In-Depth

by Malcolm Riddell

How to Meet the China Challenge

CHINADebate

CHINADebate

Malcolm Riddell
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Founder of CHINADebate

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March 17, 2021
How to Meet the China Challenge
How to Meet the China Challenge
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Council on Foreign Relations headquarters, circa 1930

How the Biden administration characterizes the China – strategic competitor, rival, enemy, and the like – and how it develops strategies – containment, confrontation, competition, cooperation, or some combination of these - will have an impact, to a greater or lesser degree, on most every industry and every market.
  • So, while the President and his team are working toward what is promised to be a comprehensive, all-of-government approach to China, it’s time to begin considering the broad nature of the possibilities that could emerge.
  • Here are some ideas to help you understand the Biden China policies as they evolve.

1 | The Briefing

The Council on Foreign Relations is celebrating its 100th anniversary.

  • Conspiracy theorists will tell you that for all that time U.S. foreign policy has been secretly directed from the CFR, not from Foggy Bottom or the White House.
  • A more credible view is that one of the CFR’s sources of influence is as a resource for policymakers.

One of its activities to support policymakers is the briefing.

  • A policymaker asks for a briefing on an issue or region, and the CFR invites its members with expertise on the subject to brief him or her on it.

On Tuesday, I joined a small group of CFR members, all distinguished China specialists, to brief a member of Congress on how the U.S. should think about China and how to approach U.S.-China relations.

  • This was an off-the-record meeting, so I can’t comment much on the discussion itself.

But I can tell you about one of the issues that the group felt was especially crucial.

  • That is, how should we characterize U.S. policy responses toward China?

This sounds like the kind of useless, arcane debate only pointy-head, academic-type, foreign affairs wonks would enjoy. But how you define something informs how you handle it.

  • If you are getting ready for a race, you will train differently for a marathon than for a ‘fun run.’
  • And so it is with foreign policy: How you characterize an issue suggests the strategy or strategies for dealing with it.

The classic example of this is George Kennan and his ‘Containment Doctrine.’

2 | Kennan & the 'Containment Doctrine'

At the beginning of the Cold War, the U.S. was still groping for a strategy for how to counter the threat from the Soviet Union,

  • Then in 1947 State Department Russian expert George Kennan, writing anonymously as ‘X,’ published ‘The Sources of Soviet Conduct’ in the CFR’s journal, Foreign Affairs. Here’s how he characterized the situation:

‘It is clear that the United States cannot expect in the foreseeable future to enjoy political intimacy with the Soviet regime.’

  • ‘It must continue to regard the Soviet Union as a rival, not a partner, in the political arena.’
  • ‘It must continue to expect that Soviet policies will reflect no abstract love of peace and stability, no real faith in the possibility of a permanent happy coexistence of the Socialist and capitalist worlds, but rather a cautious, persistent pressure toward the disruption and weakening of all rival influence and rival power.’
  • ‘Balanced against this are the facts that Russia, as opposed to the western world in general, is still by far the weaker party, that Soviet policy is highly flexible, and that Soviet society may well contain deficiencies which will eventually weaken its own total potential.’

It’s a little eerie how Mr. Kennan’s characterization of the USSR echoes the situation with China today.

  • You could almost substitute China for Russia or Soviet Union throughout his essay and be on the mark.

Here are a few examples using the excerpts above:

  • ‘It is clear that the United States cannot expect in the foreseeable future to enjoy political intimacy with the Soviet Chinese regime.’
  • The U.S. ‘must continue to regard the  Soviet Union China as a rival, not a partner, in the political arena.’
  • The U.S. ‘must continue to expect that  Soviet Chinese policies will reflect no abstract love of peace and stability, no real faith in the possibility of a permanent happy coexistence of the Socialist and capitalist worlds, but rather a cautious, persistent pressure toward the disruption and weakening of all rival influence and rival power.’
  • ‘Balanced against this are the facts that  Russia China, as opposed to the western world in general, is still by far the weaker party, that  Soviet   Chinese policy is highly flexible, and that  Soviet  Chinese society may well contain deficiencies which will eventually weaken its own total potential.’

Let me add one more:

  • ‘The Soviet Chinese concept of power, which permits no focal points of organization outside the Party itself, requires that the Party leadership Xi Jinping remain[s] in theory the sole repository of truth.’

Based on his analysis, Mr. Kennan concluded:

  • ‘In these circumstances it is clear that the main element of any United States policy toward the Soviet Union must be that of a long-term, patient but firm and vigilant containment of Russian expansive tendencies.’
  • ‘This would of itself warrant the United States entering with reasonable confidence upon a policy of firm containment, designed to confront the Russians with unalterable counterforce at every point where they show signs of encroaching upon the interest of a peaceful and stable world.’

This was Mr. Kennan’s 'Containment Doctrine,' which informed U.S. strategy throughout the Cold War.

  • Edward Luce of the Financial Times calls Mr. Kennan ‘the architect of a doctrine that won the cold war.’

3 | China Isn’t the Soviet Union

Unfortunately, this conclusion, even drawn from the same broad circumstances, does not apply to China: Containment alone won’t work.

  • China’s economy is not only massively larger than the Soviet Union’s was, its interconnections with the global economy are vastly greater.
  • Because of those interconnections and the economic interests, many nations are reluctant to oppose China on an issue.
  • And when they do challenge China, China punches back. Look at Australia.
  • Thus replicating the 'two blocs' of the Cold War is just about impossible

Instead, in our briefing of the Congressperson, we discussed four strategies the Biden administration might adopt:

  • Containment, confrontation, competition, or cooperation.
  • The general feeling was that Mr. Biden would adopt one or the other or a combination of these depending on the issue at hand.

4 | Approaches to U.S. Policy Toward China

Ian Bremmer of the Eurasia Group takes up this theme in his recent essay, ‘US must grasp China's different set of values’:

  • ‘Three distinct approaches have begun taking shape.’

‘The first approach is containment, championed by more hawkish elements within the White House and the national security establishment.’

  • ‘This group believes that a Cold War with China is unavoidable given just how many zero-sum issues there are between the two countries, including but not limited to: the South China Sea, Taiwan, Hong Kong, Uighurs and most crucially, technology.’
  • ‘Under this view, it is critical for the U.S. to meet China toe-to-toe in all aspects of great power competition.’

Just as George Kennan suggested of the Soviet Union:

  • ‘Underpinning this approach is the belief that it will not be aggressive actions from the U.S. or its allies that brings Beijing to its knees, but rather China's own policies of state-capitalism and authoritarianism, which they view as unsustainable over the long run given massive Chinese debt and continued risky investments into developing countries.’

Echoing 'cooperation': ‘The second option is one of interdependence, primarily being pushed by the economic policymakers in the Biden administration.’

  • ‘Rather than lumber into a Cold War, they want to constructively engage with the Chinese using existing multilateral architecture, reforming it to accommodate China where possible, and creating new institutions where necessary to get China to act more multilaterally.’

Also, sort of suggested in the CFR briefing as ‘cooperation,’  but clearly distinct from that, is ‘the wild-card option being spearheaded by Presidential Climate Envoy John Kerry and those in the administration who view climate change as the greatest single threat to the U.S., China included.’

  • ‘Rather than pursue a policy of either containment or interdependence, they want the U.S.-China relationship to be in service to the fight against global warming, a battle that needs to include China, the world's largest emitter.
  • ‘For supporters of this approach, the U.S.-China relationship will evolve along with the way the climate change threat evolves.’

In asking, ‘which approach will Biden choose?’ Dr. Bremmer agreed with the CFR briefing group.

  • ‘Knowing the consensus-building Biden, it will likely be some combination of all three.’ Or all four.

5 | The 100-Day Review

The Biden administration is in the midst of a 100-day review of China policy.

  • Whatever the outcome the one thing not to expect is an elegant Kennan-esque doctrine from which all U.S. strategies and policies follow.
  • Perhaps the U.S. and the world’s relationship with China is too different from that of the Soviet Union and too complex.
  • Or perhaps we just haven’t found the George Kennan of our age.

In any case, the outcome of the 100-day review will not be framed in any of the terms proposed in the CFR briefing.

  • Instead the review will discuss specific challenges and proposed policy responses.
  • But underlying each of these responses will be either containment, confrontation, competition, cooperation, or some mix of these.

Those who are able to discern which of these applies to a specific policy and how that impacts business and markets will be a step ahead of everyone else.

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