America Lacks a Grand Strategy for China – and the Political Will to Craft One
Washington’s current zero-sum approach towards superpower rivalry with China, driven in large part by domestic political dysfunction, is not sustainable and cannot succeed. Instead, the U.S. needs to formulate a new domestic consensus that neither exaggerates China’s prowess and threats nor disallows compromise and cooperation. Without a coherent and proactive strategy, the U.S. risks remaining on the defensive and surrendering the initiative to Beijing
“The period that was broadly described as engagement has come to an end… the dominant paradigm is going to be competition.” Kurt Campbell, U.S. coordinator for Indo-Pacific affairs on the National Security Council, could not have been clearer – and arguably blunter – about the trajectory of U.S.-China relations with these words last May. His statement echoed the bipartisan anti-China sentiment in Washington – essentially the only issue on which both Democrats and Republicans agree these days.
But the opposite of engagement is not competition or rivalry, it is estrangement. And the estrangement we have seen – minimal interaction and communication over the last five years – has been highly counterproductive for American interests in the global economy, public health, environmental protection, and managing future transnational and regional security threats. Whereas the U.S. used to work with Chinese officials on more than a hundred issues of common concern, today there is little contact.
Taking the hard-line on China is a rewarding public option for politicians. But to craft a truly consensual, coherent, and sustainable China strategy, the American establishment must move beyond caricatures of the “China threat” and adopt a more pragmatic and ambitious vision. It will take time to make this adjustment and to develop a new consensus – for U.S.- China relations, but also for American foreign policy in the broader sense – that can accommodate and support a new type of engagement with China.
But while Washington is muddled over its China policy, Beijing, too, suffers from significant domestic problems which have hampered astute foreign policy making. China’s relations with several of its neighbors have deteriorated following aggressive Chinese moves, and there is growing concern about its domestic, political, and economic trajectory. China is moving toward statist self-reliance and away from market-based reforms, and it has been testing tools of economic coercion to discipline what it views as transgressions of its interests. The negative spiral of U.S.- China action and reaction has brought us to where we are today.
It may take a true crisis to bring superpower relations back from the brink, although this would be dangerous. Ultimately, Washington will need to find a constructive vision for managing its relations with Beijing, one that allows for both cooperation and competition. Below, I explore the problems on both sides and discuss a potential path forward.
It’s no secret that tensions with China have been rising for the better part of a decade, if not more. President Barack Obama’s years in office saw a gradual escalatory tone with Beijing, but it was his successor, President Donald Trump, who launched his American-Chinese “trade wars,” in what he described as an effort to “re-balance” economic relations between the two. However, the Trump administration never had what could be called a clear approach to dealing with Beijing. Its biggest policy achievement was negotiating a “Phase One” trade deal with Beijing in early 2020. But the agreement was mostly about China buying commodities from the United States in unprecedentedly large quantities. The fulfillment of such a deal was dubious, even before the pandemic. COVID-19 ushered in a dramatic deterioration as Trump blamed Beijing for the reversal of his electoral fortunes and unspooled a series of punitive measures and harsh statements that continue to be the backdrop to relations.
While the Biden administration hasn’t adopted Trump’s toxic rhetoric towards Beijing, it, too, frames the rivalry between the two superpowers as ideological, “democracy versus autocracy.” Washington has repeatedly sanctioned China on issues such as Xinjiang, Hong Kong, technology associated with the military, whilst building and strengthening alliances in the Indo-Pacific.
Although many in the U.S. realize that working with China is necessary, positive interaction with Beijing is seen as a political liability
Beijing, to be sure, has been generating similarly offensive hyperbole aimed at Washington. But rhetoric aside, both sides have shown they can still cooperate during this period. Last October, the two signed a major deal to export Liquidated Natural Gas (LNG) from the U.S. to China, though the former hasn't been able to ship much under the Phase One trade deal. Recently, the coordinated release of petroleum reserves by both superpowers (alongside other countries) to cool rising energy prices involved pragmatic collaboration and behind-the-scenes diplomacy.
China has also continued to actively support and participate in the P5+1 efforts to negotiate a restoration of the Iran nuclear deal (JCPOA). And as Trump’s Phase One trade deal has now expired, the two sides are in discussions about what comes next. Given that China was unable to meet the deal’s (unrealistic) targets, there could be further punitive measures from the U.S. However, there is also the prospect of some kind of new arrangement that could at least stabilize the trade relationship during a volatile time for the global economy.
Yet, despite these joint efforts which benefit the American economy and arguably ease global tensions, the Biden administration has de-emphasized cooperation with Beijing. Although many in the U.S. realize that working with China on economic, security, and transnational issues like climate change is necessary, the perception that positive interaction with China is a political liability is controlling. Both Democrats and Republicans, on the Hill and across the country, are facing questions of legitimacy, and the one issue they can agree on is a “tough” stance against Beijing.
Since World War II, American foreign policy has been based on alliances, a U.S.-led global security network, and the promotion of free and open trade, global markets, and democratic values. When former President Trump took office, he swung U.S. foreign policy in a direction that was quite different from the previous bipartisan consensus and sought to withdraw from some international commitments and institutions.
This turn toward nativism and isolationism was a response to a number of factors, among which two are relevant to his subsequent approach to relations with China. First, the global security umbrella –disproportionately supported by the U.S. – is no longer sustainable and needs adjustment given the shifts in relative power in the international system. Second, China’s dominance of global manufacturing and its state-led mercantilist approach is seen to threaten America’s dominant role in technology development and innovation. Trump’s attempts to address these factors in his approach to China, however, were only marginally successful.
President Biden entered the Oval Office with many significant domestic issues on his plate – the January 6 insurrection, the pandemic, a stagnant economy, a razor-thin majority in Congress – and little bandwidth for foreign policy. His main priority was “getting our own house in order,” as many officials have referred to the need for domestic economic renewal and social reforms.
His main foreign policy efforts, aside from the Afghanistan withdrawal (and more recently the Ukraine crisis), have focused on restoring alliance relations and re-entering international institutions and agreements vacated by Trump. Biden’s answer to the two challenges above appears to be twofold: first, trying to offload some security network responsibilities to allies and partners and prioritizing deterrence against China; and second, increasing investment in U.S. innovation, while reducing the interdependence of the American and Chinese economies.
So far, though, the absence of a clear U.S. strategy is complicating Washington’s efforts to align its approach with its allies. America’s international partners worry about the sustainability of U.S. policy, given the uncertainties in domestic politics and the likely whiplash effect of Trump, or a Trump-like figure, assuming the presidency in 2024. And while allies generally align with the U.S. on values-based issues vis-à-vis China, their economic and security interests with China are nevertheless different than America’s. This has made it difficult to move quickly to form a broad security coalition to counter China, although the trilateral security pact between Australia, the United States, and the United Kingdom (AUKUS), as well as the Quadrilateral Security Dialogue (“Quad”), have made a start in this direction.
China's growing ambition
Like the U.S., China’s political system also suffers from complex structural problems, which can produce counterproductive foreign policy moves. On the one hand, Beijing is becoming more assertive and ambitious in its region and in the international sphere. At the same time, though, the Chinese leadership seems to suffer from what can be described as a built-in lack of confidence or fragility, which sometimes leads to mistakes and misinterpretations when it comes to relations with other countries. Again, like in the U.S., this stems primarily from domestic distortions.
People who observe China from the outside tend to make the mistake of assuming that it is fixated on foreign policy as much as the U.S. But Beijing is – and always has been – overwhelmingly focused on domestic stability. In practical terms, its top priority is the competent management of the economy and continued development of the country. This, in essence, is the “social contract” between the State and its citizens – accepting the ruling Chinese Communist Party’s political orthodoxy and control in exchange for a continued improvement of their standard of living.
China’s political system is brittle. First and foremost, the Chinese Communist Party is deeply concerned with its legitimacy – both within the Party and among its citizens. The top leadership spends a significant amount of time micromanaging the Party apparatus and making sure that it is doing what it needs to be doing. In such a huge country, these issues take up an inordinate amount of leadership time and focus.
Beijing’s retaliation has been especially sharp where it perceives that countries choose to align with the U.S. in responding to various Chinese behaviors
Another sign of this insecurity is that Beijing is overly sensitive to criticism. The vast surveillance array and harsh censorship all showcase the Chinese government’s fear of its own citizens.
Beijing’s zero-COVID policy is another example. After initially failing to respond to the spread of the pandemic in Wuhan and having faced an outpouring of anger and lament, the leadership has become obsessed with preventing spread, hospitalizations, and deaths from the pandemic. To ensure the effectiveness of this campaign, Xi Jinping has not traveled out of China for more than two years. The decision to hold the Beijing Winter Olympics without local or foreign spectators, in a “closed loop” only for those involved in the Games, further reflects this extreme caution, inspired by underlying legitimacy concerns.
Externally, to promote their primary goal of maintaining domestic development, the Chinese seek to maintain stability on their periphery and constructive relations with other major powersֿ, especially in the Asia-Pacific. So, while foreign policy generally takes a back seat in Beijing’s day-to-day priorities, the government nevertheless wants to avoid external crises or instability in the international system.
Yet Xi Jinping’s more recent and aggressive approach to standing up for China’s interests has overshadowed the traditional impetus to prioritize stability and take an incremental approach, catching many of China’s neighbors by surprise. We have seen a flare-up in border conflicts with India, tensions over maritime claims in the South and East China Seas, a border altercation with Bhutan, and elevated tensions with neighbors in Northeast and Southeast Asia.
This is perhaps natural with an emerging power that seeks to commensurately assert its interests, but China’s sheer size and weight in the system are intimidating enough, without an aggressive nationalistic or militaristic tinge. As China moves more aggressively in the region, its ties with the U.S. have simultaneously deteriorated. This has set up a dynamic where countries in the region increasingly seek protection from the American security network, just as U.S.- China competition is forcing them to choose sides.
Beijing’s retaliation has been especially sharp in cases where it perceives that certain countries choose to align with the U.S. in responding to or targeting various Chinese behaviors. For example, after the EU announced sanctions aimed at Chinese repression in Xinjiang, Beijing retaliated with counter-sanctions against a whole range of European actors. It also pushed back strongly against South Korea’s deployment of the THAAD missile defense system in 2017, retaliated diplomatically and commercially against Lithuania for establishing a “Taiwan Office,” and reined in Australian coal and wine imports after Australia’s Prime Minister called for an investigation into COVID origins. These responses were more immediate and more significant in terms of impact on the target country than previous Chinese attempts to wield its market power to defend political and other interests.
It's not clear what lessons the Chinese have learned from employing this approach, or how targeted countries should respond. Ironically, such aggressive moves are driving countries closer to the U.S., making it easier for Washington to rally countries against China.
A (Losing) Zero-Sum Game
After years of increasing animosity, both in bilateral relations and within the context of Asia Pacific geopolitics, can the U.S. and China climb down the escalation ladder? I believe relations can improve, but not before the end of 2022, which is a significant political year in both capitals. The Biden administration is hamstrung by concerns that its agenda will be thwarted by a Republican takeover of Congress in the mid-term elections this fall. For its part, Beijing is preoccupied with arrangements for the 20th Party Congress at roughly the same time.
Before the dust settles from these events, though, ties will remain strained. This dynamic of strategic rivalry between the superpowers will have major implications beyond the Asia Pacific.
But despite intensifying competition – both directly and in various strategic regions – the U.S. needs to rethink its “zero-sum” approach to Beijing’s growing presence worldwide. The notion in Washington that every Chinese gain in influence is a threat or needs to be parried is counterproductive. Not only does the U.S. lack the resources to counter Chinese moves around the world, but American soft power is diminished by making countries the object of a geopolitical competition rather than dealing with others on their own terms.
In Africa, for example, China has made major contributions to development, and many Africans have been educated in Chinese universities. When U.S. National Security Advisor John Bolton made a rare Trump administration speech on Africa policy and focused almost exclusively on China’s “predatory lending” on the continent,  it did not resonate with Africans themselves.
The same goes for Washington pressuring some of our traditional partners around the world – for example, tying weapons sales to prohibitions on the use of Huawei telecommunications equipment, as was presumably the case with the sale of F-35 fighter jets to the UAE. This sets up a lose-lose dynamic: either that country is going to meet American demands and incur huge losses in an important partnership with China, or it will reject the deal with Washington and perhaps purchase a similar system elsewhere.
From an American perspective, countries such as Israel that are key security partners – working together on military integration, intelligence sharing, joint training and operations, interoperability of weapons systems, etc. – will feel more pressure to limit ties with Beijing. What Washington often overlooks, though, is that these security partners have a myriad of other interests, including serious economic interests with China that are not easily replaced, and which may not always align with U.S. interests. In this situation, it is difficult for these countries to acquiesce in making tradeoffs that will fundamentally damage their balance of interests.
Many close U.S. security partners are also partners of China and have faced the problem of being “forced to choose.” But this is not the Cold War, and different countries have differing perceptions of the threat and opportunities presented by China’s rise. By insisting on a “zero-sum” approach, we create a very negative dynamic in our diplomacy and our partnerships. The Chinese are opportunistic and can take advantage of the vacuum left by American diplomacy in recent years.
Consequently, regarding China, it is imperative that we work together with our allies and partners on areas of common concern, while being forthright about our differences. China will continue to be a major player in the world that cannot simply be ignored or isolated. All parties must engage in candid dialogue on their interests in stability, balance, prosperity, and order in the international system. In that sense, middle countries like Israel can even contribute to the constructive evolution of U.S.- China relations.
Conclusion: What’s really on the table
One year into the Biden administration and five years after the policy of engaging China was abandoned, a fundamental question remains: what has replaced it? Geopolitical rivalry is not a goal, but a state of affairs. Some advocate isolating and containing China, as Xi has made clear that China will not change and will pose even graver threats. Others believe China’s economic opportunities still outstrip the threats and seem more amenable to try to shape and accommodate its newfound weight in the system. However, the firm bipartisan consensus in Washington on squaring off against China is politically immutable for now.
While China may prove to be a strategic challenge in the long run, most of America’s current challenges have little to do with it
But while China may prove to be a strategic challenge in the long run, most of America’s current challenges – on health, social strains, economic resilience, or the environment – have little to do with it. If the U.S. frames all its problems through the prism of China's grand strategy, the result will be a defensive, reactive approach to what it thinks Beijing is doing – which will not provide America with the edge it seeks. Instead, Washington should be prioritizing American renewal – starting at home and then moving to reinvigorate an American vision of global leadership and order, based on openness, freedom, stability, and restraint. At the same time, it should invest in preparing, educating, and attracting the human capital needed for the 21st century.
The real China question for U.S. policy leadership today might be – how can we reshape the dynamic of bilateral relations to address collective problems? The sharp deterioration in mutual ties is undermining the international system and its institutions at the very moment when the world most needs them. The dispute over the WHO’s handling of COVID-19 stands out as a particularly egregious example. And, of course, amid the planetary threat of climate change, collaboration seems essential, as John Kerry and his Chinese counterpart have been pressing. We should all hope that this kind of practical diplomacy will lead us in a better direction.
Susan A. Thornton is a former career U.S. diplomat who retired in 2018 as Acting Assistant Secretary of State for East Asian and Pacific Affairs. She is currently a Visiting Lecturer at Yale Law School and a Senior Fellow at the Law School’s Paul Tsai China Center. Thornton is also Director of the Forum on Asia Pacific Security at the National Committee on American Foreign Policy and a non-resident fellow at the Brookings Institution.
(Photo: U.S. State Department, public domain)
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