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On the menu today: President Biden and China’s Xi Jinping are expected to have their first in-person meeting in Indonesia this November, leading some to argue that the administration should set preconditions for Xi before granting him a face-to-face meeting with the American president. (This is a little tougher for a president to do once he’s chosen to fist-bump Crown Prince Mohammed bin Salman.) Of course, Biden’s renewed engagement with China’s leaders also brings us back to an infamous, mysterious, wildly underexamined phrase in our national life: “ten percent for the big guy.”
Ira Stoll, writing in the New York Sun a few days ago:
America may not realize it, but it has the upper hand. Even China’s own bogus economic data show high unemployment and slowing economic growth there. It turns out that communism doesn’t work. Goldwater was correct.
A weaker American position will only fuel suspicions of corruption — “10 percent for the big guy.” Why are the Chinese Communists so desperate to buy off American elites? Because on some basic level, deep down, they know the truth is Goldwater was right. Communism is beyond hope. The Communist Party in China, like the Soviet one before it, is just buying time until the eventual ineluctable reckoning with freedom.
There is a remarkable national lack of curiosity about that message, “10 percent for the big guy.” If I said to you that a company that was effectively controlled by the Chinese government paid Hunter Biden almost $5 million for vaguely defined “consulting” and legal work, wouldn’t that bother you? Even if you’re a loyal Democrat — even if you were so progressive you’re to the left of Bernie Sanders — do you want members of president’s family to get in bed with the Chinese government?
There is no argument on any part of the American political spectrum that it is good for the kids of politicians to cash in on their parents’ connections by accepting fortunes from hostile foreign states.
Back in 2017, one of Hunter Biden’s business associates, James Gilliar, emailed him to discuss the equity stakes that the key players in their newly created firm would get from a joint venture with CEFC China Energy Co. “10 held by H for the big guy?” he asked, suggesting that some unnamed male person of importance would get 10 percent of the deal. (“H” is Hunter Biden.)
President Biden has insisted that he was never involved in his son’s business dealings.
The first point to keep in mind is that there is no longer any doubt that these particular emails on the infamous Hunter Biden laptop are real. Back in March, the Washington Post developed a long-delayed curiosity about the emails and commissioned an investigation by tech-security experts. Those experts concluded that:
Thousands of emails purportedly from the laptop computer of Hunter Biden, President Biden’s son, are authentic communications that can be verified through cryptographic signatures from Google and other technology companies, say two security experts. . . . In particular, there are verified emails illuminating a deal Hunter Biden developed with a fast-growing Chinese energy conglomerate, CEFC China Energy, for which he was paid nearly $5 million, and other business relationships.
The veracity of the emails does not depend upon what you think of the New York Post. They nailed the story. Those 51 former intelligence officials who contended that the story was Russian misinformation were wrong, and insisted something that was true could not possibly be true to the American public. To the best of my knowledge, not even one of those former intelligence officials has ever retracted or apologized for jumping to conclusions. As of this March, all of them either declined to comment or insisted that their assessment was reasonable at the time.
The question now is: What were the consequences of Hunter Biden’s effort to go into business with a Chinese energy company? And did that ten percent end up getting held for “the big guy”? And did that deal influence President Biden’s perspective and actions regarding China?
Because the Chinese money ended up going to Hunter Biden. As the Post separately elaborated:
Over the course of 14 months, the Chinese energy conglomerate and its executives paid $4.8 million to entities controlled by Hunter Biden and his uncle, according to government records, court documents and newly disclosed bank statements, as well as emails contained on a copy of a laptop hard drive that purportedly once belonged to Hunter Biden.
Back in 2017, CEFC China Energy Company was one of the largest companies in the world, ranking 222nd globally in the Fortune 500. As with all entities in China, its independence from the whims of the state and the Chinese Communist Party is — or I should say, was — highly conditional. As CNN would later describe it:
At its height, Ye’s company, CEFC China Energy, aligned itself so closely with the Chinese government that it was often hard to distinguish between the two. . . . Two thirds of the company’s financing came from the state-owned China Development Bank.” The Jamestown Foundation summarized the company “epitomizes the close party-state-military-market nexus of the political system in China, wherein corporate interests serve the political agenda of the ruling Chinese Communist Party (CCP). CEFC China Energy has been involved in energy investments with the military’s ‘princeling’ elite, and its affiliate China Energy Fund Committee is a pro-CCP think tank with ties to retired military intelligence officer.
It is reasonable to contend that Hunter Biden was going into business with the Chinese government, or at minimum, with a company that was effectively controlled by the Chinese government.
By February 2018, the company’s CEO was being investigated by the Chinese government for “financial crimes.” By December of that year, per CNN, “A Chinese state-owned company taking control of many of its international assets.” By March 2020, the company had declared bankruptcy. Any pretense that it was an independent, private company had been abandoned as its assets came under full state control.
Once again, it seems fair to ask just what Hunter Biden offered a de facto Chinese government entity that would justify paying him nearly $5 million. For those who want to say it was his expertise and insight, keep in mind, according to Hunter Biden’s own memoir, “From 2016 to 2019, Hunter Biden’s life was a mess. He and his wife divorced, and he drank and smoked crack just about every day.” The president’s son characterizes this time as “I was smoking crack every 15 minutes.”
The only value that Hunter Biden could possibly have to the Chinese government was as a conduit to his father. No one in their right mind saw Hunter Biden as a financial genius or an astute analyst. He was the former vice president and potential future president’s severely screwed-up man-child who was desperate for cash — exactly the sort of target that Chinese foreign-influence operations desired.
And as the Post reported, the Chinese reached out to Hunter Biden when everyone could see he was in dire straits:
During divorce proceedings with his wife Kathleen, a court filing in the case described “outstanding debts [that] are shocking and overwhelming,” with the couple carrying maxed-out credit cards, double mortgages on both properties they owned and a tax debt of $313,970. Three checks to their housekeeper had bounced, and they owed money to medical providers and therapists, according to a February 2017 filing in D.C. Superior Court.
An intermediary from CEFC initially reached out to Hunter Biden in December 2015 to set up a meeting between the then-vice president’s son and Ye Jianming, the founder and chairman of the Chinese firm, according to verified emails from a purported copy of the laptop hard drive reviewed by the outside experts for The Post.
What do you think the Chinese government wanted from Hunter Biden that was worth millions of dollars?
Fast forward about two years to the first months of his 2020 presidential campaign, and we see Joe Biden contending that the notion of China as a threat was wildly overstated.
Back in May 2019, Biden declared:
“China is going to eat our lunch? Come on, man. They can’t even figure out how to deal with the fact that they have this great division between the China Sea and the mountains in the east, I mean in the west. They can’t figure out how they are going to deal with the corruption that exists within the system. I mean, you know, they’re not bad folks, folks. But guess what, they’re not competition for us (emphasis added).” Then, a few days later, Biden said, “What are we doing? We’re walking around with our heads down, ‘Woe is me.’ No other nation can catch us, including China. I got criticized for saying that. I’ve spent as much time with [Chinese President] Xi Jinping as any world leader has.”
Was Biden’s soft-on-China perspective a result of “10 percent for the big guy”? Or was it just the reflection of a calcified geopolitical mind that had trouble moving on from the discredited notion that Beijing was America’s “partner in prosperity” and that greater engagement would make China more like the U.S., instead of making the U.S. more like China?
Biden doesn’t talk about how harmless China is anymore; the past few years have brought the Covid-19 pandemic, the crackdown in Hong Kong, even more evidence of the genocide of the Uyghurs, increasing threats against Taiwan, and all kinds of other CCP abuses and crimes.
In November, Xi Jinping will travel to the G-20 Summit in Bali, Indonesia, and is expected to have his first in-person meeting with Joe Biden since Biden was elected president. What kind of thoughts will go through Xi’s mind, when he sits across the table from the American president?
“I can roll this guy”? “I can buy this guy”? “I’ve got leverage over this guy”?
Reporting from National Review.
