Key Points
- That the Chinese government seeks to infiltrate American institutions is hardly surprising.
- What is wholly new, however, are the number of American elites who are eager to help the Chinese dictatorship.
- In Red-Handed, Peter Schweizer presents his most alarming findings to date by revealing the secret deals of wealthy Americans.
It’s no secret that China wants to surpass the United States in world dominance, yet American elites continue to help the communist’s government’s ambitions rather than treating them as the enemy. In his new book, “Red-Handed,” Peter Schweizer — author of best-sellers such as “Clinton Cash” and “Profiles in Corruption” — outlines the ways top politicians and CEOS get rich off China. In this exclusive excerpt for The Post, he reveals how Big Tech companies have sacrificed privacy and national security in pursuit of Beijing riches.
Blinded by their ambition, Silicon Valley elites are helping Communist China achieve their ultimate goal: “Technology supremacy” over the West.
“Science and technology is a national weapon,” President Xi Jinping has said. “We should seize the commanding heights of technological competition and future development.”
To accomplish this goal, Beijing has created “civilian-military fusion,” which means any technological advance in the civilian market must be applied directly to the military sphere. And they have effectively courted and seduced many powerful people in America’s tech industry to willingly, and sometimes enthusiastically, play along.
In 2015, the Obama Administration held an official State Dinner at the White House for China’s Xi. The East Room was decorated in peach and pink roses. The crowd included two hundred elite guests from the world of government and business. Among them was Mark Zuckerberg, the young-looking cofounder of Facebook, and his wife, Priscilla, who was seven months pregnant. When Zuckerberg finally got his chance to see the guest of honor face-to-face, he made an unusual request: would the communist dictator give his child his Chinese name?
Xi, understandably surprised by the request, declined, saying it was “too great a responsibility.”
It was not the first time the Facebook cofounder had gushed over Chinese officials.
In late 2014, a high-ranking Chinese official named Lu Wei made a trip to Silicon Valley. Lu was a Communist Party hack, the former deputy head of the Propaganda Department of the Communist Party of China. President Xi had recently appointed him to head the “Central Leading Group for Internet Security and Information.” In short, Lu was China’s Internet czar, with the Orwellian job of restricting access to certain ideas and monitoring the flow of information.
The Chinese government had given him plenty of tools to do his job. In 2013, they created a law making it a crime to spread rumors online; if a post deemed untrue received more than five hundred reposts, the original poster could be sentenced to up to three years in prison.
But when Lu visited Facebook’s California headquarters in Menlo Park, Zuckerberg treated him like a VIP. The Facebook head gave him a tour of the new Frank Gehry–designed campus, which boasted the “largest open floor plan in the world.” Later, the two retreated to Zuckerberg’s private office. Lu sat in the CEO’s chair, took a few pictures, and then spotted a familiar book sitting on Zuckerberg’s desk. “The Governance of China” is a 515-page tome containing the speeches and comments of President Xi.
Why was such a book sitting on a capitalist’s desk? Zuckerberg explained to his guest that he bought the book for both himself and his staff as a guide. “I want to make them understand socialism with Chinese characteristics,” he said.
Zuckerberg’s Facebook teamed with Google in 2016 to build an undersea cable that would link San Francisco with Hong Kong, China, and other locations in Asia. The so-called Pacific Light Cable Network would provide better internet and data services to their customers in Asia. But the two American tech superpowers chose to partner with a Chinese company called Dr. Peng Telecom & Media Group to provide the link to Hong Kong.
Dr. Peng was financially backed by the Chinese government’s China Securities Finance Corporation, and worked closely with Huawei and military defense contractors in China. What could possibly go wrong?
The U.S. Federal Communications Commission in 2020 took the unprecedented step of blocking the project. The Facebook-Google cable presented “‘unprecedented opportunities’ for Chinese government espionage,” according to the U.S. Justice Department.
How the tech giants did not see the obvious espionage risk to their plans is a mystery. Or maybe they saw it and did not care.
At the heart of Google’s business strategy is an unquenchable thirst for data, and their dealings in China show they cannot resist tapping any vast resource offered to them.
In 2017, Google announced the opening of an AI research facility in Beijing. The Google AI China Center would include “a small group of researchers supported by several hundred China-based engineers.”
The head of the venture for Google, Fei-Fei Li, explained, “I believe AI and its benefits have no borders.”
The research at the Google AI China Center includes machine learning that would classify, perceive, and predict outcomes based on massive amounts of data. This is precisely the sort of work that military and intelligence officials would want from AI.
Google’s cooperation with China on AI research occurred the same year that the Chinese Communist Party and government laid out its “artificial intelligence development plan.” A report issued by the Chinese government explains that “AI has become a new focus of international competition,” mastering that technology enhances “comprehensive national power,” and that it would lead to the “great rejuvenation of the Chinese nation.”
Beijing has declared that passing the United States in artificial intelligence is a “national priority.”
“The work that Google is doing in China is indirectly benefitting the Chinese military,” Marine General James Dunford, then chairman of the Joint Chiefs of Staff, told a U.S. Senate committee. Then he corrected himself. “Frankly, ‘indirect’ may not be a full characterization of the way it really is, it is more of a direct benefit to the Chinese military.”
Collaboration between American tech companies and Chinese military-linked research labs has enormous implications for our national security. What makes that collaboration even more galling is the fact that China has very different anticipated uses for the technologies than the United States.
As the National Security Commission on Artificial Intelligence announced in its final report, “Authoritarian regimes will continue to use AI-powered face recognition, biometrics, predictive analytics, and data fusion as instruments of surveillance, influence, and political control.”
The chair of that commission? Former Google CEO Eric Schmidt.
In short, Schmidt favors continued AI joint work with Beijing, knowing that they will be using it to make Orwell’s dystopian “1984” a reality.
It is clear why Beijing wants to work with Silicon Valley firms. But why are America’s technological gurus so eager to work with Beijing?
The short answer: data is king.
“More data helps you more than any other algorithm,” explains Dr. Kai-fu Lee, a tech investor and author of “AI Superpowers: China, Silicon Valley, the New World Order.”
“Therefore, in the era of AI, if data is the new oil, then China is the new OPEC.”
China has so much more data than the United States because Chinese consumers are more data-connected, but even more importantly because the Chinese government collects so much more data than Western governments do.
TESLA
Elon Musk, one of the richest men in the world, is an example of how even executives who talk tough about China can eventually fall in line.
He has expressed his frustrations with high tariffs and Beijing’s crackdown on information, as well as intellectual property theft.
Musk himself acknowledges that Chinese entities stole software code from his company Tesla. That is not just a competitive problem, it is a national security one: that same software is used by Musk’s SpaceX, which launches payloads and works closely with the U.S. military.
Musk had for several years denied that he was going to build a facility in China, claiming that he was quite happy with his production in the United States. In 2015, when transcripts of a meeting in China were leaked, indicating he had plans to build a factory there, he quickly declared that the transcripts were not accurate, refuting them on Twitter. “My comments in China weren’t transcribed correctly. Tesla will keep making cars & batteries in CA & NV as far into future as I can imagine.”
Beijing still courted him. In March 2017, China’s government-linked Tencent Holdings bought a 5 percent stake in Tesla. Musk explained on Twitter that Tencent would be both “an investor and advisor.” (What advisory role the company would play was never explained.)
Then Beijing rolled out the red carpet: Chinese government–backed banks coughed up $1.6 billion in subsidized loans. And the regulatory red tape to build in China was eliminated by government authorities. “What surprised me is how little time it took for the regulatory process to get approved by the Chinese government,” explained Ivan Su, an analyst at Morningstar Inc. The enormous plant was built in less than a year.
Musk arrived in the country for the groundbreaking ceremony and met with top-ranking officials. Two days later, he was meeting with Vice Premier Li Keqiang in the private compound reserved for high- ranking visitors. “I love China very much and I am willing to come here more,” Musk reportedly told Li. The vice premier offered to make him a permanent resident in the country.
He also clearly wanted Musk’s help in the wake of the Trump administration’s pushback on some of Beijing’s technology and export policies. “We hope your company can become an in-depth participant of China’s opening and a promoter of the stability of China-U.S. relations,” he told Musk.
Musk has since become a Beijing booster. In January 2021, he explained in one interview how the unelected Beijing regime was possibly “more responsible” toward its people than the democratically elected U.S. government.
“When I meet with Chinese government officials, they’re always very concerned about this. Are people going to be happy about a thing? Is this going to actually serve the benefit of the people? It seems ironic, but even though you have sort of a single-party system, they really actually seem to care a lot about the well- being of the people. In fact, they’re maybe even more sensitive to public opinion than what I see in the US.”
But some national security experts are very concerned about Beijing’s ability to leverage Musk.
Miles Yu, a professor at the U.S. Naval Academy, says that Beijing lured Tesla “into China with initial preferential tax and regulatory treatments. Once you are hooked in China, and have gained initial success, the CCP would not hesitate to use your investments in China as a leverage to force you to comply with a whole list of demands, outright or subtle, including sharing proprietary technologies and knowledge.”
From the book “RED-HANDED: How American Elites Get Rich Helping China Win” by Peter Schweizer. Copyright © 2022 by Peter Schweizer. Reprinted by permission of Harper, an imprint of HarperCollins Publishers.
