"Beyond Diplomacy": Why Victor Cha Says North Korea is More Dangerous Than Ever

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We're obviously disappointed with the case, which was wrongly decided.

But the president and president, she

have developed a very strong and stable relationship.

Scott Bessent, myself, we've established strong relationships

with our counterparts.

Our deals were not premised on whether or not this case remains

in place or not.

As you mentioned, we have a variety of tools.

We've had tariffs on China since 2018.

Even now, the average tariff on China is still about 40%.

We have other tools if we need to use it.

The point isn't trying to fight with China.

It's really to have stability for the soybean farmers

you mentioned for people who are selling aircrafts

and medical devices.

And folks who want to be able to import some things

we can't get elsewhere from China.

And we're still on track for that.

The meeting in April is still on track.

We think it will be very successful.

Jamison Carrier weighing in the crisis management

that they're doing now because of that Supreme Court

decision and how it affects the China visit.

There's going to be a follow up visit

if all things go well here.

I'm sad to find out that we're holding up

our weapon shipment to Taiwan just to make sure

the March visit goes well.

Taiwan needs to be a porcupine.

That's the phrase they use.

So China knows if they go in and try to fight a war

they haven't had a war since 1979,

that they're going to get a lot of resistance.

And it's going to be trouble.

And we're going to go for it.

And we're going to hopefully watch their back.

Dr. Victor Cha knows all the machinations of the region.

He's got a brand new book out called China weaponization

of trade resistance through collective resilience.

He's the distinguished university professor at D.A.

S.F., endowed chair in government international affairs

at Georgetown, as well as present the geopolitics

and foreign policy department and career chair

at the Center for Strategic and International Studies.

And a former director for Asia Affairs

at the White House National Security Council.

Victor, congratulations on the book.

Thank you, Brian.

I think when people think about weaponization of trade,

we think of China not buying our soybeans

and China not selling us rare earth.

Is that an example?

Yeah, those are two very good examples.

Basically they take what is normal trade interdependence

and they weaponize it for political purposes.

And they've been doing this since 1979.

We've documented over 600 cases

and it's really heightened under Xi Jinping.

WHO, putting bring in them in, big mistake.

Into the WTO, yes, it was probably a mistake at the time,

but at the time there was this prevailing assumption

that China, as it got rich, would eventually become more like us.

And so when they weaponized trade, we put up with it

saying, oh, this is just a bump in the road in the end.

There'll be a good new story to come out of that.

But clearly China got rich and the CCP is still in control.

They haven't politically liberalized

and they're not following the trade rules.

So in your book, you categorize and you list

and explain all the times China used trade against the world.

Why did we allow ourselves to let them control our former

pseudicals?

How do we allow ourselves to let them control rare earth?

What was the West thinking?

Because it wouldn't work to anyone's advantage

and we have plenty of these same resources ourselves.

I think there are two reasons.

The first was this faith in globalization

and just in time supply chains.

It was trying to get the cheapest production costs

and often that ended up being in China.

And we never really thought about trade disruption.

The other was this view that, again, eventually

that as China grew, it would be more of a responsible stakeholder

in the international system.

And therefore, we could countenance a single active trade

coercion every once in a while.

Because in the end, China would become more like us.

That clearly was not the case.

That clearly has not been the case.

But now we find ourselves in the position

where our supply chains many of them are compromised.

And this really became clear during COVID

when so much as you said of our medical supply chains

and PPE supply chains were dependent on China.

And we saw a disruption.

And we didn't have a good answer.

But many other using, you know what?

I was just going to say that just many governments

around the world are well aware of it.

They've all appointed economic security point people.

And everybody is trying to shore up their supply chains now

because they know this weaponization is not going to stop.

Look at Japan.

What have they done to Japan over the last six months?

Yeah, exactly.

I mean, you got a new Prime Minister in Japan.

Basically, all she did was restate

existing Japanese defense policy when it came to Taiwan.

And China is carrying out a full court economic coercion

against her, you know, not importing Japanese seafood,

not allowing tourists or students to go from China

to Japan, a variety of things of this nature.

And also on heavy rare earth minerals,

they're curtailing heavy rare earth mineral exports

to Japan.

China had done this before in 2010.

They curtailed light rare earth minerals to Japan

over a territorial dispute.

Japan shore up that supply chain.

And so what does China do?

It doesn't go after light rare earth.

This now goes after heavy rare earth.

So, you know, trying to answer this problem

with showing up supply chains is good.

And it's necessary.

But China is always looking for the next thing

that they could press you on.

So what do you think's going to be?

What do you think the President's strategy is now?

We did confrontation, hit him with the fentanyl tariffs

backed off when they said we're going to hold back rare earth.

They agreed to put everything on hold

and then agreed to work out the kinks

and then the President and President Xi

let's meet together and they're going to do it in March.

What do you think the President's strategy is now?

I think at the core of the basic strategy

is to continue to use the threat of tariffs,

to try to stave off China using critical minerals,

you know, trying to weaponize critical minerals.

And this is kind of a holding pattern

because the idea is eventually that the United States

and like-minded countries will be able to develop

to the best they can independent critical mineral supply

chains so that they're no longer prone

to Chinese threats of economic coercion.

I think that's sort of the game plan right now.

And so when we go into this summit this spring,

there'll probably be a similar sort of ratcheting up

of threats on both sides in the run up to the meeting

and then some sort of interim agreement

that might last for another year or so.

But the last meeting basically bought a year

where China said we said we would not raise tariffs further

and they said that they would not hit on critical minerals.

But this is only a temporary solution.

In the long term, we've got to, you know,

shore up these critical mineral supply chains.

There's a critical mineral security partnership

that both the Trump and the Biden administration

have done.

These are the things that are necessary

to get out from under this constant threat of coercion.

Do you think we're doing enough to get our own sources

of rare earth between the deals?

We cut in Southeast Asia, but the one in Australia,

Argentina, I talked to Doug Bergam,

he seems to see the urgency, are you seeing it?

No, I think we are seeing it.

I mean, I think this is a top priority

for the administration.

I think we're seeing it in their conversations

with allies and partners, potential sources

of critical minerals.

And anywhere there are critical minerals,

it's part of whatever bilateral meeting the present

is doing with the leaders of those countries.

So I think there's an urgency attached to it

because, you know, I think the idea is that within a decade,

we want to get out from under this.

Japan, as I said in 2010, went on a major push

to become less vulnerable to China and critical minerals.

It took them about a decade to reduce their dependence

by about 50%.

So it may take less time for the United States,

particularly if we work in partnership

with other like-minded countries.

Headline in the New York Times today,

the looming Taiwan chip disaster

that Silicon Valley has long ignored.

Why?

Because Taiwan's making about 90% of all our chips

and China's determined to take the island,

claiming it as their own.

Number one, their claim is an authentic.

They've never had the island.

And number two, they seem obsessed with taking it.

And that would certainly hurt our net,

that not certainly not being our national interests.

Yeah, I mean, yes, that's exactly right.

China, if China were to take Taiwan,

it would have a chokehold on, you know,

these high end computer chips, semiconductor computer chips.

Xi Jinping is in an increasingly precarious position.

He's been purging some of his top generals,

people that he put into place,

which speaks both to the corruption in the PLA,

but also to his own paranoia and concern

that people are going to stab him in the back.

But that also means that he's become much more aggressive

in terms of these quarantine exercises

that they've been doing around Taiwan.

You can't even call these exercises.

This is like practicing quarantine around Taiwan,

basically to try to choke a strategy,

to try to choke off Taiwan,

so they cry uncle in the end

because they can't get anything into the island.

But the strategic value of Taiwan,

both in terms of shipping lanes,

this potentially being a permanent aircraft carrier

for China, if they ever were to get hold of it,

as well as the chip issue,

make this strategically very important.

I think the good news is that the administration

is very focused on this.

The Pentagon is very focused on this.

They've been building capabilities.

But at the same time, you know,

the concern is that Xi Jinping may see

his window opportunity closing by 2027,

and that, you know, that creates a lot of concern.

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I mean, at one point, we'd still be waiting

for AOC to answer the question, what do we do?

I hope we are prepared to defend Taiwan.

And I don't think he would do it with this president

as president, that's what I don't think.

But my hope is we're prepared to do this,

because the West will begin to just gradually

lose grip and credibility and basically

give the world over to China if we do.

Yeah, there's a lot riding on Taiwan

that goes beyond what's in Taiwan, the chip issue.

In some research that we've done,

we found that one of the most important indicators

of US general commitment to allies and partners in Asia

and in Europe is what happens on Taiwan.

US credibility and strength, in many ways,

rests on that.

I mean, it's good in the sense that other countries

in the region, Japan, Australia, the Philippines,

South Korea, and others really do understand

what's at stake in the past.

They just saw it as a US problem.

But now they really do see it as something

that can affect their very lives.

So there's a lot more vigilance.

We see defense spending increasing across Asia now.

As the president has wanted, 3.5%, 5% defense spending

is going up in places like Japan and Korea.

Nuclear submarines in Australia.

Also talk about that in South Korea.

So things are happening now that are shoring up defense

and deterrence that benefit the Taiwan Straits issue.

No, that is great.

So Victor Cha, I guess, his book is now

our China's weaponization of trade,

the resistance through collective resilience.

So where's China vulnerable?

So what we found in the research we put into this book

is that there are about 600 items that China trades

with countries that it has coerced.

They're very important to its construction industry,

to its solar panel industry, to a variety of industries.

And if countries can work together,

we can threaten retaliation.

If China continues to use economic coercion

against any one of us, and that will deter them

from using this as a tool, as they're doing to Japan today,

as they're doing to us, as they've done to us

on critical minerals.

And as they've done to many American defense contractors,

software companies, clothing companies, airlines,

you just name it, like they've gone after everybody.

But there is capability that the United States, Japan,

Australia, and others have that could deter

and stop this sort of activity.

It's pretty obvious to the products.

What I also hear too is they're people don't buy anything.

They need to sell their products, 70% to us.

So we are the consumers they need to sell

are also just going to be stuck with these products,

because they can't just, the billions of people

in China don't buy the billions of items,

because they don't have a social safety net,

and they don't trust any excess spending,

money that they have.

And they got to use job issues, correct?

They're out of make-work jobs.

Yeah, no, that's absolutely right.

I mean, the still, the most important sort of

consumer middle class market is the United States.

And China, while it's a big market for production,

for cheaper production, in terms of consumption,

it's not nearly as big,

and China faces vulnerabilities there as well.

Do you think there's any chance

of separating Russia and China at this point?

Right now it seems pretty hard.

China has been both keeping

an arms distance length away from Russia

while behind the scenes continuing to supply them

in, you know, with microelectronics,

all sorts of industrial capacity,

so they continue the war in Europe.

But right now these two seem to be brought even closer together.

As we saw in the victory-day celebrations

that Xi Jinping hosted last fall,

where he had Putin on one side,

and he had Kim Jong-un on the other side.

Are you concerned about Canada's new

family relationship with China?

Yeah, so I think there is a concern that the tariffs

by the Trump administration are causing

some of our allies and partners to look at

what you might call plan B's,

what else they could do if they can't rely on the United States

and this relationship between Canada

and China's one manifestation of that.

I don't think that, I don't think that means

that we're pushing everybody into the arms of China

because nobody wants to be in the arms of China.

It's just going to be squeezed to death if they do that.

But, you know, it is a bit of hedging by Carney

and we'll probably see European leaders do the same thing.

But again, you can't get in bed on trade

and economics with China because they steal technology.

Yes.

They use economic coercion.

You know, they'll try to steal technology.

They'll enter into a joint venture.

They will try to steal your technology.

They will then domestically produce

and dump on the open market to basically kill

your industry.

So nobody, you know, they may be hedging a little bit

by talking to China,

but nobody's going to get fully in bed

with China on investment and trade.

I know this, but this Prime Minister in Canada

is a real piece of work.

I don't know if he understands the dangers fully.

I think it's taking a personal and the hockey loss

is not going to make him feel better.

Victor Chau, congratulations on your book.

China's weaponization of trade resistance

through collective resilience.

Appreciate it, Victor, and thanks for what you do.

Thanks, Brian.

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