Two of the last three American ambassadors to China, and the son of the third, followed up their stints in Beijing by signing lucrative deals with Chinese state-backed companies or firms, Peter Schweizer details in his new book Red-Handed: How American Elites Get Rich Helping China Win.
Gary Locke and Max Baucus, who served as top diplomat to Beijing under President Barack Obama, and Terry Branstad, who served in the role under President Donald Trump, all maintain public stances in media and commentary that oppose limiting the Chinese Communist Party’s access to the American economy. Each, Schweizer details, has a distinct relationship with the Chinese companies that stand to lose from policies meant to keep China from using its money to influence America’s elite. Several of the companies in question have been accused of enabling the Chinese regime’s human rights abuses.
Locke was governor of Washington before entering the Obama administration. The lowlight of his tenure as ambassador to Beijing was the Chen Guangcheng fiasco. The “barefoot lawyer,” as Chen is known, fled to the American embassy seeking asylum in 2012 after years of advocating against China’s policy of forcing women to kill their children, born and unborn, in the event that they were “illegally” pregnant after having one child. Chen, now a U.S. citizen, would later accuse Locke’s embassy of pressuring him to leave and go back to China, facing potentially fatal consequences for his human rights advocacy.
Chen’s mistreatment at the hands of the Obama administration in part led him to speak in support of President Donald Trump at the 2020 Republican National Convention.
Red-Handed offers some insight as to why, perhaps, Locke’s embassy appeared so hostile to a Chinese dissident. Prior to becoming ambassador, Locke worked for a firm that, as Schweizer recalled, “did significant business in China.”
Locke returned to the firm, David Wright Tremaine, when his ambassadorship ended, to work in its “China and government relations group.”
The former ambassador also counted on two other jobs following his time in Beijing with ties to Chinese companies: a position on the board of AMC Entertainment, the movie theater chain now owned by Chinese company Wanda Group, and a position on the board of NW Innovation Works.
“The name was innocuous-sounding enough. The business planned to develop one of the most ‘environmentally responsible, advance manufacturing plants ever built,’ by constructing a methane gas plant in Washington State,” where Locke was once governor, Schweizer recalls, “with the products exported to China.”
The company behind the project, Chinese Academy of Sciences Holdings (CASH), is “an investment vehicle run by the Chinese government.”
Even outside of his official professional capacities, Locke appeared unable to avoid at least the appearance of impropriety with wealthy, regime-connected Chinese nationals. Prior to leaving for Beijing, he sold his home to a Chinese executive and his wife for over $150,000 the price Locke paid for it. The executive, Huaidan Chen of American Pacific International Capital (APIC), was the brother of a fellow APIC businessman, Wilson Chen, to whom Locke had lamented that the home was not selling.
“In short, wealthy foreign nationals from a country where Locke represented the United States bought his home after he had told of his desperation to someone well known to them,” Schweizer observes.
“Curiously, three months after the home purchase, Wilson Chen got a choice invitation to an exclusive meeting with Ambassador Locke at the U.S. Embassy,” Red-Handed adds. “The meeting was to discuss real estate opportunities in the United States.”
Former Montana Sen. Max Baucus succeeded Locke in both leading the American embassy in Beijing and following his tenure there with lucrative business deals with Chinese companies. Baucus did not opt for obscure state-linked companies: he joined the board of advisors of Alibaba, arguably China’s single most important company. Alibaba is an online store often compared to Amazon that was founded by Jack Ma and Joseph Tsai and is notorious for its repressive company culture. Ma notoriously invented the “996” work schedule, which required workers to work from 9 a.m. to 9 p.m. for six days a week. He also encouraged workers to marry each other and build lives and families around Alibaba in the name of advancing the Chinese Communist Party. Joseph Tsai, who features prominently in Red-Handed, is the owner of the Brooklyn Nets and one of the most prominent supporters of the Communist Party currently active in American business.
More recently, Schweizer revealed, Baucus joined a shady Chinese cryptocurrency company named Binance.
“Shortly after Baucus joined it was announced that Binance was being investigated by the U.S. government for money laundering and tax charges,” Schweizer writes.
Baucus also set up his own company, the Baucus Group, catering to Chinese clients in 2017, following his departure from Beijing.
Baucus spent much of the Trump administration’s tenure defending the Chinese regime in social media, comparing Trump to Sen. Joe McCarthy and Adolf Hitler for suggesting that America should become more economically independent from a genocidal communist regime.
Former Iowa Governor Terry Branstad did not have the luxury that Locke and Baucus did of having a pro-China president behind him. But to the extent that any voices in favor of enriching the Communist Party existed in the Trump administration, Branstad was one of them. Schweizer recalls that Branstad is a personal “old friend” of dictator Xi Jinping’s and had bizarrely described the man running the world’s largest concentration camp system currently functioning as a “progressive” seeking to “open China.”
“As U.S. ambassador, Branstad pushed Trump to back down on restrictions on goods and services trading despite the ongoing trade disputes,” Schweizer writes, “while leaving unaddressed ‘the more fundamental complaints of the American side.’”
Branstad personally did not cash in with Chinese companies like his predecessors, but his sons did.
Marcus Branstad, according to Red-Handed, is a registered lobbyist for a company backed by big-name Chinese chemical producers. At least one such producer, Wanhua Chemical Group, is controlled by the Chinese state.
Eric Branstad, who joined the Commerce Department under Trump, later went on to work for Mercury, a lobbying firm that represents Chinese corporate interests. Among Mercury’s clients is ZTE, a giant Chinese telecommunications company accused of aiding repression of political dissidents in Cuba and Venezuela. Branstad denied lobbying for ZTE during a visit to Shanghai after leaving the Trump administration; but, writes Schweizer, “according to Chinese officials in their accounts of the meetings posted online, they did in fact discuss issues and policies, some of which were close to concerns about ZTE.”
“The firm that Branstad joined had a myriad of Chinese clients beyond ZTE, including Hikvision, who … works with the Chinese government to monitor its citizens,” Red-Handed concluded.