Apple CEO Tim Cook and other corporate leaders should be required to register as foreign agents due to their ties with the Chinese Communist Party (CCP), according to expert testimony received by an influential Congressional advisory body.
“When Tim Cook comes to testify before Congress, he testifies as the head of an American multinational, said Clyde Prestowitz, president of the D.C.-based Economic Strategy Institute. “No. He should be compelled to testify as a foreign agent. He is much more an agent of Beijing than he is of Washington.”
“I could say that of the head of the Chamber of Commerce. I could say that of the head of the U.S.-China Commission here in Washington. They are all tools of China, not of the United States.”
American CEOs ‘On Their Knees’ in China
Prestowitz delivered the testimony during a seven-hour hearing of the U.S.-China Economic and Security Commission on April 14, which sought to understand the threat posed by China’s anti-competitive and coercive trade practices.
He said that key leaders across major American corporations and the finance sector were increasingly beholden to the CCP, and that their capture presented an immense threat to national stability that needed to be responded to by the whole of society.
“What we have to understand is that our corporations, our major business leaders, the Ray Dalios of the world and the Tim Cooks of the World, they are powerful here in Washington, you know the money they spend, the entreat they have here in Washington,” Prestowitz said.
“In Beijing, they’re on their knees. They kowtow.”
Prestowitz particularly singled out Tim Cook for his personal efforts to ingratiate himself with Chinese communist leaders in order to secure better business deals in China.
Cook toured China in 2016 and personally lobbied CCP officials in order to secure a secretive $275 billion deal with the regime which involved greater investment in China from Apple in exchange for less regulatory oversight.
The deal also allegedly included promises from Cook to source more of Apple’s supplies from Chinese suppliers, to expand collaboration with Chinese universities for research and development, and increase direct investments in Chinese tech companies.
Prestowitz highlighted the discrepancy in Apple’s behavior in the United States versus in China.
He noted that, in 2015, Apple refused FBI requests to unlock the phone of a terrorist who carried out a deadly mass shooting and attempted bombing in California, eventually leaving the government no other option but to hire hackers to try and crack the phone.
In 2019, however, Apple rushed to remove a real-time mapping app from its store after attracting the ire of the CCP over its use by pro-democracy protesters in Hong Kong.
“Within two days the app was out of the app store,” Prestowitz said.
Apple, at the time, said it removed the app because it caused “serious harm” to law enforcement and local residents.
When CEOs and investors acted for the benefit of the communist regime, Prestowitz said, it was not usually done out of malicious intent, but fear.
“Tim Cook knows, Ray Dalio knows, that if they get a little bit out of line with what Beijing wants, the electricity could go off or the water could turn off.”
Prestowitz also noted that Chinese laws require foreign companies operating in China to maintain CCP organizations within their companies to ensure that they operate within the confines of communist dictates, and that these party cells actively worked to stop companies from acting against the wishes of the CCP.
To that end, Prestowitz described American corporate leaders as “hostages of Beijing,” and said that the situation would not change until the U.S. government took firm action against the CCP to curb its coercive practices, and set clear consequences for those corporate leaders who represented CCP interests over those of the United States.
“One of the things that I think is very important is for the U.S. government to put the CEOs of global corporations on notice that they’re not going to be able to operate in this sort of two-sided, unbalanced world,” Prestowitz said.
The Epoch Times has reached out to Apple for comment.
Democratic Nations Require ‘E-NATO’ to Combat CCP
Prestowitz testified that democratic nations with market economies throughout the world were facing a similar threat from the CCP, and that a unified response between like-minded nations who could agree on adhering to a rules-based order was necessary to eradicate the creeping dependency of the United States on China.
“China doesn’t accept our concept of free trade,” Prestowitz said. “It doesn’t accept our concept of rule of law. So we have to respond to China in a full-court, full-strategy way, in order to deal with all the issues it raises.”
To that end, he called for a new, “E-NATO” of democratic countries with market economies to craft an alliance that would increase trade between nations that played by the rules and respond against efforts by regimes such as the CCP to undermine or exploit their markets.
He said that such was necessary because the CCP did not accept the separation of markets, trade, and defense into separate spheres, but sealed them together as a unified weapon for national benefit, which Prestowitz described as a “complete strategy”. Thus, the CCP did not represent a mere threat in trade, but also in research, development, technology, and security.
“The Chinese Communist Party is aiming to requite what it calls ‘150 years of humiliation’,” Prestowitz said. “It’s aiming to displace the United States as the world’s leading power, and to do so not only in terms of political or military power, but particularly in terms of economic and technological power.”
But, he said, that effort still required American business leaders like Tim Cook to toe the Party line in a way that disproportionately harmed U.S. taxpayers, and it was that relationship that needed to be severed.
“Everything that Apple sells at some point came out of U.S.-funded government research, came out of the Defense Advanced Research Projects Agency,” Prestowitz said. “Everything that Apple sells had a high degree of U.S. taxpayer-funded money behind it in the beginning.”
“[Yet,] Everything that Apple makes is made in China.”
Nazak Nikakhtar, former assistant secretary of commerce for industry and analysis, agreed with Prestowitz that multinational corporate leaders who acted in tandem with the CCP should be registered as foreign agents due to their involvement with Chinese government companies.
Their actions, she said, were harming U.S. interests with impunity, and expanding the CCP’s malign efforts to “exploit” the “open borders” of the U.S. economy.
“Our companies are forging joint ventures in China, developing technologies there, and by virtue of developing technologies there, it’s outside U.S. export control jurisdiction,” Nikakhtar said.
“Why aren’t we investing that in the U.S. economy and the economies of our allies?”
She highlighted that, since 1992, the United States has pumped more than $2.3 trillion in direct investments into China. The trade deficit with China in 2020, meanwhile, was $366 billion.
The CCP, meanwhile, has used that money to create international dependencies so that nations such as the United States will not break away for fear of economic fallout.
“The Chinese government’s endgame is to render the rest of the world dependent on it, and today this plan is succeeding,” Nikakhtar said.
“The greater our dependence grows, the more vulnerable and fragile we become. This is not a sound strategy.”
The CCP’s strategy, she said, is to essentially vassalize other nations through economic coercion by creating supply chain weaknesses and economic dependencies. To this end, Nikakhtar considered China under the yoke of the CCP to be a “foreign adversary,” and introduced what she believed could be the answer to effectively leveraging the U.S. market against it: “China Inc.”
China Inc., she said, is a concept in trade jurisprudence with decades of precedent and which has been recognized by the Supreme Court.
It recognizes, in essence, that “Every entity in China is affiliated with the central government unless you prove otherwise,” Nikakhtar said.
Thus, if the concept of China Inc. was expanded from trade law to other realms of law and policy across the government, the United States would be able to effectively combat creeping CCP control.
This is because it would allow the government to effectively cut off any company leader deemed to have lost autonomy over their business due to social or economic debts incurred with the CCP.
“The rest of the government doesn’t have this legal framework,” Nikakhtar said. “So you have a whole bunch of federal agencies who have really exquisite legal authority to do things, but they just can’t act on it because they’re missing this link.”
As such, she urged the commission to recommend that the government expand the China Inc. policy to all government agencies, in a final bid to slay the dragon.
“Let’s just do things right for a change,” Nikakhtar said.
“We may not get a redo.”