CCP ‘Creating an Empire’ Exploiting International Financial Systems: Rep. Lucas

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‘The Chinese operate by different standards than the rest of the world,’ says Rep. Frank Lucas.

Communist China is exploiting international financial systems and engaging in predatory loan schemes to unfairly advantage itself, according to one congressman.

The Chinese Communist Party (CCP) is creating economic dependencies to ensure nations worldwide cannot break away from its influence, Rep. Frank Lucas (R-Okla.) said.

“The Chinese operate by different standards than the rest of the world,” Mr. Lucas said during a Feb. 5 talk at the Hudson Institute, a conservative think tank.

“[They’re] creating an empire reminiscent of the colonial period.”

Mr. Lucas said that the regime was granting “lavish” spending terms for loans to authoritarian and underdeveloped nations, whom he compared to the victims of a loan shark. In many instances, he said, the regime knew that the recipients of such financing would not be able to pay and would be subject to stringent terms further indebting them to Beijing.

To that end, he said, the regime had effectively fused its communist political ideology with a one-sided, “mercantilist” international economic policy.

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“It looks almost like the colonial model,” Mr. Lucas said.

“[But] It’s still an old Marxist, communist political system.”

China Could Be Ejected From Global Institutions

For CCP leadership, Mr. Lucas said, “blackmailing” was “just the pattern” of business. To counter it, the United States should work to limit the regime’s power over international financial institutions.

To that end, Mr. Lucas sponsored the PROTECT Taiwan Act, which was signed into law last month. That bill would direct U.S. leadership to exclude CCP officials from financial and intergovernmental forums if the regime attempts an invasion of Taiwan.

To participate in international institutions, he said, the regime should be required to behave more responsibly.

“They have benefited from our open society,” Mr. Lucas said. “If they’re not going to be a part of our open society, they should not be able to benefit from the chaos that they bring.

“It’s been contrary, it would seem to me, to the best interests of most of the planet.”

Similarly, Mr. Lucas said that the CCP unfairly advantaged itself by manipulating international prices in its favor. In one example, he noted how the regime stockpiles vast quantities of cotton, which it can release or hold at any time to effectively control the price of its imports.

One solution to that problem in high-tech sectors would be blanket tariffs or restrictions on U.S. exports to China.

Mr. Lucas said that such action was a highly contentious topic in Congress, however, and would not likely be legislated any time soon. For his part, he said he was opposed to sweeping restrictions on investing in China.

“I believe that international trade is in the benefit of everyone,” he said.

“If you’re foolish enough to send your money, you should be able to do it.”

Beijing Seeks Leverage Over US Research

Another key area of concern, Mr. Lucas said, was the regime’s efforts to gain financial leverage over American institutions of higher education.

The CCP has long exploited the American university system, providing large amounts of funding and using myriad talent programs to send its people to be trained in the United States with the requirement they return to China and help develop state programs, including in the military.

The regime’s nuclear and hypersonic missile programs have both directly benefited from such programs.

To that end, Mr. Lucas said that Congress was working to help research institutions balance their funding sources and to help them “change the culture” that has fostered dependencies on China.

“There will always be a need for additional scientists and engineers and mathematicians and technologists,” he said.

“We’re working hard to get their attention, and I believe that we have.”

More broadly, foreign funding at American universities has become a topic of concern in national security circles since a 2019 Department of Education investigation found more than $6.5 billion in previously unreported foreign gifts to American universities.

Many of those gifts were made by entities with ties to adversarial powers, including China, Iran, and Russia.

“We’re dealing with a porcupine, and we’ve got to be real careful when we hug it,” Mr. Lucas said.

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