In another broadside against the People’s Republic of China, a top official in President Trump’s State Department last month urged American universities to divest their endowments from Chinese-owned corporations; to closely monitor or shut down on-campus activities that promote Chinese propaganda; and to protect research centers from Chinese theft of intellectual property.
This followed the President’s attacks on the Chinese communists for releasing and then covering up the threat from the Wuhan coronavirus. Also his trade war, with huge tariffs on China’s exporters, has caused the Far East nation great pain.
And regarding investments, a special working group of the administration’s top financial regulators, led by Treasury Secretary Steve Mnuchin, recommended the Securities and Exchange Commission impose stronger transparency rules for foreign companies that are listed on American exchanges. The step was primarily directed at China, whose companies’ financial disclosures are opaque.
This followed a decision by the Department of Labor in May to reverse plans to place some retirement funds for government employees and U.S. military veterans – the largest in the world – into an index with a strong representation of Chinese companies. Trump’s allies in the Senate have echoed the calls to disinvest in China.
With regard to the universities – whose collective endowments undoubtedly sit on trillions of dollars – the State Department official also warned that Chinese firms listed in the United States may not be as stable as they represent themselves to be, and that China’s hostility towards America and its human rights abuses at home are bringing a reckoning via U.S. policy. If those firms don’t respond with stronger transparency measures in line with standards that American companies must follow, they will be delisted from our exchanges.
“Boards of U.S. university endowments would be prudent to divest from People’s Republic of China firms’ stocks in the likely outcome that enhanced listing standards lead to a wholesale de-listing of PRC firms from U.S. exchanges by the end of next year,” warned Keith Krach, the State Department’s undersecretary for economic growth, energy and the environment, in the letter to directors of U.S. universities and colleges. “Holding these stocks also runs the high risks associated with PRC companies having to restate financials.”
The advisory, of course, was taken as a threat by one of the Chinese government’s top propagandists.
“Putting up obstacles for such cooperation does not serve the interests of our capital markets,” said China’s foreign ministry spokesman Zhao Lijian, according to Bloomberg News. “We urge the U.S. side to create a fair, just and non-discriminatory environment for Chinese companies’ investment in the U.S.”
Zhao is the Chinese official who suggested in March that the U.S. Army “brought the (COVID) epidemic to Wuhan.”
“Be transparent!” he tweeted. “Make public your data! US owe us an explanation!”
The Trump administration’s demands for transparency follow the National Legal and Policy Center’s efforts in recent years to hold American companies, institutions, and politicians accountable in their dealings with the Chinese. And it is the focus of a new project and website NLPC has established, Freedom4China.com. The first initiative under the endeavor is to call attention to the hypocrisy of the National Basketball Association and its biggest star, LeBron James, which have immersed themselves in social justice virtue signaling about alleged “systemic racism” in America, while ignoring the obvious human rights abuses of their business partners in communist China.
And NLPC has also called attention to investment inconsistencies by the world’s largest investment manager. In May NLPC President Peter Flaherty wrote to BlackRock Chairman and CEO Larry Fink, asking the firm to divest its customer’s money from the 137 Chinese companies currently listed on American stock exchanges. Fink has led the way in the investment trend of prioritizing so-called environmental, social and governance (ESG) goals above financial returns for their customers – while at the same time ignoring the injustices perpetrated by the China-controlled companies that it invests its billions of dollars in.
For years now NLPC has also called attention to double standards applied by hypocritical big tech companies – mainly Apple and Google – whose corporate leaders attempt to moralize politically against Trump policies at home, while remaining uncritical yet cozy with the ChiComs.
Finally, universities’ involvement with the Chinese are also part of NLPC’s agenda. In May the nonprofit watchdog filed a complaint with the U.S. Department of Education requesting that it conduct a full investigation into the University of Pennsylvania’s failure to disclose the source of millions of dollars of donations from China since 2013 to the university and its Biden Center for Diplomacy and Global Engagement, as required by law. The center is one of several organizations that Democrat presidential nominee Joe Biden founded since leaving at the end of the Obama administration in 2017, including the domestic policy-focused Biden Institute at the University of Delaware and the Biden Cancer Initiative, all launched the same year. All three entities have refused to reveal the sources of their funding.
America has had a blind spot for too long towards how China has infiltrated and harmed our politics, culture, and public health. NLPC is glad that top leaders in the federal government have joined it in renewed scrutiny of the Communist regime.