The President's Daily Brief - PDB Situation Report | November 22nd, 2025: Putin's Economic Crisis Gets Worse & China Trades Blows With Japan

Episode Date: November 22, 2025

In this episode of The PDB Situation Report: Russia’s war economy is starting to crack. Deep Ukrainian strikes and tough new U.S. sanctions have pushed Moscow’s oil revenues to their lowest point in two years. We’ll explain what’s driving the pressure and why it matters. Eddie Fishman of the Center for a New American Security joins us for more. In Japan, a single off-the-cuff remark from new Prime Minister Sanae Takaichi has triggered the most serious diplomatic clash with China in years. We’ll break down what she said and how Tokyo and Beijing are reacting. Author Gordon Chang stops by to give his insight. To listen to the show ad-free, become a premium member of The President’s Daily Brief by visiting https://PDBPremium.com. Please remember to subscribe if you enjoyed this episode of The President's Daily Brief.  YouTube: youtube.com/@presidentsdailybrief Mando: Control Body Odor ANYWHERE with @shop.mando and get 20% off + free shipping with promo code PDB at https://shopmando.com! #mandopod Ridge Wallet: Upgrade your wallet today! Get 47% Off @Ridge with code PDB at https://www.Ridge.com/PDB #Ridgepod Lean: Visit https://BrickhouseSale.com for 30% off GUESTS: Edward Fishman: Author of CHOKEPOINTS: American Power in the Age of Economic Warfare - https://www.penguinrandomhouse.com/books/726149/chokepoints-by-edward-fishman/ Gordon Chang: Follow Gordon on X - https://x.com/GordonGChang Learn more about your ad choices. Visit megaphone.fm/adchoices

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Huge savings on special buys, plus a free professional measure now during the spring Cyber Monday sale. Rules and restrictions apply. Welcome to the PDP Situation Report. I'm Mike Baker. Your eyes and ears on the world stage. All right. Let's get brief. The first step, Russia's war economy is feeling real strain as deep Ukrainian strikes and new U.S. sanctions

push its oil revenues to two-year lows. We'll be joined by Eddie Fishman of the Center for a New American Securities for more on that. Later in the show, an off-the-cuff remark by new prime minister, Sinai Takichi, has set off-the-country's most significant clash with China in years. Well, off-the-cuff remarks will do that, reshaping diplomatic conversations in Tokyo and in Beijing. Author Gordon Chang, friend of the show, will stop by to give his insight. But first, today's situation report Spalmite. Russia's oil sector is taking some of its hardest blows of the war, and it's happening on two fronts at the same time. Ukrainian drones and missiles are striking deeper inside Russia, targeting major refineries that produce the fuel that Moscow's military depends on. And on the economics side, new U.S. sanctions are prompting India and China, Russia's most

important customers, of course, to sharply cut back purchases of crude oil from Rossnev and luke oil. The result, oil prices plunging, tankers stacking up offshore with no buyers, and the Kremlin's weekly revenues falling to their lowest point in more than two years. It's a moment of real pressure on the backbone of Russia's war economy. Joining me now for more on this is Edward Fishman. He's an adjunct senior fellow at the Center for New American Security, where he focuses on the intersection of business, economics, and national security. That's a big intersection. He's also the author of the book Choke Points, American Power in the Age of Economic Warfare. Edward, thanks very much for being here on today's Situation Report. Thanks so much, Mike. I'm excited to be on the show today. Let's start

with a 30,000-foot view on Russia's economy. We hear a lot about how it's taking a beating, right? In particular, after these new sanctions on Ross Neft and Luke oil, and after the the Ukrainian drone and missile attacks, which are striking deeper in the Russian territory on energy infrastructure. But from your perspective, what is the current state of the Russian economy? Sure. So look, I think from the beginning of the Russian full-scale invasion of Ukraine in 2022, the U.S. and Europe had been effectively trying to walk a type because they'd been trying to impose as much pressure as they possibly could on Russia's economy without affecting the main export sector of Russia's economy, which is oil. The Russian economy is quite large, but relatively simple.

Their one globally competitive industry is oil and gas, and they use the revenues that they can generate from those industries to subsidize everything else, including the military industrial complex. The reason that the U.S. had been cautious around this is that at the beginning of the war, if you can remember back to 2022, inflation in the U.S. was 7.5%. We had oil prices over $100 a barrel, and there was real concern that aggressively targeting Russian's oil sales would worsen those situations. But what do we have today? You know, oil prices have been stubbornly low now for a very long time. They're in the low 60s, despite even the war that happened, the 12-day war against Iran earlier this year. And inflation in the United States is under control. So I think the West today has a lot more leeway to hit Russian oil.

What Trump did a couple weeks ago, I think it was a big step in the right direction. finally, targeting the two biggest oil companies in Russia, Rothsteft and Luke oil. Even before those sanctions were put in place, Mike, the Russian economy was stagnating, right, projected effectively not to grow at all this year, at the same time as having pretty high inflation as well as extraordinarily high interest rates that are basically preventing any productive investment in the Russian economy, with the exception of the military industrial complex. I think if the U.S. goes ahead and aggressively enforces these sanctions on Rosszept and Luke oil, you could see the Russian economy

really pushed into a major recession. I think that's a big if, because we're not totally sure yet whether Trump is serious about enforcing these sanctions. Yeah, that's a really interesting point because then I was going to ask you about your perspective on this as well, there is some reporting that says the Trump White House is pushing up a new peace plan, a concept that basically says, okay, we'll freeze the front lines where they are, but we will give Donbass to the Russians, including territory that they don't currently hold, and we will look to limit Ukraine's military and put some guardrails on the size of their military in exchange for Russia's agreement for a ceasefire, a movement on a peace plan or a negotiated peace. That doesn't sound like they're all in

on the sanctions. Look, I think we have to wait and see how serious this deal is for the Trump administration. It's very clear to me that Kirill Dimitriov, he's the head of the Russian sovereign wealth fund, who's been sort of the main Russian interlocutor with the Trump administration, has been pushing for a long time that the U.S. and Russia should just create a peace deal between the two of them, that that is enforced on Ukraine. That's basically pushed down the Ukrainian's throat, almost sort of like, you know, Neville, Chamberlain and Hitler and the Munich Agreement in the 1930s. They've also, another line that

Demetrivis had been pushing was that part of this deal shouldn't just be about Ukraine. It should be about the broader bilateral issues between Russia and the U.S. And the line he's been pushing is that there are these big business opportunities for the U.S. and Russia that could potentially be unlocked if we only were to resolve the Ukraine issue. I think that Yeah, if we were only to be able to resolve it in Putin's favor. Yeah. Exactly. And so you hear this, Mike, and I think are probably our ears here at the same way.

This is the Russian sort of wishcasting, right? They're putting out their maximalist objective. And they're hoping that they can persuade Steve Wickoff, the president, President Trump's diplomatic envoy who does not have any diplomatic experience or does not have any experience with the Russians to basically come around to this perspective. My own view is I'm pretty skeptical that even if this is the. deal that Dmitriyov and Ritkoff think that they have, that this is going to be ultimately what the United States does. Because if you look at it, there is not a strong political constituency in the

United States for selling the Ukrainians down the river. I think that you still have quite a bit of support domestically to support in favor of Ukraine and honestly a lot of skepticism about poop. Yeah, we certainly, the plan already doesn't have any support from, you know, EU backers of Ukraine. They've already come out and said, you know, this just smacks of capitulation. And so I think to your point, yeah, Steve Whitkoff has essentially said, okay, look, you know, you give up territory, you limit your military for some vague U.S. security, you know, guarantee. And now the ball's in your courts, Slavski.

You can come talk to us about it if you want. And it, it smells a little bit like where the White House is going with the Gaza situation, right? I guess what they're looking, to me, it feels like, you know, peace at any cost, basically. Let's just get a peace plan out there. Let's just get an agreement. And so with Hamas now, not to disappear down a, you know, a rabbit hole, but now they're saying, hey, you know, maybe we can just start the reconstruction thing without Hamas disarming or giving up any governing role.

And, you know, that sounds like there's a little bit of desperation just to get something happening, regardless of whether it's practical, realistic, or actually action. or not. And it sounds like this idea from Whitgolf and Dmitriev is basically, look, we want concessions from Zelensky. We're not asking for anything from Putin other than him signing it. And, you know, there we go. Look at that. Hazah for us. We've got a piece of player. I know I sound very cynical, Edward, but, you know, that's a... I've seen a long time overseas. You may sound cynical, but you also sound right to my ear, too. I think there's also a big difference between the Israel-Gaza situation, which is, you know,

A, the U.S. has a lot less leverage over Russia than we have over Israel, and B, the Ukrainians have a lot more of ability to fight the Russians on their own than the Ghazans have to fight against Israel. So I think, look, even in the worst-case scenario in which Wiccoff somehow persuades Trump that this Demetri of deal is worth pursuing, I don't believe that the U.S. could stuff this deal down the Ukrainians and Europeans' throats, because ultimately, It's the Ukrainian's choice whether or not they want to sacrifice their territory. And at this point, the lion's share of support is not coming from the U.S. Trump has not authorized additional military support to Ukraine.

It's really coming from Europe. And so I think the big question here is, are the Europeans going ahead and get to seize that 140 billion euros worth of Russian sovereign assets that are sitting in Europe, which I think might happen before the end of the year, which would give the Ukrainians a massive runway to continue fighting this deal regardless of what deals with. Koff and Dimitriov and that they've negotiated with each other. What's the downside of that, though? If they do, I mean, if they do take those assets and use them for Ukrainian military efforts

or reconstruction down the road. Yeah. Look, the Belgians sort of been put at the center of this problem because the Belgian, Belgium is home to an institution called Euroclear. It's a big sort of a clearinghouse that exists in Europe. that's where actually the majority of Russia's Euro-based sovereign assets were sitting when the sanctions were imposed in February of 2022. And so, you know, either by luck or by, you know, disfortune, whichever side you're on here, the Belgians are stuck with these assets. And they're very worried that if the assets are repurposed to support Ukraine, that Russia could retaliate against Belgium, that they might start seizing Belgian assets in Russia, that they could even retaliate through cyber attacks or through drone.

drone strikes or something like that on Belgium. So the Belgian's concern has been, how can other European countries, how can NATO allies, including the U.S., help collateralize the risk that they're taking on by potentially seizing these assets? My own view is ultimately, it will get done because the classic example that I'm sure you take away from your time in government, too. When there's no alternative, you know, ultimately, you know, you want the river sort of drifts in one direction. And that's where it's going. Because if the Europeans don't take these assets from Russia to support Ukraine. Ukrainians are going to have a massive shortfall in support, and the only alternative is

taking it from European taxpayers. And I think that doesn't make very much sense when you have 140 billion euros of Russia assets sitting there that are never going back to Russia any. Right. Yeah. I want to revisit this particular issue. But first, Edward, if you could stay right where you are, we do have to take just a quick break.

And then we'll be back with more from Edward Fisherman right here. on the PDB situation report. So, you know what that means? Stick around. Hey, Mike Baker here, host of the BDB and personal hygiene specialist. I didn't see that coming, did you? Now, if you're anything like me, right, you deal with long days, hard work and high pressure jobs. And we know what that can result in, huh? Sweat and body odor. I told you I was going to talk about personal hygiene. Well, I've got a pro tip for you. Mando whole body deodorant, right? Problem solved. It's created by a a doctor, it's safe everywhere. You can use it on all your bits and pieces and clinically proven.

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See Home Depot.com slash license numbers. Welcome back to the BDB Situation Report. Joining me once again is adjunct senior fellow at the Center for a New American Security, Edward Fisherman. Edward, thanks very much for sticking around here. Of course, my pleasure. And let's revisit this idea. of if the U.S. does back off from Ukraine, I'd say that they've got this, I believe it's a 28-point

peace plan, that the White House appears to be floating as a result of conversations between Steve Whitkoff and others and, you know, Demetriov on the Russian side in particular. If Zelensky looks at that and goes, no, no, I'm not giving up, you know, all this territory. I'm not, you know, making other concessions. And the EU says, well, that's the right decision. It's capitulation. So no, we're not going to back that either. And the U.S. decides, okay, well, we're kind of done. You know, we've got other things we have to worry about. So I'm a practical standpoint on the sanctions front. Can the EU, on its own, exert sufficient pressure to continue, sort of the downward slide of the Russian economy? I think it'll be a challenge.

but it's not impossible. So the European Union obviously is a major economic actor. The challenge when it comes to sanctions is that the sanctions policy is set at the EU level. So the European Commission creates the policies that are that endorsed by the 27 member states, but the actual enforcement is done at the level of the member states. So for instance, if a German company is violating sanctions, it's up to the German government to enforce that against a German company. Similarly, if a Hungarian company is violating sanctions, it's up to Victor Orban and the Hungarian government to enforce them. And so what that has done is it's meant that businesses around the world do not take European sanctions as seriously as they take U.S. sanctions. Part of the story that I tell in my book, joke points is how in the 2000s and 2010s, big European banks like B&P Paribah and HSBC were fined billions of dollars by the U.S. government because they were violating U.S. sanctions on countries like Iran.

So basically, the U.S. has played this role almost as the world sanctions policeman, right? The country that's kind of the backstop with the teed for all of the sanctions in the world. You know, the Europeans have been building their capacity on this area since 2022 in particular, but I do think of Trump actually were to back away. You would need the Europeans to really come together and find a way to actually move that enforcement level of sanctions from the member states to the EU level. And I know this is sort of a soft science question, not necessarily right in the economics field, but what's your perception of the impact so far of the damage to the Russian economy on the average Russian, on the people, you know, somebody walking around Moscow, say Pete, wherever, does it appear as if they're starting

to feel the problem or is the Kremlin doing a not bad job of kind of, you know, sheltering the general population from the damage they're doing to the economy. I think so far, the Kremlin has done a relatively good job of allowing there to be a sense of normalcy for large parts of the Russian population. I want to caveat that by saying that you have had over a million Russians who have left the country, right? So I don't know, Mike, if you've been to Berlin recently or other European countries or European capitals, but there's a huge Russian diaspora that's just left in the last few years, and some of these are the most talented people in Russia. In the cities that you haven't had massive conscription

yet, and so they've been sort of shielded. When you get further out, you know, almost everybody knows someone who's lost someone in Ukraine, and that starts becoming a big problem over time. I think economically, the way that Russians feel this the most is really through the very high interest rates. So you've had interest rates in Russia in the high teens and even the low 20s, primarily over the last couple of years. And so what that means is there's effectively no business investment, right? Because if you can just get a 20% or 25% return by keeping your money sitting in a bank account, you're not going to start a new business. And you're not also going to take a loan to start a new business because how are you going to service the debt? And so it's really

sort of frozen the economy with the one exception of the military industrial complex. But what we all know is that that only works for so long. And already this year, you do have stagnant economic growth. And I think if you did especially shut off the spigot of these oil revenues in Russia, you would have a massive recession. You'd start seeing unemployment. And I think in some ways, that would be a good thing in that it would show Putin that there really are consequences to these actions and maybe change his perception of whether or not it's worth fighting. But at the same time, there's also the dilemma, which is now that he has this military-driven economy, there's an incentive for him to keep fighting. Because if all of a sudden there's no demand for soldiers

and no demand for missiles and no demand for guns, they're going to have a real problem on their hands and they're not really, they don't really have a great alternative in terms of how to run their economy anymore. Yeah, I mean, I think you're right. I think that, you know, obviously the one thing that could change Putin's position, maybe get them to the negotiating table in a meaningful way, would be the sense that he's losing control of the population. And that would come from, you know, immediate impact up to the economy, dissatisfaction over that, because it does seem to, I take your point on the million plus casualties, right? But I think that alone, you know, there's an ability, it seems, this is a bit of a stereotype, but his ability, it seems,

over the generations for the Russian population to suffer far beyond what the West imagines they put up with. But I think the combination of the damage to society through all those casualties, plus the economic damage, I think that then could create the sort of of dissent that Putin hasn't seen since he's been in power, which I believe he's been in power for about 190 years. Yeah, to your point, by the way, I think something that's almost forgotten about Putin, because now he's sort of recast himself as, you know, this latter day Peter the Great or Tsar or something like that, is that the way that he originally built his popular base in Russia in the 2000s in the

2000s, it wasn't through, you know, trying to reconstitute the Russian Empire, right? It was through rebuilding the Russian economy, largely on the back. of Western financing and technology for things like the Russian oil sector. ExxonMobil, for instance, effectively built up the Russian oil sector during Putin's first decade and a half in power. So I do think that his original social contract that he had has broken down. He's trying to rebuild it around this concept of nationalism and fear. But ultimately, if his original pillar of support, which is he actually provided stability and prosperity after the chaotic 1990s, you know, the casino capitalism period that Russia had after the end of the Cold War, then I think all bets

are off. And even Russians who are somewhat apolitical who don't see themselves as involved in a political process, if all of a sudden their livelihoods are vanishing, they don't have jobs, their savings are disappearing, I do think that Putin has to worry about pressure from below. Edward, in my book labeled questions for Edward Fishman, I have a bunch more. So what I'm hoping is that you'll come on back here on the Situation Report. I've really enjoyed this conversation. I would love to continue it, but we are out of time. So I hope when we call you, you'll pick up the phone.

I'd be happy to you. It was a really nice talking to you today. Excellent. Well, thank you very much. Edward Fishman of the Center of a New American Security. That's excellent. It's so interesting, isn't it? when you think about that, it'll make course, it's just a real world, right, and real politic to say,

well, you know, we don't want to risk going after the one thing that could have forced Putin to stop the war in the early days, right, choking off his oil revenues because, well, that'll send prices soaring at the gas stations here in the U.S. And our voters are going to get upset. Well, anyway. Coming up next, Japan and China are in their biggest diplomatic clash in U.S. years after Prime Minister Saniya Takeichi's comment about a potential Chinese move on Taiwan. Gordon Chang, great friend of the show, will join us with his insight. Stay with us. Hey, Mike Baker here with a message from our very good friends over at Ridge Wallets. Now, before I switched to a Ridge Wallet, right,

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Tap the banner to learn more and get a quote at usa.com slash bundle. Restrictions apply. Welcome back to the PDB situation report. Japan and China are locked in their biggest diplomatic clash in years after an off-the-cuff remark from new prime minister Sna'a Takeichi. During a parliamentary session, she suggested that a Chinese military move against Taiwan, such as a blockade or naval engagement, could qualify as a, quote, survival-threatening situation for Japan under its 2015 security laws. Well, as you might imagine, Beijing didn't take too kindly to the remark, calling the comment, quote, egregious, oh, that is hard. They are accusing Tokyo of interfering in China's internal affairs and issuing multiple warnings.

China has since suspended seafood imports from Japan, raised travel advisories, and demanded a full retraction as tensions continue to escalate. Joining us now is Gordon G. Chang, author of Plan Red, China's project to destroy America. You can follow him on X at Gordon G. Chang. Gordon, terrific to see you again. Thank you very much for joining us here on the Situation Report. Well, thank you, Mike. Let's start with this scuffle between Beijing and Tokyo, now over Prime Minister Takiichi's statements.

Give us a kind of a rundown and tell us whether you think it's serious or just a momentary flare-up. This looks serious because I don't think either side is going to back down. On November 7, Prime Minister Takeichi on the floor of the diet was asked the question by an opposition member of parliament or the diet. And she responded that if there were an invasion of Taiwan, that this would be a survival-threatening situation. And that is a phrase that comes from the 2015 national security law of Japan. that would give her a right to mobilize the self-defense forces. Now, China went ballistic over that. The following day, the Chinese Council General in Osaka posted on X,

a statement basically threatening the assassination of the Japanese prime minister. And China is going on a bender since then. It has a war of words, but more important in a sense, it has started to apply economic pressure against Japan. So, for instance, cutting off seafood exports most recently, encouraging Chinese not to travel to Japan. There's probably going to be a ban on the export of rare earths to Japan, which would replay what happened in 2010. And, of course, there have been Chinese incursions into Japanese waters around the Sankakus, which are those islets in the East China Sea. they're administered by Japan, China has a very weak territorial claim to them.

China, I think, is upset two reasons. One of them is that she's just defying Xi Jinping, and she's inspiring others around the world to also stand up to the Grand Celestial Court. The other thing, though, is that Xi Jinping wants to isolate Taiwan, and what Takichiichi was saying was that others would come to the aid of the island if it were. were attacked. And Xi Jinping certainly doesn't like that because Japan does have a very capable military. They don't call it a military. As I mentioned, it's the self-defense forces, but it is fearsome. Yeah, it's interesting because they, I mean, they went immediately, you're basically, I think the

foreign ministry went immediately to, you know, you're meddling in our internal affairs, meaning you're talking about Taiwan. But and you're right about the sort of the immediacy of the reaction after the comments. If I'm not mistaken, I think the PLA Navy sailed a Coast Guard convoy through the Sankaku Islands area. As a show or, yeah, a demonstration of their displeasure. But do you think, I guess I'm always. confused when when they talk about supporting Taiwan right or the concept of it I'm not really saying the idea of the they're phrasing of it I'm always confused about what

that down the road would look like I like if in whatever fashion the Chinese regime moves on Taiwan you know I I don't know that anybody understands what the allies like Japan would actually do? What would they physically do about? It depends what the Chinese do. So, for instance, recently there have been drone incursions on Yatigumi, Japanese island. That island is 58 nautical miles from the main island of Taiwan on the eastern side, but it's also south of Taipei. And the reason why the Japanese are so concerned is because Taiwan and Japan are part of the same archipel. ago. And essentially, if the Chinese were to have a successful invasion of Taiwan, they'd have

to declare an embargo. Now, that embargo to be successful has to be big enough to include the sovereign Japanese islands of Yonagumi and possibly others. So if that were the case, then that's certainly an act of war, and the Japanese would obviously have to get involved, and so would we. Now, maybe the Chinese would draw. that embargo line between Yanogumi and Taiwan. But if they were to do that, their embargo then wouldn't be at least as defensible as you'd think the Chinese would want. And of course, the Chinese very well may decide that as an opening strike, they would go after American bases and Japanese bases in Japan. So we just don't know what the Chinese doctrine would be on something

like that. And so it really, the answer to your question is, well, what do the Chinese do? Because that in the first instance determines the reaction on the part of Tokyo and Washington. Could Xi Jinping accomplish the goal of how, again, I'm always confused on the phrasing, taking over, bringing it back into the fold, whatever he wants to call it. Annexing. Yeah, annexing. Yeah, through it. purely through economic means? Well, yeah, I mean, he could do that. I mean, it's not impossible.

You know, nothing is impossible. But it's pretty unlikely for a couple of reasons. One of them is that the people in Taiwan don't consider themselves Chinese. We've seen from self-identification surveys that about 68, 69, sometimes even more percent of the people see themselves as Taiwanese only. And the number of people on the island who view themselves as Chinese only is usually like three or four percent at most of these surveys. And among the younger age cohorts, it's even worse for China than that. So, for instance, in the last survey I saw, 83% of those in the 16 to 24 age cohort saw themselves as Taiwanese only.

So these are people who are probably going to resist because they just don't think that they are part of the mainland. Now, if China were to declare an embargo, which is really what you're talking about, that really disrupts everybody because TSM, the Taiwanese company, makes 92% of the world's most sophisticated semiconductors. And that puts everybody at risk. So, you know, it's a real question. I don't think that the world sits by and watches China do that. There's one thing that always strikes me.

You know, Dean Atchison, who was Truman's Secretary of State, I think it was early 1950, actually publicly drew America's Western Defense perimeter, and it excluded South Korea. So that convinced Kim Il-sung that he could get the approval of Stalin and Mao Zedong, who were initially reluctant to authorize an invasion of South Korea. because they always said, well, if you do that Kim Il-sung, you're going to have to fight the Americans. But once Dean Atchison did that, Kim Il-sung got the green light. So what happened, Mike? Well, within six hours, Truman decided that he was indeed going to defend South Korea.

So really, the question here is, we don't know, we Americans, definitely know, we just don't know what we're going to do until we actually do it. And I expect that if China were to declare an embargo of Taiwan, that we wouldn't take that lying down. Yeah. Yeah. Kim Il-sohn, of course, the grandfather of Kim Jong-un. And, yeah, I mean, I guess when you look at U.S. options, I mean, that's always the big question. I mean, what would the U.S. do? and I think it's administrations have gone to great lengths to dance around the issue.

So I think from the current perspective, when you look at, I think it's fascinating when you look at this current situation between China and Japan because it's like a little tiny case study, right, a little way to kind of peek into this and say, okay, you know, how would this, how would this play out? Do you think this is going to be a strange question to ask, but I know their reaction is outsized to, well, maybe it's not from their perspective, but for Daki Ichie's statement, it seems outsized. Is that just natural saber rattling? Or do you think that the She's thing thing actually, you know, is fearful of this? Or are they just, you know, doing this, it's a game, they're just reminding. looking, look, this, you know, get out of the way. Were they actually fearful of Japan's involvement

and not just Japan, but as you said, they would bring the U.S. into it? Well, that's a great question. And I think that this is more than just the typical we've got to punish the Japanese because they defied us reaction. And the reason is right now, Xi Jinping, I believe, has a little bit in trouble. in the Chinese political system. He's got an economy, which is at about 0% growth. He's obviously being blamed for a lot of obvious policy mistakes. And so I don't think that he can climb down. And I think he actually wants a confrontation. And the reason is not because he thinks he can rally the Chinese people to war. Chinese people right now do not want war. So, you know, I sort of think that really what Xi Jinping is doing is he wants some sort of fight, probably

short of a kinetic war, in order to prevent other senior communist party figures from challenging him. So he probably thinks that he can manage some sort of confrontation and sort of solidify his position. The question is whether he can really do that. Now, he's configured the Chinese political system right now so that only the most hostile answers are considered to be acceptable, which means he can't compromise, he can't back down, he can't de-escalate, he can't act constructively. And that's what makes this so dangerous. And it's also what makes the confrontation with the Philippines so dangerous. One other thing, and that is, I actually don't think that Siegempig has got to wake up one morning and order invasion of

Taiwan. First of all, I don't know if he has the clout to do that. There's a lot of evidence to suggest that he doesn't control the Chinese military anymore. But whatever it is, we know there's turmoil in the military with the sacking of so many senior generals and admirals. You know, the Chinese Defense Ministry announced that nine of them most senior officials in the PLA were investigated and removed. So this is not an organization that is ready to fight. Also, Xi Jinping, even in his best days, is not going to authorize an invasion of Taiwan because that would require a combined air-land sea operation. And that means that sea has to give some general or admiral almost complete control over the Chinese military, making that cigger the most powerful person in China.

Xi Jinping is just not going to do that, and I don't think he's going to do that right now. So I think that it could very well be a war involving Taiwan, but it won't start with an invasion of the main island in Taiwan. It starts elsewhere, against Japan, against the Philippines, against God knows whom. But the point is, eventually that will spread and involve Taiwan. So that means Taiwan is in a war. That means Japan's in a war. But it doesn't start with an invasion of the main island of Taiwan, as everybody has been talking about since November 7th, when Takeichi made her statement. It's almost using it as a distraction to back into their overall objective.

That's really interesting. Gordon, a lot of more questions here, but we have to take a quick break. So if you could stay right where you are, we will be back shortly with Gordon Chang here on the Situation Report. Please, stick around. Hey, Mike Baker here. Now, you know this. Black Friday is right around the corner.

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including botulinum toxins, as these may increase the risk of serious side effects. Why wait? Ask your doctor. Visit Botox Chronic Migraine.com or call 1-800-44 Botox to learn more. Welcome back to the PDB Situation Report. Joining us once again is Gordon Chang. You can follow Gordon on X at Gordon G. Chang. Gordon, I want to switch gears a little bit. Move from a focus on Japan, on Taiwan. The UK government issued a very interesting warning just the other day about Chinese espionage, efforts on the part of Chinese intel to gather information on the parliament and the UK government. What can you tell us about that? This has been a long running saga where China has infiltrated parliament and British institutions.

And so they did issue that warning because there are these reports, various reports now, of Chinese agents who have turned important figures in Britain. This is like the least surprising news of the year, because China has infiltrated the United States. And these stories about Larry Summers, the former Treasury Secretary, former president of Harvard, and the honeypot allegations, which are undoubtedly true, that shows you that China has been infiltrating everybody. But in Britain, it's been especially important because right now there is the decision that the government must make about whether to permit what's called the mega embassy for China in Britain. And that would give China the ability to probably tap into all sorts of cables, which lie underground under

the proposed site for the embassy. So this is a whole issue that is bound together with all of these allegations, one right after the other, of people in Britain being turned by China. As an aside, that your embassy comment makes me remember the go-rope that took place in Washington, D.C. years ago, when we agreed to let the Russians build their embassy on the highest point of ground in Washington, D.C. And, you know, again, you do this and you think, what are we thinking? Yeah, I agree with the 100 percent. It's the least shocking, surprising news ever that the Chinese intel apparatus, has been aggressively pursuing contacts, recruited assets, sources.

There's a variety of ways they can go after information. In fact, I think that, if I'm not mistaken, they had to dismiss a case because there was involving a couple of UK citizens who were accused of passing sensitive information to the CCP because, if I'm not mistaken, the UK government had not labeled, I'll get this wrong, maybe had not labeled China as a threat. Yes, you're talking about two staffers in the parliament who had been working for China, turning over information. And it was determined that the government could not pursue the case because China had not been designated an enemy. Now, there is a lot of technical aspects to this,

and part of it is that some people report that that designation was not necessary in order to prosecute the parent. But the charges were in fact dropped. And that was the reason the government prosecution gave for their decision not to pursue the case against the two staffers. As always, Gordon, thank you very much for your time. We always appreciate your insight, your experience, your expertise, and we look forward to seeing you next time. Well, thank you so much, Mike, because I really appreciate it as well. So thank you. And stay safe. Of course. And you too, please. Thank you very much. That's all the time we have for this week's PDB situation report. That's a lot to cover. If you have any questions or comments, maybe you've got a humorous anecdote.

Yeah, maybe. Send it along or a dad joke. You got a good dad joke. I'm always in search of those. reach out to me at PDB at thefirsttv.com. You know what we do? We collect all your comments, your questions, and we put them together in our once a month, or roughly once a month. Sometimes we get held up. Episodes called Ask Me Anything. I mean, with it, a reason. Finally, to listen to the podcast of this show ad-free, become a premium member, the president's daily brief, simply by visiting PDB Premium.com. And don't forget, if you get a chance, check out and subscribe to our YouTube channel. You can find that, oddly enough, on YouTube. Just go to at President's Daily Brief.

I'm Mike Baker. Until next time, you know the drill. Stay informed. Stay safe. Stay cool. Some follow the noise. Bloomberg follows the money. Whether it's the funds fueling AI or crypto's trillion-dollar swings.

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