CONFRONTATION CONTINUES.

ASHLEY: YEAH.

STUART: DENNIS WILDER, FORMER

NATIONAL SECURITY COUNCIL

DIRECTOR FOR CHINA, JOINS US ON

THE PHONE.

DENNIS YOU ARE IN HONG KONG,

THAT CORRECT?

>> NO.

I'M IN WASHINGTON.

STUART: I DO APOLOGIZE.

I'M SORRY.

MISTAKEN, MY FAULT.

I'M SURPRISED TO SEE THIS.

IT IS MIDDLE OF THE WEEK.

IT IS AN UGLY CONFRONTATION.

WE NORMALLY HAVE THIS ON THE

WEEKENDS.

WHAT SAY YOU?

I WASN'T EXPECTING THIS?

>> WELL I THINK WHAT YOU HAVE TO

THINK ABOUT, STUART BEIJING MADE

A DECISION AT THEIR SUMMER

RETREAT, LEADERSHIP, WHAT THE

DECISION IS USE THE HONG KONG

POLICE IN MUCH MORE SERIOUS

MATTER THAN BEFORE.

THERE IS STARTING TO BE THE

LITTLE GREEN MEN PROBLEM.

IN OTHER WORDS, I THINK THEY

HAVE TAKEN A PAGE OUT OF PUTIN'S

BOOK, YOU'RE BEGINNING TO SEE

PUBLIC SECURITY PERSONNEL FROM

ACROSS THE BORDER IN HONG KONG.

SO RATHER THAN MOVING IN WITH

UNIFORMED PLA, OR THE PEOPLE'S

ARMED POLICE THAT WE SEE AT THAT

STADIUM ACROSS THE BORDER, I

THINK BEIJING IS AUGMENTING THE

HONG KONG POLICE FORCE WITH

PEOPLE FROM ACROSS THE BORDER

AND IT IS GOING TO GET ROUGHER.

STUART: NOW THE CHINESE FOREIGN

MINISTRY NOW ADMITTED.

YES, IT HAS DETAINED BRITISH

CONSULAR OFFICIAL FROM

HONG KONG, WHO WENT BY TRAIN

INTO MAINLAND CHINA, THEN

DISAPPEARED.

NOW THEY ADMIT THAT THEY HAVE

DETAINED HIM.

DOESN'T THIS REALLY RAISE THE

TENSION, RAISE THE STAKES

BETWEEN BRITAIN, WHICH HANDED

HONG KONG BACK TO CHINA 1997.

THAT RAISES ANTE

CONSIDEREDDABLY, DOESN'T IT?

>> IT DOES.

ALL BEING DONE AGAINST BRITISH

COMPANIES AND AMERICAN

COMPANIES, TO PRESSURE THEM IN

HONG KONG RIGHT NOW,

CATHAY PACIFIC PILOTS BEING TOLD

TO HAND OVER THEIR PHONES WHEN

THEY GET TO BEIJING.

PEOPLE CAN LOOK TO SEE IF THEY

HAVE BEEN INVOLVED IN

ACTIVITIES.

YOU HAVE SEEN THE MANAGEMENT OF

CATHAY PACIFIC TURNED OVER

BECAUSE OF THIS WHOLE THING.

THERE IS A MULTIPRONGED APPROACH

BEIJING HAS THAT IS VERY

OBVIOUS.

PRESSURE THE COMPANIES.

PRESSURE THE TRADE UNIONS.

PRESSURE THE HONG KONG POLICE TO

DO MORE.

THIS IS, THIS IS AN ALL-OUT

CAMPAIGN NOW ACROSS THE BOARD IN

HONG KONG.

USE THE QUOTE, UNQUOTE,

PATRIOTIC CITIZENS OF HONG KONG

AGAINST THE STUDENTS.

USE TWITTER, USE FACEBOOK.

WE ARE SEEING AN ASSAULT ON

HONG KONG NOW NOT WITH POLICE,

I'M SORRY, NOT WITH TROOPS BUT

WITH ALL OF THESE OTHER, SORT OF

WAYS OF PUTTING THE HEAT ON AND

YOU'RE GOING TO SEE THIS

INCREASE.

STUART: OKAY, WILL IT WORK?

YOU'VE DESCRIBED VERY WELL THE

INCREASING PRESSURE, QUIET

PRESSURE ON EVERYONE, TRYING TO

SQUASH THIS MOVEMENT QUIETLY.

WILL IT WORK?

>> I DON'T THINK SO BECAUSE

1.7 MILLION PEOPLE CAME OUT ON

SUNDAY IN SUPPORT OF THIS

MOVEMENT AND THAT IS A BIG PART

OF SIX OR SEVEN MILLION PEOPLE

OF HONG KONG.

STUART: DENNIS, HOLD ON A

SECOND.

I JUST WANT TO ALERT OUR

VIEWERS, WHAT IS ON YOUR SCREEN

RIGHT NOW IS A LARGE FORCE OF

RIOT POLICE MARCHING RAPIDLY

THROUGH WHAT WE BELIEVE IS THE A

SUBURBAN TRAIN STATION.

THEY'RE PICKING UP THE PACE.

THEY HAVE PRESS ALL OVER THEM.

THERE ARE DEMONSTRATORS

FOLLOWING THEM.

THIS SQUAD LOOKS TO ME, 30, 40,

50 RIOT POLICE.

THEY'RE IN THE SUBURBAN TRAIN

STATION.

I CAN HEAR SHOUTING BIG TIME.

WHAT'S REALLY GOING ON I CANNOT

SEE ON CAMERA AT THIS MOMENT

BUT --

ASHLEY: THEY HAVE BEEN TRYING TO

REMOVE PROTESTERS HAVING A

SIT-DOWN PROTEST AT THIS TRAIN

STATION, THE SAME LOCATION ONE

MONTH AGO WAS THE SCENE WHERE

PROTESTERS WERE ATTACKED BY

MASKED MEN.

45 OF THOSE PROTESTERS WERE

INJURED, ONE CRITICALLY.

THIS IS BASICALLY ACKNOWLEDGING,

THIS HAPPENED ONE MONTH AGO,

NOTHING HAS BEEN DONE ABOUT IT.

STUART: DENNIS, YOU WOULD KNOW

ABOUT THIS.

>> SURE.

STUART: BEARING IN MIND YOUR

POSITION.

HAS THERE BEEN CAPITAL FLIGHT

FROM HONG KONG?

IN OTHER WORDS, LOCAL PEOPLE

WITH SERIOUS MONEY GETTING THAT

MONEY OUT AS THE TENSION RISES?

>> OH I THINK PEOPLE ARE MAKING

THOSE CONTINGENCY PLANS.

THEY MAY NOT HAVE MOVED IT YET,

THEY MAY HAVE BEEN WORKING ON

IT.

I THINK FOREIGN COMPANIES ARE

BEGINNING TO SERIOUSLY

RECONSIDER THEIR POSITIONS IN

HONG KONG BECAUSE OF THIS KIND

OF PRESSURE, BECAUSE SOME OF

WHAT BEIJING IS ASKING THEM TO

DO IS PRETTY UNTENABLE.

FOR EXAMPLE, FIRING EMPLOYEES,

SIMPLY FOR JOINING THE

DEMONSTRATIONS.

SO I THINK BEIJING IS IN

DANGERING THEIR POSITION IN

HONG KONG RIGHT NOW, THROUGH

THIS VERY HEAVY-HANDED SET OF

TACTICS THEY'RE USING.

STUART: I DON'T SEE MUCH

DIFFERENCE BETWEEN THE COLD WAR

BETWEEN THE UNITED STATES AND

THE SOVIET UNION AND WHAT SEEMS

TO BE A DEVELOPING NEW COLD WAR

BETWEEN AMERICA AND CHINA.

AM I GOING TOO FAR?

>> I THINK IT IS A DIFFERENT

KIND OF STRUGGLE.

IT ISN'T INVOLVING MASSIVE

NUMBERS ABOUT NUCLEAR WEAPONS.

IT IS NO QUESTION, WE ARE IN A

IF YOU WILL, A COLD WAR.

WHAT WE'RE SEEING IN HONG KONG

IS THE CHINESE VALUE SYSTEM,

VERY, VERY DIFFERENT FROM OUR

VALUE SYSTEM.

AND IT IS BECOMING VERY OBVIOUS.

FRANKLY, PRETTY UGLY.

AND SO I THINK THAT BEIJING IS

REVEALING SOME OF ITS TRUE

COLORS, BEING XI XINPING

GOVERNMENT RIGHT NOW.

IT IS GOING TO INCREASE TENSION,

AGGRAVATION, THE FACT THAT THE

PRESIDENT DID COME OUT ON SUNDAY

WITH A STRONG STATEMENT ABOUT

HONG KONG SHOWS THAT THIS ISSUE

IS MOVING THE AMERICAN SYSTEM A

BIT.

SO YES, I THINK, WE'RE HEADED TO

ROUGHER GROUND IN THE U.S.

RELATIONSHIP.

STUART: DENNIS, YOU KNOW WHAT

YOU'RE TALKING ABOUT.