China Lies, China Kills, China Wins

Thursday, April 23, 2020
Image credit: 
Poster CC 229, Poster collection, Hoover Institution Archives.

Image credit: 
Poster CC 229, Poster collection, Hoover Institution Archives.

As a plague compounds our political divisions, it’s essential to recall that the cause of the global carnage is not across the congressional aisle or parliamentary divide. This pandemic came courtesy of the breathtaking (literally, in this case) ruthlessness of the Chinese dictatorship, whose policies nurtured, hid, and fostered the spread of the COVID-19 virus currently killing our citizens by the tens of thousands and crippling economies worldwide.

Even the origin story of this pandemic, suggesting that the virus escaped from a “wet market” that trafficked in exotic animals, may have been propaganda. Given that China continues to deny access to trustworthy international investigators, conjectures vary, but the actual disease source may have been the Wuhan Institute of Virology, a lab with inadequate security that had been researching coronavirus strains (for domestic defense, not germ warfare).

Initially, the Chinese sought to smother news of this plague—abetted by a dubiously credentialed head of the World Health Organization indebted to China for his appointment. When the outbreak could no longer be concealed, President Xi directed a propaganda campaign to shift the blame for the outbreak, even suggesting that visiting U.S. Armed Forces personnel had brought the virus to Wuhan, while—we now know—drastically under-reporting the Chinese body count. Beijing piled lies atop heaps of corpses.

Despite subsequent mistakes from Milan to Manhattan, the guilt for this avoidable slaughter and economic destruction lies exclusively with Beijing. President Xi deserves to be charged in the International Criminal Court as an accomplice to mass murder, if not genocide.

Instead, China is the state likeliest to profit strategically from this global catastrophe, with much of Europe plague-ravaged, the European Union (EU) in an existential crisis, and the United States abandoning its vital leadership role. Barring an improbable upheaval in China’s leadership circles, and despite China’s own financial battering, Beijing will not let this unprecedented opportunity pass by.

Yes, China will pay more than one price for its monstrous behavior. Among governments, there is a broad awareness of—and anger over—China’s atrocious behavior. And despite Beijing’s vigorous disinformation campaign, populations also grasp that the sickness scything through families and neighborhoods was “made in China.” Should the virus continue to spread in Africa, Southeast Asia, and elsewhere, we may see local pogroms against ethnic Chinese. Of far greater concern to Xi’s regime, we will see scattered attempts by multinational corporations to diversify supply sources or even repatriate some manufacturing functions (China’s control of drug manufacturing has come as one shock among many). Beijing could even see its flagship tech enterprise, Huawei, lose contracts for 5G-network equipment.

But increased dislike of China will be eclipsed by increased dependence on China: Ready money rules. The lynching of Chinese emigres or “development-project” personnel will not drive Beijing from vulnerable countries. Popular discontent is merely another cost of doing business once you have bought off the local political elite and ensnared a bankrupt government in a web of strategic payday-lender debt. China may do many things, but it will not retreat from its pawnshop empire.

As for multinationals diversifying supply sources, the effects will be trimmed by our greed: Access to the huge Chinese domestic market will be judged too important to corporations seeking to compete globally. China also will offer discounted terms to retain business. Corporate resolve will last barely longer than a rice wine hangover. As over-extended companies struggle to recover from this pandemic, moral, ethical, and even long-term practical considerations will disappear: Getting bottom lines back in the black fast will outweigh every other consideration.

This effect will be exacerbated by China’s anything-goes determination to recover first and be ready to reap all possible benefits from its open wallet. Despite deep structural weaknesses in its banking system, post-plague China will launch a strategic buying drive that will further divide Europe, frustrate the United States, and corner its East-Asian neighbors. (China realized decades ago that economic power can equal or exceed the utility of military force in a hard-power role.)

Europe will be target number one for Beijing’s global landlords. Buying up key industries at post-plague fire-sale prices, China will seek to degrade what remains of EU unity and become a de facto hegemon in southern Europe—with Italy its primary beachhead.

Italians know full well that China is responsible for the horrific human toll and economic devastation their country has suffered over the past few months. As COVID-19 raged in Wuhan and beyond, the extensive business travel between China and Italy remained at normal levels, while Chinese tour groups continued to arrive through January (as I can personally attest, Chinese tourist groups seemed to be the only ones squeezing together in off-season Rome). Beijing did not halt the business exchanges or tourism because that would have required an explanation. For President Xi, dead Italians were not an issue.

And the response from Italy’s all-but-anarchic leftwing government? As Italians died at rates not seen since nineteenth-century cholera epidemics, the foreign minister, Luigi Di Maio, welcomed a plane-load of Chinese medical supplies with obsequious hoopla—then said nothing when Chinese testing kits proved worthless and face masks lethally shoddy.

Italy is a paradigm worthy of study. Chinese economic subversion has been going on in il bel paese for more than a quarter-century. One of the first victims was the world-renowned Italian textile industry, with its incomparable fabrics—produced not en masse, but by small-to-medium-size family-owned firms. With excess capacity at home, the Chinese launched a strategic assault on the industry, increasing the quality of its own textiles and dropping prices sharply. The Chinese textiles were never as fine as those “made in Italy,” but the reduced costs won over European and global firms: If Chinese fabrics were not as good, they were deemed to be good enough. Then, as one Italian firm after another collapsed, Chinese investors bought up the plants and hired back skilled Italians to teach (often-illegal and all-but-enslaved) immigrant Chinese laborers how to make higher-quality cloth—enabling the new masters to sew on the prized “Made in Italy” label. In Italy’s traditional textile regions, expat Chinese business communities now wield political clout, while local employment of Italians has never recovered.

This pattern is about to recur on a much larger scale, in far-more-sensitive industries. Suffering economic toxic shock, Italy will welcome investment from any source that can boost its convalescence. And the only major source with ready money and resolve is going to be China, which will gain back-room veto-power in the EU and backdoor influence in NATO. Spain and Greece, as well as France, also will face corporate takeovers and the purchase of poison-pill minority stakes in strategic industries. For Beijing, an economic occupation of southern Europe is a means to disrupt northern Europe and crack the EU block into less-competitive, more-cooperative pieces.

And what incentive will the EU have to resist, when it’s plunged into deep recession, when the trans-Atlantic relationship is on life-support, and the United States threatens trade wars against its closest allies? Beijing will supercharge its quest for economic empire just when Washington’s embittered factions cannot even agree on constitutional lines of authority.

As for Putin’s Russia, now facing the COVID-19 onslaught after insisting it had escaped, our grim consolation will be that Moscow’s domestic authority and international capabilities will be further weakened by a systemic frailty masked until now by bluster.

We cannot know precisely how all of this will end, but, at present, it looks as though only China will profit strategically from the terrors and devastation of the plague it unleashed on the world.

 

Ralph Peters is the author of acclaimed works on strategy and prize-winning historical novels. A retired U.S. Army intelligence officer with global experience, he enjoyed a career as a media commentator until he didn’t enjoy it anymore.

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