#144 Erik Bethel - TikTok Spies, Blockchain Technology and China's #1 Goal

Erik Bethel's life story is a testament to overcoming adversity, embracing cultural heritage, and pursuing a dynamic career that spans military service, finance, and international business.

Bethel grew up in a Cuban immigrant family in Miami, with a father who worked as a diplomat and press attache

Erik Bethel's roots are deeply embedded in the turbulent history of Cuba and the immigrant experience in Miami. His mother's escape from Cuba with little more than a Bible and a photo album during the revolution speaks volumes of the political struggles encountered by his family. His grandparents were under house arrest in Cuba, and his father played a vital role as the press attaché at the US Embassy in Havana, relaying intelligence back to Washington. Following his departure from the diplomatic service, his parents ventured into entrepreneurship, starting a business of their own.

Bethel's father insisted he speak Spanish, which resulted in him not learning English until he entered elementary school. This language barrier initially placed him in ESL classes, emphasizing the linguist challenges faced by many immigrant children.

Against the conservative backdrop of his maternal household beliefs, Bethel's mother, a stark advocate of education and autonomy, managed to attend the University of Miami. She worked at the US Embassy until the Cuban revolution's end and then sought a new beginning in Miami.

Bethel attended the US Naval Academy and served as an officer, before transitioning to a career in finance

Bethel's formative years were marked by financial hurdles after his father passed away, leaving his family to grapple with economic difficulties within Miami's Cuban diaspora. Their gradual ascent from Hialeah to the more prosperous Coral Gables mirrored the success of his mother's magazine company, which flourished to secure contracts with numerous airlines across Latin America.

From being placed in ESL classes to high school at Belen in Miami, a legacy of Cuban academic institutions, Bethel's academic journey was tumultuous, punctuated with behavioral issues and a stint in military school. He chanced upon the Naval Academy, which cultivated in him a sense of purpose and nobility. Despite an initial rejection, Bethel's perseverance saw him through the Naval Academy Prep School in Newport, Rhode Island, and onto the Naval Academy, where he excelled and served as an officer upon graduation.

Contemplating his future during the Clinton administration's post-Cold ...

Erik Bethel raises significant concerns about China’s ambitions and its global influence, especially as it relates to the United States.

Bethel observed concerning trends of intellectual property theft and technology transfer from the US to China during his time living and working in China

Bethel voices his concerns about the predatory economic strategies of China, which include intellectual property theft and unfair competition practices. He mentions grave instances where Chinese nationals at high-profile US companies and research labs have stolen valuable data. This theft extends to the practice where Chinese companies often directly compete with American firms by duplicating and undercutting them.

He observes that when American companies took their manufacturing to China for cheap labor, the Chinese duplicating behavior included creating "splinter factories," stealing employees, and undercutting on prices — practices that erode American companies' market shares and revenues.

Bethel believes China poses a serious long-term threat to US interests and that more leadership is needed to confront China's ambitions

Erik Bethel underlines China’s substantial investments in critical technologies such as AI, quantum computing, and advanced manufacturing, noting that they have now surpassed the US in many areas. This strategic goal to eclipse the United States carries the risk of China pushing its economic model based on centralized control, visible in sectors like Hollywood, where financial influence has led to self-censorship.

China's investment in critical technologies like AI, quantum computing, and advanced manufacturing have surpassed US capabilities in many areas

Bethel asserts China's advancements in AI are partly due to larger data sets and fewer privacy restrictions, which when paired with its dominance in sectors like drone production and shipbuilding, pose a technological threat to the U.S. He mentions China's progress in hypersonic missiles and satellite technology as examples of China’s fast-paced growth in critical areas.

The US needs to take significant steps to rebuild its domestic manufacturing and energy production capabilities to reduce reliance on China

Bethel stresses the importance of reshoring manufacturing to the US, especially in sectors like rare earth element processing and solar panel production, to reduce reliance on China. He suggests that the U.S.'s vulnerability in the supply chain, particularly in the processing of rare earth elements, underscores the need for a complete ...

Bethel offers his reflections on the fiscal challenges facing the United States, the promise of decentralization, and the risks associated with central bank digital currencies like China's.

Bethel is concerned about the long-term implications of China's development of a central bank digital currency and its potential to undermine the role of the US dollar

Bethel considers China’s central bank digital currency (CBDC), exemplified by the ECNY, to be "evil and bad," linking it to the authoritarian control seen in China’s social credit system. He expresses concern that it might globally undermine the role of the U.S. dollar. However, he proposes that, if designed with care, a U.S. central bank digital currency could offer privacy and security. Bethel views decentralized finance and blockchain technology as tools to ensure transparency and protect privacy and autonomy. He suggests that public blockchain, possibly supported by institutions like the World Bank, would allow everyone to see where money goes, thus helping to prevent corruption.

Bethel believes decentralized finance and blockchain technology offer a potential path to preserving individual privacy and autonomy in the financial system

Decentralization, says Bethel, could be key in preserving agency, freedom, liberty, and individual autonomy against centralized systems' risk of corruption. After exploring Bitcoin and decentralized finance post-Trump administration, Bethel suggests that these technologies could help maintain U.S. dollar preeminence and prevent government overreach.

However, Bethel cautions that central bank digital currencies could also be used to increase government control over citizens if not designed properly

While not explicitly stating central bank digital currencies in the transcript, Bethel's concern about quantum communication technologies hints at fears regarding increased government surveillance and control, which could also apply to CBDCs.

The growing U.S. national debt and deficit spending pose serious risks to the long-term stability of the US dollar as the global reserve currency

Bethel discusses the concerning state of the U.S. national budget, highlighting a significant deficit that results in a rapidly growing debt—an unsustainable model akin to an individual living beyond their means. The Federal Reserve's balance sheet expansion, he notes, ha ...