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By PHELIM KINE
with STUART LAU
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Hi, China Watchers. Today we look at the future of the Quad as it faces the departure of President Joe Biden and Japan’s Prime Minister Fumio Kishida and unpack criticism of the State Department’s efforts to free unjustly jailed Americans in China. And we profile a book that argues that the role of U.S.-China tensions in reducing the number of U.S. citizens working and studying in China is “an enormous loss for Americans.”
Let’s get to it. — Phelim.
Biden’s Quad farewell
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President Joe Biden will huddle with the leaders of the Quad nations — Japan, Australia and India — in Wilmington, Delaware on Saturday to demonstrate the resilience of the informal grouping.
Continuity is key. The meeting will be a symbolic toast to Biden’s role in bolstering the Quad as a key part of his Indo-Pacific Strategy aimed at offsetting Beijing’s growing influence in the region. And its members likely hope to telegraph that the grouping’s regional cooperation in areas including climate, health and infrastructure development will continue despite Japanese Prime Minister Fumio Kishida’s exit from office Sep. 27 and the end of Biden’s presidency in January.
Delaware bro-fest. Biden will meet with Kishida, Indian Prime Minister Narendra Modi and Australian Prime Minister Anthony Albanese separately before convening a group meeting later in the day focused on “expanding cooperation across a range of critically important issues,” National Security Council spokesperson John Kirby told reporters Wednesday.
Here’s what they’re likely to address
Election-proofing. The leaders likely will aim to curb speculation that future U.S. and Japanese leaders may downgrade the Quad as a foreign policy priority.
“The Quad continued through Mr. Trump’s [first] term and is likely to continue and still have a champion in whoever leads the Japanese ruling party” post-Kishida, said Jane Hardy, a former leader of the Australian embassy’s congressional office in Washington.
The China factor. A key factor in the Quad’s durability — and its ability to engage four countries with differing interests — has been its framing as a platform for “development, stability, and prosperity” rather than as an overtly anti-China entity.
Biden may try to shift that emphasis in Saturday’s meeting with an agenda that will include “aggressive PRC military action, unfair trade practices, tensions over the Taiwan Strait,” the national security council’s Kirby said.
A delicate balance. That sort of move would confirm Beijing’s worst fears. The Quad “is inciting antagonism and confrontation,” Chinese Foreign Ministry spokesperson Lin Jian said in July.
And it might spook Japan and India if Biden pushes for more than his standard “rules-based international order” rhetoric. Japan and India “don’t want to send an ‘us against you’ kind of message — they want to leave some room to engage China,” said Yuki Tatsumi, former special assistant for political affairs at the Japanese embassy in Washington and currently director of the Japan Program at the Stimson Center.
The India gap. That ambiguity is important in ensuring that India — which shares a fraught land border with China and historically close ties to Russia — doesn’t retreat from the Quad over concerns about an anti-China stance. “I’ve always seen the Quad as being about India, about seeing whether it will go beyond its own narrow interests in the world and contribute more to global public goods,” said Susan Thornton, former acting assistant secretary of State for East Asian and Pacific Affairs, now a fellow at Yale Law School’s Paul Tsai China Center.
Compete, don’t confront. Any moves to push the Quad toward a more confrontational setting toward Beijing is likely to backfire in New Delhi.
“There is a security element to the Quad but it’s not the only element,” said former Indian ambassador to the U.S. Navtej Sarna. The Quad’s value is offering “alternative paradigms, both economic and technological, than the ones that China may be offering,” Sarna said.
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The Biden administration’s victory lap over China’s release on Sunday of wrongfully detained U.S. citizen David Lin (read Phelim’s scoop here) hit a congressional brick wall on Wednesday.
Family members of other Americans behind bars in China joined with lawmakers in a hearing of the Congressional Executive Commission on China to urge the administration to do more to free the remaining two U.S. citizens that the State Department considers “wrongfully detained” by Beijing. And they pressed State to expand the list of people who meet that criteria to include those whose arrests and prosecutions reflect disregard of due legal process.
“Not a single American prisoner held in China has had a fair and transparent trial…[its] judicial system is a political system of oppression, not a system of justice,” testified Peter Humphrey, a former victim of wrongful detention in China who works to release foreign citizens who unfairly end up in prison there.
Beijing rejects that assessment. China’s judiciary “handles criminal suspects strictly in accordance with the law [and] treats them equally regardless of their nationality,” said Chinese embassy spokesperson Liu Pengyu.
The lawmakers want the State Department to intensify its efforts to free Mark Swidan and Kai Li, the other two Americans in China that the Office of the Special Presidential Envoy on Hostage Affairs considers unjustly jailed. “There needs to be a surge right now” in diplomatic efforts to free them, said commission co-chair Rep. Chris Smith (R-N.J.).
Kai Li’s son, Harrison Li, argued that the U.S. presidential cycle means time is running out for action to free his father. A new administration in January means “months or even years where absolutely no progress on these cases will be made, Li said.
The administration has signaled that a breakthrough may be near. “They have assured me they are actively discussing the case in the near term and aim to get it done in this administration,” Li said.
The State Department hasn’t provided details about the deal that freed Lin nor the status of possible talks to free Kai Li and Mark Swidan. “We continue to push for the release of other wrongfully detained Americans,” State Department spokesperson Matthew Miller told reporters Monday in response to questions about Lin’s release.
That ambiguity irks Katherine Swidan, mother of Mark. “How did it happen — was there money involved? Was there a swap involved?” said Swidan. She added that Biden’s hostage envoy, Roger Carstens, had asked her to refrain from publicly criticizing the Chinese government in the wake of Lin’s release. Carsten told her to avoid “China bashing” for fear it prompts Beijing to “pull out of any negotiations,” Swidan said.
The State Department declined to comment on that allegation. “We support families speaking with press and in public on behalf of their loved ones [and] we also seek to provide an assessment of how that messaging will be received,” said a State Department official. The official was granted anonymity because they aren’t authorized to speak on record about U.S. hostage issues.
Michigan GOP Senate candidate Mike Rogers has made criticism of China a centerpiece of his campaign against Elissa Slotkin, who he claimed was “getting into bed with the Communist Party of China.” Some of the donors to Slotkin or the super PAC Senate Majority PAC heavily supporting her do have financial ties to China, including Stephen Mandel of Lone Pine Capital, and John Vogelstein, a special limited partner at Warburg Pincus, according to FEC records and publicly reported information.
Yet POLITICO’s Daniel Lippman writes in to note that several of the top donors to Rogers’ super PAC have also received major Chinese investments or talked up investing in the country, and that he and his wife have made money from companies with links to China, according to FEC records and earlier media reports.
Citadel founder Ken Griffin, who gave $2.5 million to the Great Lakes Conservatives Fund, a pro-Rogers super PAC, said last year that investors have to “be watching and investing” in China; his firm has operated in Hong Kong for two decades. (Since then, Griffin has appeared to grow more cautious on investing in China, telling Shanghai’s Yicai TV in late May: “From the perspective of a global investor, China’s a country rich in opportunity. From the perspective of an American investor, the geopolitical tension between our two countries makes China less investible.”) Steve Schwarzman meanwhile gave $2 million to the PAC; his investment firm Blackstone operates in China and in 2007 received a multibillion dollar investment by a Chinese state-owned entity, although it sold off the stake a decade after.
Rogers’ spokesperson Chris Gustafson directed questions on the donations to the super PAC. He did note, however, that one of the main companies that Rogers worked for that had China links was AT&T and said “if working as a contractor for AT&T qualifies as ‘profiting from China’ then there’s no single American company that wouldn’t qualify as that.”
Griffin sent a statement reiterating his support for Rogers. Warburg Pincus spokesperson Kerrie Cohen declined to comment while Senate Majority PAC, Blackstone and Lone Pine Capital didn’t respond to requests for comment.
Great Lakes Conservatives Fund President Jason McBride said in a statement: “Elissa Slotkin and her staff were caught signing NDAs that cover a Chinese Communist Party-connected factory being placed here in Michigan, the epicenter of the American auto industry. With the heat on, she is now attempting to flip-flop away from the issue because of bad polling and worse headlines.”
Slotkin campaign spokesperson Austin Cook said: “Mike Rogers is desperate to change the conversation from his long history of profiting from corporations with ties to China. But facts are facts: Rogers left Congress, increased his net worth by 2000 percent, and moved to a waterfront mansion in Florida. Mike Rogers got rich and Michigan paid the price.”
— SHAMBAUGH BEIJING-BOUND TO TALK ‘OVERCAPACITY’: The Treasury Department’s under secretary for international affairs, Jay Shambaugh, will convene two days of discussions in Beijing tomorrow and Friday, POLITICO’s Ari Hawkins writes in. The talks — which will include officials from the Federal Reserve Board — are the fifth meeting of the U.S.-China Economic Working Group. Discussion will focus on U.S. concerns about the international spillover effects of China’s industrial overcapacity, Treasury told Ari. The U.S. delegation will discuss “China’s macroeconomic imbalances and industrial policies that risk causing significant harm to workers and firms in the U.S. and around the world,” Shambaugh said in a statement. Treasury Secretary Janet Yellen warned Beijing in April to scale back industrial production in various sectors to avoid swamping global markets with low-cost Chinese goods.
— TAIWAN LEGISLATOR: U.S. SHOULD RECOGNIZE ‘TAIWAN’: A visiting Taiwanese legislator urged the U.S government to stop using the island’s formal name, the Republic of China, and refer to it strictly as Taiwan. “I wish that the U.S. government can recognize Taiwan as Taiwan, not Republic of China…Taiwanese people should have a say and should have the right to decide if we are Taiwan,” ruling Democratic Progressive Party lawmaker Ngalim Tiunn told reporters at a Hudson Institute event Tuesday. That position differs from that of the island’s independence-leaning President Lai Ching-te, who uses the “Republic of China” and Taiwan interchangeably in public statements.
— KRITENBRINK: ‘TOO EARLY’ FOR ‘ASIAN NATO’: The Biden administration is not interested in upgrading its network of Indo-Pacific alliances into a NATO-like mutual security body, POLITICO’S Eric Bazail-Eimil writes in. “It’s too early to talk about collective security in that context and more formal institutions that way,” Assistant Secretary of State Daniel Kritenbrink said at a Stimson Center event Tuesday. He added that the U.S. is currently focused on “investing in the region’s existing formal architecture and continuing to build this network of formal and informal relationships, and then we’ll see where that goes.”
The idea of a collective security alliance in Asia modeled off of the transatlantic partnership has gained some traction amid Japan’s Liberal Democratic Party’s leadership election to replace outgoing Prime Minister Fumio Kishida. Former Japanese Defense Minister Shigeru Ishiba, a contender to be Japan’s next prime minister, has called for an Asian collective security alliance as a way to counter China and reinforce U.S. partnership with allies in the region. That’s likely to fuel Beijing’s fears that Washington wants to create an “Asian-Pacific NATO” to thwart China’s interests in the region.
— DEA SHUTTERS CHINA OUTPOSTS: The Drug Enforcement Agency is closing two of its four offices in China as part of a wider agency reorganization. The DEA’s offices in Shanghai and Guangzhou are closing despite China’s outsize role in the U.S. opioid overdose epidemic, the Associated Press reported Monday. Those are two of 14 overseas outposts the DEA will shutter to refocus resources on “attacking every link of the global synthetic drug supply chain,” a DEA spokesperson said in a statement on Tuesday. The individual was granted anonymity because they aren’t authorized to discuss internal staffing decisions.
That could harm DEA efforts to monitor and interdict narcotics and fentanyl precursors that originate in China.
“Losing direct eyeballs on the situation there is very significant,” said Vanda Felbab-Brown, senior fellow at the Brookings Institution and an expert on China’s role in the U.S. fentanyl crisis.
Chinese embassy spokesperson Liu called the closures “an internal matter of the U.S.” but said that U.S.-China counternarcotics cooperation had resulted in “tangible and practical results” since Biden and Xi met in November.
EU POSTPONES VOTE ON EV TARIFFS: The EU’s national trade experts will not vote next week to impose duties on made-in-China electric vehicles, according to three EU diplomats who spoke to POLITICO’s Koen Verhelst and Camille Gijs.
The vote has been taken off the agenda of a Sept. 25 meeting of the EU’s Trade Defense Instruments Committee. To enable the vote, the European Commission first needs to formally share the definitive findings of its anti-subsidy investigation with national governments, which it has not yet done.
The delay comes as Chinese Commerce Minister Wang Wentao was in Brussels on Wednesday and Thursday, when he would meet the bloc’s trade chief Valdis Dombrovskis in search of a compromise that could avert the tariffs ranging from 8 percent to 35 percent, in response to Chinese subsidies for the sprawling industry. Here’s Koen and Camille’s full story.
CHINA WANTS TO RESUME FINANCE TALKS WITH BRITAIN: Beijing would like London to resume the China-U.K. Economic and Financial Dialogue, Chinese Vice Premier He Lifeng said Wednesday, according to Chinese state media. He made the remarks with the British finance minister Rachel Reeves.
Beijing has been testing the water whether the new British Labour government would be more ready to engage, as Labour heavyweight Peter Mandelson recently slammed the previous Conservative government for boycotting Hong Kong.
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— HEZBOLLAH’S EXPLODING PAGERS EMBARRASS TAIWAN FIRM: The Taiwanese firm Gold Apollo is struggling with the fallout from Israel deploying booby-trapped company-branded pager devices to members of the Iran-backed Hezbollah militant group in Lebanon. “This is very embarrassing,” Gold Star executive Hsu Ching-kuang told NPR Wednesday. Hsu said that it sold branding rights for pagers in 2021 to Budapest-based BAC Consulting which allegedly produced the exploding devices.
— OXFORD DEBATE: U.S. ‘MUST REASSURE CHINA’: China hawks took a beating at an Oxford Debate on Tuesday focused on the motion that “The next U.S. administration must reassure China, not just deter it.” Seventy-one percent of attendees at the event — co-organized by Asia Society Policy Institute and Asia Society Switzerland — voted in favor of that motion at the debate’s conclusion. “Reassurance may not build strategic trust…but it can build a floor, and the floor is to avoid war,” argued Yun Sun, China program director at the Stimson Center, who along with Asia Society Policy Institute managing director Rorry Daniels championed the more dovish approach to Beijing.
— JAPAN PROTESTS INCURSION OF CHINESE CARRIER GROUP: The Japanese government expressed “serious concerns” about what it says is the first-ever incursion by a Chinese carrier group into Japanese contiguous waters on Wednesday. The carrier group’s moves were “utterly unacceptable from the perspective of the security environment of Japan and the region,” said Japan’s deputy chief cabinet secretary Hiroshi Moriya, VOA reported. The incursion follows two other Chinese military violations of Japanese airspace and territorial waters since August. China’s naval activities “are consistent with China’s domestic law and international law,” Lin at China’s Foreign Ministry said Wednesday in response to Japan’s concerns.
— REPORT: BEWARE REVOKING CHINA’S TRADE STATUS: A GOP party platform position that calls for Republicans to “revoke China’s most favored nation status” will wreak havoc on the U.S. economy, said a report released Tuesday by the Peterson Institute for International Economics. The “most favored nation” status, also known as Permanent Normal Trade Relations, allows World Trade Organization members preferential tariff rates. Stripping Beijing of that status will reap “a short-term decline in U.S. GDP relative to baseline… from which the economy never fully recovers,” the report warned. That impact will be “magnified if China retaliates,” it argued.
Council on Geostrategy: Understanding Xi Jinping’s ‘reform and opening up’
New York Times: What happens if China stops trying to save the world?
