CHINA'S 100-YEAR PLAN, SPYING & COMMUNISM

March 1, 2022

S01 - E02

RSnake and Jennifer spend the focus of the episode discussing the people's republic of China, the Uyghurs, Hong Kong, Taipei. Jennifer and RSnake also dive into the hacking of Stratfor and some of the back-story.

GUEST(S):

Jennifer Richmond

VIDEO TRANSCRIPT

Robert Hansen

Today's guest is Jennifer Richmond. Jennifer is a moral courage mentor, the founder of the Truth in Between and Substack and the Hold My Drink podcast. We begin with some of the backstory behind the widely publicized hacking strategy.

The lion's share of the podcast is a discussion of many China-related topics starting from the end of the Second World War to the beginning of what I refer to as Cold War Two and beyond. So without further preamble, I hope you enjoy getting to know Jennifer Richmond.

The reason I wanted to talk to you today is largely about China, which is, I think, on a lot of Americans’ minds these days. Before we get there, I want to talk a little bit about your history with Stratfor and in particular, how we met. Give a little backstory there because I think that's an interesting lead into a lot of things that are going on here.

Why don't you first start with what you were doing at Stratfor when we first met and what you remember? Because I'm a little shaky on how we first met. I think it might have been a rotary club or something.

Jennifer Richmond

I was going to say it actually wasn't at Stratfor. It was just that happenstance rotary. And then we happen to find out that we were in the same kind of space, if you would.

I was working with Stratfor doing all their China work. From there, I went on and was their vice president of international projects, of the still remaining focus on China because that's my specialty. I speak Chinese, my background is in China. But running all of our other networks across the world.

Again, when we use the word intelligence, people are thinking cloak-and-dagger. They're thinking spy pens. That was not what Stratfor was about. The intelligence of Stratfor was really taking that information, even as little as what a taxi driver would say in response to economic policy, and putting that through this framework of geopolitics.

That's what made Stratfor unique because a lot of intelligence does not take into account geopolitics, which we felt at Stratfor really was a very useful explanatory tool for how the world is operating.

One of the things that you already said was in the geopolitics framework, I don't know if Stratfor has changed this now. Again, it's been several years. But cyber wasn't one of our biggest focus. We did have people who did look at cyber. But that wasn't part of the larger overarching model that could actually change geopolitics.

The thing with geopolitics is it doesn't really change that much. A lot of geopolitics is focused on geography, in the constraints within your geography of various countries. We can get into that a little bit more as we speak about China. There are a few things that actually change geopolitical outlooks. And they're usually large events; war, natural catastrophe. But cyber wasn't really part of that framework.

I think that cyber is something that actively changes geopolitics. So whether or not they've incorporated that into their framework now, hard to say. But as we already noted, it wasn't in the framework when I was there and particularly wasn't in the framework at the time that we were hacked.

Robert Hansen

I would think it would be very remiss to ignore it now. Get hit by a club once and you're like, “Yeah, maybe I should avoid clubs.”

Jennifer Richmond

Let me tell you a little bit more about what happened after that. And I'm going away, I'm going on a tangent a bit about intelligence. So let's bookmark that because I do want to go back to that. We were a very small and nimble and flexible group, which is another thing that I think was part of Stratfor’s success.

We ended up having to bring more outside money in order to deal with the blow that we took from the hack. In doing that, we became more of a corporate entity. We became, in my opinion, more ossified in what our procedures were. Whereas that flexibility and that nimbleness that we had as a smaller group was really, I thought, some part of the secret sauce.

I believe Stratfor now is owned by a company called RANE, R A N E. I'm not familiar with that. Can't really speak to that. But shortly after I left or it may have even been before, but the timing was around the same. The corporation that came in and owned the majority of Stratfor ended up pushing out a lot of people, including the owner and founder George Friedman. So how Stratfor operates now is a mystery to me.

Robert Hansen

Well, that's fine. Your experience is good enough.

Jennifer Richmond

Going back to the word intelligence, I want to repeat, it wasn't intelligence in the sense that it was CIA type operations, although we did work with various sources on the ground and used those to piece together our geopolitical model. But it wasn't the way intelligence is typically interpreted.

That term, I think, was still applicable insofar as we took disparate pieces of information and created intelligent blueprints based on the geopolitical model. That said, as I already mentioned, the word intelligence got us in a bit of trouble. Or at least, particularly, got me in a bit of trouble because the Chinese don't like that word.

Robert Hansen

I would love to continue that, and I do want to hear at least one good story from you. But before we get any further, I think this is really important for the audience to hear. When you and I use the word China, we are not referring necessarily to the people of China or Chinese people. We're referring to the Communist Party. We're referring to Beijing in the same way someone would refer to Washington.

With PLA, in particular, I think there's a lot of people who would say that you're xenophobic if you use the word China and you're not very specific. You're talking to anti-Chinese people. Of course, I can tell my Chinese friends, “I am not referring to you.”

Not to mention, in China, there's a rumor at least, and it might have been true in the ‘90s, that they put formaldehyde in their beer. I lost it as a college student there. So they were asking me things that I was like, “I had no idea.”

Anyways, though, I believe probably what finally triggered them into action was the fact that I actually shared space with Admiral Inman. Oh, there's the intelligence word again. Surely, now Stratfor is truly the intelligence company that we thought it was.

This was about a week before Christmas. I was going home to spend Christmas with my son. All I could think of during that was about a two-hour grilling. All in Chinese, mind you. My Chinese is not that good. It was good, but to be able to talk about complex ideas was difficult. And I just kept thinking of when I see my son for Christmas.

I'll just end that story. That was the first of many similar visits. I was left alone that evening to go back to my room. I was standing in line to leave. Again, this is a few days before Christmas. And I hear someone call out my name in the airport.

It’s what I've come now to see as my handler. She just stands and walks right up to me. I almost missed my flight. But I got out. Again, more stories from there. But that was the first introduction I had face to face with the ministry of state security.

Robert Hansen

I wish I could say I've never had any similar stories. But in my travels, it's been a wild ride. Maybe on some other podcasts. I’ve got to do it. If we're going to start talking about the Communist Party in China, I think it's probably best if we start with modern day as opposed to the long 1,000-year long history of China.

I think probably the biggest change in China really started happening in the ‘50s and ‘60s with the Great Leap Forward. For those who aren't super aware of what happened there, would you mind just giving a brief overview of what you think led up to that cultural revolution and the subsequent 20 million people getting killed in the aftermath or so.

Jennifer Richmond

The Great Leap Forward, I think, might be the greatest famine of our known history. That was the time that Mao Zedong, the founder of the Chinese Communist Party, was really trying to consolidate his power. So he was following, at that time, a lot of the blueprint that he took from the Soviet Union.

That was when they collectivized farms. They took a lot of metal, including cups and pans and whatnot trying to industrialize which, as we know now, that's really not the way to industrialize. But when you're coming from an agrarian economy, you use what you have.

He started to create a system where there wasn't a fluid information flow because again, we're creating this very centralized system. Not only that, but there was the cult of personality. And he was a very dynamic and charismatic figure.

A lot of the numbers for farming were getting distorted when they were coming to Mao. Mao for quite some time thought everything was fabulous. When in reality, it really was the beginning of a lot of chaos and a lot of death. At the same time, this is when they were trying to consolidate power. While this was not the time of the Cultural Revolution, in the process of collectivizing farms, a lot of landlords were killed or persecuted.

Robert Hansen

This is the removal of the Bourgeoisie?

Jennifer Richmond

The removal of the Bourgeoisie.

Jennifer Richmond

The Cultural Revolution was where Mao was, again, trying to centralize power. But the effect was a complete decentralization. I'll go back to the Cultural Revolution. But I’ll jump forward to it got so bad that they actually had to bring the PLA in because it had become so decentralized.

Mao mobilized what he called the Red Guards. That's where the cult of personality came around Mao. So they wanted to break, they call it the Four Olds. That included Confucianism.

Anything that even was tinged with any historical relevance was literally and figuratively smashed. So any remnants of the Bourgeois that were not wiped out in the Hundred Flowers movement that was more towards academics or the landlords during the Great Leap Forward. This was anything that was still considered Bourgeoisie. The running dogs of capitalism was another term that they used.

Jennifer Richmond

When Deng Xiaoping came into power, he made a lot of changes. He never outright demonized Mao Zedong. That would be bad as the father of the Chinese Communist Party. But he made a lot of changes that gave the impression that things were moving towards a more open society.

He was the one who opened up trade to the rest of the world. There was a lost generation under Mao because colleges literally under the Cultural Revolution shut down.

There was this new kind of energy under Deng where colleges opened back up again. There was this excitement for something new and that outreach to the outside world. But they went quicker than Deng Xiaoping was ready.

They miscalculated how willing Deng was to open the society. While Deng was very interested in primarily opening the economy to the outside world, the Communist Party was still very much in control of China proper. When you saw students pushing the boundaries, that's when enough was enough. So there was that need to reassert the dominance of the Chinese Communist Party at that time.

Robert Hansen

Let's talk about the one child policy, which I think was around that same timeframe when that started getting implemented. I think it stemmed from the fact that there was a concern about overpopulation. I'm sure that they just looked in their not too distant past, and they saw somewhere between 10 and 50 million people die of starvation in their country alone. So as much as possible, let's prevent that kind of thing from happening again.

From your perspective and people you talked to on the ground, how do they look at that, in hindsight? Did they make a massive mistake because things have gotten unwound?

Jennifer Richmond

Yeah. As a matter of fact, for the past couple years, they've been rolling that back in various segments. In the countryside first and then in cities and whatnot. Here's the mistake that was made though. Chinese demographics is one of the quickest grain demographics that we see.

This is really important for China's strategy that I know that we're going to talk about this current global strategy. They literally are dying out. With the rollbacks that they have now, even if people started to have babies right now, you're still looking at a gap of 20 years at least before you can repopulate the army. And that's a big thing.

One of the main reasons I would argue that we see China acting so aggressively now is because their timeline to act aggressively to have people in the military who can actually play out some of their global goals or objectives is limited because there is this huge gap.

Now the other problem, too, in China is particularly in the big cities. It's expensive to live. So most people now can't even afford more than one child because there's not enough parents and people to actually take care of more than one child. So they're locked into this demographic decline.

Robert Hansen

Also it seems like as people get more educated, they have less children. So that's probably not helping their cause at all. I keep going back to this, I come from a generation where there was a slowdown in the amount of births in the United States between boomers and the next generation, their children.

I always thought that was interesting because at some point, I'm going to be the oldest guy in the room, at least in a business context. That time’s not too far in the distant future, which is interesting. If that's true, then surely I'm going to get invited to more boards. And this is where my head was going when I originally came up with this idea. But it also strikes me as a very similar problem in China.

You're going to have this massive amount of mostly men because of the way that people selected the children that they were going to have, which is a horrible, unfortunate thing. But there's a massive amount of men who are single that are very easily weaponized. Because what else do they have going on? It's not like they have a wife to go home to.

I'm curious if you think that might play into the strategy that you're talking about. It's not just that there's this massive current amount of people that could be weaponized, but it's mostly males that could be weaponized.

Jennifer Richmond

So in the strategy of global objectives?

Robert Hansen

Sure. Or whatever. I'm not trying to lead you down a path. I'm just curious if you think there's something to that. Because what are you going to do with half a billion men?

Jennifer Richmond

I think that when Xi Jinping came into power, there was a lot of expectation that he was going to continue to open up society and perhaps even democratize society. And we saw very early on that that was not the case.

Indeed, there were many purges as he was solidifying his own control. We've seen a drop down of that now. A lot of people see the propaganda from the outside in and think that that was propaganda directed maybe at the United States. And really, a lot of it was directed internally, as a mechanism of control.

We saw more control. You've seen aggression towards Hong Kong. You've seen aggression towards Taipei. You've seen aggression in the Chinese periphery. I think a lot of that is to lock down some impending catastrophe and to be able to mobilize internally their people.

As far as weaponizing this group of unmarried men, I see them not weaponizing within their own communities external to the Communist Party but the Communist Party more weaponizing them to keep outsiders out and to solidify Chinese boundaries and Chinese objective.

Robert Hansen

It sounds like if I was in control of China, I could build cities with these men. I could create new technologies. I could investigate brand new areas of industry that might not have been possible before or whatever. So not necessarily a weapon of war but more of a weapon of economics.

Jennifer Richmond

Yeah. But there you get into some trouble, too. We've seen ghost cities come up in China as just a way to keep people productive. One of the biggest fears of the Chinese Communist Party is its people turning against itself because the Chinese Communist Party is predicated on the fact that, “We take care of our people.” So the biggest fear of China really isn't the US, really isn't Russia, it's its own people.

That's why you still have large state-owned enterprises. That's why you still have a huge real estate boom. It's not an iron rice bowl like we saw when it was much more centralized under Mao Zedong and even less so but more so than now under Deng Xiaoping.

You still have to have a system where the people are kept fed and active. So one of the things that is worrisome is because China, outside of being an open society and trade and whatnot, it still economically is quite controlled. Because they have to have the SOEs, the state-owned enterprises. They have to have that activity to make sure that the internal dissent is kept to a minimum.

Robert Hansen

I keep thinking that they should just let Hollywood have one of their cities and just say, “Go for it. Do whatever you want.” Because what else are you going to do with those cities?

Jennifer Richmond

Honestly, the Chinese, their own movie industry has used those cities. There was one city, and I forgot where it was, but it was built up like this gorgeous French paradise. And no one moved in. It was literally a facade.

Robert Hansen

That's just a blight on the country. It really is.

Jennifer Richmond

I've been saying that for a while. China's very adept to continue. They play the long game of pushing things out into the future. But it's hard to see a time where there isn't a reckoning with the, I was going to say irresponsible economic policies, but really depends on the lens that you're taking.

It's irresponsible from an economic standpoint. But it's actually quite responsible from a government standpoint in terms of, again, government control of a population.

Robert Hansen

Let's talk about Xi Jinping a little bit. He had a pretty interesting childhood. This isn't just some career politician whose daddy got elected, which is the nepotism that we see in the United States or typically anyway. This was somebody who grew up in poverty because his father was kicked out of the Communist Party as part of the original purges of the Cultural Revolution if I'm not mistaken.

He grew up in and out, trying to get into the Communist Party. Trying to find his way in and doing everything you possibly can. Got ejected multiple times. Ejected out of a city at one point. I mean, he was definitely on the very outs of society for quite a while. Do you think that matters?

Because I have to think if I'm a farmer sitting there thinking about myself being ejected from cities and my family having been purged, or whatever. I'm going to be much more appreciative of somebody who's lived a little bit of my life even if his dad was a bit of aristocracy before the whole thing happened.

Jennifer Richmond

I think that one of the reasons that we thought Xi Jinping was going to come in and be different was because he did have a different background. That said, he still moved up through the ranks of the Communist Party. I feel that the economic situation, the global situation that he is facing put it in perspective even if he came from a different background.

He still is part of the communist mindset. That the number one priority for China is to keep its actual geographic boundaries intact. There's a reason for that. We'll talk about that later. But also to keep control of the people so as not to lose power. Even though he didn't come through the normal ranks of power, power is still very much a part of the game that he's playing.

I was personally at least surprised with how much he recentralized power in himself. Where I thought because he came from a different background, that he might actually be more open to this experiment here. This experiment there. But I think that he was also constrained by the global world order, and by the demographics that we talked about within China.

Realizing if they are going to play this long game, and to become a power player, and remain a power player into the future that there were certain constraints that in his calculus must entail that recentralization of control. We saw that even much more I'd say, than under Hu Jintao or previous leaders.

Robert Hansen

I mean, I certainly wouldn't disagree with any of that. I gotta be thinking, if I'm sitting there on the ground. I'm some peasant. He says, “I'm going to stop the purges.” That's gotta mean something to the population. They gotta be looking at him as a bit of a massive shift. We have a lot of globalization. The borders are opened up for the most part.

It was very important in part to recentralize control. Centralize control over an area and a province that's known throughout history to be a bit of a renegade. I think there was a lot of that interplay going on and a lot of fear going on with Bo Xilai. When you say stopping the purges, I don't really know. I don't really see that.

You see a recentralization of media. You see a recentralization of propaganda. Maybe purges in the sense of more Bo Xilai type purges. You saw a slowdown of that in the past couple years. But I think after his initial purging he could afford to slow down on the purges. He'd met his objectives.

Robert Hansen

We'll get back to these purges in a minute because I think this is going to be an interesting one to talk through. But before we do that, let's talk about this 100-year plan. I think it is compelling that they, as a national strategy, have said, “We're going to be the best country in the world in 2050,” which is coming up fast. By some accounts, they're about 20 years ahead of their original plan. So 2030.

That's something we're going to see in our lifetime. We're going to be in the middle of being the second-best country in the world if we play our cards right at this rate. First of all, do you believe that's true, that they will actually achieve this superiority? Do you think those timelines are correct? How do you feel that's galvanizing the country?

Jennifer Richmond

There's this network effect that is very difficult to really know what everyone's doing at all times, and what they need at all times. It’s very troubling to even think of a system that would be able to track that effectively that wouldn't be unbelievably draconian and big brother-ish. Let's start with the China side, and then we'll move to the United States.

How do you feel China feels about capitalism? How do you feel they look at us when they're like, “Well, there are people who can consume as much as they want and they can get as high up as the president if they felt like it or be living in the streets.”?

Jennifer Richmond

Well, when China opened its doors, I mean, in some respects China is as capitalistic or more so even than the United States. I mean, it's really become a doggy dog capitalistic mentality that I feel was pent up from the communist era where everyone had that iron rice bowl. Everyone was brought down to the same level. It's this odd mix of this capitalist mentality but again, with a centralized approach.

The Communist Party gets to dole out those capitalists incentives as they see fit. They pick the winners and the losers. Now, you always have wonderful stories of people coming in from the countryside and starting the Alibabas, and the other, I think, I don't know if it was Alibaba. But one of the big organizations was started by, I want to say, a pig farmer.

Robert Hansen

Somebody’s favorite pig farmer.

Jennifer Richmond

But those stories I think are not common. A lot of it is the Chinese like those stories. Those are great stories. But a lot of it is driven through, again, still, the state-owned enterprises have a lot of control. There's a reason for that because I do believe underneath the Chinese economic model is a lot of fragility. That it's built on a house of cards.

There is that need for continued or the perceived need for continued economic control at the central level. There's a lot of capitalists leaning in there mixed with this odd sense of centralism. This picking and choosing of who gets to be the winners and who gets to be the losers.

Robert Hansen

What about the United States? When college students are out there protesting having less rights, literally, and having more state control over goods and services and means of production. Are they just absolutely totally ignorant of the facts of how that ends up playing out? Or is there something there?

I admittedly, that is I have not kept up with this pretty boy phenomenon.

Robert Hansen

It is crazy.

Jennifer Richmond

It is really interesting. It's not surprising to me, however.

Robert Hansen

Why isn't it surprising? Why does that sound like a rational thing for a country to say, “I’m not going to allow men to wear makeup?” What about newscasters who have to put a little blush on to make sure that they don't get washed up by the camera?

I'm not wearing blush right now, by the way, just for anyone who is hearing this.

The fact that the Uyghurs have their own culture, have their own perception of how they should be governed, that is the threat. Because Xinjiang is so critically important to China's overall global strategy. It is a buffer. That is why more so I would say than the fact that they're Muslim. Or the fact that they think differently or worship a God that might have more authority than the Communist Party. That's what makes them the biggest threat.

Robert Hansen

There's about 10 million Uyghurs I believe. About 1.6-ish, current estimates, are currently in concentration camps. As many as maybe 25,000 of them have organs that are harvested per year.

Because Xinjiang is so incredibly important. There is absolutely no way that the Chinese would let Xinjiang become its own province. No way. They have been assimilating Xinjiang. There has been, much like Tibet, a huge migration of Han into these areas precisely because of the geographical importance of Xinjiang.

I don't know why they chose the tactics that they're doing now, excuse me, over and above mass migration. But I'm assuming that it just worked easier. I don't think that they care too much about whether or not, what the international outcry was. But perhaps putting people in concentration camps is less so than mass migration. I'm not quite sure.

Robert Hansen

Let's talk a little bit about Hong Kong very briefly, just so everyone is familiar with the backstory. Because I'm not sure everyone understands what Hong Kong and its brief history as its independent entity was. But can you briefly talk about the British and how that all happened? Just so we're on the same page. Then we'll jump into what…

Jennifer Richmond

Yeah. Hong Kong, when was it? Was it 1997? For 100 years, it was a part of the Opium War. They allowed the British to stay. Hong Kong was a British territory. The time came up. I want to say it was 1997. My dates might be wrong. The promise was to keep Hong Kong as autonomous. It was the ‘Two Governments, One State’ policy or something along that way.

The reason that that worked for a while was because Hong Kong was a place that Beijing leveraged. I mean, it was a port. It was active. I mean, they themselves put a lot of money and a lot of flow, international trade through Hong Kong. That worked for a while. But the fact that Hong Kong started to again, much like Fulan Gong, much like the pretty boys, started to assert its own autonomy.

That's when they would rather have control over Hong Kong than have it be the economic port or the economic powerhouse that it was. That is more important. The overall government strategy is to keep that unified China whole.

Robert Hansen

The government basically walked into Hong Kong when they were finally given the keys. Pretty much the very first thing they did is start doing a purge. Back to these purges. They found the group of people who were resisting whatever policies they wanted to put in place which were severe. Not unnecessarily death-camp severe, but certainly by someone's freedom loving view of the world living under effectively European law for quite a while, suddenly he's going to be pretty shocked I think by that new set of standards.

Oh, yeah. I just heard about him.

Robert Hansen

So I have an interesting story about Taipei. I was invited there many years ago. I had just come up with a new exploit and was invited over, which is a somewhat typical thing to happen in our industry in computer security. And it was a brand new issue. So it was pretty noteworthy. And later became a much bigger deal. I show up and I'm basically asked by the head of this group to speak.

So he's sort of showing me around and they're putting me at the head of the table, all the things you'd expect. And I found it was a wonderful experience, no problems up to that point. And I'm about to get on stage and it's an Opera house, and he points back behind in the back of the Opera house, and there's all these barriers sort of set up. Sort of designed to push people forward so it looked more full than it actually was. Which I'm not offended by.

If there's 100 people in the audience, I'm probably happy. But there was, whatever, maybe 500 people there or something. So it was a relatively good crowd. And he walks up and says a couple things to me. He's like, "First of all, are you okay if anybody records you?" I'm like, "I prefer not because there's some stuff in the slides that I just don't really want out there yet.

There's brand new research. There's this one particular slide I just don't really want out there. I don't mind if you guys all see it. I just don't want it publicized out to the world." And he's like, "No problem." So a few minutes later, I'm about to go on stage now. I'm like, ready. I'm getting everything plugged in and everything. And he says, "So remember that whole recording you thing, at the back of the stage, back in that area back there, there's some guys with cameras. Do you see him?" And I look back, I'm sure enough there's some people back there with cameras. He's like, "That's the Communist Party.

That's the Chinese. That's the PLA." Something to that effect. And I'm like, "Why don't you just kick them out? I mean, it's your country." He's like, "I can't do that. I'm sorry." So I went on stage and I'd get my presentation. There was one slide I really didn't want recorded, so I did my best to kind of click, click as fast as I could on the slides.

Fast forwarding in the story I went home and there was one particular URL that they would have to hit that was on a server, and I checked it, and it was hit from all over the world. That was definitely widely viewed. That particular, that one particular slide. So later on I was hanging out with this person, and he is sort of the son of the head of their CIA.

So he's very highly placed. And he runs an anti-malware company. And effectively they were trying to solicit me to come work for them. And he didn't mince around. He told me exactly who he was. He wants me to build weaponized malware for him in the country.

So during this conversation, he was talking about China as an enemy to Taipei and how we have a mutual enemy. And he's trying to get on my good graces, which is good recruitment. A good trade craft. So I effectively just kept asking questions like, "Okay, so tell me what's going on?" He said, "One of the things that you don't understand is, this isn't just a matter of computer security. There's this other stuff going on, for instance like SARS V1 at this time."

We have strong evidence that that was introduced into Taipei to test us to see how our pandemic response worked. I'm like, "That's terrifying." And it didn't occur to me that he would be so highly placed that he would get this sort of incredibly confidential information.

Of course, he's the son of the head of CIA, or there CIA. So then, the second part of the conversation, and this gets into my world. He said, "We have it on good authority that the Chinese have approximately three pieces of sensitive information, like PII on every single man, woman and child inside of Taipei. And the reason we know that is because we broke into the system." It's called Million Grades of Sand. "We broke into it and we stole it. Now we've got a copy of it. And now they're able to do the same sort of reconnaissance on themselves and within China."

So this system is not just focused on them, it's focused on everyone in the world. And I have no doubt that we have copies of it in our data centers as well here in the United States if it's that easy to get, especially as we're allies with Taipei or at least sections of it.

So when I was hearing this story, I had to think, well, if I was China, that's exactly what I would do. I would build up the biggest set of databases on every single person. I would go through every single birth record that's publicly accessible. I would find every social media account, and I would just log it all.

I mean, obviously the NSA is going to do the same, and anybody with sufficiently large intelligent agencies are going to start working in that direction. I'm kind of curious how you see the technical sophistication of China. Do you see them going further down the path of sort of stealing as much information as they possibly can on people. As well as what we're hearing more and more is technical information being stolen from various different companies around the world.

Specifically private intellectual property that is maybe not turned into patents yet being stolen and brought into China. It seems like that's part of their doctrine. It's not a dot, dot, we also do this, but this is sort of part and parcel to how they operate.

Jennifer Richmond

Robert Hansen

Well, I think it speaks to if there is sort of an operational dominance in the cyberspace, that if we do have it, we're not really showing our hand. And China has unfortunately, unwittingly been sloppy about their procedures and how they protect the data they do have but the data they have is enormous.

Jennifer Richmond

Yeah. It's enormous. And they have so many more people to be able to collect, to be able to not only collect from an intelligence standpoint, but going back to social media and the way we are manipulated. I mean, they have people on payroll. I'm sure we do too, but I mean, there's just so many more people.

So the original research around getting around it was something like, well just ignore the reset packets on both sides and now you can communicate. It'll keep saying reset packets, but who cares? But one thing that I thought was interesting is there's another way to get the firewall to get angry at you. And that way was, it does sort of deep packet inspection.

So when you make a connection and you use the word Falun or Falun gong, amongst a bunch of other litany of words that we are able to figure out. It basically blocks you for five minutes and you can't connect to that site at all for five minutes. So before I go any further with this story, can you tell us what Falun and Falun gong is?

Jennifer Richmond

Falun gong is not a religion per se, it's really more of a meditative group, artistic group.

Robert Hansen

Kind of like Tai Chi.

Jennifer Richmond

Yeah. Like Tai Chi. But for reasons that I can't really speak to, they generated quite a following. And again, it was this sense that the leader of the Falun gong and his name escapes me, was such a figure that people would follow him over and above the dictates of the Communist Party. And again, like we were talking about before, that's unacceptable.

So when the crackdown came was when they were able to assemble a bunch of people in Tiananmen Square for, again, it was a meditation. It wasn't a protest. This was not a redo of 10 Tiananmen Square. But the fact that they were able to amass that many people and that the leadership had that much control was ultimately a threat. I do not know if there was anything more to it than that simple assessment.

Everything that I've heard, the people that I've spoken with who are followers of Falun gong, it really is nothing. To them it's really nothing more than a meditative and lifestyle way to lifestyle. Organize your life in a more spiritually uplifting way. So again, like you said, Tai chi, maybe even yoga.

Robert Hansen

Which does have deep cultural roots. There is a religious aspect to it. Some spirituality associated with it. And that might have been partially the driving force for seeing it as a threat.

Jennifer Richmond

But other than that, if there was more to it, if there was some, you know, kind of insidious plant within the Falun gong that was a provocateur foreign agent. I don't think so. It was simply that power that was, again, it didn't fall within the hierarchy that was comfortable for the Chinese Communist Party.

Robert Hansen

So part of the security research I did was how to leverage the great firewall against itself. So if you could effectively cause machines within China or outside of China to make arbitrary HTB connections, just blindly throughout the internet as fast as they possibly could, looking for Falun to every single IP on the internet, effectively the entire country would shut itself down. Which is a kind of a fun little hack. And then, the code fits in a tweet.

It's actually a very small piece of code. I gave that presentation many years ago now, and coming out of it, one of the people stopped me and he's like, "Are you worried that you're going to get killed?" And it wasn't one of those, like, "Is this sort of a fringe thing? You really think that?" It was more like, "I think you're going to die. You really need to stop doing what you're doing, because that is really dangerous research you're doing."

Which is the first time I've ever really had that sort of chilling effect related to the research I was doing. And I've done some pretty intense research. North Korean research and so on. Stuff that was used in the Green Revolution, but that in particular really kind of blew my mind. But later on, several things happened. Number one, people started using HTTPS pretty much everywhere.

So the utility of them keeping that filter on for any length of time, if they ever saw it acting up goes to zero. I mean, they're not going to be breaking the bulk of the internet. Google Chrome started using HTTPS everywhere. So it effectively made it very difficult for that to be a useful viable tactic. So what we're sort of left with is Sesame credit.

So Sesame Credit is the next generation firewall, but instead of it being a technical control at a network level, it is designed to get people to obey the regime. And very similar to our credit score and our ability to pay back our debts and basically make sure that we're credit worthy. This is the sort of credit worthiness or how reliable are you for the regime? How closely do you follow the rules of the regime?

So there are some examples where, if you buy baby food and dishwashers, you get a higher credit score. If you buy comic books and play video games, lower credit score. But that's sort of, I would say already that's terrible, but it gets worse. So the first level it gets worse is now they're going to tie it to who you're friends with.

So let's say you and I are friends and we are having this conversation. Let's say you were living in China and you had no other negative affiliation with China. Never said a negative word about it, but you and I are friends and I have said something negative about it. Now you, because you're implicated with me, get a lower credit score and people around you are going to get a lower credit score because they're friends, friends with you, and so on and so on.

So this is a network effect. And you can see this is all open data. This is not closed. So you can go see where everyone is on this graph. So that immediately makes people want to chill and remove themselves or go over and beat that person up until they get back in line. So that's one level of terrible. And by the way, the ramifications of that for anyone who doesn't know about this are, you can't leave the country. You don't get jobs. You can't use public transportation. You can't get a loan. You can't buy a house.

A bunch of really terrible sanctions on you. Basically, making it so that you die in an alley somewhere all alone. So no one wants that, that would be bad. So they're going to comply. So that's sort of the first level ring of bad, I would say.

But much bigger and a much wider ring. Actually a brief aside, I was looking at the Canadian government website around their view of sesame credit, the Chinese social credit score, and they said it's going to have implications for Canadian business and certainly all businesses elsewhere who do business in China. And their reason for it was the flexibility of the government to change, arbitrarily change law.

They can go in and say, well, this type of business, being in the pretty boy business, selling makeup for men, where you are just carved out of society. You get a negative credit score if you're involved. So you can very quickly remove entire lines of business out of China just by fiat, by saying this one type of thing is not allowed anymore. I thought that was very smart of them to put something out like that.

It was a little bit more obvious but it didn't go anywhere near far enough. Not even close. The real problem is China now has the ability to finger point anybody outside of China so they can have an effect. Let's say I'm a CEO living in the United States, minding my own business, but I do some work in China. Now I can have somebody within China saying, "No, I can't work with you anymore because of this thing."

Canadian's guidance, and this was kind of terrifying, is you should work with people inside China who understand the local laws and can tell you what you can and cannot do. So clearly that's going to be part of the PLA, some government agency within the Communist Party. That means effectively China has now gotten in control of any company that does business in China. How does that strike you?

Jennifer Richmond

Again, absolutely not surprised. You called it the sesame?

Robert Hansen

Sesame credit.

Jennifer Richmond

Sesame credit. That was a new word for me but I absolutely understood the social credit that they have started to implement. There have been incidents that have not been publicized that we've had to look into. And this again, was years ago where local authorities would literally blockade a visiting CEO into their office space when they came to visit and not let them out until certain demands were met.

So absolutely, I see that that is the next trend. Of course it is. So this has been ongoing for a while now. It's showing up in this new way through the credit score or credit system. But again, I think that it will really depend on the value that that foreign company foreign CEO has to the Chinese government.

And if the value is great enough, then they will watch them, but they will override anything that might show up negative. If you are just your average, say, button maker looking for a factory in China, and you've got something negative or you've spoken poorly of China in the future. Oh yeah. I mean, you're out. So it really, it will depend on the value of the organization to the Chinese Communist Party.

Now, here's something we haven't talked about, and it's tangential to what you're saying, but it's a trend that I've been noticing, and it's not a new trend, but it's one that you don't hear about that much. And this goes to the discussion of China's economic heft. A lot of corporations are starting to realize that the benefit to working in China is not as great as the cost.

And we have seen large organizations moving more to, particularly, we're talking like in the automobile industry and whatnot, moving more to Mexico. So I think you are seeing, it's not a mass exodus, but you are seeing an exodus. And China is going to need to weigh at some point, I believe, where they draw the line. China's economy is still largely predicated on exports.

I mean, that is going to be of great importance. Either they are going to have to fill in those exports from domestic companies, but then they don't have the investment. But again, I don't know that that matters to them because they'll just invest in themselves with the SOEs.

So I know that that was a bit of a tangent. I don't think that is a trend that doesn't surprise me. I think they will continue to move along. Some of the areas where I would see that trend or the government not paying as much attention are particularly in the areas where they can get technology that they need and allow, that's in the medical spaces. So it's not necessarily the high tech technology.

Well, it is high tech technology, but not something maybe that would be sensitive to a country. But that's a lot of the areas where I've seen a lot of continued and robust interplay is in medical fields because that's a priority to the Chinese government.

Robert Hansen

It should be. They've had very poor healthcare for quite a while, for a wide variety of reasons. So one other trend that I thought was kind of interesting was the Communist Party seems to want to have a stranglehold on the security industry, my little chunk of the world. And they've actually gone to the point, there was a new vulnerability late last year called Log4J that affected a lot of companies. This is not like a little issue.

This is tons and tons and tons of companies are affected by. It's a little thing within Java. So apparently, it was invented by somebody at Alibaba and they got a very large slap on the wrist from the Communist party for releasing that to the public internet instead of releasing it just to them.

Jennifer Richmond

Can you explain a little bit more, or maybe I'm interrupting you because I'm not quite sure. No, just this development. I'm unfamiliar with it.

Robert Hansen

Well, effectively somebody within Alibaba came up with a new exploit, which is a very common thing within companies. I'm working on something and then you kind of go down a rabbit hole, you find a vulnerability. In this particular case, they just released it to the public internet. They put it out there so everybody could have equal access to it.

And of course, it's very easy to exploit and it got weaponized and now it's being used all over the internet and I'm sure a lot against people inside China as well. So it's not just outside of China. Everybody, China included, got affected by it.

So instead of just saying, “Well, that was great research, thank you for doing it,” or “That's dangerous research, but you should come work for us.,” they actually went fully and slapped, basically sanctioned Alibaba because of it.

I think this is another example of where that centralized authority actually gives them an enormous amount of control. There was a senate hearing about China today as a matter of fact. And they were talking largely about how there have been a number of hacking contests.

One is just in China, and there's another one that's globally. And the one that was in China, they found something like 37, I believe I might get the number slightly wrong, vulnerabilities good, payable-type vulnerabilities.

What they were after, the global one found something like 20. Just within China, they've dramatically increased their capabilities. Now, none of those vulnerabilities they've found made it to the public internet. They're all owned by the Chinese government.

I think the centralized control thing is very interesting and it does provide very strategic advantages in certain cases, that being one of them. I also think another version of that would be the various different chat software that we're seeing coming out of China. Zoom for instance, TikTok, et cetera. WeChat.

Robert Hansen

Well, I don't think Alexa will be particularly upset with you, but I get upset. My friends always think that I'm spying on them. So very rarely, by the way, do I do that. Only special occasions. So I think another example of this is companies like Huawei. Did I pronounce it wrong?

Jennifer Richmond

Just slightly different.

Robert Hansen

All right. I'll do my best. So it's funny, I was talking with a Gartner analyst, I don't know if you're familiar with them. They're an analyst company. They tell you which products are good or bad or whatever. So I was at this conference and I was saying, "Well, I think that they're going to have a hard time with it. I think people in another two or three years you'll still be hearing issues about national security in Huawei And he's like, "No, they'll be fine. No one will care. They'll be completely fine." And I'm like, "I'm pretty sure."

And he was adamant and I'm like, "I'll bet you a dollar." I think it was three years to the day that the United States banned them outright. And now they're definitely front page news. Apparently they believe they lost something like $13 billion by not being able to sell US handsets. Because they also sell handsets as well as firewalls and routers and switches.

But that's the kind of company where it's very easy to buy a low-cost phone. It is very easy to buy a low cost firewall or switch or whatever. I don't think your boss is going to get particularly upset as long as you're the one managing it, right? But we really don't know what's on any of these devices. We really don't have any guarantee.

That's new news to me. So I'm just, again, kind of spit-balling here. I think that that plays into the strategy though, to create fear internally within the US so that if they're targeting conservatives, I would say, “They’re watching you." But not us, not us being the Chinese. It's like you need to be careful of your information from your own countrymen, women, whatever.

That's a pretty slick strategy to make people more fearful. And again, I'm guessing this is new information to me, but it goes back to the sense that a fearful nation is a nation that is more pliable.

Robert Hansen

When this information did come out, it was interesting to see the comments when people were talking about it. And one of the naysayers was like, "Well, why would having it in the United States or anywhere else be any better?"

And I actually had kind of a hard time answering that question because it's a valid question. Why would he trust the United States, over China, over Russia, over any other country? Because maybe it's exactly the United States who he disagrees with their policies because this person might be protesting on the street looking for communism.

All I could really answer without trying to interject any feelings about the matter, is you have to pick whichever side you have the least amount of concerns with getting in complete control of you and your data.

Jennifer Richmond

Or the side that is the most easily manipulable because they're not looking at, I mean, yes, the conservative party might be the one that's fighting more against communism, but to the extent that this generates fear internally and does so pretty well.

Again, they're not so concerned. China doesn't care whether or not we choose communism or not. They care whether or not we come after them or we thwart their expansion, et cetera. They really don't otherwise care.

I'm sure he understands, there's something called shore's algorithm that would effectively allow a quantum computer to break classical encryption. The effect of that means that things that rely on encryption to work things like cryptocurrencies, things like you connecting to your bank. Things like you and your cell phone trying to connect to your home entertainment system, all those things over SSL TLS and all of them would suddenly be visible and decryptable by the Chinese government if they had access to this thing.

It is a super weapon. He is not overstating it. It would absolutely cause, if it was available to him and in whatever way he wanted to use it, every single piece of sensitive information that the government sent over public internet that wasn't behind a skiff or behind a firewall would suddenly be accessible. And even that stuff largely would be accessible because of spies and people who break into things.

This is definitely one of the most groundbreaking pieces of technology that doesn't yet exist, or at least we don't think it exists. But the people I know who spend a lot of time thinking about this think that it's a year or two away, which is way faster than the public media is saying. They're saying more like five to seven years. If that were a weapon in his arsenal, the opportunities are effectively boundless.

I mean, it's really just a failure of imagination to say he couldn't do X, of course he could. He could do whatever. And really the only things that would still be secure are things that use one time pads, where you don't have either access to either pads or stuff that, like I said, that they just don't see. If they don't see the traffic, they can't intercept it.

They've invested very heavily in this and artificial intelligence in a number of areas that are sort of similar asymmetric warfare type things. Cybersecurity being another one; it seems to me like if this were to happen, we really don't have anywhere to hide.

Like all of our secrets are now out there. And what is a society without its secrets? I would like you to actually answer that question. What do you think the United States would be if we had nothing that was private anymore? Do we even have a civil society? Is the United States even capable of running?

Jennifer Richmond

I mean, secrets in the sense of going back to like intelligence in the CIA, but I mean that sense of privacy just even at the individual level, no. I think that that's absolutely an individual right that if it is taken away, you will have some sort of mass chaos.

I don't want to overplay this analogy, but I really do feel that this is another reason why, among the fact that we are susceptible to division because there are things that are divisive internal to our country and national dialogue. But I do think a lot of it is, it has opened us up to manipulation. And I think that's one of the key strategies, is that manipulation so that we aren't.

And not only are we not paying attention to it as individuals, but as governments, we're just trying to put out fires, little fires here and there, versus some of the bigger fires that we should be paying attention to. And I can only hope that our government is having these conversations, they're just not making it to the mainstream.

Robert Hansen

Let's hope. One of my more conservative friends has an idea, which I'd love to get your take on. One of the pressure points that the United States has not leveraged is the Chinese students that are here. We could very easily select, basically put them all on a registry, which already sounds terrible. But this is his plan, not my plan.

Take like the first 100 or whatever, and say, you must, say disavow China, we're going to give you a script, or you can write your own or whatever. We're going to videotape it, we're going to put it on this thing, or leave. And do this specifically for anyone whose children are part of the Communist Party. Not just any random person. And very quickly we would find, this is his opinion, we'd find that one of two things would happen.

Either they would say, "See you." And they'd all leave because they just don't want to do that. Or they would say, "Okay, yeah, I do want to stay." And that puts them in some pretty hot water. But it also allows us to start applying pressure, because now we can see that the bulk of the Chinese Communist Party's goal, of the people who actually work in it, is to have their children go abroad and learn and be part of society, whatever.

If they get expelled from the United States and possibly other countries as well, following a similar doctrine, it would be very difficult for them to stand up and say, "Yeah, I'm part of this party." They would say, "No, we’ve got to start playing ball." Not necessarily leave the party, but we can't have our children not able to work in the United States. What do you think of that? I mean, I realize that's just about the craziest thing I've ever heard.

Jennifer Richmond

Jennifer Richmond

And again, I don't see that flow of students to the United States, first of all has trickled. So, there's that. It wouldn't be that effective of a policy because there's not all that many. I see, if it were something where they said, "Okay, you just can't be part of the Communist Party." This is like contracts in China. "Okay, I disavow the Communist Party." Write it on paper.

But you know, that doesn't mean you've disavowed the Communist Party. A lot of people who came earlier that I'm familiar with, who were part of the Chinese Communist Party, their objective was to take this information and to go back to China and start businesses and whatnot.

So you're going to say if you're part of the Communist Party, even if you're not a spy, you can't go back to your country to start a business with the degree that you took from Harvard. I mean, that's McCarthyism. That's too much of a slippery slope.

Robert Hansen

I wasn't particularly a huge fan of it myself.

Jennifer Richmond

I'm trying to think of other things that might work.

Robert Hansen

No need to come up with it here. I just wanted to get your brain working on it.

Jennifer Richmond

I mean, we've got enough witch hunts going on.

Robert Hansen

I think what I'm starting to narrow in on what I'm thinking about specifically China and Russia is, what I'm calling now Cold War II. Which I really wish I hadn't come up with something so catchy.

There is a TV show called Cold War II. I did not come up with it, I'm not the first person to ever say it. But I think in this context it really makes a lot of sense. We're right back in the Cold War all over again and hopefully it stays cold and casualty count stays low.

One of the Chinese doctrines is called Shi. Don't know much about it, so maybe you can educate me. But it's effectively the idea that you have to get your incentives aligned. Because one thing they found, I guess probably right after World War II, is their alignment with Russia was not particularly great. And maybe that ended up working in their favor by virtue of aligning themselves with us.

Although again, that is not with more, the cheap consumer goods, but more like the automobiles and some of the larger textile or companies as well are starting to move out of that. International trade fuels as well as printing money, that's another thing that the Chinese do.

Though fuels the drive to generate the economy, to generate all this kind of tech exploration and whatnot. there's still a reliance on the United States that I think that while they're taking advantage of the United States, pulling back from the international scene. I think that China's strategy would not be so bold as to completely overturn that relationship and that dynamic.

Robert Hansen

Gary Kasparov, the famous chess player said that, I'm paraphrasing poorly, but he said something like, "If you're playing chess against Russia, they're very belligerent. They're going to go right for your queen. They're going to, they're going to try to take you out immediately." China is the very long, work around the edges, and death by a thousand cuts and finally get there.

The United States can't pick one. We have to do both. We have to know both strategies and be playing both games at the same time, sort of a 3D chess. I think that that puts us in a pretty precarious position, especially in a Cold War II environment. Where we have two very strong superpowers. It's not like the first time around.

This is much more aggressive on both fronts and much more powerful on both fronts. I think multiple different ways, despite the fact that Russia has now broken up in some ways, they're more powerful the way they are now.

I'm sort of curious how you see the future of the United States and how we are sort of dealing with them, and ultimately how you see the parallels between how communism sort of grew up inside China. And what's happening right now where authoritarianism seems to be rising within the United States. It's like we're all sort of becoming mirrors of one another in a very strange way.

Jennifer Richmond

And I do think that if the trends within the United States of the rise of authoritarianism, we will not be able to really counter not just China or Russia, but the combination of the two. Both of which would be very happy if the United States continued to fight internally. But you're absolutely right. There's two completely different strategies. The only saving grace if things were to go completely off the rails or not the only.

Jennifer Richmond

With everything that we talked about, with my information on China and where I saw China become so centralized and become so authoritarian, I saw these trends starting to surface in the United States. And some of what we've already touched on as well is like these affection towards communism and other systems that tend towards authoritarian rule.

I started to apply everything that I knew and everything that scared me from what I knew about China, and put that lens, focus that lens here on the United States. I'm doing several things along those lines. I started my own Podcast. Hold My Drink Podcast.

Robert Hansen

Sounds like a very good podcast.

Jennifer Richmond

Yes, thank you.

Robert Hansen

Despite the drunkenness.

Jennifer Richmond

Just a drink here and there. Just greasing the wheels. But started because we've become so polarized. And there's many reasons for that outside of China. Like I said, in Russia.

I think we are being exploited by China and Russia, but the polarization is for reasons that are a lot internal including the way we use or misuse social media. Including the way traditional media has become more polarized as well in the sense that, most media tended towards the center because you'd have the big advertisers.

I'm having a noun failure here. Subscription model, right? So then, advertisers create niches. And so then, you have more polarization within actual art, mainstream media. You've got kind of the Fox news and the MSNBC.

And so advertisers that used to kind of control in a way the messages mm-hmm and the messages, therefore had to be more neutral. Now, you've got the more conservative advertisers with, you've got outlets for them so they can kind of still have the same spread.

Robert Hansen

Some of them are Chinese communists.

Jennifer Richmond

And we feel like that's what's been missing in our dialogues with each other and that's what's been one of the reasons that we have created this polarization in the first place, is that we live in this society. I already mentioned before you've got the social media, you've got the political sectarianism, but our egos haven't really been fully formed.

Our ego was there meant to save us when a saber-toothed tiger was coming our way. It's the fight, flight or freeze effect. It didn't evolve to really take in account the current Twitter sphere that we're in. Where a few words, it sees that as a threat much in the way you see a tiger, in saber-toothed tiger.

We have now assumed mere discomfort actually is a physical threat. And so again, that primitive part of our brain, the ego hasn't evolved to address modern society. And that is one of the ways that we think that there is this polarization. There's an attempt in applying moral courage to hear and not fear different viewpoints.

One of our big premises of moral courage, moral courage College and the Moral Courage Project is really to teach viewpoint. Is diversity without division. Much of diversity itself is one of the areas where we see us coming apart in fraying. The talk about diversity, equity, inclusion, how it's applied in schools, how it's applied in colleges, how it's applied in corporations. And what we've seen is there's been more division as a result.

we're taking that model because we do believe, this is one of the things that I think, and this is me talking personally that makes America so great, is its diversity. That's why I was cautioning against your friend's conservative view of what we should do with Chinese students coming in. I love that idea of diversity because we've got so many different ways to think about the world and to solve problems.

Where, if you're looking at more homogeneous countries like China, the way the Chinese education system that I do think lacks innovation and a lot of the innovation comes from taking innovation from other countries and then using that, perhaps even better than the original countries. I love this idea of diversity, but I fear the way we talk about it today is driving in many ways a lot of division.

This idea is moral courage is diversity without division. And where it adds to traditional diversity initiatives is it goes beyond demographic diversity to viewpoint diversity. It's like what we're talking about here is this kind of tribalist tribe of dissidents who are willing to question and to hear, again, know, repeat, hear, but not fear and have these hard conversations that we need to be having if we are to survive these external threats.

If they are to arise that you and I are discussing here, specifically with actors like the Communist Party of China. And I want to go back though and reiterate what we started at the very beginning, when we are talking about China, we aren't talking about the Chinese people. We're talking about government objective world domination or global supremacy.

Robert Hansen

Every country has their checkered past, US definitely included.

Jennifer Richmond

We all do. And the United States has been doing a lot of naval gazing lately. Some of it for good reason. I mean, some of it, some people would argue that we have not addressed our checkered past appropriately and that we need to revisit it. I'm not arguing that at all.