And somehow then it sounds like up until very recently, these balloons were able to slip through with nobody noticing, which is, again, I think caused some real alarm bells to go off in parts of the U.S. and perhaps the Canadian governments as well.

00:11:04.500 I would have hoped all those generals and analysts in the mountain in Colorado would have picked up on this.

00:11:09.640 Well, I mean, again, and this is it's so now I think you're seeing, although to your question, right, you say, you know, the Biden administration that has to say, you know,

00:11:20.700 well, we knew about the whole time and, you know, we wanted to surveil it and track it.

00:11:25.520 And we were able to we were able to, you know, I guess the public reporting says they put U2s over it.

00:11:31.100 So they get very good pictures and video and whatever else they collect on the actual balloon and its surveillance payload apparatus from all sorts of angles, including above.

00:11:41.780 And they said, oh, we could block all the signals.

00:11:43.580 So they were, you know, we were they're saying, oh, that whatever they were collecting and trying to transmit back to the PRC, you know, we were able to block.

00:11:51.540 Is that true? I have no idea.

00:11:53.320 But but the story, of course, is we were tracking it the whole time.

00:11:57.020 We we there is intelligence value in letting it drift over the U.S.

00:12:00.300 And we couldn't actually shoot it down safely over the continental U.S.

00:12:05.940 And so, you know, they waited until it just crossed over off the coast of South Carolina over the Atlantic Ocean, heading east.

00:12:13.000 So heading out towards the ocean.

00:12:14.840 And then it was much safer to shoot a missile at it.

00:12:17.040 I mean, there was a chance.

00:12:17.860 I don't think they were confident, at least the beginning, that they could shoot the thing down.

00:12:22.080 And so you could have been firing off a missile over the continental U.S.

00:12:25.420 It's just going to keep going and then land somewhere.

00:12:27.680 And it's you know, they go pretty far and fast.

00:12:30.480 And then if you shot the balloon down, depending on, you know, it looks like when they shot it down, it's sort of the balloon itself exploded.

00:12:37.080 Then it just dropped straight down for the most part.

00:12:39.840 I don't think they were confident.

00:12:41.380 And so you could have had a sort of a drifting out of control balloon with a much larger debris field, blah, blah, blah.

00:12:46.500 So at least that's the story.

00:12:48.380 And then, of course, it's also said, well, if it falls in the ocean, it'll be easier.

00:12:52.300 It's more likely that the payload won't be completely destroyed on impact.

00:12:56.000 And so there's more exploitable intelligence if we can, you know, salvage it.

00:13:00.140 So that's the story.

00:13:02.680 I'm not in a position to say whether or not that makes total sense.

00:13:05.340 It certainly has gotten a lot of skepticism, mostly from the Republicans, right, because it's very much a partisan issue here in the U.S.

00:13:12.460 Now that, you know, the Biden administration was too slow and they should have shot it down right away.

00:13:16.900 And, you know, why did they shoot it down over the Aleutian Islands, blah, blah, blah.

00:13:20.740 Or there's huge swaths of North America.

00:13:24.920 I mean, you fly over in the daytime, I mean, you can spend a lot of time, as I do, looking out the plane window.

00:13:31.900 And see nothing.

00:13:32.720 There's no sign of human life, not even a road.

00:13:35.640 And like if or probably in sort of British Columbia, Western Canada, there's probably even more unpopulated areas.

00:13:43.040 And so, again, it's like it sounds like, you know, I think given that there was this planned trip for the U.S. Secretary of State to go to Beijing last weekend and he was going to meet with the top diplomats.

00:13:56.120 And then I guess that was never officially confirmed.

00:13:59.100 But the belief for the leaks were that he would have a meeting with Xi Jinping.

00:14:03.320 I think, you know, there are a lot of reasons for the Biden administration to want to keep this from getting from turning into some sort of a crisis that it has become.

00:14:11.240 And so, but of course, again, once it goes public, it shows up on Twitter, you know, everyone goes nuts.

00:14:19.720 And then it was politically impossible for them not to take action.

00:14:23.720 And now, of course, shooting down a, you know, this PLA airship, of course, has, you know, created quite the reaction from the Chinese side, from the PRC side.

00:14:34.060 And to your earlier question, you know, the Chinese now saying, you know, potentially saying they want compensation.

00:14:41.320 I mean, good luck to the to the PRC side to do that, because as soon as they name the companies and say these companies lost money.

00:14:48.040 I mean, America is a very litigious place.

00:14:49.860 There are a lot of lawyers.

00:14:51.020 There are lawyers who would love to start a class action suit representing all the people whose flights were delayed and the airlines who had to delay flights,

00:14:59.440 which, you know, has an economic cost to sue any Chinese company involved over this incident and then make it an even bigger incident that just keeps going and going and going.

00:15:08.740 I mean, I wish at this point, you know, it would be behoove the PRC side, at least, to just stop talking about it and move on.

00:15:17.360 You know, they got caught red handed.

00:15:20.260 The politics in the U.S. are they're just going to get worse the more this issue keeps going.

00:15:26.280 And so they really should just sort of move on.

00:15:29.060 If if but I don't think they can.

00:15:31.100 So I don't think this thing is going away anytime soon.

00:15:33.600 Do you know if you have any readers in the Politburo in Beijing that would would be reading Sinosism to know that this will happen?

00:15:42.100 I don't know.

00:15:43.220 I have some readers in Beijing.

00:15:44.900 I don't think they're at that level.

00:15:47.180 But no, I mean, I think it's, you know, quite honestly, the there was a lot of surprise from on the Chinese side.

00:15:57.000 I think, for example, like the Ministry of Foreign Affairs in Beijing.

00:16:00.260 I don't think a lot of people, if anyone or other than maybe at the very top, actually knew the existence of this program.

00:16:07.420 I think a lot of you know, you've seen just like you have commentators and academics and pundits on the U.S. side.

00:16:13.020 You have the same on the Chinese side.

00:16:14.940 I don't think many of those folks had any idea what this about this program.

00:16:19.400 You know, there's this sort of and I think a lot of people's interaction.

00:16:24.120 What's the big deal?

00:16:24.860 It's a weather balloon, but it's not a weather balloon.

00:16:26.740 And so now, you know, each side has to sort of take its positions in the in the U.S. government.

00:16:35.120 You know, again, they're very robustly going out and pushing pushing briefings in the story about this balloon from the U.S. perspective.

00:16:45.080 And, you know, they're not just doing it for the domestic audience in the U.S.

00:16:49.000 They're trying they're doing a lot of other countries.

00:16:50.860 It's really an interesting sort of, you know, you have the surveillance bit and now you really have this global information struggle where, you know, the U.S. is basically trying to tell a whole bunch of countries, look, China is, you know, they're violating international law by these by these surveillance flights.

00:17:04.340 And, you know, I mean, again, big country spy.

00:17:07.300 And the U.S. has certainly flown surveillance platforms over other countries without their permission.

00:17:11.620 And so it's it's just one of those things where the best case is like, look, China's like us versus where China keeps trying to say that they're the you know, the U.S. is this destroyer of international law and, you know, it does what it wants. 0.71

00:17:26.040 But we, China, you know, we we respect international law when, in fact, if if this global surveillance sort of operation or program is as what it appears to be and what the U.S.

00:17:37.840 government is describing it as, then, of course, when it comes to at least respecting other countries sovereign airspace, the Chinese don't care. 0.76

00:17:45.100 And they're violating international law, too.

00:17:46.440 Yeah, I was reading on your newsletter the other day that this is very important to China, that they be seen as following the rules, following the law, because that is one of their regular criticisms of the American and other Western governments.

00:18:03.540 Yes.

00:18:05.180 Let's talk about how this is impacting the relationship then.

00:18:08.840 I I am not hearing much from our government here in Canada.

00:18:12.780 I think they're just letting Washington deal with this.

00:18:15.200 And, you know, Prime Minister Trudeau will talk about his blind spot when it comes to China in a little bit.

00:18:20.700 But you've said it's worse than at any point.

00:18:25.400 What is it about this that is pushing it in such a negative direction, considering everything that's gone on over the last few years with the changes that we've most

00:18:38.720 definitely seen in China?

00:18:39.720 Well, I think, you know, sadly, I've been I've been fairly bearish on the trajectory of the U.S.-China relations for a while.

00:18:46.180 And it just, you know, there's lots of structural reasons to be not particularly optimistic about any real improvement in the in the near future, excuse me, or even medium term future.

00:19:01.180 I think, though, again, this the hope was that, you know, China's they've had a rough, rough year with COVID.

00:19:12.540 They've come out of COVID.

00:19:14.420 Xi Jinping was, you know, at the 20th Party Congress last October.

00:19:18.500 He got his third term.

00:19:19.900 He really got from a from a sort of political power perspective, looks much more, you know, to be the most powerful leader since since Mao.

00:19:27.460 At least that's what he looks like.

00:19:29.380 You know, he he had not yet met President Biden.

00:19:32.540 Everything had been virtual.

00:19:33.560 Lots of these meetings, you know, Xi Jinping starts coming out in October, went to Bali, met Biden, went to he was APEC in Thailand and started meeting all sorts of international leaders or China was reopening and reengaging.

00:19:46.120 And Secretary Blinken going to China was going to be, I think, the first his the first visit to Beijing to meet Xi Jinping in person.

00:19:55.240 And and it was just sort of all like the hope was, OK, the relationship's not great.

00:19:59.980 There are all these problems in relationship.

00:20:01.380 They're going to be continue to be these problems.

00:20:02.900 But, you know, the U.S. talks about wanting to set guardrails to in the relationship to prevent the the the the tensions from turning into actual outright conflict.

00:20:13.060 The Chinese don't use the same language, but generally, I think they believe that, you know, they don't want conflict either.

00:20:18.060 So the hope was with this Blinken visit, it would be the beginning of another beginning to another attempt at a process to, quote unquote, put a floor into the relationship so that at least it wouldn't get worse.

00:20:29.260 And maybe the two countries could start reengaging in certain areas around dialogue and start trying to figure out a new sort of a new way to coexist as you sort of in this new era.

00:20:40.580 And the the balloon incident made Blinken's trip impossible.

00:20:48.420 But it's not just I think that it made it impossible for a couple of weeks.

00:20:51.720 I think the sort of the fallout since the balloon and the shoot down and all the sort of competing statements over the last week and then other issues in U.S. domestic politics, the Chinese political calendar.

00:21:03.780 It means it's very, very unlikely, I think, that there'll be another chance at a visit by Blinken until maybe it's the summer or even longer.

00:21:14.120 So and over the next few months, again, you're going to see more measures from the U.S. around technology, export controls, potentially around investment controls.

00:21:22.420 You're just going to see more, I think, pretty negative rhetoric, especially from the U.S. Congress.

00:21:27.320 And so it just it just sort of and then, of course, if like the new speaker of the House McCarthy visits Taiwan, like the former speaker Pelosi did last August, that's going to cause a whole new downturn relationship.

00:21:40.140 And so there's a lot of forces that were already lining up this year to push the relationship in a more in a more downward direction.

00:21:47.620 And one of the arresters was some people hoped and may not have been realistic, but at least it was a hope that a potential arrestor or governor would have been this Blinken visit that, of course, then was blown up by the balloon.

00:22:00.900 And so so that's sort of where it's all kind of left, I think, worried that there really is a potential for a pretty significant freefall in the relationship over the next few months.

00:22:09.980 There used to be a bipartisan openness towards China and my read on American politics over the last several years is that there is now a bipartisan consensus against China.

00:22:23.480 Am I reading that the wrong way? What's your take?

00:22:26.400 No, no, you're reading it absolutely correctly. And I mean, there's a lot of reasons that has happened.

00:22:30.840 You know, it's it's a you could do it all long podcast just on that topic.

00:22:33.920 Like it has to do, I think, with domestic politics, economic issues.

00:22:37.220 It certainly has a lot of a lot to do with PRC behavior and specifically Xi Jinping and sort of, you know, I mean, there were and just also with the shifting of the relative balance of power.

00:22:50.620 I think that China is much bigger, more powerful and is seen as really pushing an agenda and interests and values that are really quite inimical to Americans' interests, agendas and values.

00:23:07.240 And so a lot of different things have sort of there's been a confluence of a whole bunch of domestic international factors to really coalesce into a much harder and tougher view towards China.

00:23:22.380 And, you know, certainly I think Trump Trump was in many ways that, you know, things were hardening under Obama, but Trump really accelerated it.

00:23:31.780 Just like on the Chinese side, Xi Jinping accelerated a lot of things, both in the way the the U.S. and some of the West views China, but also how the PRC government views America in the West.

00:23:42.660 And so, you know, one of the one of the jokes over the last few years that started during the Trump era was that on both sides, you had this like accelerator in chief.

00:23:50.540 Right. So so Trump was accelerating a tougher, tougher relationship with China and Xi was doing the same thing.

00:23:56.840 And so it was really sort of accelerating the two sides towards a collision course.

00:24:00.980 And the hope in some quarters and it was misplaced, it turned out, but certainly there was hope on the Chinese side in some parts of the U.S.

00:24:08.060 that President Biden would have a sort of figure out a way to have a sort of a more positive or a nicer relationship with China.

00:24:15.420 When, in fact, President Biden, the Biden administration, I think, in many ways has been tougher on China than the Trump administration was in part because it's it's a bit more of a coherent agenda.

00:24:27.480 And also it has done more with certain allies.

00:24:31.260 And so it's much more of a sort of a united, almost united front against the PRC than sort of the Trump administration, more sort of my way or the highway approach.

00:24:41.520 I want to talk when we come back, we're going to take a quick break.

00:24:44.940 But when we come back, I do want to talk with you, Bill, about how China's changed, how the relationship has changed and and whether we're we're seeing China the way it really is instead of the way we wish it to be.

00:24:57.800 Back in moments.

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00:25:13.160 You're richer than you think.

00:25:15.800 One of the big questions for me over the last little while, Bill, has been, are we looking at China through rose-colored glasses or do we have a realistic view?

00:25:26.140 Essentially, are we seeing China as they are or how we want them to be? 0.97

00:25:32.140 Because, you know, there's definitely been a change in the relationship between China and the West.

00:25:38.500 We have our own prime minister who's definitely had a blind spot on China.

00:25:42.680 But I'm wondering your thoughts on on that among Western governments in general.

00:25:48.100 President Xi is very different than previous leaders.

00:25:55.320 He's much more authoritarian, in my view, has taken the country backwards, in my view.

00:26:01.560 But I get the sense that some of our leadership continues to think it's the 1990s when Bill Clinton invited the Chinese into the World Trade Organization as a way to open things up.

00:26:14.320 How do you read this?

00:26:15.480 No, I think most, it's more realistic to really look at, you know, I mean, Xi Jinping himself talks about the new era.

00:26:28.720 And, you know, the new era started when he became general secretary in 2012.

00:26:33.380 And it really is a new era, both inside China, in Chinese politics, but then also with China's relationship with the sort of view of the world, relationship with the world.

00:26:41.560 And so the folks who look at things the way they were in the 90s are, you know, they're in the old era.

00:26:46.100 And even the Chinese have moved on. 0.66

00:26:48.500 I think that, you know, certainly, you know, there are a lot of things that Xi has done that have been very popular in China.

00:26:59.060 And, you know, his corruption crackdown, I think, was got a lot of public support.

00:27:03.400 Their approach to COVID for the first two years was internally highly successful and had a huge amount of support.

00:27:12.240 I think really where the COVID sort of came off the rails was Omicron and the way they pushed starting in about a year ago or so with the kind of lockdowns, this dynamic zero COVID.

00:27:25.400 But I think, you know, if you did a public opinion poll, say, a year ago, you would have found pretty confident, even though it's hard to do polling in China, you would have found a lot of strong support for Xi Jinping for some of the things he's done in the country, sort of around the politics, around corruption.

00:27:42.320 Also, China's increasing prominence in the world.

00:27:46.060 And, you know, there's a lot to be proud of.

00:27:47.700 And if you're Chinese, there's a lot of reasons to be happy and to be, you know, and nationalism runs deep.

00:27:53.380 And like in any country, it can be manipulated by the political system and the propaganda and the sort of the media systems.

00:27:59.420 But it's also real.

00:28:00.440 And so I think, though, that what we end up with now is trying to deal with a much more complicated and powerful and in many ways assertive PRC that is really hard to deal with because many of the policies that, say, the U.S.

00:28:22.880 or Canada or other sort of Western countries would take to shift the relationship with China to reflect more concerns about some of the Chinese, you know, foreign policy, as well as some of the issues inside China, like around Xinjiang and the Uyghurs or what's happened in Hong Kong.

00:28:40.940 You know, we're so bound to China from an economic perspective that any choice that pushes back on the PRC is expensive, both financially, socially, and potentially, you know, things like employment.

00:28:58.300 And so they have a domestic political cost if you're Prime Minister Trudeau or you're President Biden or President Trump, et cetera.

00:29:04.340 And so China is just much, much harder to deal with. 0.98

00:29:09.080 And I think to back to your question, the folks who sort of want it to be back like the 90s, I think a lot of us kind of do because it was much easier to deal with.

00:29:16.000 But that era is gone.

00:29:18.880 And so now the question really – and I think this is where like one of the reasons potentially this balloon thing is such a big deal is, you know, you've had this debate and, you know, and more of the sort of the policy world sort of pushing back on China.

00:29:34.380 And D.C. they call it the blob, sort of the foreign policy blob or, you know, other capitals have a similar sort of think tank official, foreign official world.

00:29:46.100 The balloon put China over everybody's head in the U.S., right? 0.77

00:29:50.800 And so –

00:29:51.520 Quite literally.

00:29:52.100 No, quite literally.

00:29:53.100 And it was all over the news.

00:29:54.820 You know, you had the videos on, you know, all the networks were talking about the balloon.

00:29:58.580 And it brought sort of this idea of this other and this threatening thing in our – literally over our heads to a much broader audience in the U.S.

00:30:09.460 It made the kind of this idea of China as something to be worried about much more mainstream than I think anything has over the last several years, including the trade war, including a lot of the rhetoric during the Trump era.

00:30:24.080 This was much more, I think, of bringing it home to lots more people.

00:30:27.900 Well, I remember 20-odd years ago working – I worked in an office building next to a Nortel facility, and the police showing up and arresting people for spying for China 20 years ago.

00:30:42.300 So, you know, this stuff has been going on for a long time.

00:30:45.040 I think you're right.

00:30:45.880 It very much put it front and center for everyone that China is out there spying on you because, well, look up.

00:30:52.840 No, I mean, Nortel was – yeah, Nortel was gutted.

00:30:57.440 I'm sure there was bad management too, but certainly there didn't help to have a lot of the secrets end up in another country.

00:31:03.880 In another company, yeah.

00:31:05.000 In another – yeah.

00:31:05.920 And I think – but so it just is – again, it's a – you think it's like the balloon should be happy.

00:31:15.440 You open this conversation when talking about balloons and kids' parties, right?

00:31:19.620 And you think – balloons are supposed to be good, but in this case, I think that balloon really is just a symbol of how the world has changed.

00:31:29.980 And it really is a symbol of this new era and dealing with a really bigger, more powerful, and different China under Xi Jinping.

00:31:38.140 And however the U.S. or Canada or other countries want to sort of try and reshape the relationship with the PRC or push back on certain things, it's going to come with a very significant cost that it isn't clear a lot of people have fully calculated.

00:31:58.420 You lived in China from 2005 to 2015.

00:32:04.860 You can – you read and speak Mandarin.

00:32:07.820 You can still, you know, tap into whatever local media from China that you can get here.

00:32:16.220 What are the big changes that you've seen in that time?

00:32:20.340 Is it a very different China now than when you first went?

00:32:23.900 So I actually first went in the late 80s.

00:32:25.720 I spent some time there in the late 80s and the early 90s.

00:32:28.120 And then the last time I lived there was 2005 to 2015.

00:32:32.460 I've actually lived like 13 and a half years in my adult life.

00:32:35.720 It's – if you hear me coughing, it might be the Beijing smog.

00:32:38.380 Although the Beijing era is very good now.

00:32:40.440 No, I mean, again, it was – to your point about sort of earlier this sort of the sort of older folks who talk about China and like sort of like out of the 90s.

00:32:50.580 You know, China was – in the 90s was – there was a lot – it was very open.

00:32:55.780 It was quite poor.

00:32:57.620 There was a lot of ferment.

00:32:59.320 There was a – it just was a – and it was frankly relatively weak.

00:33:02.860 And so for I think a lot of America, a lot of other countries, it was we can work with these – we can work with this country because we're still the big – you know, we're the big country.

00:33:13.320 We're the strong country.

00:33:14.080 They have to listen to us.

00:33:15.380 And, you know, that isn't what a country with a long history like China and a proud history and a – you know, that's not ultimately the position they wanted to be in.

00:33:26.900 They see no reason why they should be subservient at all or number two to the US.

00:33:30.820 And I think that – so over the last several decades, China has gotten much richer.

00:33:35.760 It's obviously – you know, you see the hardware and the amazing things like high-speed rail and all the infrastructure that, you know, we certainly in the US would think would be great.

00:33:46.180 But, you know, that comes with a separate set of costs.

00:33:48.700 That's not the point of this podcast.

00:33:51.380 But my point is that, you know, there are lots of reasons for people in China to be incredibly proud of where the – how the country has developed.

00:34:00.320 I mean there are lots – don't get me wrong.

00:34:02.100 There are lots of problems.

00:34:03.100 There are lots of people who are unhappy like in any country.

00:34:06.160 But China is a much stronger, richer, more powerful country today than it was in the 90s.

00:34:13.540 And anyone who – any citizen of any country who's had this incredible trajectory of growth in terms of both economic and as well as national power would be, I think, pretty proud of where the country is for the most part.

00:34:28.220 And so we're dealing now – you know, the challenge for the US is we're dealing with a near peer on almost every dimension of power.

00:34:38.300 And that's not something that – I'm just – from a US government perspective, that's not something the US government is used to dealing with.

00:34:44.540 In fact, the people who have had those experiences, you know, those are – they're all retired.

00:34:48.860 This was maybe during parts of the Cold War with the Soviet Union.

00:34:52.700 This is a whole new thing for most people who are working in, say, the US or Canadian governments.

00:34:58.940 And it's very – it's a very, very hard problem.

00:35:03.140 I imagine it would be in a complete mind shift change.

00:35:06.300 Now, you talk about nationalism and pride and you're right.

00:35:10.760 Everybody's, you know, proud of their country.

00:35:12.780 You know, I get worried when I see China with its military posture threatening in the South China Sea with Taiwan, other flashpoints.

00:35:23.200 I'm guessing that it's not viewed that way by people living in China.

00:35:27.780 They take a very different view, probably in line with where the administration in Beijing is.

00:35:33.380 Oh, for sure.

00:35:35.060 No, I mean, for, you know, Taiwan is seen by just about everybody in the PRC as the sort of the wayward province that has to come home.

00:35:45.400 And I mean, I've said this before.

00:35:47.000 And, you know, even if Xi Jinping and the Communist Party went away tomorrow and there was the sort of Democratic Republic of China, they'd still want Taiwan, I think.

00:35:56.140 Because it's so ingrained in this idea that this is part of our country that was basically – you know, there's the whole, you know, the predation that the country suffered during the imperialist period and, you know, how it was carved up and the opium wars and sort of all the things that happened in the country that were quite devastating.

00:36:20.480 And now they've – you know, Mao came in, they've stood up, and they've gotten strong, and then they've gotten rich, and now they're getting strong.

00:36:27.420 And part of that – you know, Xi Jinping, he wasn't the first Chinese leader to talk about this idea of the great rejuvenation of the Chinese nation.

00:36:33.860 But he's the one who's pushed hardest on it and made it much more central to his overall agenda and program for his period of control over the country.

00:36:45.000 The key to that is returning – what they say is returning Taiwan to the motherland.

00:36:51.100 And again, Taiwan a decade, two decades ago was – they always – the Chinese side, the PRC side always said it had to come back.

00:36:59.860 But it was – there was possibilities or hope for a potential political solution.

00:37:03.620 There also was not the military capability to take Taiwan by force.

00:37:09.980 And now we've gotten to the point where the PLA, the People's Liberation Army in China, is much closer to having the capability to take back Taiwan.

00:37:18.660 And certainly they're, I think, very close to having the ability to prevent other countries, including the U.S., from successfully defending Taiwan.

00:37:26.540 And so, again, this goes back to this idea that one of the things we're seeing is this real shift in the relative balance of power in ways that are not favorable to sort of the U.S. and the U.S.-led West.

00:37:39.980 You've mentioned several times the popularity of President Xi.

00:37:45.720 Does he face any internal unrest or dissent, whether it's from the population or within the Communist Party of China?

00:37:56.160 There was some pushback over the lockdowns a little while ago.

00:38:00.260 That was shocking and surprising to many of us.

00:38:04.400 Is that just a one-off or is that a symptom of something else?

00:38:09.220 No, I think there's, I mean, you know, there's a lot of, there's always been grumbling, like in any country.

00:38:16.140 The last few months of the Dynamic Zero COVID program last year did so much economic damage and so much social damage that it really pushed a lot of people to the brink.

00:38:30.340 And so you ended with this culmination of various protests in November that were pretty, you know, they weren't huge, but they were pretty shocking to see people gathering like that in Shanghai and Beijing.

00:38:43.440 And, you know, most, the vast, vast majority of the people were not advocating to overthrow Xi or overthrow the Communist Party.

00:38:50.660 They wanted to basically get their lives back, right, to get out of this crazy, what was increasingly looked like, just this crazy lockdown and, frankly, unsustainable lockdown policy.

00:39:03.360 You know, the Communist Party, though, they do have to worry about the economy because if people are not able to make money, if they're not able to work, you know, if they have large unemployment,

00:39:13.720 that does raise the potential of some sort of social unrest on a larger scale.

00:39:22.020 And that's certainly one of the things that drove, I mean, everyone looks at a protest in China and says, oh, my God, it's like 1989 Tiananmen Square.

00:39:28.980 And it's not, it's very different.

00:39:31.060 But there's certainly if you if from the Communist Party's perspective, when they look at sort of how to maintain social stability, you know, what are the causes of protests?

00:39:41.360 They've done a lot of work on what led to the 1999 events and certainly economic problems, the lack of opportunity, unemployment, inflation were some of the key factors.

00:39:51.900 And so those are things that they're very, very focused on avoiding.

00:39:54.560 And I think that's what when you go back to, say, what drove the exit from from Dynamics Zero COVID last fall, one of the factors was, I think, the the realization that it was destroying the economy in terms of inside the Communist Party.

00:40:11.920 You know, it's one of those things where it's it's it's always been opaque.

00:40:15.360 It's much more opaque now than it was in the previous era before Xi Jinping came into power.

00:40:20.500 And so it's it's dangerous to say there's no opposition.

00:40:24.560 But I think what you can say is, one, when you look at this, the 20th Party Congress last October, when you look at the key sort of personnel appointments and the way that people were appointed into the various bodies that sit at the top of the Communist Party, it's pretty clear that Xi Jinping was able to pick basically all people he approved.

00:40:47.860 So so so so that, you know, it really pushed out any remnants of potentially other power centers.

00:40:56.860 The other thing he's done over the last 10 years is he's gone through the the systems that really control hard power, like the police, the the secret police, the Ministry of State Security, the People's Liberation Army.

00:41:10.980 And he's pushed through restructuring and he's pushed through restructuring and purges and again, stacked it with people he's chosen.

00:41:18.900 And so the odds of something coming from within the party to challenge Xi Jinping, I mean, you can again, I would never say zero because of the opacity of the system and the sort of the way or the sort of history of authoritarian systems.

00:41:33.320 But the I think the likelihood is lower now than it has been at any time during his 10 plus years in power.

00:41:41.340 I'll leave you with this.

00:41:42.880 I've often heard from skeptics of China that China will get old before it gets rich.

00:41:48.060 You sound much more bullish on that side of things.

00:41:51.100 You're bearish on the relationship, perhaps.

00:41:53.460 But you my take from what you've been saying, what I've read to Sinosism is that you don't necessarily see it that way.

00:42:03.780 Well, I don't want to say bullish, but I think that, you know, that so much of the China discourse and sort of popular discourse outside of China is sort of this binary, you know, sort of boom or bust or collapse or take over the world.

00:42:16.320 And, you know, the answer is always somewhere in the middle.

00:42:18.580 It's more of a spectrum.

00:42:20.020 And so I think when, you know, this idea of old before rich is, of course, you know, now for the first year, we see that the Chinese population started to decline and the demographics are not good in terms of the sort of the composition of different age cohorts.

00:42:34.820 And so there's lots that are going to be a real burden with older people over the next few years in China.

00:42:39.900 You know, other countries have, you know, you can still be fairly prosperous.

00:42:47.980 There are potentially technology solutions to some of the issues around the workforce and sort of it's so so I think it's it's it's something that the leadership in China is is obviously worried about.

00:42:59.780 They're now they've switched from trying to control births, promote births and trying to push much more pro natalist policies.

00:43:06.640 And and so far, none of them have stocked, but they're going to keep trying.

00:43:10.660 So it's something they're concerned about.

00:43:12.200 But is it like, oh, my gosh, heroin fire crisis?

00:43:15.760 Probably not.

00:43:17.060 But it's also certainly another potential headwind on China's development.

00:43:22.740 Bill Bishop, thanks so much for your time.

00:43:24.520 Thank you.

00:43:24.960 If you want to read more of Bill Bishop, you can look up his newsletter, his blog, Sinicism on Substack.

00:43:31.980 Definitely well worth the read and regularly updated.

00:43:35.700 Full Comment is a post media podcast.

00:43:38.060 My name is Brian Lilly, your host.

00:43:40.260 This episode was produced by Andre Pru.

00:43:42.320 Theme music by Bryce Hall.

00:43:44.340 Kevin Libin is the executive producer.

00:43:46.320 And remember, you can subscribe to Full Comment on Apple Podcasts, Google, Spotify, Amazon Music.

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Full Comment - February 13, 2023

Chinese spy balloons are taking over

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