ne ship sails East,

And another West,

By the self-same winds that blow,

Tis the set of the sails

And not the gales,

That tells the way we go.

—Ella Wheeler Wilcox, “The Winds of Fate”

We promised at the outset of this book to provide you with both a survival guide and an action plan. We now keep that promise by including in this chapter a set of individual choices, executive decisions, and government policy actions that can be taken to protect you and your family from unsafe Chinese products and to bring about the kind of constructive changes we need to make our relationship with China a prosperous, rather than a perilous, one.

Our underlying belief is that real change in the U.S–China relationship can only bubble up from the grassroots. That’s why our primary goal has been to inform every citizen of the world about the broad range of threats that a rising China poses to us all. Our fervent hope is that once the public fully understands the scope of the world’s “China problem,” the stage will be set for the kind of peaceful political change we need to bring about constructive policy reforms in Washington—as well as in Berlin, Tokyo, Sao Paulo, and other capitals around the world.

Before we list our proposed individual choices, executive decisions, and policy reforms, we would like to offer some words of wisdom from some of the world’s most astute thinkers. To all the policy makers who read this book, we echo Betty Williams’ admonition about inaction: “Let’s have no empty talk from this assembly, let’s get something done.”

To those who may think we have been too hard on China or who may let their optimism about a “democratizing” China outweigh the real evidence of its totalitarian nature, please remember the moral imperative from Albert Camus that led off this book: “It is the job of thinking people not to be on the side of the executioners.”

Finally, to any American citizen at the grassroots who feels powerless to fight back, please take heart from these words of William James: “Act as if what you do makes a difference. It does.” And every day, try to follow Theodore Roosevelt’s credo: “Do what you can, with what you have, where you are.”

Avoiding Death by Chinese Junk and Poison

We go to a big box retailer like Costco, Target, or Walmart or to a retail drug outlet like Walgreens or CVS or to a grocery store like Kroger or Safeway, and it is virtually impossible to buy China-free products. This is not just frustrating; it’s insane. As we have illustrated, far too much of the Chinese junk and poisons that cram America’s retail shelves is flat-out deadly. Here are some concrete steps all of us can take to protect ourselves.

#1: First, Let’s Change Our Attitude—“Cheap” Isn’t Always the Cheapest

We can’t change our buying behavior until we fully embrace the principle that seemingly “cheap” Chinese products really aren’t that cheap. Besides the price you pay on the tag, you also have to factor in the risks of injury or death, the increased chance you or someone you know will lose her job because of the unfair trade practices involved in delivering that Chinese product to market, and the various regulatory and taxpayer costs that Chinese product failures entail. So if it’s “Made in China,” put that product back down unless you absolutely, positively need it and can’t find a reasonable substitute.

#2: Find the Label—Then Read It Carefully!

We also can’t stop buying Chinese products unless we know they have been made in China. Therefore, we all must do a much better job of carefully reading product labels.

Unfortunately, while “country of origin” labeling is required on all products by U.S. Customs regulations, finding the “Made in China” disclosure on a product can be like playing “Where’s Waldo?”—and sometimes even requires a magnifying glass. (We are not kidding here.) That’s why labeling regulations must require standardized, easy-to-find, and easy-to-read information, similar to the useful nutritional labeling on our nation’s food products.

Label subterfuge is, however, not the only problem we face in trying to wean ourselves from Chinese products. This observation leads to our next action.

#3: Tighten Up the Cyberloophole on “Country of Origin” Labeling

In the traditional retail environment, “country of origin” labeling gives sharp-eyed consumers the opportunity to make choices about their purchases. However, as more and more consumers move to the Internet, this ability to use one’s discretion is being lost, much to the benefit of unscrupulous Chinese manufacturers.

To understand the problem, just go for a browse on Amazon’s website. For any given item, you can see every product detail except where the product is manufactured. This is clearly a loophole that needs to be tightened. Federal law should require all online retailers to clearly display the country of origin labeling information for all of their products.

#4: Demand “Country of Origin” Ingredient Labeling

As we have learned, some products are not wholly “Made in China,” but rather many of the ingredients or parts in the products are of Chinese origin. For example, if multivitamin capsules are blended for packaging in the United States, producers can still slap on a “Made in the U.S.A.” label despite substantial Chinese ingredients. A similar problem exists for products like putatively “American” cars that may have mission-critical parts like brake pads or tires manufactured in China.

Because of the dangers this labeling loophole poses, we urgently need tougher ingredient and component labeling legislation. For example, Congress should require all food and drug producers to clearly label the countries of origin for all major ingredients that go into a product—and do so in a standardized and legible manner. As Jerome Krachenfelser has aptly put it: “If you put it in your body,284 you deserve to know where it’s from.”

#5: Let Your Favorite Retailers Know You Prefer China-Free

If retailers like Walmart, Target, and Nordstrom know you would prefer China-free alternatives, they will change the way they stock their shelves. So do take the time to talk with all the salespeople and managers at the stores that you typically frequent, and let them know you would be a much more loyal customer if the store offered more alternatives.

To put further pressure on the big box and mall retailers that are so addicted to artificially cheap Chinese products that inflate their profits, you may also want to go online and look for websites that offer China-free products.

Likewise, you should feel free to write a letter or send an email to the customer relations division of both the manufacturers and the retail stores. Tell Apple and Best Buy that “Designed in California” simply doesn’t cover up “Built in Guangdong.” Once retailers get the China-free message, they will start competing for your business not just on price but on country of origin.

Finally, it is important to view this not as a “Made in the USA” statement but rather as a “Made in the Free World” campaign. Real free trade without the kinds of mercantilist and protectionist practices that characterize China can be a good thing. Great products coming from our real free trade partners like Japan, Mexico, and Germany improve our lives and contribute to our mutual prosperity. We need these countries on board the “real free trade” agenda and ready to share the burden of sanctioning a mercantilist and protectionist China whenever that becomes necessary.

#6: Beware of Big Ticket Items from China Bearing “Foreign” Brands

One major way that China plans to penetrate America’s markets—particularly “big ticket” items like that of automobiles—is to sell their products under the name of familiar foreign brands that create the illusion of China-free. A case in point is Volvo. This nominally “Swedish” auto firm is now wholly owned285 by China’s Geely Automotive, and its CEO, Stefan Jacoby, has recently stated that the company is considering exporting Chinese cars to the United States under the venerable Volvo moniker. Note also that Honda has been selling a Chinese car, the Jazz, into Europe since 2005. So again, buyer beware. Cash-rich Chinese firms—particularly state-owned enterprises—are going to be snapping up major Western brand names like there is no tomorrow, and you will have to pay attention to the financial press to learn about these deals.

#7: Tort Reform That Makes China and Its Middlemen Truly Liable

We are not even small fans of big lawsuits. However, we do believe it’s just plain wrong that Chinese manufacturers can’t be held accountable in American and international courts of law, while their American, European, and Japanese competitors are.

It’s equally absurd that American companies that import dangerous Chinese drugs, foods, and products can’t be held more accountable either. The current situation actually reduces the motivation for real tort reform by giving American firms this Chinese escape clause: Move your production to some mysterious broker in Guangzhou, and then pretend you don’t know exactly where your products come from. Don’t laugh; this happens.286 That’s why we need much tougher laws that clearly assign blame to any American wholesaler or retailer selling a Chinese product that ultimately harms someone here in America. More accountability will force retailers to find a way to push the liability back to where it actually belongs or make other choices when they stock their shelves. So let the White House, Capitol Hill, and your own State House know that it’s well past time to crack down on the American middlemen purveying China’s junk and poisons.

Disarming China’s Weapons of Job Destruction

America’s politicians need to get a whole lot smarter about the box that a mercantilist and protectionist China is putting us in—because it looks more and more like a coffin every day! That’s why Congress and the President must tell China in no uncertain terms that the United States will no longer tolerate its anything-but-free trade assault on our manufacturing base.

If China refuses to lay down its Weapons of Job Destruction—which violate every rule in the free trade book—the President and Congress will have no other choice than to take swift action. Here’s how America can unilaterally disarm these Chinese weapons.

#1: Pass the “American Free and Fair Trade Act”

The simplest and most effective legislative cure for China’s mercantilist and protectionist ways—and one that avoids direct confrontation because it need not mention China directly by name—is for Congress to pass the “American Free and Fair Trade Act.” This Act would set out the following ground rules—with appropriately tough sanctions for failing to play by them:

Any nation wishing to trade freely in manufactured goods with the United States must abandon all illegal export subsidies, maintain a fairly valued currency, offer strict protections for intellectual property, uphold environmental and health and safety standards that meet international norms, provide for an unrestricted global market in energy and raw materials, and offer free and open access to its domestic markets, including media and Internet services.

By passing such legislation, Congress can both safeguard the international system of free trade and ensure the long-term prosperity of the American economy. Such legislation is not “protectionist”—as the China apologists will no doubt leap to brand it. Rather, it is simply common sense and a legitimate self-defense in the face of Chinese economic aggression.

#2: Global Cooperation and Coordination Is the Watchword

To quote the great American patriot, Ben Franklin: “We must all hang together, or assuredly we shall all hang separately.” That’s why as a companion action to passage of the Free and Fair Trade Act, the United States must partner with Europe, Brazil, Japan, India, and other victims of China’s mercantilism and protectionism to petition the World Trade Organization for full compliance of its rules by China. Only by strength through numbers will the U.S. and others succeed in bringing a now “beggaring thy neighbor” China into a true community of free trading nations.

#3: A Secret Currency Manipulation Mission

If we were asked to identify the single most egregious problem in the U.S.–China relationship, we’d have to call out the yuan peg to the U.S. dollar. A floating currency is fundamental to automatically adjusting trade flows and prevent the sort of chronic trade surpluses that China runs with so many of its trading partners.

We do agree, however, with the China apologists that the Chinese government doesn’t respond well to direct pressure. That’s why, at least on the currency question, the first best option to bring about a fairly valued Chinese currency may be found in some top secret “shuttle diplomacy.”

To this end—and this is an extremely urgent matter!—the White House should immediately send a secret emissary to inform the Chinese Communist Party of this: The United States will have no other choice than to brand China a currency manipulator at the next biennial Treasury Review and impose appropriate countervailing duties unless China strengthens its currency to fair value on its own.

In this discussion, America’s emissary should make it clear that the United States would much prefer that currency reform be “China’s idea,” not that of the United States; and that in no way does the United States wish for China to “lose face” on this issue. In fact, that is why this mission must be conducted in total secrecy.

America’s emissary must be clear, however, that after more than seven years of debate on this issue, patience has run out in the United States politically, and time has run out economically. Of course, if China fails to act in a timely manner, the Department of the Treasury must follow through on branding China a currency manipulator and impose appropriate defensive duties to bring the Chinese yuan to fair value.

#4: Recognize the Real Corporate Risks of Chinese Offshoring

Far too many American executives who decide to strategically offshore production and jobs to China invariably fail to adequately assess a range of risks. Obvious risks include the loss of a company’s intellectual property either through outright theft or via China’s policies of forced technology transfer and forced relocation of research and development to Chinese soil.

Beyond the loss of a company’s intellectual property, other risks range from endemic corruption, severe pollution, and looming water shortages to the need to scale China’s Great Walls of Protectionism. In any comprehensive corporate risk assessment, executives must also acknowledge this reality:

If there is any one country the United States is likely to engage in military conflict with over the next several decades, it certainly is a rapidly militarizing China. And if you were an American business executive contemplating an offshoring decision, would you really want all of your company’s eggs in the China basket when such a conflict arises over Taiwan or Tibet or territorial rights in the South China Seas or access to oil in the Middle East?

It follows that American executives offshoring to China must remove their rose-colored glasses and do a far more comprehensive risk assessment. Such a sober look at the real risks associated with offshoring to China should help, in turn, power a new “reshoring” tide that brings jobs back to America, Brazil, Japan, Europe, and emerging markets outside of China.

#5: Be Like Nucor Steel’s Dan DiMicco—Not GE’s Jeffrey Immelt

If American corporate executives want to better understand the art of fighting back against Chinese mercantilism and protectionism, they need look no further than Nucor Steel and the example set by its CEO, Dan DiMicco. Besides running one of the most successful and technologically innovative companies in the world, DiMicco spends considerable time in the public arena lobbying for real trade reform with China. In this way, DiMicco provides a sharp counterpoint to the naïve or even turncoat behavior of CEOs like GE’s Jeffrey Immelt and Westinghouse’s Jack Allen.

#6: Stop Forced Technology Transfer and the Hijacking of U.S. R&D

As the U.S.–China Commission has strongly recommended, the U.S. government must “help U.S. companies resist attempts by Chinese authorities287 to mandate or coerce foreign high-technology firms to reveal sensitive product information as a quid pro quo for market access in China.” The U.S. government must likewise help companies resist the forced relocation of their research and development facilities to China as a condition of market entry. We, as a nation, are dooming ourselves to decades of stagnant growth by surrendering our technology to the Chinese, and this must be stopped! Because of the importance of this issue, we must also consider legislation that would prevent our firms from entering into deals with China that require any such technology transfers as a condition of market access.

#7: Stop the Use of Censorship as a Non-tariff Trade Barrier

Many of America’s greatest exports are from our best-in-the-world entertainment, media, and Internet firms. China’s heavy-handed use of censorship in movies, television, and the Internet combined with tacit support of rampant piracy is a massive assault on free trade. While Facebook is totally blocked in Shanghai, its Chinese counterpart RenRen is receiving a grand welcome in the United States and a $500 million listing on the NASDAQ. This is just so very wrong!

To ensure that China does not benefit from such predatory economic warfare, Congress should pass legislation that blocks any Chinese media and Internet firms that engage in censorship from raising funds from the U.S. stock markets.

#8: Prohibit Chinese State-Owned Enterprises from Buying Private Firms

We must stop pretending that a giant national oil, telecom, or mining firm with the backing of the Chinese state that buys up a competitor in America, Canada, or Australia will ever create any real value for our consumers or shareholders. Instead, we must recognize that China’s state-owned enterprises are nurtured in a monopoly environment, fed with profits from unfair trade practices, have access to massively subsidized state bank financing, and are all run by members of a communist party elite intent on locking up markets and locking down resources around the world. While some American CEOs have been happy to sell off our national treasures to Beijing’s cadres of state capitalists to pocket a quick buck, such transactions are not even remotely in our national interest.

And let’s be crystal clear about this: China would never allow a Western company to buy any Chinese firm in a “strategic industry”—which includes aircraft, autos, energy, finance, technology, natural resources, and just about anything more sophisticated than peddling burgers or fried chicken.

Because of the strategic threat from foreign governments gaining control of American private industries, the U.S. Congress should pass legislation preventing domestic private firms from entertaining offers from state-owned enterprises, whether they are Chinese, Russian, or otherwise.

#9: We Need a President with Both Brains and a Backbone

Much of the blame for the destruction of the American manufacturing base through a massive wave of offshoring can be laid directly at the White House doorstep. From 2001 to 2008, President George W. Bush certainly had the backbone to stand up to China. Unfortunately, his ideological blinders didn’t allow him to understand the difference between free versus fair trade. As a result, the fiddling Bush administration did nothing but fixate upon the war on terror while a mercantilist and protectionist China systematically took apart our economy job by job and company by company.

In sharp contrast, President Barack Obama certainly has the intellect to understand the problem—he campaigned on a platform of cracking down on Chinese mercantilism and certainly knows the issue. Obama’s problem, however, is that he doesn’t appear to have the backbone to take the actions necessary.

Forgive our bluntness here, but what we really need now is a leader with both brains and a backbone—a Winston Churchill, not a Neville Chamberlain. Barack Obama could fit the bill if he got the message—but if he doesn’t, the 2012 election will certainly provide America with another opportunity to find a president who will lead us out of the post-industrial wasteland that America is becoming under the onslaught of China’s weapons of job destruction.

Drawing a Hard Line in the Sand on Chinese Espionage and Cyberwarfare

We have seen that China operates the most aggressive espionage network in America and that its Red Hacker brigades regularly assault our personal, corporate, and government computer networks. We must recognize the clear and present dangers these various forms of “war without fire” pose and rise up to counter them. We must also keep asking ourselves: Why are we trading so heavily with a country that so aggressively spies on us?

#1: Beef Up Chinese Counterintelligence Efforts

A lion’s share of the resources available to the American intelligence community—the CIA, FBI, and other bulwarks such as the National Security Agency—continue to be devoted to the seemingly endless war on terror. This is hardly surprising as the threat of some Islamic fundamentalist group getting its hands on a weapon of mass destruction is a frightening possibility.

That said, we must also face this incontrovertible fact: Even as a rapidly militarizing China is accumulating hundreds of nuclear weapons, it is waging a relentless war of espionage and cyberattacks against our nation. To counter this equally clear and present danger, we must radically staff up and beef up our dedicated China counterintelligence efforts—and coordinate this work with our allies in Asia, Europe, and Latin America.

While any additional expenditures will be difficult to authorize in an age of severe budget constraints, in the end, we will get what we do or don’t pay for. In considering such expenditures, we must recognize that the losses to our economic well-being from China’s industrial espionage alone surely dwarf the woefully inadequate sums we are currently spending on countering the Chinese threat.

#2: Aggressively Prosecute and Penalize China’s Spies

A spy who contributes to China’s ability to develop advanced weapons systems is every bit as dangerous as any Chinese soldier pulling the trigger on those weapons. That’s why our courts, our juries, and our prosecutors need to take Chinese espionage a whole lot more seriously; and any form of spying should be aggressively prosecuted.

As for appropriate penalties, spying for China by an American citizen is treason—the highest crime against our country. It should be punishable by life imprisonment and, in cases involving military and defense secrets, it should result in execution.

Moreover, if any Chinese agents are caught here in America, they should be locked up and the proverbial key thrown away—for only such harsh penalties will deter spy activity on our soil. And please note here that any American spy caught on Chinese soil would experience a far more brutal fate than anything our justice system could mete out.

#3: Increased Scrutiny of Chinese Visitors and Visas

The Chinese government clearly does not allow tourists, students, or business executives to roam freely throughout China, and it puts severe constraints on many types of visitors, including journalists and documentary filmmakers. Yet America allows virtually any Chinese citizen who asks for a visa to run wild in our country. This must stop now!

Therefore, as part of our enhanced counterespionage efforts, there must be far greater scrutiny of anyone from the People’s Republic of China applying for a visa. While the vast majority of Chinese visitors come in peace, there are more than enough secret agents in this bunch to warrant far greater precautions.

Is this “racial profiling”? Absolutely not. It is “country of origin” profiling, and it must be done precisely because China has proven to be the most aggressive nation in the world when it comes to exporting spies to U.S. soil.

#4: Declare Cyberattacks to Be Acts of War—and Respond Accordingly

The Obama administration has called for a more comprehensive cybersecurity policy, and that is all to the good. The cornerstone of this policy must be to treat any state-sponsored cyberattacks as acts of war subject to immediate economic, political, and, if necessary, military retaliation. Moreover, we must be completely honest about where these cyberthreats are coming from and deal with them directly.

In this regard, for far too long, we have allowed the Chinese Communist Party to hide behind the absurd excuse that the computer hacking originating from the most heavily censored and monitored Internet in the world is outside the Party’s control. Trust us: If these hackers were distributing videos of Chinese atrocities in Tibet or pro-democracy meetings in Shanghai or Falun Gong worshippers in Chengdu, China’s cybercops could and would find them and stop them—quite permanently. So let’s end this charade and call a Chinese hacker a state-sponsored Chinese hacker!

We also believe that economic restitution to the victims of Chinese hacking must be part of any comprehensive cybersecurity policy. Accordingly, the American Congress, along with the European Union, the Japanese Diet, and other legislative bodies around the world should pass legislation providing for such restitution to citizens, firms, and government agencies that suffer from foreign hacker attacks. To make such restitution meaningful, such legislation should provide for strong mechanisms to attach the assets of companies found to be involved in such cyberhacking—a case in point being the role of a major Chinese telecom firm in an attack we described in Chapter 10.

#5: Develop a “China Kill Switch” for the Internet

From a strategic perspective, there is no real difference between a power plant destroyed by a Chinese missile or one disabled by a Chinese hacker. Both threats are real. Both have to be anticipated and defended against.

Given the repeated attacks and probes of Chinese hackers on American institutions during what is supposed to be “peace time,” it is critical we develop a “China Kill Switch” that can disconnect America’s Internet from all Chinese Internet Protocol addresses in the event of a full-scale cyberwar. But that’s not all.

Many Chinese cyberattacks are launched from servers and personal computers outside of China that have been hijacked by the Red Hacker brigades. This means a second-level kill switch is needed that can completely isolate key pieces of our infrastructure—utilities, banks, defense firms—from the Internet entirely.

The political discussion of this badly needed defensive system will no doubt include well-meaning arguments over free speech and civil liberties. Obviously, any solution must be designed for minimal impact on civilian communications and in no way limit access to media. However, the external threat to our freedom is unfortunately much more real than some imagined domestic conspiracy; and if we trust our government with a huge nuclear arsenal, we also need to be able to trust that same government to make the right call on protecting our nation from a massive external cyberattack.

#6: Call Beijing Out for Its Reckless Espionage and Theft

Just as we need to call a Chinese hacker a Chinese hacker, we need to call a spy a spy and publicly chastise China for its hostile espionage behavior. We must also make it clear that America, Japan, Korea, Taiwan, Australia, India, and the European Union are not going to continue to look the other way while Beijing’s agents steal our technologies, sabotage our institutions, and prepare for a future apocalyptic cyberwar. If the People’s Republic of China wants to do business with us, it will have to behave like it belongs in the same club of free and fair trading nations.

Confronting and Countering the Rising Chinese Military Threat

We cannot turn our backs on this truth: China’s rapid economic growth at the expense of the American manufacturing base is financing an even more rapid Chinese military escalation. It is a multidimensional buildup of an air, land, sea, cyber, and space war machine that will soon threaten the global supremacy of the American military. We must both acknowledge and confront this threat; and as we do so, we must keep asking ourselves this question: Why are we buying so many Chinese products when the profits are being used to build weapons that are increasingly aimed at us?

#1: We Can’t Overwhelm the Chinese with Our Industrial Might

As a first strategic principle, America must recognize that China is putting the United States in the same role that Germany played facing Roosevelt’s America in World War II. The United States beat the Nazis not with superior technology but with the overwhelming might of its industrial machine.

Today, the shoe is on the other foot because it is now China that can churn out hordes of ships, tanks, and planes on its factory floor. Because China’s superior quantity of weapons can ultimately bury America’s superior quality of weapons—just like America’s matériel overwhelmed the Nazis—we must be ever more clever and strategic in our military strategy.

As a first rule, we absolutely must get more “bang for our buck” out of our moribund, cost-plus military industrial complex. The current weapons procurement system creates spectacularly expensive weapons systems that are constantly over budget, always behind schedule, and often trouble-plagued.

At the same time, we must recognize that as China rapidly arms, our vulnerabilities will only increase. Therefore, if we are ever going to confront the Chinese on this silently escalating cold war, the time is now. We need to publicly call them out on their anything but peaceful rise and seriously ask ourselves if “most favored nation” status really belongs to a nation hell bent on being our top military threat.

#2: We Can’t Be Lured into an Arms Race and the “Reagan Trap”

From a strategic perspective, America’s political and military leaders must also recognize that a cash-flush Beijing would love to put the United States in the same role that the Soviet Union played facing President Ronald Reagan’s America in the 1980s. As China well knows, the Reagan administration buried the Soviet Union by luring it into an arms race that eventually bankrupted the Soviets—and triggered the worldwide fall of communist regimes.

Here, again, the shoe is on the other foot. China, with its trillions of dollars in foreign reserves, booming economy, and rapid militarization, would love to lure a fiscally precarious United States into an arms race that could ultimately break America financially. Again, this reality demands that America be both more clever and strategic in its approach—as well as more aggressive in acting to preempt China’s lightning-quick military rise.

#3: Honestly Assess Our Vulnerabilities

Following the recommendation of the U.S.–China Commission, the Pentagon should be required to report annually on the ability of the U.S. military to withstand a Chinese air and missile assault on its regional bases and list a set of specific steps that can be taken to survive such an assault. The Commission has also urged our military to “strengthen its interaction with allies in the Western Pacific”288 and “expand its outreach to other nations in Asia to demonstrate the U.S.’s continued commitment to the region.” Building up strong alliances with three of China’s likely future targets—Japan, India, and Vietnam—represents an important part of this strategy.

#4: We Must Disarm China’s Weapons of Job Destruction If We Are to Prevent China’s Massive Military Buildup

It was the famous Prussian military theorist Karl von Clausewitz who once said, “War is an extension of politics, but by other means.” Today, in a similar vein, we must recognize that China’s rapid military buildup is a direct extension of its economic growth, and that far too much of that growth is coming at America’s expense.

That’s why ultimately we must come to understand that the best argument for disarming China’s weapons of job destruction is not to “save our jobs”—as important as that might be. Rather, the best argument for confronting China’s unfair trade practices is one of national defense:

If we surrender our manufacturing base to Chinese mercantilism while we continue to finance China’s rise by buying Chinese products and running massive trade deficits, all we are doing as consumers is ensuring our own eventual demise.

Countering the Colonial Dragon

As we have illustrated in great detail, Chinese boots on the ground are marching all across the African continent and into Latin America looking to lock up energy and raw materials for China’s industrial machine. So far, this budding colonial empire has gone virtually unchallenged.

Stemming this tide of Chinese colonialism certainly won’t be easy. But just as every journey begins with one small step, there are at least some steps we can take to meet this global Chinese challenge.

#1: Stop China’s UN Veto Abuses Now

Here is one of the most important moral questions of our time that each of us as American citizens must continually ask ourselves and our political leaders: How can America’s President, Secretary of State, and United Nations Ambassador remain silent as a “rug merchant” China continues to use its United Nations veto power as a bargaining chip to obtain natural resources and raw materials from rogue nations like Iran and dictatorships like those in the Sudan and Zimbabwe? This crass commercial behavior by China to build its colonial empire must be roundly condemned not just by the United States but also by countries around the world—from Europe and Asia to Latin America and especially Africa, which bears much of the brunt of China’s bloody and barbaric veto strategy.

#2: Rebuild Our Diplomatic Missions with a Counter-China Focus

We need to beef up and staff up the institutions that have typically helped the United States project “soft power” around the world. These institutions include government agencies like the Foreign Service, the U.S. Agency for International Development, the Peace Corps, and the many branches of the U.S. military that provide services in regions where American forces are deployed.

As part of a revival of U.S. diplomacy, we also need to carefully monitor Chinese activities around the world. Such monitoring must be conducted at the global grassroots; thus, in every one of the almost 300 embassies, consulates, and other diplomatic missions the United States maintains around the world, we should deploy one or more China specialists. More broadly, this focus will help build up a core of China analysts in the American diplomatic and intelligence communities.

Nor should possible corporate contributions to the projection of America’s soft power be overlooked. The fact here is that many American CEOs view themselves as patriots, and we need to engage their firms in getting their operations abroad to act as ambassadors for our nation.

#3: Get America’s Message Out to the World

Both of us have listened to radio broadcasts from the Voice of America in far-flung places around the world, and we both know firsthand the power of such information. We also know how important facilities like American centers offering libraries and cultural programming can be in swaying “hearts and minds” in developing countries.

Regarding the Voice of America, it is useful to note that satellite TV is extremely popular in rural China, where even 200-year-old adobe brick farmhouses are sprouting big dishes. For this reason, we think it important to expand Voice of America satellite TV service beamed into China; and this can be done on existing Asian positioned geo-sync satellites. If the Chinese protest, we should tell them it’s our way of getting some of that “market access” they agreed to when they signed on with the World Trade Organization.

The West might also consider ways to actively provide free Internet proxy server services to Chinese citizens. Such services would allow Internet users behind China’s Great Firewall to freely venture into the “real virtual world.”

In considering such options, it is useful to remember that America is still by far the media and marketing king of the world. In light of our capabilities, it is amazing that we have completely failed to leverage that ability to effectively sell our democratic values abroad.

#4: Replace French and German with Mandarin in Our High Schools

We are all for multilingualism in today’s world, but we find it extremely myopic that in this new twenty-first century, many junior high schools and high schools continue to require students to meet their foreign language requirements with courses in French and German but do not offer classes in Mandarin Chinese. In fact, Mandarin should be offered beginning in elementary school. This is a case where we have met the enemy, and it is our school system. So lobby your school boards accordingly. (While you’re at it, have them replace cursive handwriting instruction with keyboarding.)

Stopping Death on China by China

Immediately upon assuming the position of Secretary of State, Hillary Clinton informed the world that America would no longer pressure China on human rights. No more imprudent words have ever been spoken on this subject.

The fact is: We need a “jasmine revolution” in China—peaceful or otherwise—to either rid the people of China of Communist Party rule or have Communist Party leaders loosen their totalitarian grip on the world’s most populous nation. Turning down the rhetoric and pressure on human rights abuses as Secretary Clinton has done moves China in exactly the wrong direction and gives the rest of the developing world the impression—hopefully incorrect—that the West tacitly approves of the regime in Beijing and its brand of totalitarian state capitalism.

#1: Reinstitute Human Rights as an Element of U.S. Foreign Policy

The United States and other countries around the world must continue to exert pressure on China to respect basic human rights, including freedom of speech, association, assembly, and worship, along with freedom to organize in the workplace and reproductive self-determination.

America must also be willing to stand up for the rights of indigenous populations like those in Tibet, Inner Mongolia, and Xinjiang Province; and that includes calling for an immediate halt to the ongoing ethnic cleansing campaigns now taking place in these anything-but “autonomous regions” of China.

#2: Divest, Don’t Invest

The “Divestment” campaign against South African firms was highly successful in bringing down that country’s racist oligarchy. We suggest the same tactic would be just as effective with a country as dependent on foreign investment as China. Do your part by not investing in Chinese firms, Chinese mutual funds, or even “developing nation” growth funds that are chock full of Chinese stocks. Frankly, you’ll be doing yourself a favor by reducing your exposure to a risk-filled, corrupt, and nontransparent economy plagued by asset bubbles. If you want to play the China growth card, at least do it one step removed by considering investments in the firms and currencies of resource-rich countries like Australia and Brazil that boom as China booms.

#3: Restrict Exports of Internet Censorship Tools

Far too many of the virtual “bricks” that have been laid down to construct China’s “Great Firewall” have been made in America by some of our best-known companies—with Cisco being a poster child for this problem. It is far past time we put a halt to this kind of complicity and duplicity. Congress should therefore immediately pass legislation to restrict the export of any software or hardware products that may be used by totalitarian regimes to censor the Internet and telecommunications systems.

Meeting the China Space Challenge

Of all the areas we’ve discussed, the competition to establish dominion over the high frontier may have the biggest impact on our children’s future. Ensuring that our children are free from President Lyndon B. Johnson’s nightmare of “sleeping by the light of a communist moon” requires prompt and immediate action. With America’s public space program in disarray and the federal budget in crisis, bold new ideas are certainly needed.

#1: Leverage America’s Private Industry Advantage to Drive Down Costs

Government support was critical for jump starting our space program after Sputnik. However, since the success of the Apollo program, the moral hazard of cost-plus accounting coupled with pork barrel politics has created an incestuous oligopoly of inefficient aerospace giants and left us with a space exploration bureaucracy that timidly goes where man has gone many times before—and at great expense.

The time has now come to turn the government’s space monopoly over to real private industry and let both civilians and our military benefit from the market forces that have always served our nation well. The West was won by miners, ranchers, wagon trains, and railroads, not by Custer’s cavalry. A single container full of government astronauts floating closer to the Earth than the distance between Boston and New York is not how you conquer the last frontier.

In fact, reducing the costs of space exploration is something that exciting new companies like SpaceX, Scaled Composites, Sierra Nevada, and XCOR are already doing. Even better, this sort of freethinking, barnstorming aerospace design is something that China’s giant state-owned enterprises can never replicate and China’s control freak leadership will never allow—although Chinese spies and hackers will surely try to steal the resulting technologies. We must, therefore, leverage America’s private industry advantage in this critical dimension.

For these reasons, NASA administrator Charles Bolden has called for private firms to quickly take over the more mundane “space trucking” functions and thereby provide “reliable, routine, access to low Earth orbit.”289 Delegating these more mundane functions to private enterprise would allow NASA to move back into more exciting exploration challenges. This goal has been backed by President Obama’s budget, which includes $6 billion in additional NASA funds specifically allocated to contracting for private launch services. Congressional efforts to sink this plan, backtrack on privatization, and return NASA to a sleepy socialized jobs program must be stopped!

#2: Promote STEM Education

China is producing ten or more times the amount of scientists and engineers as the United States; and we as a country are falling far behind in these fields. We must redouble our efforts at the individual, family, corporate, and government levels to close this widening gap by encouraging our new generations to become engineers and scientists, and by providing appropriate funding, facilities, and opportunities.

Accordingly, scholarships, student loans, and educational grants should be disproportionately tilted to Science, Technology, Engineering, and Math—the so-called STEM subjects. At the same time, parents need to encourage their children to pursue STEM careers. The media can do its part here, too, by generating positive messages and role models about bright kids who do great things that move civilization forward. Corporations can likewise make a point of publicly rewarding their top engineers in the same way they massage the egos of their star salespeople with awards’ dinners and trips to the tropics.

#3: Claim the Moon Before China Does

After reading this book, do you really expect that China’s space program will be dedicated to the good of all the world? The fact is, we have to anticipate that China is going to start snapping up space resources exactly the way it is carving out the whole South China Sea as a sphere of influence and claiming resource-rich Japanese territorial waters as an exclusive Chinese domain.

That’s why the United States must start laying claim to valuable space resources like the moon while we still have a strong position to do so. We must also start laying out our claims to resource-rich asteroids like Eros and potentially colonizable spots like Ceres, Mars, and the Lagrange points. When other countries yell and scream about our “land grabs,” pull them to the table and create an equitable system that will allow free enterprise, free thinking, and free people to carry mankind’s legacy to the stars rather than a harshly repressive, totalitarian, and state capitalist China.

Concluding Thoughts

While each of the individual actions, executive decisions, and government reforms outlined in this chapter will significantly improve the prospects that the U.S.–China relationship will be a prosperous rather than a parasitic one, what is perhaps most needed around the world is a wholesale attitude adjustment.

For far too long, we in the West have waited for a growing Chinese economy to somehow magically transform a ruthless totalitarian regime into a free and open democratic nation. We have waited through the massacre at Tiananmen Square; the ethnic cleansing campaigns in Inner Mongolia, Tibet, and Xinjiang; the development of the world’s most sophisticated propaganda machine and stifling Internet censorship; the unleashing of a flood of lethally dangerous products onto world markets; the gutting of America’s manufacturing base; the wholesale polluting of the global commons; the repeated assaults of an elaborate espionage network on military and industrial targets; and the emergence of a five-dimensional expeditionary military force capable of one day enforcing all of its absurd territorial claims around the globe—and no doubt one day in space.

We must wait no longer. Indeed, it is well past time for all of us to confront China—even as we confront our own false hopes that somehow, despite all the evidence to the contrary, China’s rise will indeed be peaceful.

And it should also go without saying here that as we move forward on issues ranging from Chinese mercantilism and product safety to climate change, human rights, and military cooperation, working with China at any level will require constant vigilance. It will also require a strict adherence to this variation on Ronald Reagan’s cold war advice about negotiating with the Soviet Union. For based on China’s abysmal track record to date, with Beijing, we must appropriately “mistrust and constantly reverify.”