Not the new cold war
29 Oct 2018|

Competition and confrontation build between China and the US.

The era of engagement fades. Superpower rivalry returns. Great power challenges great power. The world’s biggest economy faces off against the second biggest.

The descriptor of the moment is the new cold war. As a label, ‘the new cold war’ or ‘cold war 2.0’ is a sharp, vivid headline. And it’s wrong.

This is not the new cold war. The ‘new’ bit is right, but the newness of much of the contest cautions against the old label.

Today’s struggle is equally significant. And it’ll run for decades.

Yet ‘cold war’? Standing only steps from hot war and nuclear conflagration? No.

Badly bungled and dumbly driven, this struggle could eventually create two opposing blocs that’d resemble a cold war line-up. But it’s going to need a lot more poor strategic policy and economic stupidity to reach cold war 2.0.

What we face is big yet different. This is not a binary confrontation between two superpowers peering across the Berlin Wall, separated by a geographic and economic iron curtain, their leaders isolated from each other by fear and different understandings.

Today’s fight is not a confrontation based on a massive clash of ideologies and two completely separate economic systems.

The Soviet–US struggle was defined by separations—the standing armies facing each other across central Europe. The symbol of the Cold War was the wall. Today’s motif is the web.

What China and the US are fighting about is what they share and what they both want to dominate.

The competition will be defined by its connections and closeness. Two superpowers seeking to be number one. Both want to sit atop the system, not overthrow the system.

Washington’s new fear of China was announced in the 4 October speech by US Vice President Mike Pence. Canberra’s view is that Pence ‘sets out the most dramatic shift in relations with Beijing since Nixon and Kissinger’s “opening” of relations in the early 1970s’.

Pence rails against China for its interference in everything from media to movies to markets.

The vice president’s description of the struggle offers some implicit rebuttal of the cold war 2.0 idea. In version 1.0, America never accused the Soviet Union of causing the US trade deficit by gaming the World Trade Organization.

Consider some then-and-now differences.

Ideology: The Cold War was a contest of ideas and values: communism fighting capitalism, Marxism versus democracy.

The ideological content today is almost non-existent.

China isn’t offering any big new political idea. Beijing wants to expand its international power, not export its political system.

The US has a binary president, visceral in rejecting the friends, values and international institutions central to US conduct in the Cold War.

The ‘America First’ leader confronts the ‘China Dream’ leader. The images put forward by both men play to their domestic audiences. Neither side has much in its ideological armoury to enlist others in a new, frigid division.

Economics and trade: The Soviet Union wanted to overthrow the economic system championed by the US. Communism versus capitalism. Bloc against bloc. Economic sphere facing economic sphere.

China merely wants to beat America at its own game. China loves what America has created; now Beijing wants to own it. From the WTO to the World Bank, China embraces the system.

Pence harangued the Chinese Communist Party (18 mentions in his speech), but take it from the World Bank: ‘China has had a remarkable period of rapid growth shifting from a centrally planned to a market based economy.’

Savour the irony that China, the new superpower, follows the same protectionist/mercantilist policies the US used in the 19th century to become the new superpower able to match Europe (the US Civil War between the industrial north and slave-owning south was a fight between protectionists and free-traders, and the protectionists won).

Today’s struggle between the US and China has free-traders and protectionists on both sides. Many other nations looking on are conflicted about this choice; Australia, more than most, knows that it wants the free-traders to win.

So, another irony: China’s leader chants the free trade and globalisation mantra in confronting a protectionist US president.

Alliances and proxy wars: Militarily, the Cold War was waged by opposing alliance systems, a hair-trigger nuclear standoff and proxy wars.

The nukes remain, but the rest of the equation is gone.

The proxy wars—Korea, Vietnam and the Soviet invasion of Afghanistan—were disastrous conflicts whose wounds bled across the second half of the 20th century. We’re still dealing with the consequences in Korea and Afghanistan.

The US has allies. China doesn’t. Another irony: China understands the value of the US alliance system better than Trump does.

The US is clearly the world’s greatest military power, and US alliance dominance is a formidable bulwark against a new cold war. Yet China is coming and the equation is shifting. Robert Kaplan ponders what this means for America and its Asian allies:

The United States must face up to an important fact: the western Pacific is no longer a unipolar American naval lake, as it was for decades after World War II. The return of China to the status of great power ensures a more complicated multipolar situation. The United States must make at least some room for Chinese air and naval power in the Indo-Pacific region. How much room is the key question.

Australia and Asia need the US as a balancer, not as a belligerent in a new cold war.

The rivalry is real and the competition will be intense. The times, though, call for brains, not blocs. Take lessons from the Cold War, don’t remake it.