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Should we worry about Chinese land purchases in US?

Feb 23

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Some U.S. lawmakers have expressed concerns about increasing ownership of American land by Chinese entities, often attributing it to the Chinese government’s attempt to control food supply and surveil U.S. infrastructure. China ranks 18th on the list of foreign landowners in the U.S., trailing Canada, the Netherlands, Italy, and the U.K. So how worried should we be about China’s ownership of U.S. land?

Straight Arrow News contributor Peter Zeihan isn’t very concerned. Zeihan argues that Chinese purchases of U.S. farmland over the past few years have actually been negligible, and that was even before certain states passed laws preventing the Chinese from purchasing American land.

Excerpted from Peter’s Feb. 23 “Zeihan on Geopolitics” newsletter:

I’ve had a lot of you write in concerned about Chinese land purchases in the United States. There’s not much to be concerned about here, but let me paint the full picture for you.

Foreign ownership of U.S. land is quite limited, and the Chinese portion of that is just a sliver of the pie (Canada has the largest piece of the pie for those curious). To temper worries even further, most of this U.S. land is being bought by Chinese individuals simply trying to park their assets outside of China…and you can’t really blame them for that. If you need even more reason not to stress, just look at the historical precedence of foreign assets being seized in times of conflict.

It’s good to ponder these questions and keep an eye on things like foreign land ownership in the U.S., but as of now, there’s really no need for concern.

Everybody, Peter Zeihan here coming from Colorado. Today we’re going to take another question from the ask Peter list, which we’ll put at the end of this video. So you know, he can send your own questions in. It is am I worried about the Chinese buying up land across the United States short version really not. To hold up private property in the United States, only about 3% of it is foreign held. And half of that is Canada. So you know, if you’re gonna be stressed about someone worry about our neighbors to the north, the Chinese don’t even crack into the top 10 lists in the last three years purchase Chinese purchases of say farmland has essentially dropped to zero. And that was before we started seeing changes in the regulatory structure, a lot of states to just borrow it completely. Most of the money we see coming from China to the United States is in the form of capital flight, it’s not government institutions. It’s individuals trying to get their cash from out from under the CCPs. Thumb. And then the Chinese government working to prevent people from sending money abroad. One of the things to keep in mind about the Chinese system is one of the ways that the Chinese government, finances everything is it forces its citizens into a very short list of investment opportunities, which include primarily deposit accounts at banks. And then the banks which are run by the state funnel that money at sub market rates to industry in order to keep job creation high. It’s the model that has allowed China to expand its industrial plants so much. But it’s come at the cost of creativity and dynamism. And I’d say that most of those Chinese state owned companies now that are benefiting from this sort of system are among the less efficient companies in the world. And they’re just being kept alive on a capital drip feed that the Chinese citizens have to pay for. Now, that’s not the entire Chinese economy. But for the state run chunk, that pretty well describes it. Okay. Let me get other angles to this that matter. Oh, yeah. If we ever do get into a situation with the Chinese, where relations really do breach, or we do have an exchange of fire, I’m also not concerned about whatever holdings the Chinese have in the corporate world. Right now, in February of 2023. We’re going through kind of the final phases of finally disposing of a company called Cisco. Now, Cisco was the refining and marketing arm of PED of Asa, which is the Venezuelan state energy company. They bought slash merge slash built back in the 70s, and the 80s. And then Hugo Chavez came in in the 90s, and took over Venezuela, and basically ran the place into the ground economically. And they eventually had to walk away from Cisco for a mix of reasons, everything from sanctions to complete mismanagement, Venezuela, so they could no longer supply Cisco refineries with fuel. And now it is basically been seized by the government in bankruptcy hearings and is being distributed to other companies. Basically, if you’ve got a claim against database or set go, everyone is making their case heard now, or with just a plain old cash offered to take it over. This is kind of the neat way of disposing of foreign assets over time and using the legal system. But if you go back to World War Two, we had no problem with the government just seizing everything that the Germans had in the American economic system, and I have no doubt that if push really does come to shove, the same will happen to the Chinese assets as well. So I’m not suggesting we shouldn’t watch these issues. But these are not the sorts of things that keep me up at night.

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