The PDB Situation Report | October 17th, 2026: Ukraine Is Taking the Fight to Russia's Critical Infrastructure & China's Growing Taiwan Threat

At Verbo, we understand that even the best of plans sometimes need a little support. So we've planned for the plot twists. Every booking is automatically backed by our Verbo care guarantee, giving you confidence from the very start. Whenever you need help, it's ready. Before you stay, through the moments in between, and after your trip. Because a great trip starts with peace of mind. And maybe a good playlist. But we've got the peace of mind part covered. Welcome to the PDB situation report. I'm Mike Baker, your eyes and ears on the world stage. Coming to you from my very posh wood paneled office somewhere in our secret compound. Alright, let's get briefed. First up, Russia and Ukraine continue trading blows against critical infrastructure. While new questions emerge about American support for key. John Harding, Deputy Director of the Foundation for Defense of Democracy's Russia program, stops by to give us his insight. Later in the show, China is stepping up its military activity around Taiwan. Raising fresh concerns about Beijing's intentions will be joined by Steve Yates of the Heritage Foundation for more on what that can all mean. But first, today's situation reports spotlight. The war in Ukraine is entering another period of uncertainty. President Trump announced an energy ceasefire, and we kind of announced it unilaterally, between Moscow and Kiev, but the agreement never materialized. Well, in part because Moscow and Kiev didn't know about it. And in part because Russia continued its attacks on Ukrainian energy infrastructure. Meanwhile, Ukrainian forces have reported sudden restrictions on the American satellite network that they rely on for critical battlefield operations. Disrupting drone missions and raising questions about Washington's support. So, where does the war stand and what should we make of these latest developments? Well, those are good questions. For more on this, let me bring in John Harding. He's the Deputy Director of the Foundation for Defense of Democracy's Russia program. John, welcome back, man, to the situation report. I really appreciate you being here. Thanks for having me back. Well, let me ask you this to start with. Is it possible to have a ceasefire if neither party to the ceasefire knows that there's a ceasefire? Well, I think we've seen President Trump's best shot at doing just that, and so far has not been working out very well. The Ukrainian showed that they were willing to at least see how it went. But obviously, the Russians have been just striking harder than ever against their power plants, gas production, you name it. So, I think it's just unrealistic, frankly, to think that Ukrainians are going to sit on their hands and just know what that happened without some sort of retaliation. It does seem odd when, you know, after all these years at Putin's invasion, one of the few things that has really worked in Ukraine's favor is to target Putin's energy infrastructure and his oil refineries. And to your point, you know, Zelensky said, well, fine, we'll stop. And they did stop attacking Russian oil refineries for, I think, three or four days, a little bit longer. And Russia just kept on pounding their infrastructure ahead of the approaching winter. So, again, to your point, what's, I guess you could ask in simple terms, what's in it for keep? Right. And when you think about the Russians have developed just very detailed plans and put the munitions production against it to execute them going after not just energy, you know, that just heat and electricity, but also even water. And so it goes down to like, you know, which particular substation gets, you know, which munitions and, of course, they've increased production of, you know, Iskander ballistic missiles are kind of cheaper ballistic missiles that are fired by actually air defense systems to kind of complement those those were powerful iskunders. And then you also have the drones, the Iran, these days, four and five. So jet powered, you know, faster, hard to shoot down for Ukraine's kind of cost effective systems. And, and so you think Ukraine really has its hands full right now. And as you know that the winter's coming, it's already getting colder. And I think the Russians are just trying to turn that brutality really of thinking about think about like a senior citizen in their flat and key food. And, you know, doesn't really have the means to go elsewhere. And they just have to tough it out. And so or work, you know, a kid who had basically has their entire school they interrupted by by air sirens because it's not just nighttime strikes anymore. It's also daytime. And so, you know, Putin thinks that he can use this brutality to try to bend Ukraine to its will to his will. And I think he's wrong about that. But it's giving very, very difficult for Ukraine. Well, the Kremlin's implied that their goal here leading into the winter is to basically drive people out of the urban centers, you know, to lead the cities. I mean, to depopulate the cities. What do you make of you mentioned the the the risk and their ballistic missile largest. What do you make of the recent situation where Ukrainian military government said, you know, the key was targeted by I believe it was five Russian ballistic missiles. And they were unable to get any warning of the launch. Right. It's actually the other day we saw one of the biggest ballistic missile salvos of the of the war 39, according to the Lensky again is condor in the cheaper or in 48 you. So I think with the intelligence, it sounds there have been very, very credible reports saying the the Trump administration is threatened to cut that off if Ukraine does not, you know, exceed the demands of halting the tax on oil refineries. That ends the whatever meager supply of a patriot missiles is still getting to Ukraine to counter that threat. I think so far, it sounds like the intelligence has not been cut off. You know, President Trump said this. I think the Lensky alluded to this as well. And actually they're there Ukrainian Air Force spokesman the other day said, you know, we didn't get warning on basically the first wave of the attack and we did on subsequent waves. And that that happens. It's not unheard of you, especially if you think about ballistic missiles that are ground launched less less kind of response warning time compared to say, you know, air launch cruise missile where you can see the you know, the missiles being loaded onto the into the aircraft and you see it fueling up and you have much more time, including the flight time of the missile itself. So, I think that early warning is still happening. If the US were to cut off any sort of intelligence sharing, I suspect they would start with the kind of targeting data that's helping Ukraine conduct attacks inside Russian. Yeah, how critical at this stage of the game, right? Four plus years into it, almost going on five. You know, early stages, US intel sharing on targeting data was critical, absolutely critical. What's your assessment now? I mean, to what degree? As a Ukrainian military and their intel service has been able to fill that gap so that if if that does happen, if Trump's irritation, however you want to refer to it, was the Lensky continues and it does impact intelligence sharing. Would it have the same impact as it would have had early on in the war? So, Ukraine gets intelligence from Europeans and even these days, thing has small number of its own kind of contracted satellites that it uses for its military intelligence service. So, it's not like there'd be zero intelligence, but nobody has the resources of the United States intelligence community. And so certainly that there'd be a pretty significant drop off. I think it would be most impactful for air defense. And so the situation for Ukrainian civilians and cities and infrastructure would get even worse. More people would die. More things would be destroyed. I don't think you would be decisive in terms of breaking Ukraine, allowing Putin to impose his imperialistic demands. I think you're creating forces on the front lines and still continue to hold, but it would be quite a bit tougher. It is, and it is worrisome and obviously it's speculation. President Trump said they haven't stopped intel sharing, but his threats to do so certainly rattled NATO. They're concerned about this and they stepped out their own efforts. But when you combine those threats with then this disruption in star shield, the military version of starlink, and the problems with that now, firmly causing you creating military, it does, you know, there's always coincidences, but sometimes you have to look and say, what is going on here? Yeah, it's certainly the Ukrainian suspects that there was no coincidence. I mean, the timing would be pretty incredible if that were just a technical glitch. It does sound like it's been turned back on, the throttling has stopped. So basically what was happening was for star shield. And then as you said, the military version of star leg, when when the terminals, the things that receive the signal from the satellite, where we're going above the certain speed, maybe, you know, 160 kilometers per hour sometimes even much, much lower, seven year, and they were losing connection. So that prevents you from, for example, using a starlit control drone to conduct a strike. against Russian logistics and the Occupy territory's, yeah, I have its Ukrainian logistic drones and even vehicles were moving fast enough with a Starlink, for example. And there were also actually also some of Ukraine's defenses against, kind of their newer, more recently developed to defenses against Russian jet-powered that Iran 4 and 5 also used Starlink. So that was inhibited. It sounds like it's been turned back on as of this morning that Ukrainian units were reporting, you know, the access that they were stored. Still have no explanation from Washington or the Pentagon, though. So that, that's, in me, is pretty strange. And again, as we said, the timing is very, very suspect. Even it's coming on the heels of this war of words between Trump and Solansky, you know, that we've mentioned. Yeah, it is fascinating. And one of that, it's, it's kind of an absurd part of the whole story about the Star Shield and the disruption to services, but going into some credible reported from inside the creative military, they didn't, they had no idea what was going on when it happened. And they had to call the customer support line, which in a way is remarkable in today's world, right? And they're engaged in the fence of their country from an invasion by Putin's military. And there they are on. I know they're simplifying it, but they're trying to reach somebody in customer support. And I think we all know what that's like. Trying to get somebody on the line. Well, listen, I think if we, if we step back just a little bit and we look at where we are in terms of any possible negotiated settlement. Where do you think that stands? Right. So not a great place to ensure it. I think, you know, Putin is just despite the fact that his forces are not doing well on the battlefield, still clinging to these, you know, demands that the outstrip his military means, namely, first of all, the rest of the Donbass is this region in Eastern Ukraine that he's been trying to capture basically since the invasion of Kiev, of Kiev failed in winter of 2022. And so, you know, Russian forces are still in some areas making very slow gains. In some areas, Ukrainians are actually taking back some chunks of territory. But Putin is still insisting on this on this demand. It's a red line book for military and political reasons. And then you have kind of a host of other demands from the Russians regarding Ukrainian geopolitical status. It's right to host Western forces, join NATO, etc. It's sort of what you could call legal changes to codify Russian cultural influence inside Ukraine. So those are all on the table. And there's no indication that it is budging on that. I think recognizing this one kind of more immediate, perhaps a little bit and more achievable goal is this energy truth that, you know, the White House had made some attempts to lobby the Kremlin fork. Basically, the idea is, you know, on both sides, you stop attacking the other's energy infrastructure. As we discussed, the Kremlin has been rejecting that. And so it really hasn't gone anywhere. I think what's unfortunate is that when met with that resistance, President Trump's instinct or his reaction was to just kind of try to force Ukraine into a unilateral concession. And, you know, obviously that's not going to fly. I think both for Ukraine's sake and for President Trump's, the sake of President Trump's own goals of a lowering diesel prices and then be kind of eventually getting to a place with Putin, where he's able to strike a deal. It would be if President Trump's interests too push for something that's that's my order. It's neutral. If Ukraine's not going to stop striking and there's no indication they will, they resume strikes on refineries today. You're not going to really get substantially more Russian diesel to market and lower prices. If the refineries are able to have calm, then you can. Obviously for you, I do think President Trump actually, some part of the land does care about humanitarian aspects in Ukraine. And so he does care about some billions there. And right now, I think the White House is undercutting its own, what has been its consistent negotiating position with the Russians going back to last year, which is we don't do business deals or sanctions relief until there's a deal. And so that's out the door. It is. And I worry it's going more out the door because there's some White House officials who think, okay, not just the deal thing, which is really driven more by electoral considerations, but also other business deals with Russia, done now prematurely, could in their mind kind of generate momentum. And I think that's, the Kremlin probably reads that, not as a sign of goodwill, but as a sign of irresolution. And so if I'm Putin, that just tells me, okay, here's Mush, I'm going to push more. I'm going to double kind of dig my heels in on these demands. And at the very least try to intensify military pressure to exploit this friction between the US and Ukraine. So I think that's classic. Yeah. That's a classic US, you know, not just this administration, but any administration, the idea, you know, another culture, another country is going to respond or process offers or information or negotiations the same way that we would. Right. So let's make a deal. Putin's going to love a deal. He's going to look at it as good. Well, what they didn't, you know, again, want a load of crap. Oh, wait a minute. I just, I was about ready to climb up on my soapbox there, John. Listen, if you'll stay right where you are, we do have to take a quick break. We'll be back with more from John Hardy right here on the situation report. So don't go with it. Yeah, Mike Baker here. Let me take just a minute to talk to you about an incredibly important subject. I mean, the absolute key to your health. I'm talking about sleep. So let me ask you a question. Do you snore? I know it's a personal question. And as a result of snoring, did somebody, I don't know, maybe your partner, hand you a CPAP machine. And then, well, did you just stop using it? CPAP users know, right? The mask never quite seals that the hose is tugging at you every time you roll over and eventually like the rowing machine and the exercise bike, the CPAP machine ends up sitting abandoned in a closet. Well, here's your answer. Excite OSA works a different way. It treats a root cause instead of just managing the noise. And you use it while you're awake. It's an FDA cleared prescription device for primary snoring and mild obstructive sleep apnea. 20 minutes once a day, that's it. Maybe while the coffee roost, maybe while you're watching episode of something daily for six weeks, then a lighter routine to keep. Most people notice a change in four to six weeks and in clinical studies, 90% that's 90% of patients saw a reduction in snore. And getting started is straightforward. There's no sleep lab. There's no appointments. There's no sitting around a waiting room. You answer a few questions online, a license provider reviews them and it ships straight to your door. See if it's right for you. Get Excite OSA at springsleep.com/PDB and use code PDB for 20% off. Again, that's Excite OSA at springsleep.com/PDB. And of course, thanks very much to springsleep response ring this episode. Disclaimer, Excite OSA is an FDA cleared prescription only device for primary snoring and mild obstructive sleep apnea. It's not for everyone. Individual results may vary. Check out the risks and benefits at springsleep.com. Book a loved by guest property with Verbo and you get a top rated vacation rental that's love for all the right reasons. I love my Verbo for the location. Good reason. Oh, and for the pool because pools are cool. I feel the love. Book a Verbo that's love by guest. If you know, you Verbo. Welcome back to the PDB situation report. Joining me once again is John Hardy. He's a deputy director of the Foundation for Defensive Democracy's Russian program. John, thanks very much for sticking with us. Glad to do it. Excellent. Listen, in the last segment, you touched on the idea of sanctions and the whole concept of fuel exports, the White House just eased sanctions on Putin for fuel exports in an effort, perhaps, if you want, was cynical to lower diesel prices ahead of the U.S. midterms. It's a fascinating sort of sidebar conversation about how Putin views what he's seeing from the White House right now, where it seems Trump has, once again, decided that it's Zelensky's fault, that there's no deal, that it's Zelensky's fault. He did blame him for fuel prices in the U.S. It doesn't make you wonder what Putin is doing other than sitting in his chair juggling while stroking his airless cat. Well, I think that's a great visual. Yeah, to put a finer point on it, if you think about this diesel deal. According to President Trump's social post, it's something like 300,000 tons within October or another 500,000 in November after that. It's somewhat dependent on whether Ukraine stops strikes and what refinery capacity Russia has. 300,000 tons is It's actually less than all of American demand for a single day. And so I think it's something like that, even all the time that President Trump mentioned in his post, something like 4.8 million tons, that's about 0.25% of global demand. So you just consider that the toners were talking about the volumes, it's not going to make a significant difference for prices, certainly not before the midterm. So I think this is really kind of for show, like I said earlier, what could make a difference is if these Russian refiners are actually allowed to be prepared and you get full capacity. So instead of having very depressed amounts of exports, you start to get them back towards the maybe I think it's like 3 million tons or so, like around that rate and every month. I think that could make a significant difference. Ultimately, of course, what Mark and I still say is the straight-off removes that situation is having the biggest impact. So how much Russia wouldn't even affect it, I'm not sure. Well, of course, every dollar that goes to the Kremlin as a result of being able to sell more fuel helps to fuel their war machine, and that would be Ukraine's perspective on this. I mean, there's some inequities here that are very interesting. I find sort of the machinations and the strategy that's coming from the White House about this. And I'm excited with you. I think the President genuinely wants to see an end to this war for humanitarian reasons. Most people too. You know, it seems a bit at odds with reality to then propose after that sort of bizarre unilateral ceasefire announcement on truth social to then say, well, we'll do a refinery for refinery, negotiate a deed. Because my understanding is, you create doesn't have a functioning refiner. That's exactly the point I was going to make. And that's exactly equal there. What Ukraine does have in rely on, of course, is power plants. And Russia has been struck maybe three or four of those just in the past few days and dozens of other energy and other critical infrastructure targets. And I think when you're thinking about how to deal with the Kremlin and how to get to a place where there's actually some space for a deal, I'd want to be reducing their energy revenue and not increasing it. Of course, the President Trump's credit initially started in that back in October 2025, then the Treasury Department put sanctions on Russia's two biggest oil companies that added onto sanctions put onto smaller companies at the waiting days of the Biden administration. And that really was, was having a bite on the Russian oil revenue and in turn, the federal budget, which takes around 20 to 25 percent of its market. Go ahead. I'm sorry for interrupting, John, but I was being mindful of time, but, but so what changed? So what changed really was, was a, to begin with, there was never really enforcement of those sanctions. So the Russians quickly said, okay, we're not going to move money, at least on paper, you know, from, or move oil rather, from these, these sanctioned companies, we're going to have kind of cut out middleman, do it for us. And usually what you're supposed to do is, is coming to say, okay, now those middleman, under sanction two, we kind of play whack-a-mole on those schemes, Trump administration ever did that. And then B, of course, that was the Iran war. So after that happened, you know, that the policy went from constricting revenue to just getting as much oil in the market as you can. And so we, you saw this series of waivers to kind of facilitate Russian shipments. Yeah. Yeah. Uh, and the time we've got left, John, can you give me your current assessment on the battlefield situation, what's happening on the ground? Okay. So we've discussed kind of the stalemate. I think, you know, to put a few more details on it, the Ukrainians are doing a really good job of using a combination of, you know, traditional prepared defenses and, you know, mass precision fires, especially from drones, you know, mixed with other kind of traditional arms to put a really stout defense against the Russians, who at the same time do do, you know, massive casualties are just their force quality, it continues to plunge. And so the Russians have tried to kind of adapt to Ukrainian way of fighting in their weaknesses with a lack of manpower by using infiltration tactics to kind of, you know, see through those ports, Ukrainian lines, the Ukrainians in terms of counter-adapted to that. And so what you have is basically Russians inching forward and exchange for just massive uh, quantities of men, uh, you know, maybe, you know, 10 go forward, you know, in drips and drabs of one or two and, you know, maybe a few survived and they kind of accumulate. And so you'll have a situation for maybe 10 or so kilometers. There are interspersed positions, and it's just in gray zone. You don't really know who controls what, um, what that also means is that those, when Russia takes some territories and that first, you know, 10 kilometers or so is not really that firmly held. So the Ukrainians had some success in different areas and clung that back, including because they are improving a command and control under their new core system. They have a new chief of defense, uh, General Drapati, who I think is going to do a great job. He's doing a great job of kind of, you know, protecting manpower and also, you know, attacking and, uh, where the, where the, where the circumstances and, uh, the land is, is worth it. So, I mean, it does casualty rates and there's been talk there, uh, that perhaps Russia would engage in, or the Kremlin would engage in another mass mobilization after their parliamentary elections. Have you heard anything more about that about their personal situation? Right. So I think right now, uh, the Russians are super flush on manpower. They're still recruiting somewhere around 30, uh, thousand men a month, uh, probably losing around the same number, if not a bit more in, in, uh, killed and wounded. Um, so I think, you know, there's pressure on that on, on them, on the manpower, on the main power front. It's not yet as such a situation where it's so critical that, that Putin would take the drastic step of further mobilization, which if you remember, really, the most significant protests of this war, uh, and there weren't even that big, but most significant ones happened back during September, 2022 when Putin did the first rad of mass mobilization, have forced mobilization rather than voluntary incentivized by mass, you know, big payments. Um, and, and he did that only when he had really had no other choice because Ukraine had just caused the collapse of, of, of the, of the front and heart gave all blessed due to this, you know, drastic, undermining of Russian lines there. So I don't think he's at the point where he would have to do that. Um, if we get to that point, you know, we'll, we'll see which way he goes, you know, make a deal to sound to compromise or escalating, I think he would probably escalate. Um, and I, I don't think he would, I think the political conditions are such that he can't get away with it, but it would be a little risky and it would be costly in terms of the men that would fully rush a, and in turn, you know, hurt the economy, including the defense industry because of their tight labor market. Yeah. Uh, finally, John, I know this is probably a simplistic question, maybe a stupid question, even although my, my mom always told me there's no such thing as stupid questions. I got this agree with her at this point over my years. I have heard some, um, and this might be one of them, but what, what wouldn't break the Russian population against Putin's invasion? I mean, maybe the mass mobilization, but me at what point do they say enough is enough stops. So if you look at what polling there is out of Russia, most Russians want, and then to the war, um, they're sort of apathetic. So they're not going to take to the streets and try to topple Putin, but they would like to see it come to an end. They'd like to see creature, creature comforts return. The issue is that, you know, Putin, on the one hand, the Kremlin does monitor Russian public opinion, you know, very carefully, on the other hand, um, it's, they've, they've tamed, uh, the population, the opposite kind of, uh, destroy the opposition such that Putin is able to, you know, he had the conditions where he's able to start an unpopular war like this, where he's able to do things like mass mobilization and get away with it, even though it's, of course, not in the, in either Russia's best interests or the will of his population. All right, man, well, I have a feeling we're going to be talking about this for quite some time. So I look forward to having you back on John, listen, thank you for coming back on the situation report. And, uh, I hope next time I give you a call, you'll pick up the phone and say, sure, I'll come back. Thanks again to John Arty of the Foundation for Defensive Democracy's Russia program. All right, coming up next, China's latest military maneuvers are raising new questions about where the Beijing is preparing to blockade Taiwan. Steve Yates, you know, um, of the Heritage Foundation joins us to discuss, stay with us. Hey, Mike Baker here with a tip on how to jumpstart your day. Now I've been trying to rethink my morning routine lately, especially when it comes to just how much caffeine I actually need. That's where mudwater comes in. Let me spell that for you. M U D W T R. It still gives me that one comforting morning ritual. You know the one I'm talking about, but with about 1/7, that's 1/7, the cafe. a coffee. I've been loving the OG blend. It's cacao, it's chai, it's turmeric, and functional mushrooms. It's got a delicious chocolatey chive flavor. Ready to make the switch to cleaner energy? Well, I hope so. Go to mudwater.com/PDB and grab the starter kit. Use the goat PDB and you'll get 43% off. That's almost half off. The drink farther alone is worth it. That's right. Up to 43% off with goat PDB at mudwater.com. I'll spell that for you one more time. It's WDWT or mudwater.com. And after you purchase, they'll ask you how you've ever heard about it. Do me a favor. Tell them the PDB said you. So we plan for the plot twists. Before you stay through the moments in between and after your trip. Because a great trip starts with peace of mind, and maybe a good playlist. China is ramping up its military activity around Taiwan with a Chinese aircraft carrier heading into the western Pacific as the US and Japan prepare for major military exercises in the region. The deployment follows another confrontation near Taiwan, raising fresh concerns about Beijing's intentions. And whether China is laying the groundwork for a future blockade of the island. So is this just another round of Chinese intimidation? Or are we watching preparations for something much bigger? And with American forces heavily committed in the Middle East, does Beijing see an opportunity? Well, for more on this, let me bring in great friend of the show Steve Yates. He's a senior research fellow at the Heritage Foundation. And the host of the podcast nation states with Yates on the Clay Travis and Buck Sexton podcast network. Thanks very much Steve. Hey, his Buck Sexton still being a jerk to you. Yeah, he's rough around the edges sometimes. But you know, he's a dog guy. So all you got to do is talk to him about your dog and everything just warms right up. Yeah, good. Good. Well, I'm glad, glad things are turning the corner. Yeah, it's very erasible. So it's my word of a day, erasible. It's more syllables than I can use. That makes sort of it on his show. Steve, it's always, it's always at the light. Even when we talk about things that are disconcerting as we are today, giving the rundown on the latest from the China Taiwan kerfuffle, where do we stand? And what is the latest provocations that we're seeing from China? Well, there's a rage of them and it's one of these challenges where the movie never really stops. So we'll talk about what we know at the moment, but it's going to keep going. There's one part of the sort of Chinese buffet or what we call Grey Zone harassment, constrainment or coercion. And that's where things that could be fishing vessels, but are not really fishing vessels, sometimes military craft, increasingly large numbers of military craft that will go all the way around Taiwan. It's meant to give the impression of a capability to cut Taiwan off temporarily, maybe even to be able to cut off supply lines in a time of crisis that would come from the Pacific side of the island. And it's somewhat cost-free for China because international markets have not responded to these kinds of threats, the way they have in a kind of hypersensitive way to things in the Middle East. So insurers are not raising premiums. There's even though it's not just chips. There's a whole ecosystem that depends on the waterways and airways around Taiwan. So why it's not, I'm sorry for interrupting. Why, from the way I just did, why is that? Why don't insurers, why doesn't the transportation industry, why don't they take it seriously? Is it because they just don't believe it's anywhere in our near future? Is it because there's just too much else going on? Well, I just don't think they consider it real yet. And so the difference between the two theaters is that some commercial vessels have actually been shot at in the Strait of Ramos and with the Houthis now expanding that theater, whereas China has been somewhat strategic in keeping most of its interference just around Taiwan and trying to avoid kinetic things. Although there are sometimes when things go bump, whether it is, and it's expanded to Japan and the Philippines, which gets closer to what the Middle East theater has been like in terms of real treaty allies, but it's really things that would literally go bump a ship runs into another ship or they're firing water cannons at each other. We haven't had an instance where they're really like blowing something up or firing on the command center of a tanker that's trying to carry a lot of fuel or these huge, huge only people can't conceive of how big the container ships are that go from that point of the world to everywhere else. So they haven't taken that commercial hit yet, but the capability is there and it's being demonstrated. Is it all about from Xi Jinping's perspective? Is it all about just kind of pushing it to margins in an effort to test and probe and see how far he can push or what the response is from the West? That is a very Chinese way of thinking. It's basically a traditional Chinese way of thinking. And of course, the communists are not traditional Chinese. The whole idea of the revolution was cutting away all of that. But now it's fashionable again. So yes, it is kind of tell me where the line is and I will push my toe and then my foot over that line and see what happens. And if you haven't shot my foot off, then I'll see where they can make it up to the knee. And there's very much that kind of escalation test that is going on. But also there's a little bit of competition inside China about what exactly is the objective is the objective to take and hold and integrate Taiwan into something that goes on in prosperous from that point forward or is the idea to basically destroy Taiwan or give the some kind of a demonstration of capability where Taiwan basically seeds. And so you don't have to have to engage in a war. And so a lot of these theories are being tested out. I have my own belief is that China does not have the capabilities to military take and hold Taiwan. And I think that's well among the reasons why Xi Jinping has purged 80% of his top military leadership is they refuse to give the mafia boss the answer that he is asking for because those who've grown up in the military don't want to sacrifice the military and what will be a losing mission if you declare that is the objective. You think Hong Kong is perhaps the model that they'd be going for more likely rather than about a full scale military kinetic action. Prior to Xi Jinping, I think Hong Kong was the model. And it's sort of what the Deng Xiaoping the gregarious short leader of China who famously came to the United States. Really? You had to you had to comment on it. I had to do the altitude really necessary to do well, you know, why leave it out of the story? And so so you have a short leader of China. He comes to America. He puts on a 10 gallon hat in Texas, which again, you accentuate things. It's it's cartoon like, but Americans loved it and and then they reciprocated with trillions of dollars of investment over multiple decades under this idea that you know what we can have this thing that's called one country to system. We can be comic, comic, comic, but you guys can be free market. But under our sovereignty, you can continue to be the goose that lays the golden eggs will take the gold. Thank you very much. You keep being the goose. And that was sort of the promise. Now did Deng Xiaoping mean it? I think he probably did, but he's dead and we can't ask him anymore. And does Xi Jinping believe in that? I don't think he does. It's actually under Xi Jinping that much heavier controls over Hong Kong came into place. The imposition of the national security law came into place. The threat that even if you're a Westerner, engaging in unlawful information exchange, which might just be economic data from China, that you can have your profits and your executives seized and tried inside of China. That's not one country to systems anymore. And so I don't think Xi Jinping is trying to sell that, but I think some of the old guard in communist China actually is still on that memo and thinks that's the way that's supposed to be going. Well, you could argue that that Hong Kong has worked for the Chinese Communist Party. I mean, it took probably wrong, really. And they imagined it. Yeah, but it's done the trick. And so it is interesting that Xi Jinping is not stupid and he's also not short, by the way. He's taller than Deng Xiaoping. So as most of his, he has started, it's surprising that he wouldn't look at that and go, "I, fine." And so that leads you to wonder, what's his timeline? Does he just not want to take the time that would Jake would die on? Well, the problem is Hong Kong had a demonstration effect. And so you don't, the targets of your offer aren't going to believe it the way a lot of people in Hong Kong did at the time of the handover. The very distinguished barrister, as I think they call them in Hong Kong, Martin Lee, was an advocate for freedom and democratization, but would also be very detailed in his defense and explanation of what the promises of the joint declaration with the British were, the fact that it was a registered treaty in the United Nations, and here are some covenants that are meant to apply. And so I think that there were a lot of people who didn't necessarily want the handover to go the way it did, but saw the promise of one country, two systems is something to fight for and believe in. I think that a lot of those hopes are dashed to where you can't sell this pony twice after you've basically taken its hooves. It's my gross analogy for what they did to Hong Kong. You know what it goes, I was with you when you were just selling the pony. When you started that, shut up that pony. That idea. You know, a lot of, I lie off in monotuch, you know, yeah, he really did. You took it one step too far. Right. That's exactly the right. Listen, Steve, you know how this shell works. They're despite our scintillating conversation and my rapier like wits. We do have to take a break. So if you'll stay right, we'll be right back with more from Steve Yates. And by the way, if you're not listening to his podcast, right, nation states with Steve Yates, I don't know what you're doing with your time. Anyway, we'll be right back to stick around. Whether it's a birthday trip, a family reunion, or just a fun getaway, booking a verbo vacation rental means no worrying about surprises. Verbo care and 24/7 life support have your back if something's off. The love by guest filter helps you find top rated homes and verified reviews mean real feedback from real verbo guests. So you know exactly what you're booking. Honestly, I just booked my verbo because there was a sweet line for it. Hey, we all have our reasons. Don't walk into a surprise. Terms apply. See verbo.com/trust for details. Welcome back to the PDB's situation report. Joining us once again is Steve Yates, senior research fellow for China National Security Policy. There he is right there at the Heritage Foundation. He's also host of the new terrific podcast, nation states with Yates. Sometimes I say nation states with Steve Yates because I like to give him full shout out, but it's just Yates because that's a little iterative. And by the way, the way I'm marketing that podcast, Steve, I hope I get some of your swag at some point. Absolutely. We got it. We got to work on that. We're we're light years behind the Mike Baker standards of the world, but we aspire one day, one day to at least be able to carry said bags with swag behind Mike Baker. Well, I tell you what, I've been pushing. I'm the this is between you and me. I don't think anybody else is listening. I it's not through millions of listening. But I've been pushing here with the PDB team for some swag for some time. And I don't like saying one of my best ideas. I mean, in my entire time on this planet has been for the president's daily brief to have as part of the swag bag, president's daily briefs, days of the week. I signed me up. That's pretty clever there. I got to give you right now. I know I love it. That could be my one epiphany over all my years. That's going to be it. I know that people have a tune in here about that. But let's let's continue this conversation. I'm I'm curious from your perspective to what degree he is. Xi Jinping spending his time staring at what's happening with the Iran conflict. And I mean, we've talked about how he's viewed the Ukraine conflict. But you know, I guess we could we could look at both and see what the greatest outside influences the conflicts that are occurring outside of his region have any sort of impact. Do you think on his mindset and strategy towards Taiwan? Well, there's a few things that I think way in the direction of he might feel like there's a window that is closing on him. And there's some things that might be telling him by watching some of these developments in the technologies related in both conflicts that his window might already be closed in terms of what they might have estimated as an easier operation than it is now. What I mean by that is the kinds of technologies that were used by Ukraine to be able to extend its life against what people thought was an outmatched larger foe are already spreading around the world. And while the Trump administration has committed a huge amount of arms to Taiwan for them to purchase, I might add, not given. And there's a second $14 billion tranche that is in waiting. That would be an historic amount. But not waiting for government. Our private sector is surging capabilities into Taiwan. One of the conspicuous examples of that is Andrew Pong are lucky going in there with it's basically commercial to commercial. So there's nothing standing in the way of getting advanced drone capabilities going in there. I guess they call them uncrewed. I think that is the politically correct form of drone. I try to keep up on that front. But in Saudi, that gap is really important. And what it does is it makes a power that is trying to protect and defend much harder to penetrate and much cheaper and easier to frustrate forward and drain out the attacking force. And from Japan, through Taiwan to the Philippines, they are racing ahead in that area in the private sector, not having to wait for government. So I think that, and in a way, it's giving a fair due to China, which has mastered Greyzone with ships. We're just these fishing boats that are out here. And so they've used this as a form of constrainment and harassment. Now the weaponization of tech is working against them. I think that was demonstrated in Ukraine to some degree. The Iran conflict has to give them pause because the United States has proven that it can fly from the continental United States, drop the mother of all ordinance on a target, and it's home before you know what hit you. And China and Russia don't have any answer to that yet. And I think that's another part of what the generals have been raising by way of concerns. The last part is that the fact of the matter is the United States is still ahead on AI. And a lot of that application of advanced AI modeling and communication in space allows us to do some things I think China's top generals are still quite afraid of. Yeah, I'm not sure, no, this will surprise you, but I'm not an AI expert, but I'm not sure, I'm on the artificial side. Yeah. The gap between the US and China may not be as wide as people imagine. And I would argue given the PLA, given the Ministry of State Security's abilities to steal technology, I would argue that that gap wherever it may be months, months apart or a year apart is inevitably shrinking because they're extremely good at hoovering up information, research and development in particular. That story, I'm sure you saw about the young Saudi employee at Open AI who was Koya installing a listening device into one of the conference rooms where they have sensitive conversations. Common classic industrial espionage, now they haven't determined, they haven't publicly said who he's working for. I'd be rather surprised if in fact, he probably not China, the Saudis, as opposed to China, probably not China, but it is a tactic that is, you know, used by all and some, yeah, so yeah, I mean, I think the State Department can honestly had a had a conference room bugged for some time by the Russians that you finally got dug out of there. Yeah, no, they they'd say, look, it is, it happens. My point being that, you know, even at this stage where it's still speculation, of course, on my part and investigations, I'm sure ongoing. Yeah, it doesn't matter whether it's a Saudi national, you know, obviously a prime target is a Chinese national or a Chinese American from the Chinese intel perspective. Well, they don't care, they'll go after anybody that the field has access, is accessible, maybe has some, you know, some weaknesses, there could be some leverage points that they've identified. So, but the point being anyway is I think that gap between the two is closing. And as far as weaponization of space and the utility there, you know, China has been putting a great deal of resource into their efforts. And people talk about, well, I think we should weaponize space. Well, that horse left the barn sometime ago. I agree with that completely. Uh, and, uh, yeah, we, we definitely should not think of any form of warfare, as one, an arena where our enemies that seek to constrain us or worse are not going to be governed by the rules that we pretend that we're going to follow. And so we do have a pretty commanding lead in terms of quantity of what's up in space that is ours and that we use, and I wouldn't want to be boastful or sit on our laurels about this, but not only do we have the technology, we have the entrepreneurial spirit to apply this to real world use cases that are being tested in battle now. And so the Chinese, they have the benefit of no ethics and they can do whatever they want in their country, and they do have an army of people and technology going out in the world to soak up anything and everything to their advantage. But we do have this test of concept that, you know, sort of like having the best recruited team in football, but they've never taken a snap in a real game. And then I think they have to, at some degree, have a degree of humility about that. Xi Jinping have that humility, I don't know, and I wouldn't bank on it. I also don't think that he's the healthiest guy in the world. Now, we have a president who has raised himself on McDonald's, and yet seems to be a dynamo when it comes to energy. Xi Jinping has raised himself on what is categorically hard liquor for decades. And I don't know that he's going to break longevity records. Maybe he does. There's always those old stories about ladies in the 1860s that smoked a cacadelet and belted it down and they lived to 101. But I don't think Xi Jinping is in the greatest of health. He's purged all these people. The technology is more complicated. His targets are getting harder. He might personally feel like there's a reason to push on this. And he might start to feel some pressure from the politics in China that's saying his time is not unlimited. Plus this economy is having some significant problems. We've been covering that on the PDB for a while now in terms of digging into what that economy actually looks like as opposed to how they portray it. Let me ask you this though, with Taiwan, because there was a fair amount of talk about the idea of reassuring chip capabilities in the US, right? The idea being, well, look, I mean, I don't see the biggest issue with Taiwan is it lose Taiwan. You know, the chip industry. And so the thought was, let's move it all back to the US. What are you hearing about that in terms of actual investments from the key players in the industry? Well, there are some extremely serious investments. I mean, the TSMC is the most well-known anywhere in the world. It's a substantial portion of Taiwan's GDP. But it's also a substantial portion of Arizona's GDP at this point. And so I mean, that's a, just a multiple, multiple billion dollar maybe that it's going to be crossing trillion dollar investment. And that has substantial implications for the whole ecosystem that comes along. It's not just the fabs, there's a whole ecosystem of inputs and workforce that come along that add to Arizona and there are other locations across the United States. And that's just one company. There's I think been a little bit of foolish talk and thinking about Taiwan that's been committed by a lot of people that I like. But there's this notion that somehow Taiwan is far away. And so that we get out of this dilemma of what can we avoid a conflict with China because all they really want is Taiwan. And so if we just reshore the semiconductor industry, would we then be a okay? And the answer to that is a deep, deep no because our ally Japan has deep equities. But it's also the fourth most valuable stock market in the world. And so if you imagine missiles landing in Taiwan or some kind of effort, even if it fails to try to take Taiwan by blockade of some sort, you're going to have a question. A crash in that stock market. And guess what? We're not insulated from that either. It would be an order of magnitude that is greater than 1929 when it comes to our market, London's market, Middle Eastern markets. And so you have, there's, so this is economic nuclear weapon material. And we just haven't taken that side of it serious enough. And by the way, it's not that far from US territory and we're not saying we're not going to defend US territory. Yeah. No, you're raising a really important, really important point that sits up there at 30,000 feet, which is, you know, how we interconnected the world is. And yeah, I'm sure you're, you know, you have the same sort of conversations that I do occasionally with individuals who think, well, oh, yeah, let's just draw the curtains around the US. We should just worry about the US, you know, why are we doing these things overseas? What? And yeah, yeah, sometimes it's adventurism and it's misguided. But sometimes there's a real reason for it. And it involves the safety, stability and national security of the US and our allies. You know, before I get fully up on the old soap box, Steve, I just looked at the clock on the wall and I realized that we're out of time, dammit. So it must have been good. Tell, tell our, tell our, tell our wonderful viewers and listeners where they can catch your podcast. Well, please just, you can look up the words, nation states with yates. It's basically, it's available wherever you get your podcasts. You can use it for free on the I Heart app. You can even watch video of the podcast if you are truly daring and would like to punish yourself. But the audio version, very easy to go down and we're still in the build out parts of the operation where we're going to try to make it easily accessible on a YouTube and other places. But you know, I'm a child of the 70s and 80s. We're getting there. And I've got the help of some much more capable people. But for now, just go wherever you get your podcasts, Apple Spotify, I Heart and download every single episode of nation states with yates, tell your friends, tell them Mike Baker said, if you don't do this, someone's going to come knock it. Oh, yeah. Is that why you haven't invited me, Steve, is because it's still in the build out stage? I actually have not had a guest yet, but you know, I want to, if you're not now, I want to be a part. I definitely, definitely we're going to work in returning the favor and invite Mike Baker in for a conversation about the importance of the nation's state and the issues that affect its fate. Just because we like to rhyme in a little rate. Yeah. Yeah. It's going to get a run out of energy there. I've real soon. And just keep doing that rhyme. That's why the good news is Steve to wrap it up is that the amazing Nick Rizzuto is the executive producer for the PDB operation and myself are almost finished with your theme song. You're going to love it. I can't wait. I can't wait. Nice. All right, man. Listen. Thank you was always Steve. I look forward to the next one. Thanks, Mike. Well, as Steve Yates, Heritage Foundation, again, check out his podcast, nation states with Yates, that is all the time we have for this week's PDB situation report. I know. I mean, we'll be back next week. If you have any questions or comments, maybe a humorous anecdote, well, reach out to me at PDB at the first TV dot com. Please keep your cards and letters coming and every every month, we try to compile some of the great questions and comments you send along into and ask me anything episode. So as I said, keep your cards and letters and faxes. And finally, listen to the podcast and the show ad free you can do that. It is very, very simple to speak on a premium member of the president's daily brief by visiting PDB premium dot com. I'm Mike Baker. And until next time, you know the drill, stay informed, stay safe, stay cool. At Virbo, we understand that even the best of plans sometimes need a little support. Every booking is automatically backed by our Virbo care guarantee giving you confidence from the very start. Whenever you need help, it's ready, before you stay through the moments in between and after your trip because a great trip starts with peace of mind and maybe a good playlist. But we've got the peace of mind part covered.