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[applause] >> well, thank you and welcome everyone to a very exciting day for the inaugural launch of our project called chinese handcuffs. in case you didn't pick one up on your way and we had these for everybody on the way out, which has become the emblem of this project. the so-called child's game in which you voluntarily immobilize yourself. this is one product that actually was made in china but i look for one that was made in china. because i think it is critical for us to start to recognize what we are doing to ourselves, vis-à-vis u.s. energy security and advocating our energy security voluntarily to china in the name of climate. they are doing this and highly

predatory deliberate campaign to overtake us in energy and make us dependent on them. the good news is that we can write the ship and reverse this if we take it seriously. so today the first panel which discusses the chinese campaign we are very pleased to publish their guard many, many people at heritage i would like to thank, starting with our patient study center and davis, and harding and erin walsh who took lead on this project and brought it to fruition in a very timely timely manner. we of course very grateful for our friends in the climate and energy group led by diana ross, and that is one of our great strengths, heritage gives us the ability to work across this lens and bring folks together to collaborate on a project such as this. so without further ado i i wod

like to introduce our panelists who will be discussing this project here. we will then have time for q&a here in the room and then also for our friends joining us online. so if you would like to join me. erin walsh is a senior research fellow in international affairs at the asia study center at the heritage foundation. xi has had an extensive career in the private and public sectors, has worked for thwart republican administrations including president trump's when xi was both at the department of commerce and a fellow colleagues of the national security council staff. and critically for our project today, erin also spent 12 years at goldman sachs in services going particularly xi served in china. so xi knows what xi speaks. a senior director and morningstar chair for global

energy security at the atlantic council global energy center. and landon was also a colleague of mine both on the nsc and at the department of energy where he has worked for several decades on energy issues. and then finally last but sorting not least jack spencer is a senior research fellow for energy in a mental policy here at heritage in the center for energy climate and the environment. and he previously was our vice president of the institute of economic freedom and opportunity, which is again a very important perspective that jack brings to our project here. he will also be deeply involved in pillar four in his other area of expertise which is civil nuclear energy. so please do join me in welcg them to the stage.

[applause] >> in the honored tradition of ladies first, erin, i would just like you, i would like to start with you with a total softball, which is we've had the publication of how china exports america's climate region today. congratulations on that. what are your key takeaways from the recent on the paper? >> thanks so much, victoria, and you and your party who cowrote the paper with me. the key takeaways are really as you mentioned that we right now are in the handcuffs the china. this is been a decade agenda that led one of the same time our own liberal left agenda has brought us to this point. so that's quite disconcerting. the other issue is the united states is the number three energy producer in the world,

and china is the number one energy importer in the world. what they're trying to do is to reverse this trend so that they become dominant in distant energy and renewable sector, and we become dependent on them. so that is an extraordinary place the united states to be right now and hopefully we will be able to get ourselves out of it. >> thank you. jack, i can actually remember moments when this project sort of cropped up in my mind. it was actually very early february of 2020, and as i was transitioning on the nsc to the department of energy i read a report on this which i found shocking in the degree to which china is doing this deliberately to create this shift in energy balance. and in your decades of absorbing energy policy, what's the trajectory you have seen for

china? as erin says the most needy, consuming nation. but have they sort of changed their role on the stage of global energy policy? >> first, thank you, victoria, for inviting here today to participate in this important event and with the whole project. it's interesting what china has done. for all intents and purposes the united states should be dominating the world in energy both on hydrocarbons technology across the board because we have it all. we have lots of -- we not only have now to resources but we have in addition, , we have the technology to dominate the world. but that wasn't good enough. the left has decided that what is lifted literally billions of people out of poverty over the last couple hundred years, which is introduction of hydrocarbons combined with free markets wasn't quite enough. that they wanted, they thought

that they could manage this better and did use global warming as the vehicle to do exactly that. why that's interesting apropos in our conversation today is that it falls right into china's hands. because what they've been able to do because they are chinese communists is spend a whole lot of chinese communist money to build their manufacturing facilities for things like wind and solar and electric vehicles which are precisely what the environmental left is forcing us to buy. and over time the trajectory has been us becoming more dependent on them. it's literally come here using -- its hand in glove where we're building a policy for no good economic reason that completely opens us up to chinese dependence. after will talk about more why

that might be but that's the trajectory, unfortunately, and it's completely unnecessary. >> well, thank you. landon, jack raised climate issues which are central in to this discussion and we have seen the biden administration said some very interesting long-term climate goals and they have defined climate issues and i commit such as the national security strategy as an existential threat to the united states. and where the conflict i see there is if you do that, then you have to write china even if you take it seriously as a lesser threat. so i'm wondering how you assess the goals that the set and also the critical question of can they be achieved without the participation of china? >> thank you victoria. thank you to the heritage

foundation, erin, andrew, congratulations on a really nice report. i think it reads really well and articulate the conversation. excessive pricing as jack e china would want to dominance over its deficit of indigenous resources, make it want to gravitate towards a new model. the united states doesn't have a challenge. so thinking through this challenge is from our perspective of how do we maintain our primacy and going forward. the biden administration has set out some i think very fairly ambitious climate benchmarks. right? talking 80% renewable energy generation by 2030, carbon free electricity by 2035, zero emissions in 20 thursday under note exactly 2030 but these are all benchmarks to require us to be engaged or require the world to grapple with how we make new energy affordable and the repercussions of what those

supply chains i can have on us. to your point about how engaged china is in this value chain is really important point. looking at their command of energy resources, china has effectively 80% of manufacturing newbie just as much as lithium batteries conception of rare earth extraction, 90% of processing. the point is when it comes to these new technologies, china has set up a framework that is could advantageous for them. this is a yes yes or no finr question can we achieve those benchmarks that the buy administration set up without china? probably not. to do so without them is going to have economic consequence and good run of costs and what is a policy induced energy transition. >> sticking with you for a moment since you raise this supply chain, one of the things

the covid-19 experience i think refill to everyone was the fragility of global supply chains. erin is also because she is superwoman working on a bipartisan report on the origins of covid which will be rolling out later on this month so hopefully will be able to welcome you back then. but one of the thinks as i said, covid revealed was these fragile supply chains, particularly the ones that run through china. i was wondering if you could talk a little bit more about how those supply chains can potentially undermine our energy security? >> well look, convention in a g supply chains we with. oil and increasingly allergy are fairly global fungible commodities. we know how to move them. america does them well. when you start to add the context of clean energy resources tickets were collected and there's a tremendous

additional input we have to break down. i need a battery itself has some 17-20 individual input. when you're creating a lithium ion battery is not just a barrel of crude oil. it's much more complex gps we discussed through a series of state led policies of subsidies, of investments by the chinese communist government, what we've seen is than actually kind of surround and as a put up with some other figures before, concentrate their control of those resources. there is a vibrant conversation about how we break up that dominance but they clearly see the value of taking what is a much more complex supply chain and garnering benefits from the extraction standpoint, the processing standpoint and the manufacturing standpoint to an end-user that may or may not be able to be a part of that value chain. right now that's what we're grappling through the policy led conversation we're seeing here

in washington. >> i'm sorry to cut -- can answer something about the supply chain? >> you may, sure. >> what covid taught us is about the fragility of supply chains, but it something more important that i think. it's the risk that governments impose on supply chains. it was in covid that made supply chains break down here it was the response of governments shutting down the economy that cause supply chains to break down. we saw that again with russia's invasion of ukraine, and that government shutting down supplies of natural gas to europe. i only bring it up because we need to soberly assess the risks that government supposed to be supply chains. and when you talk about communist china, when they control a completely vertically integrated supply chain of

something that our government is forcing us to depend on, and makes the risk that much more, even more than what can what we saw under covert. >> i think that's an excellent point, jack, and it actually is a good segue to the next question for erin, which is that to my knowledge the history of what china has done in terms of deliberately dominating supply chains in this space, this truly has been written before. to my mind is a very analogous to the 5g playbook that you're going to move into space, exploit various weaknesses to dominate it and as jack said flooded with a whole lot of chinese commerce money was subsidies and whatnot that allows them to manipulate the market. can you walk us through that campaign a little bit, erin, and what your research uncovered? >> sure. really, the energy, the whole energy space is extremely

complicated actually many ways. one of the things we want to look at is what underpins where we are today? and that is the history. and without starting a genesis, a move us up to the 50s, that is really when the global warming science started in the 1950s in the united states. al gore for many of you are familiar with, he was a student at harvard and he latched onto a professor who was very interested in this. he decided this is going to be a critical thing for the united states global warming. he really moved ahead and when he got to congress he started building up an entire, i would say, group of fellow members that would support this agenda here and they moved quickly to really start the first almost advocacy and activist movement on global warming and green

energy. and with that, when he became a senator he led the first senate delegation to the first rio summit, which was one of those cops you about the u.n. summit, cops, that we have each year. he then came back to the united states as vice president. he really drove a lot of these negotiations for this, and for the climate agenda. and then when he left, he started a movie and made a movie and got an academy award from that, from that he got a nobel peace prize. so it really was to his benefit to really keep driving this agenda. at the same time in china in the 1960s, mao zedong was leading the cultural revolution. so you look at where china was amber al gore was who was really the real godfather of our climate movement. and with mao key, after the

cultural revolution about 16 years later, will became involved in starting to remove this agenda in terms of creating their own agenda for the most part. and who jintao was the president at the time to really saw the impact of what was happening in china in terms of their pollution because their industrialization had taken place since the opening up of china with deng xiaoping and richard nixon. and so what we've seen is really his vast amount of water pollution, air pollution really killing agriculturally and really starting to create a lot of health concerns within. china china and i was goinge a lot of discomfort and social unease amongst the population and that became a real issue for the ccp. and so when cluj and how got involved, he decided to push this agenda -- hu jintao -- and

create china's agenda for green energy. and then when xi jinping came in and in 2012 he's on the road accelerated their move in terms of these new energy and renewables, understand the course that china does not have the that they need and have to import so much oil. for 1.4 billion people, that got a lot to be dealing with. so, therefore, they knew they didn't have the oil resources that the united states does, and nor did have natural gas. what they wanted to do is create these renewables. u.s. has solar, i decided to take that. the wind they took over. and then they have the new energy vehicles and the batteries. so i know you talk more about that but it's important to understand the history of where we are at because al gore, john kerry who's intimately involved in all of this in negotiating the paris agreement, obama and a bite at a brought us where we

are today. >> along those lines, jack, i'm plotting a double question for you next i'm going to bring this to land in for for a secondk a little bit about the cops. you are and i were at dubai together this december. i really started watching them starting in edinburgh in 21. >> edinburgh would be 26. so two back. but covid gets in the way. >> yeah. but the evolution of the cop, what it does, and is that conversation shifting noticeably? did it shift and charm or in dubai, and what you anticipate coming next year? >> it's a great question. i appreciate it, victoria. ..

only talk about change so long. you have contribution but eventually they involved and not

every government, taking it despite his remarks follow so everybody is grappling with what it means in this context and the conversation is for better or worse galvanizing. i wouldn't say has its own magnitude impact. right now there are a couple of benchmarks around a couple million figure in these countries and they are looking at that is challenging to begin with.

our companies in the u.s. government, u.s. companies are engaged to make sure we have a strong appreciation there. maintaining that process. >> a good segue into what happened looking up project.

it is against our loss and you have i met envoy coming out yelling out that companies that raise this issue. that was his priority and position. as we have been discussing it may beget the opportunity in a second, china's anticompetitive practices, what are we going to

fall into this conventional wisdom approach? it is not precisely what you might think. >> like-minded countries. the green energy mandate but essentially forces the united states. people respond.

the american coal and natural gas producing what happens when the subsidies go away? and invest and has to wait really bad outcomes that's why we need to get off the hamster wheel of green energy. i would like to free market drive energy policy get back

where we don't have this completely artificial. investment decision will cause the primary. >> critical report made every will continue in the next colors. the policy which everyday americans.

demands artificial intelligence are going to be dramatic and what we are doing right now the next five years alone. a couple of things regarding this reading anti- they are okay. and they control rare earth supply chain. different around the world but

not of the defense need so let's say we go to work. drones to firefighters and access errors production and critical minerals that is a real disadvantage aspect the number

one issue is inflation. and this level of cause on them everything the. >> landed, one of your history perspectives we can talk about this united states is not alone that we are creating for ourselves and wondering if you could talk about particularly europe on our way to ukraine for europe's real vulnerability have become clear to the rest of the world yet they continue to take action don't recognize that reality like continuing to buy

russian energy their power plants. i was wondering if you could talk about what urc and any hope for them to change course. >> 2019 given the global dynamics of these issues around energy transition from a they elected green wave and you've seen policies, shouldn't be surprising. like china so they don't have the energy resources we have. some are an exception but ultimately united states a strong resource base in the

russia's invasion of ukraine. they are playing equally so i think it is important that we do think about the hamster wheel and address steps. he will have to have how we got here it is important to reflect that we talk about the overwhelming control and family around these rare earth minerals and critical inputs and energy economy but it started way before that. the 1970s, china imposed regulations on joint investments in the country domestic so they build partnerships. those partnership ip sharing not taking it indirectly, divorced

companies to transition and couple that with domestic market through progressive policy acute competition down and i'm talking about electric vehicle market the requirements enter domestic market you are able to project that. it is difficult international competitors in europe or america and europe for one that has enough. there doubling you hundreds of thousands of vehicles coming into the european market and they have invested heavily in the chinese market.

you do get this catch-22 in the process has real outcomes. >> landed mentioned the capacity of the united states to search natural gas into europe and ukraine for and working the trump administration to my understanding is largely because of the streamlined permitting process allowed additional facilities to be constructed miraculously in 2022 to get across the atlantic in a heritage foundation we are committed the regulation to

allow for the exercise free market capitalism you talk about what the program might like if we have a change with this approach? >> the thing about energy market time as they are resilient mother the are allowed to operate whether conflict in the middle east or europe or revocable gas oil and all are and that is because of hot decades investment in those industries because that is what you want. what we see more recently his greater restriction on those markets where president biden camping shut them down.

the result is loss of resiliency and inability to effectively respond to just overtime. with the under the conservative administration reversion back to what we should. will produce out of energy smart we will be able to export to produce to get the molecules really need to go. we seen things like the biden administration to put a positive for additional gas exports these are things that chill investment seen on millions of dollars to build factories and things and

they just can't do it. there's got to be reform on the environment the policies which everyone acknowledges to become an owner. they will portray it is good, they will think we are protecting the thing or the but none of this, visible bunch of plans around the grand canyon for development. he would think you would in the grand canyon mining. no one is mining in the grand

canyon. it's part about federal state and i think across the board development giving the private sector the confidence it can make these investments without the government client trying to shut you down. >> we will go to audience questions at the conclusion. that stand up your name and affiliation you are addressing your question. i work your at the heritage foundation and is anything they

are doing china would do differently? if the answer is no, but yeah. >> maybe you can pass the mic back and forth. >> my name is eric, i'm with mildred associates. the question i have, what are your thoughts on elon musk visit to china last week? paradox advocating for freedom of speech and promote business dealings in china benefit and

harm interest working about batteries? >> overly when you think about this business model china's dominance in the growth, they have to. i don't know the situation today, china has incubated a policy process that makes property them as opposed to this the past century. we have to grapple with not necessarily this but how united states response to effectively. the policy would not do that.

>> i would say we are going to comment on the player but i will come again. this is what the administration has created elon musk or whomever. i'm more concerned about the public and others to do that. >> i work with the holy security. my big question would be to what

extent grapple to what extent do we need to have allies and parties on board the rest of the world going energy anyway, china would be enhancing the rest of the world you look at them like the european union and on imports that would come outside of the united states and to what extent america can do this alone be done to bring allies more invested in his agenda.

>> lots countries would love on it size but reject waves been portrayed as the bring a consensus thing we need to look more at this the state of climate science that need to look at not bottom property allowing market to drive energy policy for the most part. the rest of the world is doing everything it does distribute. if they are corrupting and

immoral, that we shouldn't do it. we take advantage doing that, knock yourself out. this report with the kind of policy what your training i think is where i see the general conversation which is whether we agree on the timeline or how we compare i think it is whether or not that can change and what we

prioritized. it is about security and the fact that we allowed it to gain this level of control we should be concerned and it is much more annuity and some might think. they're exercising that right now and i hope all but as we have to have that debate. >> there starting to get upset about their own electric vehicle in their own markets.

it is this report because our biggest challenge in the trump administration what was happening and lack of tools to combat it and having a brawl with united kingdom 5g painful when you have an ally the most and security every english sector that close to can be a

huge problem. >> we talked a lot about the problem here in going a little bit more of such a solution i gather subsidizing and i the desire to change the conversation around private short of getting global and paid government corporation trying to patent wonder relational nursing in the solar industries. >> taxes on the.

we should do that but not domestic. a million things we need to do domestically. this upward trajectory so president biden now wants america to leave the world and business act the way to build industry, there are many things we can do to make america worse. we still can't the navy talk about the work.

>> i do think there is consistency in which there and i'm a policy so we cap do you make of the passport i think it probably legislated not just executive orders. entering into the station and given the scale to be of the supply chains doesn't mean he can't be changed. trump administration wouldn't change the policy but that seems to be where we are headed credo. >> it depends upon where we are with national security if we have a conservative president common, it's highly likely there would be tariffs, highly likely

in my opinion, necessary because flooding in over the border the way they put up ability in mexico pushing the over, they will crush our industries and continue to tie our hands so the fastest way you can go up against our number one adversary in the world is put high tariffs on what they want to export. >> before we use tariffs to subsidize american manufacturing we work to get rid of the manufacturing so the demand we are trying to protect organic and sustainable and not one

under on policy. we protect an industry that is a function about policy to tariffs you will end up with a difficult man to knock can all agree that's a policy we can get behind. >> i've heard mining causing severe environmental damage in places like china. it is not true? why are we hearing more about that? >> it's very different than

ours. anything they do regarding development with an environmental impact will probably be greater than what happens in the united states. to me, that is a china problem. the u.s. problem is -- i should also say china minds engaged in other activities that impact the environment in a negative way is a comment on china, not activity so sometimes framed, i don't know mining criminals that is the problem, not china that is the problem. instead as i mentioned before, we can do mining in the united states that's not heavily

regulated and that's what we should be doing that because china is deciding to self. if that's what it wants to do that they can do what they want or we shouldn't hamstring ourselves not being able to mind at all because of. >> using child labor and their standards are diabolical. >> week talk about it in the

grandest sort of way. we have online questions? temper one more. >> we have one on my question. looking at the value trajectory, there's a question, how can we recapture and shape the agenda to a more reality -based? how did the markets incorporate that? how can renewable be a factor? >> i think it starts with our baseline.

to take admissions where the climate movement wants to be. the complexity isn't linear and why we have conversations around the security aspects of china so the technology is innovated in america. we have done both and spend provide. i think what we have an issue with is the economy and expensive cheap labor and dirty energy, 60% of china's business on whole capitalizes the market which there is a push make this

a problem here on how we think about renewable energy. we can be applicants in the market that allow united states as well. >> people presented as a balance we have to strike tweet energy and the environment. that's not true. the mark developed society becomes, the more energy they use the clear the environment becomes. we've seen country after country and our own country in particular matter and all these things that epa regulates have gone down dramatically while having this idea we can have economic growth just isn't true.

look at the poorest countries around the world week should be seeking his economic development and understanding the role energy place not and hydrocarbons have been the key question moving forward i would argue if one cares about renewables shouldn't be driven by government, whatever the government fixes exist in mediocrity were tribute is technology forward hold took the place of oil, a multitrillion dollar industry. someone to figure out a way to to be cheaper in the market is

the best way and that is how you overcome hydrocarbon if that's what you want to do. the government should set a predictable regulatory environment and about people and businesses to do that. >> being mindful of see scantily have to conclude shortly. you've got about 45 seconds. >> i just want to say china is not a partner of ours in environment what they had to coal burning plants and an amazing trajectory and they believe they are still

developing and as long as they're becoming and growing more they will do what they want to do in terms of national security. >> while we need to be concerned about what china is doing, recognizing we need to be more concerned with what we are doing, we are making it easy and we will find ourselves honest. this is where the conversation will go, there's a reason beijing has cybersecurity and with think about the communication of the systems at the digitalization and you are

getting real-time data including the layouts so the next iteration will hone in on the security component and a catalyst for change supercomputing and other topics. >> thank you. keep your eyes open for the arrival in the next six to eight weeks. thank you to the heritage foundation for hosting this event and think you for those of his joining online. have a great rest of your day. [applause]

[inaudible conversations] wednesday the house oversht committee look that washington d.c.'s response to pro- palestinian protest george washington university. the protest involved anti-sitism. testimony from d.c. mayor and metropolitan police chief. watch live 1:00 p.m. eastern on he's got three, he's got now, grateful to got or online at c-span.org. 100,000 miles