China expert Chris Johnson on Biden administration's approach to Beijing - on "Intelligence Matters"
On this episode of Intelligence Matters, host Michael Morell speaks with Chris Johnson, senior fellow at the Center for Strategic and International Studies and a leading expert on China, about the Biden Administration's rhetoric about and actions toward China. Johnson outlines the leading challenges facing the new administration and the views from both Washington and Beijing. He explains how diplomacy has been complicated by some of the scorched earth policies of the Trump administration and domestic considerations related to the COVID-19 pandemic. Johnson and Morell also discuss the overall trajectory of U.S.-China relations in the coming years and decades.
HIGHLIGHTS:
On the Biden administration's approach to Beijing: "I think they're obviously consulting with allies and partners on how to cooperate again as we prepare for this sort of extreme competition. I think the problem with that, though, is that these are sort of passive approaches. You know, thinking and studying and consulting are sort of passive words. And the problem is President Xi Jinping, President Biden's counterpart in China, isn't sitting idly by while the administration conducts that kind of thought process or navel-gazing."
Effect of Trump administration policies: "Trump's hostility toward even the allies stung and raised questions about our credibility and reliability. And I think our disastrous handling of COVID, obviously, and racial justice, tensions and other issues make the allies and others, non-allies, even, in the world, suspicious of both sort of our commitment and bandwidth."
Need for a strategic approach: "[F]or four years under Trump and arguably even before then, we've just been kind of drifting around. And this is what I mean with regard to it's finally time to have a proper China strategy. If we don't, then we're going to miss the boat and we could find ourselves in a very nasty fight with the Chinese."
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INTELLIGENCE MATTERS - CHRIS JOHNSON
PRODUCER: OLIVIA GAZIS
MICHAEL MORELL: Chris, welcome back to Intelligence Matters again. I've actually lost count how many times you've been on the show, but somebody actually said to me, 'Maybe we should rename the show "Intelligence Matters with Chris Johnson," anyway.' It is really good to have you back.
CHRIS JOHNSON: Great. Glad to be back. I think this might be number five. But who's counting?
MICHAEL MORELL: That means that means you have the record. So, Chris, as you and I talked about when we talked about doing this, I really want to dig in on the Biden administration's approach so far to China and how the Chinese are reading that and how they're responding so far - or how you think they're likely to respond. So that's what I want to do. And if that's OK with you, we will plow ahead.
And maybe the place to start, Chris, is if you can describe what the Biden administration has said about and what they've said to China so far, as well as what it's actually done with regard to China. What have they actually done and said so far?
CHRIS JOHNSON: Right. I mean, I think in terms of what they've said so far, it's important to remember, one, we're just coming up on one hundred days for the administration. So they haven't had a whole lot of time to say too much. Obviously, there's other things going on, dealing with the COVID challenges here and so on.
But I think they have been very direct and putting out a couple of pretty clear articulations so far. The first was President Biden's comment, of course, that we are preparing for what he called 'extreme competition' with China, which I think is meant to probably both underscore the reality of the situation, given China's increasingly clear signals that it sees it as such, as an extreme competition for global leadership, as well as probably a more political - or some might call it crass effort - to show that they'll be just as tough as the Trump administration was on China so as to avoid domestic criticism for for being soft.
For example, I think the second most authoritative statement that we've had was from Secretary of State Blinken in his speech in early March, kind of on U.S. foreign policy writ large, where he seemed to break the relationship into three buckets: where he noted that it will be competitive when it should be, I think he said collaborative when it can be, and adversarial when it must be. So I think that's kind of a good summation of how they're talking about the relationship in terms of what they've said to China.
I think the message has been pretty clear in that kind of bleeds into your question about what they've actually done. So in that space, I think we have seen them send a very clear signal with the use of sanctions, statements and other measures to show its very strong support for human rights globally. And as that relates to China, that obviously involves the situation of the Uyghur Muslim minority in Xinjiang. Hong Kong, of course. They have reaffirmed our commitment to Taiwan in ways that I think some people have thought was surprising and somewhat consistent with the Trump administration's effort to strengthen that relationship. And I think they've sought to regain the trust, I think you could put it, of allies and partners for collective action against China. And at home, I think they promised to build U.S. strength, the kind of notion of build back better at home to help prepare for what President Biden called this extreme competition.
MICHAEL MORELL: So, Chris, looking at both the administration's rhetoric and its conversations with the Chinese and its actions, how would you characterize the approach so far?
CHRIS JOHNSON: Yeah, I think somewhat like Secretary Blinken, three buckets. They have kind of a three pronged approach so far. The first, I think, is that they are thinking about how to respond to China's actions across this full spectrum of of great power competition. And I think that includes economic components, security, obviously, and what we might call an ideational component, i.e. this notion of competition of systems between the U.S. of China.
The Chinese are doing a lot in those spaces. So I think it makes sense for them to kind of step back and try to think about how to respond there. They are studying, I think, the Trump era policies. We've seen, you know, a lot of indications that on various executive orders and so on that the Trump administration put in place, the administration has said, 'Well, we're reviewing those,' to see what of them, I think, they believe they should maintain and if they decide they will maintain them, perhaps how those policies might be tweaked so that they might be more coordinated and strategic.
I think one of the very fair criticisms of the last administration was that the general message in terms of, 'We need to change how we're interacting with China' was right. But the execution was pretty haphazard. And then, as I mentioned earlier, I think they're obviously consulting with allies and partners on how to cooperate again as we prepare for this sort of extreme competition. I think the problem with that, though, is that these are sort of passive approaches. You know, thinking and studying and consulting are sort of passive words. And the problem is President Xi Jinping, President Biden's counterpart in China, isn't sitting idly by while the administration conducts that kind of thought process or or navel gazing.
MICHAEL MORELL: So what's motivating the Biden team at this point, do you think? Is it trying to get the policy just right or is there domestic politics seeping in here? What's your sense?
CHRIS JOHNSON: Yeah, I mean, I think a primary motivation, obviously, is the desire to show that the U.S. is back in the game after four years of Trumpian scorched earth. And that policy is both necessary and noble, I think. But I think they're learning that it's not so easy. Trump's hostility toward even the allies stung and raised questions about our credibility and reliability. And I think our disastrous handling of COVID, obviously, and racial justice, tensions and other issues make the allies and others, non-allies, even, in the world, suspicious of both sort of our commitment and bandwidth.
I mean, you raise a good question with regard to the politics. I think that's a second area that is much less helpful thus far. It seems to me the administration is somewhat afraid of its own shadow in terms of fear of domestic criticism, of being too soft on China. And I think that's causing itself in some ways to box itself in at home in terms of taking positions early on that reduce their flexibility and also might be sending some confusing signals to China about the approach.
So just as an example, I thought that Secretary Blinken's comments to the Congress ahead of the Anchorage meeting between the Chinese and the U.S., that this was not a strategic dialogue like existed in the in the Biden - excuse me, in the Obama administration - seemed almost too defensive. In other words, the fear of saying, 'Why are you going back to that old policy?' caused them to move in that direction.
MICHAEL MORELL: So, Chris, what would you like to see the Biden administration do with regard to putting together its strategy, its long term strategy toward China with the right approach here?
CHRIS JOHNSON: Well, I think by a strategy, we need a coordinated policy that recognizes that we must deal directly with China in a bilateral context as part of our effort to win this extreme competition. I think one of the challenges we're facing is that we have what we might call surrogate strategies, where we're looking to other policy approaches to try to avoid dealing directly with China.
And so that includes, I think, this notion of domestic strengthening. In other words, if we put the money into our infrastructure, building semiconductor capacity in the U.S., making sure we're leading technologically through some version of industrial policy, that almost that in and of itself will cause the Chinese to just run away because they'll be scared of U.S. strength. Or likewise, this notion of consulting and working with the allies and partners.
But we're seeing already that that has limitations. Just this last week we had the New Zealand foreign minister say that New Zealand would be uncomfortable having the Five Eyes intelligence cooperative relationship expand to cover additional issues. That's clearly directed at China.
I think we saw some very uncomfortable moments last week in the summit between - in the lead up, anyway - to the summit between President Biden and Prime Minister Suga of Japan, where clearly the U.S. wanted the Japanese to have a sort of much more throaty statement about Taiwan in the joint statement. There was some passing reference to it. It was the first time since the 60s that had happened, but it wasn't as strong as the administration wanted. And I think a strategy also starts with, ultimately, where do we want to be at some kind of endpoint, right? And then work backwards to fill in the actions to get us there. As good as Secretary Blinken's speech was, this idea of the kind of three buckets can wind up being more of a to do list approach rather than a strategy.
MICHAEL MORELL: Yeah. Where do you think the limitations on our ability to work with the allies, where does that come from? Where do those kinds of statements that New Zealand made come from?
CHRIS JOHNSON: Yeah, well, I think in New Zealand's case and with a lot of the other allies and partners, it's very clear, and that is, China's their largest trading partner. And so that obviously the economic challenges that they face there are important.
I think in the case of, say, Japan, the message that I take from the joint statement is that, understandably so, Japan is more than willing to continue the close security cooperation we have between our two countries. They're particularly keen to have us, for example, restate our Article Five commitment to the defense of of Japan as it relates to the Senkaku Diaoyu Islands. But what they're not willing to do is engage in too much related to, say, the Xinjiang, certainly anything with regard to the Olympics. You know, we've seen a lot of back and forth about a potential boycott for the Beijing Winter Olympics. It's very clear to me that Europe, Japan, pretty much everybody else in the allies and partners community would not support that kind of an action.
MICHAEL MORELL: And is there a is there a Trump legacy here, too?
CHRIS JOHNSON: Oh, definitely. Yeah, no, without question. I mean, it turns out that four years of scorched earth hurts, as I've as I mentioned a moment ago, they were stung by that. And it's not cause for, you know, the new administration can't just come in and say, 'Hey, we're back, and, you know, it's all good.' Again, I think countries are reluctant to not sort of to dive right back in with us as if that period hadn't existed.
MICHAEL MORELL: And I guess if you're if you're one of those countries, you have to say to yourself, 'OK, President Biden says the U.S. is back and maybe that lasts for four years. But what's to stop what happened in 2016 from happening in 2024? 2028?' And you don't make, right, if you're a country, you don't make national security policy in four year chunks.
CHRIS JOHNSON: No. And in fact, that's a critical point. So another part of a proper strategy, I think, is exactly that. You need almost ridiculous policy consistency over multiple administrations. You know, the Chinese are talking about 2035. Well, that's several more elections for us. You're going to need to have that kind of consistency, I think, for the allies to really feel, 'OK, this is serious.'
MICHAEL MORELL: I had dinner one night with three Chinese intelligence officers and they were talking about good and bad millennia - a good thousand years and a bad thousand years. And we're focused on, you know, we're focused on the next quarter or, politically, the next two years.
CHRIS JOHNSON: Right, exactly.
MICHAEL MORELL: So, Chris, how are Chinese officials reading the Biden administration thus far?
CHRIS JOHNSON: Yeah, I think probably they're still getting used to the new administration and trying to draw some conclusions. I think, you know, as you know, I've watched this for a very long time. And what we often see with the senior leadership in China is if they come up against something where they're not sure what the right choice is, or it's a really big issue that they're somewhat concerned about tackling, they tend to default to this sort of wait and see approach, right.
That would be their sort of official rhetoric and want to see where we're going to go. That said, I would just highlight two areas where I think they're drawing some really unhelpful conclusions.
I think the first one is that they believe that the administration is signaling that it will be every bit as tough as the Trump administration was toward China. And I think in their mind then that causes them to say, 'Well, we don't really need to change policy.' And I think it validates the Politburo's ideological conclusion that the inevitable conflagration, if you will, between capitalism and socialism has arrived.
And this is the time and, I think, it also validates all of the tightening measures that President Xi has put in place domestically and also the kind of aura around unifying around him as the leader. And I think he's taking huge advantage of that.
The second is that I think there might be a risk that they will negatively mirror image the issue of civilian control of the military in the U.S.. I mean, I think with the decision to not sort of firmly restate the the principle of civilian control of the military in the U.S. by having another general come in as Secretary of Defense, I think that's led the Chinese, where, in their system, you know, Mao's famous phrase, 'Power grows out of the barrel of a gun.' They worry that this just will further inflame the fact that their a perception that the U.S. civilian leadership is under the control of the military industrial complex that wants war. I'm concerned that could lead to some destabilizing strategic consequences.
MICHAEL MORELL: And there's a great transition. If you could put the current Taiwan tensions into the context of what we've been discussing - How do you how do you think about those?
CHRIS JOHNSON: Yeah, I think we have to separate probably the activity that we're seeing vis a vis Taiwan from the policy, if you will, or the the plans and intentions, I guess you could put it, of the Chinese leadership.
There's no doubt in my mind that we're seeing a lot more military activity around Taiwan. And it's very concerning. Just recently, we had the largest ever sort of sortie in terms of numbers of aircraft in and complexity operating in an exercise around Taiwan that we've ever seen.
As you know, I think in the U.S. there seems to be a growing sense of concern that maybe the Chinese see now is the time for them to retake Taiwan, that indeed they really do believe in this narrative that they've been talking about recently about the east is rising and the west is declining. And now's the time.
I think I would just inject a couple of points of caution. I think the first one is that while indeed those challenges are happening on the military side, you know, when China decides to do things toward Taiwan, it's never really about what's happening on Taiwan. It's really more about their perception of where we're going.
And as I mentioned earlier, in terms of this fear that the administration is kind of continuing on with the Trump policies, our approach toward Taiwan so far has made them nervous that we're moving ever closer to this idea of maybe abandoning the One China policy.
So, for example, there's a pretty significant debate, it seems, within the administration about changing our policy of strategic ambiguity. China would see that as very unhelpful and a move toward breaking with the One China policy. So I think that's the message behind what they're doing.
I would just highlight as well that while, of course, retaking Taiwan or ensuring that Taiwan independence doesn't take place - that's really their fundamental goal =is certainly very important, And I fully believe they would go to war to prevent that.
They also have this other very important goal, which is they must break through the middle income trap by 2035 in their calculation. And I struggle to see how invading Taiwan would help them with that.
In other words, you would fundamentally ensure that all other countries, in the same way they did after the Tiananmen crackdown, would then have to turn against China. And I don't see how that helps them from an economic development point of view. And that goal of breaking through the middle income trap is just as important to them in terms of existential for their survival, I think, they think, as the Taiwan issue.
MICHAEL MORELL: So, Chris, I just want to stick on Taiwan for a second here. Are you saying that to some extent, the Chinese actions that we've seen are in response to the debates in the U.S. about how we should handle Taiwan going forward?
CHRIS JOHNSON: Absolutely, yes.
MICHAEL MORELL: And they're trying to do what in doing that?
CHRIS JOHNSON: Well, I think they're trying to show us that, you know, you're approaching the red line, which is the One China policy. This has always been the be all and end all. This is what allowed us to reestablish relations, right, in the Cold War period.
And they see these kinds of salami slicing tactics of, you know, greater clarity with regard to how we interact - U.S. officials interact with Taiwan diplomats, you know, frequent commentary inviting the Taiwan de facto representative in the U.S. to the inauguration formally, you know, all these little bits and pieces as edging ever closer. And the strategic ambiguity one is really, really big.
If we were to change that policy, it's my opinion that it would actually force the Chinese to feel they must do something rather than provide additional clarity about our position.
MICHAEL MORELL: And what would that something be in your mind?
CHRIS JOHNSON: Well, I think it would certainly be very strong rhetoric. I think we could see some form of military intervention or action under those circumstances. I mean, it was exactly that fear about a break with the One China policy when the Taiwan president, Lee Teng-hui, was allowed to visit the United States in the mid-90s. That prompted them to do the series of military exercises at that time that they did. And obviously, they have a far more sophisticated and diverse toolkit of areas of pressure they can bring to bear on Taiwan now. So this is a very delicate issue, absolutely fundamental.
MICHAEL MORELL: OK, Chris, let me let me run through kind of a handful of maybe what will seem to some as disjointed questions, but I want to ask them. So I've heard you talk about the fact that you think we're at a significant inflection point with China. What do you mean by that?
CHRIS JOHNSON: Well, I think a couple of things. One, I think we're rapidly approaching a period where China's growing strength and capabilities are getting to a point where it's unclear to me how effective we can be and try to manage those and deal with them. You know, I think some would argue we've already let them get too big globally. And this goes into the whole debate in the last administration about, 'Was it a mistake to let them into WTO' and, you know, 'How can we make the trade piece, you know, sort of more complimentary?'
I think the other issue is that - and clearly in this area of technology and as Eric Schmidt pointed out on your recent podcast - the battle for these platforms of technology going forward, whether that's semiconductors, A.I., quantum computing, biopharma, that will just generate trillions and trillions of dollars in wealth, you know, the Chinese are making a decided effort to come up on us.
I was quite struck by Mr. Schmidt's comments that he feels they could be where we are on A.I. in a handful of years, not even five. So for all those reasons, I see it as an inflection point. And let's face it, for four years under Trump and arguably even before then, we've just been kind of drifting around. And this is what I mean with regard to it's finally time to have a proper China strategy. If we don't, then we're going to miss the boat and we could find ourselves in a very nasty fight with the Chinese.
MICHAEL MORELL: And is there in your mind, this is a tough question, but is there in your mind a strategy, an effective strategy? You know, if we were in the administration and we were sitting around the Sit Room and we spent hours and hours and hours debating where we should go with China, and we had all the intelligence laid on the table and smartest policymakers. Is there a strategy that you can envision the United States undertaking vis a vis China that would fundamentally change the direction of where we're headed?
CHRIS JOHNSON: Well, I think that's a tall order, obviously. And I have tremendous sympathy for the folks in any administration who are working on this problem. It's tremendously difficult to grapple with. I would say that the one thing that I have not seen done that I think would be the starting point for that kind of a strategy, and then we develop the pieces afterward, is there needs to be a dedicated effort where we just step back, rack and stack what we perceive, you know, using the intelligence, as you suggested, and our best understanding of it: What are China's global ambitions?
And once we have completed that exercise in as objective a manner as we can, we need to look at which one of those ambitions can we accept, because I think - or accommodate might be a better word, because we will have to accommodate some. And I think that was the mistake of the previous administration, was the notion that we just wouldn't be willing to accommodate any of China's global ambitions. And in my mind, that's a recipe for conflict. And which ones can we not? And then I think we need to communicate that to the Chinese at the most senior levels, probably privately is better, than, as the Chinese like to call it, microphone diplomacy, where, on those areas where we can feel we can accommodate them, we make that clear; on those areas where we can't, we tell them that as well. And then we set out a series of red lines related to those areas where we don't feel we can accommodate their ambitions and then we operationalize those red lines with action.
And that also is something where I think we've often fallen down. We've said, OK, this is a red line for us and then we don't follow through' Scarborough Shoal and the Chinese seizure thereof in 2013 as a prime example of that.
MICHAEL MORELL: So it's a great transition, because the next question I was going to ask you was about Beijing's ambitions in the world, their objectives in the world. So what are those? And then to your point, which do you think we need to be able to live with and which should we push back on?
CHRIS JOHNSON. Yeah. I think there are first and foremost objectives, if you're the CCP and they're the ones running the show and Xi Jinping as they want to stay in power, and that's a domestic objective.
But for them, their foreign policy works around that. I mean, I think something that's very interesting is that - in some ways this is an overstatement, but you'll get the point - China doesn't really have foreign policy per se. A lot of their foreign policy is just extensions of domestic policy, and I actually think we're at risk of mirroring that too much with some of the statements the administration has made.
But so therefore, that's number one, obviously, for them. And that drives a lot of what they do. I think in terms of their foreign outlook, their goal is pretty straightforward, which is that they want other countries, first, in the region, primarily in the region, in East Asia, but increasingly globally to, in the same manner, with the same speed with which they would think about how the US might think about something they're about to do, they want them to think about what China might think about what they're about to do. That's really the goal.
And that involves having a sort of hegemonic position in Asia. I think that's definitely true, being the sort of main power there. And I think fundamentally, as Xi Jinping told us last week in a major speech, they want the US to treat them as a great power, as an equal, and they feel that time has come and is now and stop lecturing them and so on.
MICHAEL MORELL: So on international influence. Is it primarily about another country's economic policies and a country choosing a set of economic policies that further Chinese economic interest? Is that the primary focus of what they want?
CHRIS JOHNSON: That's a big part of it. I think another big part of it is the security relationships. Obviously, you know, when China sees things like the new Quad structure with ourselves and Japan, Australia and India developing, they see that as something akin to a containment net. So obviously, they want to be able to influence that.
I mean, I think the economic pressure campaign against Australia is really interesting in this context. You know, most people, including myself, when we look at that, we say, "Gosh, that seems so terribly counterproductive. Why is China doing that?" But then we look at a situation where we had this summit of the leaders and there was an op ed prepared in The Washington Post and the C word, China, was not mentioned at all. And one wonders if you're sitting in Beijing and your thought is this economic pressure campaign on Australia has worked in that manner, i.e. preventing some of that collective action. It's worth the reputational negative points we're getting internationally to prevent that strategic element from developing.
MICHAEL MORELL: One more question about the Australia situation, Chris. Is the objective in Beijing's approach to this to send a message to other countries? 'This is what happens to you if you side too closely with the Americans' - is that the message they're sending?
CHRIS JOHNSON: I think that's part of it and I think we've seen that in other contexts as well. But I think it's to them perhaps strategically more important. I think what they're hoping for - and again, this is an area where maybe that dialectical materialist mindset of their doesn't serve them very well.
In other words, if you believe in things like historical materialism and the power of material forces and you're China with that market and the growing economic strength you have, your view is, 'If we can get the Australians to crumble, you know, basically with a sustained pressure, think of the huge not only economic but also geostrategic waves of benefit that that would redound to us.'
So I think it's it's arguably a little more malicious or malevolent, you might say, than something that simple.
MICHAEL MORELL: And then how important is it to them to spread their way of doing things, right, their authoritarianism, their managed capitalism. How important is it to them to spread that around the world or is that a secondary interest to them?
CHRIS JOHNSON: I think it's very important. I mean, I think we've seen increasingly there's this new meme, right, that's come through in the propaganda and in leadership speeches and so on. And in the interaction, frankly, between Secretary Blinken and Jake Sullivan and his Chinese counterparts in Anchorage, which is, 'Hey, not everybody in the world subscribes to this so-called U.S.-led, rules-based international order, or that the rules of the road internationally should be devised and supervised by a handful of countries. You know, this is a clear message.
Another one is this notion they have of the global situations witnessing changes unseen in a century. You know, that's sort of code for, 'It's time that the power equation geopolitically is changing.'
I think what the main goal there is obviously to kind of make the world safe for the Chinese Communist Party. In other words, if you can normalize its behavior and, you know, grapple with the Americans in terms of global narrative competition, I mean, I think one of the uncomfortable parts for us - and I think this is a reason why the last administration, the Trump administration, reacted so strongly to this kind of notion of ideational competition - is that we haven't had a global narrative competitor for 30 years. Right. So it's made us a little bit lazy, maybe. And now we see it's back and we see it as a particularly menacing and threatening, but maybe it's less so.
MICHAEL MORELL: So, Chris, I think there's a a view out there which I want you to react to, that China's aggressiveness and maybe even its objectives are all Xi Jinping. Right? And I want you to kind of react to that. And is it just one guy here or is the entire leadership, you know, bought into the the global ambitions and the the way to pursue them?
CHRIS JOHNSON: Yeah, I my sense is -and it's foolish to say that this is all about Xi Jinping. I think there's no doubt that in the same way that President Trump acted as an accelerant for certain trend lines in that were leading toward trouble, if you will, or a deterioration in the U.S.-China relationship, Xi Jinping has acted as an accelerant on the Chinese side. There is discussion and debate, as there always is in any system with, you know, it's important for us to remember sometimes, you know, they have 1.4 billion people. It's a complex and messy place. And so obviously there are different views, but I think it's very dangerous. And we had this longer telegrammed piece that was written, I believe, earlier this year, you know, sort of suggesting if we could just get rid of Xi Jinping, we'd have a more rational grouping. I can assure you that on policies like Hong Kong, on policies like Xinjiang, these have wide support, certainly within the leadership. And surprisingly, sometimes I think for we Americans amongst the the nationalist, increasingly nationalistic, Chinese populist.
MICHAEL MORELL: So, Chris, this kind of raises the point about Xi's political standing at home, right. And the other thing you read is Xi's in trouble; there's strong opposition. What's your thinking on that?
Again, I find it kind of silly. I can't see any - and I don't think you need, you know, clandestine intelligence to tell you this. The positive observable fact makes pretty clear to me, and I think really most other observers, that his control is undisputed. He's clearly the most powerful leader since Mao, I would argue. A lot of people say Deng; I think it's Mao, and he's probably going to cap that off again next year at the next party Congress.
But there are a couple of issues to highlight. And the first is, yeah, he's large and in charge. There's no question he's got control of, in my mind, and this has been his political genius, if you will: He knows that to succeed in a system that he sees as operating by very Hobbesian rules, that you must control the key levers of power. And that's the party apparatus, the propaganda system and the military and security services. And he has that.
But the reality is next year, he's going to be trying to do something that no recent leader has done, which is to try to serve this third and maybe fourth and who knows how many terms. And that will generate some bargaining and some opposition, I think, within sight within the system. So that's important.
I think probably the more likely things that will cause problems for him, though, are not inside baseball politics stuff. One is China has a huge demographic problem that was just highlighted recently, that I believe it's by 2035, the number of sort of child bearing women is going to decline dramatically. You know, they have all these negative aspects of the long standing One Child policy. So what does that mean for the size of their consumer market, for their ability to fuel this giant military they're, building, you know, et cetera?
And then also a very important one is this whole issue of how they're handling this crackdown in China's domestic finance sector. You know, we have a lot of concerns out there about bond defaults, about, you know, will the government continue as it always has to maintain that implicit guarantee of all this debt that's circulating around in China? You know, when Xi gave his speech at the last party Congress, when he renewed his tenure, kind of set out these three tough battles that they wanted to accomplish. One was poverty alleviation, another was improving the environment. And the third was this kind of crackdown on financial risk, poverty alleviation check. They declared victory on that late last year.
Obviously, the environment is getting better all the time. But on this financial risk, they seem to keep running into problems. And that includes the challenges of recent with Alibaba and Tencent and their so-called platform economy and the unfairness there and so on. So there's a risk that Xi's political imperative to tighten, tighten, tighten on this financial risk thing could cause them to make some mistakes that would have huge conflagration consequences for them, economically.
MICHAEL MORELL: And then, Chris, where we're running out of time and I want to ask you one more question, and it's probably the most unfair question I've asked you. Where do you think we're going to be with China in five to ten years?
CHRIS JOHNSON: Yeah, increasingly, my gut is not a good place. You know, I think we I've always been pretty optimistic. I think that there's a there's a baseline there. But in all aspects, it was interesting in talking to Chinese friends recently, you know, there's a real fear. And I think obviously some of that's drummed up by the propaganda of the party, you know, and so on.
But, you know, there's real fear about safety. If you're a Chinese person coming here now with these sort of anti-Asian attacks that we've been having in the U.S. - and I think that has implications for not only the people, the people connective tissue that has sustained us through rough patches in the past - but also for the enthusiasm of young and very bright Chinese students who want to come to the U.S. and study here and often stayed and helped us build these great tech and other companies that we have.
I think this issue of, you know, again, what Eric Schmidt said in your podcast, you know, it does look increasingly like we're moving toward a bifurcated Internet system where there are two camps. And I think that too, you know, just puts us in a very, very difficult situation. And I don't see the sort of rhetoric between the two sides getting better anytime soon. And I think, you know, it's it's very clear to me that to some degree, Xi Jinping and his leadership style has been part of the problem and I think our dysfunction has been as big a part of the problem.
MICHAEL MORELL: Chris, thank you. Thank you so much for joining us again. Your your insights are always absolutely fascinating, and I know my listeners look forward to having you on. In fact, some people send a note saying, 'When is Chris coming back on?'
CHRIS JOHNSON: It's always my pleasure.