In which we hear from Mike Pence, and others

The former US VP speaks at the UBS Wealth Insights summit in Hong Kong and calls for the release of Jimmy Lai…

One of the charges against Mr. Lai is an allegation that he met with the then-VP in 2019 to lobby for U.S. sanctions. Mr. Pence denies it. “Jimmy Lai did not ask for U.S. sanctions or any action against Hong Kong or China,” he recently told us. If Mr. Lai is being prosecuted for proximity to Mr. Pence, are the business leaders at this week’s summit at risk?

Marco Rubio, nominated to be the next Secretary of State, said in his confirmation hearings that Beijing has broken all the guarantees it made to Hong Kong. The big question for the city is how it can claim to be a global financial and trade center when it holds political prisoners and can confiscate a newspaper from its owner without so much as a court order.

The authorities encourage conferences to send a message of business as usual. They are helped by prominent speakers who show up, offer platitudes, and collect fat speaking fees. Mr. Pence opted instead to speak a hard truth on Hong Kong soil. The Chinese and Hong Kong governments would do well to put aside their irritation that he did so.

Pence follows with a stopover on the way home…

The news outlet cited a source familiar with the matter as saying that Pence decided to add the stop in Taipei to “see for himself.”

Pence also wants to remind Taiwanese that the US is an ally that “won’t allow what’s happened to Hong Kong to happen to Taiwan,” it added.

The Human Rights Watch 2025 report section on China contains quite a bit about Hong Kong…

After the SNSO came into effect, police arrested six people in May, including prominent activist Chow Hang-tung who is already imprisoned, for allegedly publishing “seditious” posts online to commemorate the 1989 Tiananmen Massacre. Three people were sentenced to between 10 and 14 months in prison for “sedition” for wearing a T-shirt, making online posts, and drawing pro-democracy graffiti on buses. The Hong Kong government used the new powers under the SNSO to revoke the Hong Kong passports of six exiled activists and to deny political prisoners early release for good behavior.

In May, three judges handpicked for national security cases convicted 14 activists and ex-Hong Kong lawmakers of “conspiracy to commit subversion” in the city’s largest national security trial to date, with 31 other defendants having earlier pleaded guilty. In November, the court sentenced all 45 to prison terms ranging from 4 years and 2 months to 10 years.

At least 304 people have been arrested for allegedly violating the National Security Law, the SNSO, and the now-revoked “sedition” law since 2020. Among the 176 individuals charged, 161 have been convicted. According to police figures, 10,279 people have been arrested in connection with the 2019 pro-democracy protests, among whom 2,328 “faced legal consequences” including conviction, many for non-violent crimes like “unlawful assembly.”

Press freedom declined further. Media tycoon Jimmy Lai’s national security trial, which began in December 2023, is ongoing. The 76-year-old Lai has been held in solitary confinement since December 2020. In September, two journalists of the now-defunct Stand News were sentenced to 21 and 11 months respectively for “sedition.” That month, the government denied work visa and entry into the city to an Associated Press photojournalist who took photos of Jimmy Lai in prison.

From HKFP, a good backgrounder on PORI – the polling group led by Robert Chung and recently raided by NatSec Police…

With dozens of civil society groups disbanded and large-scale protests [and, you could add, democratically elected lawmakers] disappearing since Beijing imposed a national security law, PORI’s polls are among the few remaining indicators of the public’s views on societal issues.

For example, a survey in October showed that those who did not want children cited the city’s education system, political environment and living space as the main reasons for remaining childless.

…State-backed media have long portrayed POP and PORI as an “anti-China” organisation that fabricates survey results to rally the opposition. One of the earliest criticisms of POP was that Robert Chung in 2004 received funding from the National Democratic Institute, an American NGO, to conduct a survey relating to the Legislative Council elections that year.

In 2015, an op-ed in Wen Wei Po suggested that POP’s survey outcome indicating that the majority of people supported the 2014 Occupy Central movement and wanted universal suffrage was false, and sought to doubt on how the research was carried out.

…Beijing-backed media have also been critical of the long-running PORI polls asking respondents about their sense of identity… In a Dot Dot News op-ed last year, the writer said PORI had used the question of asking people if they identified as Hongkonger and Chinese to promote Hong Kong independence.

“Naturally… people respond that they are a Hongkonger… PORI’s conclusion is that most people do not think they are Chinese, thereby openly supporting Hong Kong independence and localism,” the op-ed read.

Paul Krugman is pessimistic about China…

…China isn’t really retrogressing technologically; in fact, it has shown an impressive ability to compete on fairly advanced technologies. What these [total factor productivity] numbers probably reflect is a combination of massive amounts of wasted investment, especially in real estate, slowing progress in the economy outside sectors the government favors, and a general crackdown on the private sector.

…What’s remarkable is that China’s leadership seems completely unwilling to adjust to this changing reality.

As you can see from the chart above on investment shares, China hasn’t moved at all toward the kind of lower investment, higher consumption economy it needs to become. Instead, investment as a share of GDP has gone even higher, thanks to government policies that both fueled a monstrous real estate bubble and pushed investment in government-favored industries even when they already had excess capacity.

A recent report in the Wall Street Journal laid this failure to adjust squarely at the feet of Xi Jinping. Xi clearly distrusts the private sector and wants to strengthen central control; he also has views about consumption — which ultimately has to become the economy’s main support — that sound like a cross between German ordoliberalism and Tea Party conservatism:

…China may be only middling in terms of per capita income, but it has so many people that it’s an economic superpower — and by all accounts Xi is obsessed with expanding China’s power, economic and otherwise, in ways that would never occur to the leader of a smaller nation.

Former Jimmy Lai deputy Mark Simon thinks Trump will make life much harder for Beijing…

Maybe the CCP will continue on the same path they’re on now; belligerence, and a complete disregard for the interest of other nations.  I think Xi would like to continue on their destructive walkabout throughout the world.

But I don’t think that’s gonna be the case with Trump and a team of China Hawks now in the White House.

I fully expect Trump to drive the CCP crazy with his offers of great deals while at the same time smacking them around like a redheaded stepchild. I am convinced, after talking to many people over the past four years that Xi and his top folks loath Trump. That dislike of Trump is also probably what drove them in large part to their wishful thinking about a Harris victory.

There’s a lot of people making predictions about what China is gonna be doing in the next year. We are a few days away from a new president. My suggestion would be if you were making a prediction about what was gonna happen based on pre-election metrics, the Chinese thinking they would be opposite Harris, you might want to reconsider your conclusions.

We’ll see. I suspect the Chinese leadership will find it pretty easy to get Trump to give in on export controls, tariffs, TikTok, Taiwan, etc.

(Must say, I’m impressed by Trump’s pre-inauguration issuance of a cryptocurrency. Perhaps the most breathtakingly cynical of his scams yet. Are there people dumb enough to buy it and let the insiders cash out in a big way?)