As the post-9/11 chapter closes, a new one begins, marked above all by the end of American deterrence and the eclipse of American power.
Our total defeat and ignominious, disastrous withdrawal in Afghanistan, after 20 years of war and nation-building, closes a chapter on post-9/11 America — and opens another.
What comes next is to some extent uncertain, but you don’t need to be a grand strategist to see the broad outlines of what is already taking shape.
First and most obvious, Afghanistan will revert to being a terrorist haven. The Islamic Emirate of Afghanistan, by its very nature, will not keep to itself, the erstwhile assurances of Taliban officials notwithstanding. Every committed jihadist on earth who can get to Afghanistan is headed that way now or making plans to do so.
Our military leaders have already admitted as much. Two weeks ago, well before the suicide bombing attacks that took the lives of 13 American soldiers and scores of Afghans, the Pentagon told U.S. senators that the collapse of the Afghan government and the Taliban takeover means terrorist groups will reconstitute in Afghanistan more quickly than was previously estimated.
On an August 15 phone call with top Biden officials and senators from both parties, Chairman of the Joint Chiefs of Staff Mark Milley said the previous assessment, back in June, was that there was a “medium” risk that terrorist groups would form in Afghanistan within two years of the U.S. withdrawal. Asked if he believed that timeline would have to be moved up in light of recent events, Milley reportedly responded, “Yes.”
In practical terms, this means in the years to come we’re almost certainly going to see a resurgence of Islamist terrorism worldwide, and likely another attack on American soil. Why? Because for al-Qaeda, and for jihadists the world over, the Taliban’s victory in Afghanistan is a vindication of 9/11, a strategic victory. After 20 hard years, they won and we lost.
Osama bin Laden predicted something like this would happen. Not long after the U.S. invasion of Afghanistan, bin Laden issued a “letter to the American people,” in which he declared that, like the Soviet invasion of an earlier generation, the Americans would eventually leave in defeat:
If the Americans refuse to listen to our advice and the goodness, guidance and righteousness that we call them to, then be aware that you will lose this Crusade Bush began, just like the other previous Crusades in which you were humiliated by the hands of the Mujahideen, fleeing to your home in great silence and disgrace. If the Americans do not respond, then their fate will be that of the Soviets who fled from Afghanistan to deal with their military defeat, political breakup, ideological downfall, and economic bankruptcy.
Bin Laden and those who planned 9/11 recognized the U.S. invasion of Afghanistan for the strategic error it has proven to be. All of them understood the collapse of the Soviet Union as a direct consequence of the USSR’s failed invasion and occupation of Afghanistan, and credited the mujahadeen with the collapse of the communist superpower. It might take time, they thought, but the same would happen to the United States should it be foolish and arrogant enough to invade and occupy the country. And we were.
For all that, a Soviet-style collapse of the U.S. won’t happen. But our humiliation in Afghanistan will have global reverberations. The military power of the United States was the last institution of public life Americans really trusted, and it was the foundation of other nations’ trust in us — or fear of us.
Our adversaries will react accordingly. China, above all, will understand our defeat in Afghanistan as the end of American deterrence and a chance to press its irredentist agenda in Taiwan and the South China Sea. Moscow and Tehran will come to similar conclusions, as will Pyongyang.
Indeed, over the weekend, the Wall Street Journal reported that North Korea has resumed operation of its plutonium-producing reactor at Yongbyon, which had been inactive since December 2018. The operation of the reactor has apparently coincided with signs that North Korea has also begun to separate plutonium from spent fuel previously removed from the reactor.
For our allies, the end of American deterrence will likely prompt a strategic recalibration. Why would Taiwan, which this week issued a dire warning that China’s armed forces could “paralyze” Taiwan’s defenses, put its faith in an alliance with the United States? Why would Ukraine or Poland?
As we learn more in the coming weeks and months about the fecklessness and deceit of the Biden administration’s Afghanistan withdrawal — including Biden’s appalling conversation with then-President Ashraf Ghani, urging him to “project a different picture” of the fight against the Taliban, “whether it is true or not” — every nation in the world will take note of what our promises are worth.
Some of these developments will take decades to mature, but others will move rapidly. By the end of Biden’s term, assuming he’s able to see it through, we might well long for the days when all we had to worry about was our humiliation in Afghanistan. We’ll certainly come to see the events of the past few weeks in a stark new light: as the beginning of a dark chapter in world history, marked above all by the eclipse of American power and influence in an increasingly dangerous world.







California’s State Pension Invests Millions in Chinese State-Owned Companies
CalPERS has $490 million tied up in companies funding Belt and Road
California’s state pension invested hundreds of millions of dollars in Chinese state-owned enterprises linked to the People’s Liberation Army, according to records reviewed by the Washington Free Beacon.
The California Public Employees’ Retirement System (CalPERS) had more than $3 billion invested in Chinese companies, including 14 state-controlled enterprises blacklisted by the Trump administration, as of June 2020. Many of these companies are funding the Belt and Road Initiative, a massive infrastructure project Beijing is using to expand its geopolitical and military influence.
Gov. Gavin Newsom (D., Calif.), who recently praised a Chinese-owned media company for its “journalistic integrity,” has not commented on CalPERS’s Chinese investments. It is a notable silence from the embattled governor, who has called on CalPERS, the country’s largest public pension system, to divest from tobacco companies and companies linked to the Turkish government. Newsom faces a recall election on Sept. 14.
CalPERS had more than $450 million invested in 14 Chinese companies the Trump administration put on an investment blacklist last year because of their ties to the Chinese military. President Donald Trump’s executive order, which the Biden administration has continued, prohibited Americans from investing in companies that aid the Chinese military.
It is unclear whether CalPERS has complied with the executive order by divesting in the blacklisted companies. The pension fund declined the Free Beacon‘s requests for comment. CalPERS had more than $490 million invested in seven Chinese state-owned enterprises that, while not on the U.S. blacklist, are funding the Belt and Road Initiative, according to its 2020 investment report. CalPERS invested in some of the Chinese companies as early as 2016, records show.
Two companies in the CalPERS portfolio—China Merchants Port and CITIC—control ports in Sri Lanka and Myanmar that the People’s Liberation Army has used for military exercises. CalPERS had $3.7 million invested in China Merchants Port and $110 million in CITIC as of June 2020.
CalPERS, which has more than $400 billion in assets under management, also had $5 million invested in China State Construction Co., which has built roads and bridges in Asia, Africa, and the United States as part of Belt and Road. China State Construction is one of the firms on the Trump administration investment blacklist.
CalPERS had another $6 million invested in China Communications Construction Company, a state-owned company that U.S. officials have said is building military installations in the South China Sea in violation of agreements that China has with its neighbors. Former secretary of state Mike Pompeo singled out China Communications Construction last year as one of the “weapons” Beijing uses to impose an expansionist agenda.
The pension fund has hundreds of millions of dollars more invested in some of China’s largest lenders, including $185 million invested in China Construction Bank. China Construction has invested $405 billion in 176 Belt and Road projects. China Merchants Bank and Bank of China, two other state-owned enterprises in the CalPERS portfolio, are invested heavily in Belt and Road projects.
CalPERS has come under scrutiny from state and national lawmakers over its investments in Chinese companies. The fund’s critics say the investments not only aid the Chinese Communist Party but also create financial risk for the state’s pensioners because of the lack of transparency into the operations of Chinese firms.
“CalPERS would do well on its own to reconsider some of its billions of dollars of investments in China just for the fact that immediate international turmoil produces large uncertainties for California retirees,” said Lance Christensen, the chief operating officer at the California Policy Center, a conservative think tank.
Some investment managers are reportedly reconsidering investments in China because of the government’s crackdown on tech companies and other for-profit companies. Chinese companies listed on U.S. stock exchanges lost $400 billion in value in July amid a series of regulatory crackdowns orchestrated by the Chinese government, the Wall Street Journal reported.
CalPERS’s former head under Newsom, Ben Meng, is an American citizen of Chinese origin. Prior to leading CalPERs, he worked in China as the deputy chief investment officer of China’s State Administration of Foreign Exchange. In that role, he oversaw $3 trillion of foreign-exchange reserves.
During Meng’s time at CalPERS, Rep. Jim Banks (R., Ind.) criticized Meng’s membership in China’s Thousand Talents Program, which the nation uses for espionage. Banks wrote to Newsom suggesting the governor fire Meng, a power Newsom does not technically have.
“Governor Newsom, if it were up to me, I would fire Mr. Meng immediately,” Banks wrote in a February 2020 letter. Banks took specific issue with Chinese companies like Hikvision, for example, that are used by China to further its detention of Uyghurs. CalPERS responded by calling Banks’s letter a “politically opportunistic attempt to force us to divest, undermining our ability to perform our fiduciary duty to provide retirement security to California’s public employees.”
Last year, Banks and Sen. Rick Scott (R., Fla.) called on Newsom and CalPERS to divest from Chinese state-owned companies. CalPERS rejected the requests, saying that its portfolio largely mirrors investments in the MSCI and FTSE stock indices. MSCI has said it is divesting from the 14 companies on the federal blacklist, but it is not clear whether CalPERS plans to follow MSCI’s lead.
While Newsom does not directly control CalPERs, he has actively used his bully pulpit as a statewide elected official to force the agency’s investment decisions in the past. In 2019, he signed an executive order directing CalPERS and other state pension funds to invest in green energy companies in order to fight climate change.
In 2016, then-Lt. Gov. Newsom urged CalPERS not to reverse a decision to prohibit investment in tobacco companies. He said CalPERS would be “investing in death” if it allowed investments in Big Tobacco. CalPERS voted later that year to expand its prohibition on tobacco investments.
As a gubernatorial candidate in 2018, Newsom called on CalPERS to divest from Turkish companies because of the regime’s refusal to recognize the mass murder of Armenians in 1915.
“It is wrong of us as a state … to invest in Turkish businesses. It’s time for divestment at the [University of California] and CalPERS,” Newsom said at a rally outside the Turkish consulate in Los Angeles.
Newsom has not made a similar demand of CalPERS regarding China, even though both the Trump and Biden administrations have said that the government is carrying out genocide against Muslims in Western China.
“Gov. Gavin Newsom is quick to leverage his position on issues like climate change by outlawing gas-powered cars or other similar mandates, but slow to speak out on government investments in China, where their environmental and labor record is abysmal,” said Christensen, the official at the California Policy Center.
Newsom’s office did not respond to requests for comment.