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The US and China are the closest of enemies

Posted By on November 28, 2018 @ 11:13

There has long been talk that the strategic rivalry [1] emerging between the United States and China in recent years could one day give way to confrontation. That moment has arrived. Welcome to the Cold War 2.0.

The standard narrative about the Sino-American conflict is that it pits two distinct systems against each other. To the US, China is a big-data dictatorship [2] that has detained [3] a million Uyghurs in concentration camps, cracked down on Christians, curtailed civil rights and destroyed the environment—all while building up its military and threatening America’s regional allies. In the view of many Chinese, the US is an exponent of interventionism and imperialism and the Trump administration’s trade war is merely the opening shot in a larger economic, military and ideological contest for supremacy.

Yet this framing gets things backwards. The new Sino-American confrontation is rooted not in the two countries’ differences, but in their growing similarity. China and America used to be the yin and yang of the global economy, with America playing the role of consumer and China that of manufacturer. For years, China funnelled its surpluses back into the purchase of US Treasury bills, thus underwriting American profligacy and forging a symbiotic arrangement that the historian Niall Ferguson [4] has called ‘Chimerica’.

But Chimerica is now a thing of the past. With his ‘Made in China 2025 [5]’ policy, Chinese president Xi Jinping is moving his country up the global value chain, in the hope of becoming a world leader in artificial intelligence and other cutting-edge technologies. To that end, China has curtailed Western companies’ access to its markets, making it conditional on their transfer of technology and intellectual property to domestic ‘partners’.

At the same time that China has been reorienting its economic-development model, the US has replaced its traditional laissez-faire approach with an industrial strategy of its own. Behind Donald Trump’s trade war is a desire to rebalance the economic playing field and ‘decouple’ the US from China. And with both countries now locked in a zero-sum competition, Team GAFAM (Google, Apple, Facebook, Amazon, Microsoft) and Team BATX (Baidu, Alibaba, Tencent, Xiaomi) are waging a war of technical know-how and data access on a global scale.

Yet by trying to outcompete each other in the same areas, the US and Chinese strategies are becoming more alike. In response to former US president Barack Obama’s efforts to create a Pacific-rim trade bloc to contain China, Xi launched his Belt and Road Initiative (BRI), which is now being met by an American-led Indo-Pacific initiative [6] under Trump.

The two countries are also on similar paths militarily. Though China still has a lot of catching up to do, its total defence spending is already second only to the US [7]. It has built and launched its first aircraft carrier [8] and has plans to launch more. It is developing and deploying [9] anti-access/area-denial defence systems. And by establishing its first overseas military base in Djibouti, it has signalled that it has global—not merely regional—ambitions.

China and the US also increasingly share a predilection for interventionism. For China, this represents a stark break from decades of treating non-intervention as a quasi-religious doctrine. But China’s changing attitude makes sense. As Yan Xuetong of Tsinghua University explained to me shortly after the US invasion of Iraq, a country’s support for intervention reflects a recognition of its own power. He predicted that as China built up its military forces, it would become more open to exerting its influence abroad.

Chinese citizens and many others around the world now expect precisely that. After evacuating hundreds of its citizens from Libya in 2014, China increased its participation in United Nations peacekeeping missions. And, following a series of attacks in Pakistan, it created a special security force [10] (mostly of private contractors) to protect Chinese interests along the ‘new silk road’ of BRI projects.

Another area of Sino-American convergence concerns the multilateral system. In his 2005 ‘responsible stakeholder’ speech [11], then-US deputy secretary of state Robert Zoellick [12] told the West that global governance institutions must include China or risk being overturned. But to the Chinese, international engagement was never a binary choice. So, rather than becoming a responsible stakeholder in the US-led order, China is now developing what might be described as internationalism with Chinese characteristics.

Accordingly, China has taken advantage of membership in Western-dominated institutions while simultaneously defanging them and building a parallel system of its own. But, as the structure of the BRI shows, the world order China envisions is based not on multilateralism, but on bilateral relations. By dealing with other governments one on one, China can negotiate from a position of strength and impose its own terms.

Trump’s ‘America First’ doctrine embodies the same vision for the US. Both he and Xi have embraced a message of national rejuvenation. This has led Xi to replace China’s longstanding foreign policy of moderation and tactical cooperation with one based on the pursuit of national greatness. And both leaders have increasingly taken decisions into their own hands, while undercutting their respective countries’ systems of checks and balances.

Although ‘Cold War 2.0’ does not feature the same clash of utopian ideologies as the original, the metaphor is fitting nonetheless. Like its predecessor, this one will feature two superpowers that disagree on how the world should be organised, but agree that there can be only one winner.

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URLs in this post:

[1] rivalry: https://www.project-syndicate.org/bigpicture/the-sino-american-rift

[2] big-data dictatorship: https://www.project-syndicate.org/commentary/xi-jinping-surveillance-state-by-mark-leonard-2018-02

[3] detained: https://www.project-syndicate.org/podcasts/china-s-war-on-the-uighurs

[4] Niall Ferguson: https://www.project-syndicate.org/columnist/niall-ferguson

[5] Made in China 2025: https://www.project-syndicate.org/commentary/trump-vs-made-in-china-2025-by-shang-jin-wei-2018-06

[6] Indo-Pacific initiative: https://www.project-syndicate.org/commentary/free-and-open-indo-pacific-pence-tour-japan-india-by-brahma-chellaney-2018-11

[7] second only to the US: https://www.businessinsider.com/highest-military-budgets-countries-2018-5#2-china-14

[8] first aircraft carrier: https://nationalinterest.org/blog/buzz/china-next-aircraft-carrier-superpower-31452

[9] deploying: https://thediplomat.com/2017/05/chinas-a2ad-challenge-in-the-south-china-sea-securing-the-air-from-the-ground/

[10] security force: https://www.scmp.com/news/china/diplomacy-defence/article/2090033/security-firms-cash-protecting-chinas-new-silk-road

[11] speech: https://www.ncuscr.org/sites/default/files/migration/Zoellick_remarks_notes06_winter_spring.pdf

[12] Robert Zoellick: https://www.project-syndicate.org/columnist/robert-b--zoellick

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