Holding Court Special Report: Author Chris Fenton joins Patrick with an update on the ongoing Peng Shuai story.
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Patrick McEnroe: [00:00:00] All right, everyone, I told you I would stay on top of this as punk shui situation, I've been taking a little hiatus from my podcast, but I've been doing some updates as I think necessary and I'm very, very lucky to have a guest who sort of joined me at the last minute here. His name is Chris Fenton. He's worked in the entertainment business for a long time. He's got a book called Feeding the Dragon Inside the Trillion Dollar Dilemma Facing Hollywood, the NBA and American Business, and I came across you. Chris, I'd heard of you before I came across you, obviously in the last week as I've tried to educate myself on what's happening with punk shui. The tennis player who's been missing in China, although apparently she's been, she's been found if you believe what you hear and see from the IOC. But thanks for joining me. I know you're on a little vacation with your family. I'm about to take one myself with mine. So thanks for giving me a couple of minutes and giving us a little background in the tennis world about what this means. You think overall for relations and just moving forward, the Olympics coming up, there's so many levels to this story that I want to get into with you. So thank you, Chris.
Chris Fenton: [00:01:09] Well, the honor is mine. I've been a big fan of yours and I've known obviously for a lot longer than you've heard of me, and I appreciate having the time to get to talk about this situation because it's a it's an amazing confluence of events that have occurred. It's which I believe you probably came across one of my op eds that I wrote. Yes. And then in Spokane, I said I did a nice little trilogy. I'm sort of the way we need to look at the upcoming Beijing Olympics as a real position of leverage in order to get some constructive change done between the U.S. and China. But then on top of it, as you know, we had cancer out there who has been extremely vocal about many sensitive issues that the Chinese Communist Party does not want anybody talking about everything from Typekit to Hong Kong to Taiwan to Xinjiang Cross River controversy. And then on top of it, suddenly we have Tang's disappearance. And I think what's absolutely remarkable and I didn't deal with tennis during the 20 years that I talk about in my book, know we were much more involved with the NBA in Hollywood, getting both of those entities much more integrated into the China market. But the way I see it is, it's really part of the commercial and cultural exchange, which has been massively prolific over the last 40 years and very, very important in regard to the trade dynamic between the two countries. And tennis just falls right into that smack in the middle, and it's one of the most profitable sports endeavors when it comes to China. Between the events there, between the endorsements of the the individual athletes, and I am absolutely the respect and admiration I have for the tennis community coming out and almost not even thinking about it for even a split second. Whether they should come out vocally support what happened to Peng and demanding answers is just remarkable because I've been watching, unfortunately, my community of Hollywood. I've been watching. Unfortunately, NBA stay silent on these issues, and the tennis community really needs to be commended for what's happening.
Patrick McEnroe: [00:03:19] So I guess the question now, Chris, and you have so much experience. I mean, you've done movies there, you've spoken there. You have such an incredible history within China. So I guess I did read your article and I remember saying in one of my interviews, I did when when this story first broke last week on CNN, saying, and I think my last line was, when is enough enough? You know, when is as far as our relationship with China? I mean, you could you could argue with other countries around the world as well, but we'll leave that for another day. But in your in your article, you, you and then I've read and I watched some of your interviews that you gave long before this situation came up where you really look at the twenty twenty two Olympic Games as sort of as something that has to be dealt with in a way, I guess my my feeling at this moment, having seen what the IOC did and having seen the reaction, or should I say, lack of reaction from many of the media companies that were coming after me for interviews just a week ago that are now sort of saying, in fact, one of the the emails that was written to me, Chris, in the last couple of days was We're standing down on this issue. How does that? How does that hit you? Well, look,
Chris Fenton: [00:04:37] I mean, one of the things you bring up, what is the tipping point, when is enough is enough? And and unfortunately, capitalism really dictates what what is the self-interest of every entity, person and celebrity or athlete or whoever on Earth in a lot of different ways? I mean, it's let's face it, I mean, it's an instinctual part of who we are as Americans. And when money is on the line, there's a lot of skin at stake, right? So to completely blame people for staying silent, at least initially on this subject, you can see the calculus that goes on in their head. What what I think is the silver lining in all of this is that, particularly Hollywood, we have lost a large amount of market share as high as 80 percent back in 2012, down to less than 10 percent in that market this year. And it's been dropping steadily every year because what we did was we we were given access to sell them fish, but then in the process, we had to teach them how to fish. And the reason I bring this up is because this is a rinse and repeat for every other industry, every other business when it comes to China, and the tennis is no different. I mean, their their goal is obviously to create competing events, the opportunities to build their own athletes, to generate imitation products and services for some of the big tennis sponsors that are out there. And what happens is the risk reward calculus of businesses will start to change as their access to the market starts to shut down.
Chris Fenton: [00:06:17] And as that changes things like what is going on today and how vocal the tennis community is in bringing attention to this situation, what Enes Kanter is doing with Judd Apatow is doing what Daryl Morey did with his tweet from his position as the Houston Rockets GM. All of that vocalization. What's wrong is causing consumers and critics and journalists and politicians to see the problem and to start to use their wallets and their own positions of influence to stand up against it. And now, when you look at the closed access to the market for a lot of businesses, plus the Western retaliation for what a lot of consumers see as wrong occurring, the risk reward starts to weigh heavily on doing what's right. And quite frankly, when you do what's right in a situation like that, you can actually monetize whatever that product and service is. Sometimes even better because you're seeing is doing something that's correct. That's morally and ethically superb. It's something that's not kowtowing to something that we all feel very disappointed about when you're about these issues in the way corporations are looking, the other direction. So I do see that tipping point occurring and what the tennis community is doing to vocalize this, to make people aware of it is causing that tipping point to come closer and closer to today, which is.
Patrick McEnroe: [00:07:47] And my question to you and again, I'm talking to Chris Fenton, who's got a great book called Feeding the Dragon that really addresses this issue from so many different levels. And for him, if somebody from so many years. So this is not nothing new to him. But Mike, my question to you is, Chris, you know, because there's so much business intertwined between us and China, whether it's entertainment, sports, the Olympics, whatever it is, there's just so much. We've got the ship sitting off the coast of California now, trying to bring our stuff in that we know we've ordered for Christmas on Amazon, so we all know that. Is it possible to affect China to continue to do business with China and in other words, not just pull the plug? You know, the WTA, the women's tour is essentially saying, we're ready. We know that the financial repercussion for us are massive to lose nine to 11 tournaments, whatever it is in China. I would argue even more exponentially for tennis than for the NBA. You know, and probably not a bigger number, but a bigger percentage of the money in women's tennis would would leave the sport. Is it possible to affect some sort of change there while still being able to do business in China? If your tennis, if you're the NBA, if you're Hollywood.
Chris Fenton: [00:09:05] 100 percent, the answer is yes. We do not want to decouple from China, the only way to decouple after 40 years is a flat out war, a kinetic. It's just too we're just too complicated a creature as far as shark and remora to be able to do that. What we need to do is sort of what Europe did in the early 1800s, which is said, Hey, you know, at USC, you're building your infant industries and your industrial revolution on our backs with Texas exports, JVs and tariffs and protectionist policies. Enough's enough. We want to monetize what we help build, but to go to war with you over. And that's essentially what we need to do with China. But there's other facets of it, too. I mean, there are, first of all, a huge freedom of speech issues that they have encroached upon when it comes to across their borders. The ability for Daryl Morey, for instance, the Houston Rockets GM to tweet out his support for Hong Kong protesters while on Western soil should be allowed. It shouldn't have repercussions of shutting out the league for a year and a half to two years. In fact, you still can't see NBA games on CCTV, and you can't see any teams that were ever affiliated with Daryl Morey on any sort of platform or in any store shelf. As far as. So we need to stop that cross border censorship as far as Taiwan is concerned, which is something that cancer has brought up. I mean, we can flat out say, do not touch that sovereign nation.
Chris Fenton: [00:10:35] We are. We are standing behind all these companies and industries that are doing business in China. You need them. We have economic leverage. You need to stay away from Taiwan's independence. We will recognize them continuously as a and this one China policy. But they need to remain independent and not go the way of Hong Kong on top of it. Wto designations, which are still as they still recognize China as a developing nation, they need, quite frankly, be called a developed nation, especially now with China calling themselves a superpower and a rival, the U.S. and the leader in that region. We also need to apply SEC accounting practices to the way their their companies gain access to U.S. capital markets. There's all kinds of different issues, and then of course, there are the human rights issues that we need to keep pushing on. We are never going to agree with them on human rights. It is something that is in their DNA is something different than us. But what we can do is push for them to effect change. We can push companies to stop manufacturing there, to stop using slave labor, to essentially come out and speak out about it and be vocal about it and affect China in a way that affects them economically and that will eventually move them towards the direction that we need them to. But going back to your answer, yes, in effect, change. No, we do not want to fully decouple because it would be very, very disruptive to the globe.
Patrick McEnroe: [00:12:07] What would you like to see happen, Chris, as far as the Olympics is concerned in twenty twenty two in Beijing?
Chris Fenton: [00:12:14] The problem with the Olympics, and we were involved with the 2008 Olympics. Keep in mind, China at that time was coming out of their juvenile sort of status as a rising power and coming into their adolescence. It was essentially a coming of age party that they did on the global stage. What the Beijing 2022 Olympics is is that fancy dinner party where China is essentially in the world we are now and we are leaders in the world, whether we are co-leaders of the U.S. or pull out leaders. They are trying to get validation for their very competent government and their eyes for the infrastructure and the and the majesty of what they have built in less than 40 years. They are trying to get global validation, and for all of us to have all these issues that China has created, that they are not fixing and in fact are making more aggressive a stance on when it comes to most of them. And for us to still look the other way on that and go over there and validate them, I think that symbolically is completely wrong and will essentially validate that they have been doing so. My belief is that we need to do some sort of boycott. And as as somebody who was an athlete, my son is a great athlete. I look at this and think about the athletes who have worked so hard to keep those Olympics. I'd love to find a way to affect change without penalizing them. And I've talked about perhaps NBC not showing the Olympics around the world and in fact, boycotting the coverage of it so that it becomes a tree falling in the woods that no one sees. Yet the athletes compete. I think there's also a lot of discussion about moving the Olympics. I think there is a very sort of logical and practical version of the boycott, which is involving a diplomatic boycott, which I know President Biden is considering. But we need to do something that gives a strong message that enough is enough and then they need to change a lot of places where it is practicable and doable in the short term.
Patrick McEnroe: [00:14:24] Interesting, isn't it, when you look at this bigger picture and I got to ask you two things that I appreciate you again, give me a few minutes, I know you got to run, but what do you think has gone on actually with Peng schwag? Because that's what a lot of obviously people in the tennis community are still wondering. We saw the pictures, we saw the videos. We're assuming this is all staged by the Chinese government or the Chinese Tennis Association. That would be my assumption. What's your assumption on what's happened since she posted that piece she did on social media that this political figure sexually assaulted her? What do you think is actually happened there in the last month to her?
Chris Fenton: [00:15:03] Well, I look at the Chinese Communist Party as one that's a little bit like a teenager that doesn't get punished for doing wrong things, and they essentially get more and more emboldened to do things that are more and more aggressive. I mean, if you look at Saudi Arabia and the way the Khashoggi killing went down, I think he is his risk reward calculus was like, Hey, this guy's causing a problem. I'm going to get rid of him. And you know what? No one said anything bad about that before, so I'm going to get away. Obviously, the global community stood up and said that was wrong, and there was all kinds of repercussions for it. I think China's mistake. I mean, John Gotti is arguably one of the most powerful figures in the history or in the modern history of the Chinese government. He was one of the Standing Committee members. Remember this? Seven out there out of two hundred plus Central Committee members and now the 92 million Communist Party members on the whole. He was one of seven of Xi Jinping, obviously overseas standing committee, and it was extremely embarrassing to Xi Jinping to have that claim come out, that claim of sexual assault, something that happened over a long period of time and with somebody as high profile as Peng. So they wanted to do something to make sure that was and what they did was extremely aggressive. And I do believe he probably is still alive.
Chris Fenton: [00:16:30] But I will say that she's probably not in the best state and I can only go by speculation and what I'm reading and seeing because I am not over there myself. But what they did do was something that I think wasn't calculated correctly, and they underestimated essentially, the fortitude and the wherewithal of the community of Peng had built her celebrity and her success in which is the tennis community. They just expected the same thing to happen where everybody would look the other way, put their heads in the sand and essentially take what it was a tempest in a teapot and make sure that the news cycle just passed it by. What didn't happen is exactly that. The tennis community came out vocally supported and is demanding answers. And I think that was the calculus that they completely underestimated. And now they have a real resonance that they have to figure out how to crawl out of. And we better all the Tang is alive and safe and sound because they are going to be pressured to make sure that she is set free in whatever capacity that is in order to save basically and help allow the Olympics to continue. Because that is a situation where I do think the straws will break the camel's back and there will be boycotts. Something really, really has happened to Pang that should not have and
Patrick McEnroe: [00:17:56] Yeah, that you're dead on about that. And obviously the reaction from the IOC and comparing that to what's happened with the Women's Tennis Association, I think ah. Wow. I mean, it's like the IOC just kind of playing along with the Chinese and the WTA saying, no, thank you. So we shall see where this goes. I hope I can call you back if you need me to jump on. I know you have your own podcast, too, Chris, so thank you for squeezing me in. Keep up the great work, enjoy the holiday season and hopefully we'll meet and talk again down the road.
Chris Fenton: [00:18:30] Yeah, for your audience, I'll be. I'll be tracking it at the Dragons Theater on Twitter, and probably a slightly different angle than obviously you will be. So, anybody that wants to follow and follow my commentary on it, I'd love that. And I really, once again, want to thank the community, your audience, the way tennis has really stood up to this situation, where they're not many others that have. It's really fantastic. And quite frankly, that community might create the tipping point we're all looking for. So, thank you again, and thank you on behalf of the global community.
Patrick McEnroe: [00:19:07] And thank you, Chris, for coming on and for educating me and the audience on everything that you're doing and that you know about already. So well done. Chris Fenton, everyone here on holding court and happy Thanksgiving to you and yours.