WSJ What’s News - China’s Power Tactics are Blurring the Lines Between War and Peace

Episode Date: March 13, 2025

A.M. Edition for Mar. 13. Democrats signal they will block a Republican plan to avert a government shut down this weekend. Plus, US and Canadian officials meet today in a bid to tamp down the trade war between the two allies. And, chief correspondent Naharika Mandana explains how China is cementing power across Asia by exhausting its opponents with a thousand cuts. Kate Bullivant hosts. Check out our special series on how China’s trillion-dollar infrastructure plan is challenging the West. Learn more about your ad choices. Visit megaphone.fm/adchoices

TD Direct Investing offers live support. So whether you're a newbie or a seasoned pro, you can make your investing steps count. And if you're like me and think a TFSA stands for Total Fund Savings Adventure, maybe reach out to TD Direct Investing. Democrats signal they will block a Republican plan to avert a government shutdown this weekend.

Plus U.S. and Canadian officials meet today in a bid to tamp down the trade war between the two allies. And we look at China's efforts to cement power across Asia by exhausting its opponents with a thousand cuts. So China escalates a little bit with every move and no single move is so intolerable as to provoke conflict. But if you add them up over a period of time, the picture kind of changes bit by bit in China's favour. It's Thursday March 13th. I'm Kate Bullivand for the Wall Street Journal filling in for

Luke Vargas. And here is the AM edition of What's News, the top headlines and business stories moving your world today. Senate Minority Leader Chuck Schumer has said Democrats won't back a Republican plan to fund federal agencies through September, setting up a potential government shutdown this week. The Republican-controlled House left town after it approved the resolution on Tuesday, effectively giving the Senate no time to revise the bill, but to simply pass it or reject it by Friday's midnight deadline. Speaking in the Senate, Schumer floated a shorter-term plan that would fund the government

for a month. Funding the government should be a bipartisan effort, but Republicans chose a partisan path drafting their continuing resolution without any input, any input from congressional Democrats. On Fox News, Republican House Speaker Mike Johnson said Democrats could cast a vote to keep the government open or take the blame for shutting it down. President Trump's trade team will meet with Canadian Finance Minister Dominic LeBlanc and Ontario Premier Doug Ford in Washington today amid the escalating trade war between the long-time allies. Canada's reciprocal 25% tariffs on more than $20 billion

in US-imported goods, such as steel, aluminum, and computers, came into effect at midnight. Incoming Canadian Prime Minister Mark Carney said he plans to continue Canada's strategy of responding to Trump's tariffs with targeted duties of its own. He'll be sworn in on Friday. After losing a large number of their population during the pandemic, cities like New York, Chicago and Los Angeles are growing again

and at a faster pace than previously thought. New Census Bureau estimates released today show that in the year ended in June, most growth occurred in metro areas, where 86% of the US population lives. Economics reporter Konrad Putzier says cities are being boosted by immigration in particular. People aren't having kids as much anymore as they used to. A lot of these big expensive cities are still losing people to the rest of the country, even though it's now a slower pace than during the pandemic. So what you're left with is really immigration as a driver of growth. And it's not just New York and San Francisco and LA, even places like Atlanta.

And all that means that population growth in these big cities is on pretty shaky ground because the Trump administration is pretty open about wanting to restrict immigration. And if you stop the flow of immigrants to big American cities, their population are likely to shrink again. A federal judge has said that Mahmoud Halil, the Columbia University student arrested after his participation in pro-Palestinian demonstrations would remain in Louisiana for now. Yesterday's order comes as Halil's lawyers push for him to be returned to New York as soon as possible, to have better access to their client and to allow Halil's wife, who is eight months pregnant, to visit him. Lawyers for the government argue that the case shouldn't be decided by a judge in New York, but rather in New Jersey, where he was

first booked and processed, or in Louisiana, where he was transferred this past weekend. In market news today, shares in Intel have rallied in off-hours trading after the semiconductor company named Litbu Tan as its new chief executive. Tan is a career venture capitalist and former Intel board member with more than 20 years of chip and software experience. Intel shares have lost more than half their value over the past year as the one-time industry-leading semiconductor manufacturer has underperformed both the market and its competitors, though deal speculation has helped push shares up so far this year. New data from the Treasury Department shows that the gap between federal revenue

and government spending widened to $1.15 trillion in the first five months of the fiscal year. That marks a record for the October through February period. The biggest increases in spending came from interest paid on public debt, year. That marks a record for the October through February period. The biggest increases in spending came from interest paid on public debt, which rose by 10% in the current fiscal year. Higher tax credits and military and security spending also jumped. And later today, markets will get another inflation update when the Labour Department releases February's producer price index.

Yesterday data showed consumer prices were up 2.8% last month from a year earlier, a lower than expected reading, although there is concern from analysts and on Wall Street that tariffs could continue to push prices higher. PPI is due out at 8.30am Eastern. Coming up, China's relentless campaign to extend its power across Asia is blurring the lines between war and peace. We take a look at this grey zone after the break. After you spent 10 minutes looking for keys you were holding the entire time. And before you went in for a hug while the other person went for a handshake, there was a moment when everything went just right.

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Niharika Mandana reports China has been embracing across a swath of Asia as it looks to cement its power. Niharika, let me just say first off for our journal subscribers, I think it's worth checking out the link to your story. We've left a link to that in our show notes. The graphics showing Chinese military activity in the waters around Taiwan or the buildup of Chinese settlements in the Himalayas is really quite eye-catching stuff. Yeah, so what caught my attention was that China is using the Grey Zone campaign across a number of different places and geographies and problem areas, if you will, in the South China Sea, around Taiwan, along its Himalayan border, and really intensifying these gray zone activities in all of these places.

So the crux of a gray zone campaign is that it's nonstop, right? So China escalates a little bit with every move and no single move is so intolerable as to provoke conflict. But if you add them up over a period of time, the picture kind of changes bit by bit in China's favor. So if you look at the South China Sea first over 10 years, first China turned reefs into islands, islands into military bases, then it used those bases to kind of send out coast guard fleets on patrol. Those fleets grew in size, they were then joined by the maritime militia. You saw sort of an intensification of those tactics of using ramming and water cannons to push others out.

And then what we were able to see with ship tracking data over the last three years is that the presence of the Chinese Coast Guard and maritime militia is getting so much stronger near the Philippines, which means that just covering a bigger area inside the Philippines is exclusive economic zone. And more and more of this activity has become normal over time as China pushes the boundaries. You'll see a similar pattern around Taiwan. Five years ago, it was rare to have Chinese military planes cross the median line, which is kind of a notional line that divides the Taiwan Straits. Now that's the new normal. And one location we haven't discussed on the podcast before is China's border with Bhutan, where the strategy also seems to be playing out. Tell us about the significance here.

So that's really interesting because of course on land it's not ships or it's not aircraft, but what China's doing is building civilian settlements in areas that are considered to be disputed. So these areas are remote and mountainous and historically no one's really lived in these areas. But now you have little villages or settlements where China's built rows and rows of homes and administrative offices and kind of moved families into these areas. And once you've built this stuff, it's hard to reverse. So what it means is that China's effectively taken this land that it believes to be its own by building these civilian

settlements little by little by little. The geopolitical significance is that some of these settlements are close to territory that's sensitive to India's interests. So India is another neighbor of China's and is also a neighbor of Bhutan's and China's just managed to establish a stronger footprint, a stronger presence in those areas. So how are affected countries responding to that aggression? So it's hard for countries to figure out how to respond because most countries don't want to be seen to be escalating. You don't want to make things worse but you don't want to do nothing either. In the case of the Philippines, the Philippines came up with an interesting strategy of transparency,

of calling out Chinese gray zone activities rather than brushing them under the carpet. So they would release detailed accounts of these types of activities at sea if there was a skirmish or a major incident in the waters, release video footage to show the world what kinds of tactics Chinese Coast Guard and militia were using against Philippine ships. And what that's done is for the Philippines, it has cemented international support for the Philippines. But China has doubled down in response to that strategy. In the case of Taiwan, we've seen this intensification and neither Taiwan nor the US have a really

good strategy to halt or stop this kind of crazone aggression. So the military exercises that China mounts around Taiwan have continued, the near daily presence has continued and there hasn't been a really good strategy from the other sides to get it to stop. That was Journal Chief Correspondent Niharika Mandana. Niharika, thanks so much for your time. Thanks very much Kate. And speaking of the rivalry between the world's greatest powers, we've been working on a special series about how Beijing is using its trillion

dollar Belt and Road infrastructure program to undercut American dominance on the world stage. All three episodes of Building Influence are available now on the What's News feed. We've left a link to them in our show notes. And that's it for What's News for this Thursday morning. Today's show was produced by Daniel Bach with supervising producer Sandra Kilhoff and I'm Kate Bulevant for the Wall Street Journal filling in for Luke Vargas. We'll be back tonight with a new show. Until then, thanks for listening.