Thoughts on the Unfolding U.S.-Chinese Competition: Washington’s Policy Towards Beijing Enters Its Next Phase

February 9, 2021
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A decade ago, when I was a junior staffer on Capitol Hill, the congressman I worked for pushed the House Armed Services Committee to launch a series of oversight hearings focused on China’s military modernization. Hearings on Afghanistan and Iraq were happening monthly — if not weekly — but each year only a single posture hearing with the commander of then-Pacific Command was reserved to discuss the regional military balance. After much back-and-forth, more substantial oversight hearings and briefings were eventually scheduled. Today, the situation has been reversed. From the White House to the halls of Congress, Beijing’s behavior is at the forefront of policy debates. For those of us engaged in Asia policy, the shift in attention devoted to China has been as important as it has been striking.

President Joe Biden and his administration are inheriting a very different world than when he was last in the White House just four years ago. China’s predatory and coercive behavior under President Xi Jinping has increased rapidly in recent years, targeted against Uighur Muslims, Hong Kong, Taiwan, India, Australia, Japan, and others. As a result, across Washington a bipartisan consensus has emerged that a more competitive, whole-of-government approach towards China should be at the top of the agenda. Gone is the optimism about China’s behavior becoming more moderate, as well as the belief that Beijing is ready to be a net contributor to global goods. In its place is a more assertive approach designed to mitigate the Chinese Communist Party’s capacity and will to advance objectives antithetical to U.S. interests. What follows are a range of brief perspectives and recommendations on where Washington finds itself in this new and unfolding peacetime competition with China as it enters its next phase.

Passing the China Policy Baton Between Parties

During the early years of America’s peacetime competition with the Soviet Union each major political party had an opportunity to assume ownership of the nation’s policy approach. Democratic and Republican administrations adopted a similar logic when approaching the challenge, while injecting their own grammar tailored to the pressing issues of their time in office. President Harry Truman focused on revitalizing Europe’s economy and organizing domestic and international institutions for what he believed would be an enduring competition. President Dwight Eisenhower invested heavily in nuclear weapons as part of his “New Look” policy and put a greater focus on competition in the third world. President John F. Kennedy worked to balance the military’s investment in conventional capabilities for a flexible response strategy while also investing in the space program, a new domain of scientific competition. While there were many challenges, this natural shift of political ownership of the competition ensured a more bipartisan, enduring, and complete approach across the early years of the Cold War.

 

 

Similarly, Biden and the Democratic Party now inherit the U.S.-Chinese competition from the Donald Trump administration. There are some who strongly supported the Trump approach to China from the last three years and believe Biden will revert to the Obama-era policy of 2014 to 2016, when contentious issues with Beijing were cast aside in favor of cooperation on transnational issues like climate change. Since that time much has changed. Not only has China’s behavior shifted significantly, but a very new climate around China policy has also emerged in Washington. Assuming a more contentious period of competition with China will last for several decades, if not longer, one shouldn’t overlook how important it will be for a balanced and long-term approach to Beijing that both parties have a chance to lead this effort. Just like in the early years of the Cold War, a collection of different leaders will offer their own emphasis in certain policy areas that can build on and be complementary for U.S. policy. While the Trump administration worked to shift the government towards greater focus on competition with China and placed an emphasis on technology competition, Biden appears poised to bring in a more multilateral approach to China policy and increase investment in domestic technologies that offer competitive advantages, among other plans. This will not replace the Trump approach, but rather adjust and build on it in important ways that reflect the shifting nature of the competition.

Be Honest About the Trump Legacy

Washington’s polarized politics can make large issues like U.S.-Chinese policy into a zero-sum game. Depending on who you speak to, Trump either got China policy all wrong and the United States will never recover, or he was exceptional and achieved things no other president before him could. The reality is somewhere in between. The tectonic shift on China policy during the Trump administration was long overdue, gained bipartisan support in key areas, and charted a new direction for Washington’s approach towards Beijing. The administration deserves credit for diagnosing the key military, economic, technological, and human rights issues afoot; jettisoning the so-called “China calendar” where Washington self-censored into a belief that it had to choose between either competing or cooperating with Beijing at one time; and deploying a more aligned approach to China across various departments and agencies than ever before. For all this, the China hawks who supported the president’s agenda should remember that Trump’s approach to China was inconsistent, self-serving, and transactional. The president himself was regularly at odds with his own administration’s efforts and stated strategies, offered fawning personal praise for Xi and Kim Jong Un, downplayed critical human rights issues, treated allies like balance sheets, and viewed a trade deal as a key to his reelection instead of a solution to the nation’s bilateral economic troubles. Whatever view one chooses to take, what matters now is that the Trump era on China policy has closed and the reins have been passed to a new team who will have an opportunity to advance their own competitive approach.

No, Don’t Call It a New Cold War

Historians agree that the Sino-American rivalry is far different from the dynamics of the U.S.-Soviet competition. Despite this, politicians have made the case that there is a need to rally public opinion around the China competition, and the best way to achieve this is to deploy a term that the average American can easily understand. An ongoing conversation with the American public is critical, and their support essential, but U.S. analysts and policymakers should also remember that multiple audiences are listening. Whatever good the term “Cold War” might offer domestically, it will undermine efforts to increase cooperation with U.S. allies and partners in the Indo-Pacific region. These states may be ready to join coalitions focused on human rights, security, supply chains, and technology standards, but they have no use for joining anything they view Washington to be trumpeting as a Cold War set of policies. Washington needs to find ways to educate and discuss Beijing’s policies with an American audience while also not undermining its diplomatic agenda abroad. Loosely using “Cold War” doesn’t meet that objective.

Competitors, Centrists, and Optimists

When it comes to how a Biden administration will approach Sino-American relations, Democratic foreign policy experts generally fall into three camps: competitors, centrists, and optimists. While Biden and his most senior officials will be the ultimate deciders on policy towards China, understanding the interactions between these camps’ perspectives is a useful tool for analyzing the range of policy outcomes that could be adopted. To this point, the Biden team has included many competitors and several senior centrists, while the optimists have largely remained outside of government and can be expected to engage in continued thought-leadership.

Competitors believe that China seeks to reshape the global order and view the United States and China as competing in a range of domains, including defense, economics, ideology, human rights, and technology. They believe that the contest with China should be the driving principle for U.S. foreign policy. While similar in viewpoint to many from the Trump Asia team, this group is more inclined to pursue a multilateral approach to these objectives and avoid an overtly confrontational tone. Centrists are skeptical of China’s intentions and believe that additional policy measures are needed to address China’s behavior in the economic, security, and human rights spheres. However, rather than fundamentally reorienting towards a competitive relationship, centrists seek more tactical adjustments as dictated by China’s behavior in different domains. Centrists view addressing the security challenges posed by China as a critical priority, but also place emphasis on the need for U.S.-Chinese cooperation on global issues like climate change, pandemics, and arms control. While noting China’s problematic behavior, optimists do not view China as a critical threat and do not believe that Beijing seeks to overturn the fundamental global order. Optimists support specific behaviors to address China’s activity while opposing efforts to isolate China internationally.

The Biden administration will likely accelerate policy in areas where all three camps agree, including on increasing domestic competitiveness and addressing human rights issues. Policy outcomes remain less predictable in areas where debate between the groups is strongest, such as selective economic decoupling and the defense budget. For example, competitors will advocate for a more hard-edged approach on technology competition and supply chain concerns, while centrists may look to strike a middle ground that balances security and economic interests.

The New Consensus Is Here to Stay

The new China policy consensus did not come about abruptly, as some critics like to assert, but only after a decade or two of candid debate and a considerable shift in China’s internal and external behavior in the Xi era. The breadth of this new coalition is also what is likely to make it more enduring. It includes both Republicans and Democrats, defense hawks and technology hawks, investors and increasingly some business leaders, congressional staff, career officials at places like the State Department, intelligence community, and Commerce Department. There may not be agreement on every policy issue among this group, but there is a foundational acceptance that adopting a more competitive approach towards China should be near the top, if not the top, of the priority list for the U.S. government.

Preserve Bipartisanship on Asia Policy

Unlike American policy in the Middle East or towards Russia in the last decade, I have been lucky to focus on a policy field that is not only bipartisan and generally aligned on the major issues but is also where the broader community enjoys strong relationships across the political parties. Policy disagreements still exist and will continue to expand as the stakes for China policy grow, some of the more extreme voices on either side gain more attention, and political polarization deepens in the United States. Despite this strong impediment to cooperation, legislation still moved in important areas, and there are lessons in this for our current times. First, the close community of Asia policy specialists should avoid the tempting allure of partisanship. Policy disagreements are healthy but a respectful level of debate about them should continue to be welcome. Second, the same cooperation that has been possible in Congress in recent years should drive the agenda for the next two years. Members of Congress and staff should be willing to work publicly with each other and the new administration, as well as behind the scenes in ways that are so critical to Washington’s policy process.

A Strained Sino-American Relationship Is the New Normal

The domestic press narrative about the bilateral relationship is often built around how decisions in Washington will stand to strain or improve it. There are strong forces that would benefit from more stability and will push for a return to a pre-Trump normalcy. However, the goal of U.S. policy shouldn’t necessarily be a positive U.S.-Chinese relationship but rather the pursuit of America’s interests. In recent years, Beijing has employed digitally coercive, economically predatory, and anti-democratic behavior towards Hong Kong and the people of Xinjiang, allies in Japan, Australia, and Europe, and partners like India and Vietnam. Given the breadth of these challenges, the chances of Washington returning to some form of a positive relationship with Beijing are slim and should remain that way for as long as Beijing’s behavior persists. Instead of stability and normalcy, the U.S. government should be more willing to accept a strained relationship with China if it means confronting and degrading Beijing’s ability to do harm to American interests. However, U.S. officials should still seek effective ways to avoid instability, especially in the military domain. Washington and Beijing should engage in regularized Track 1 discussion on strategic stability issues, for example.

Congress Is in High Gear on China Policy

As I mentioned, when I worked in Congress from 2011 to 2016 it was a high task just to get congressional hearings focused on China, let alone have entire committees devoting their agenda to bipartisan legislation. This period was very much an education phase where some members saw the challenge and wanted to devote their energy, but the vast number of elected officials were focused elsewhere. The last five years have changed things considerably. Asia specialists have moved beyond the education phase and into one of hyper action — the risk is not a lack of attention but that there is so much demand for action that staff have to work hard to ensure that the legislation moving so quickly is sound policy. This has brought members who normally do not have much in common together. It has also forced members to think beyond the traditional national security committees and consider how other elements of the U.S. government have a central role in the U.S.-Chinese relationship.

China Will Be a Litmus Test During Nomination Season

During the beginning of the Obama administration in 2009 and Trump administration in 2017, China came up as a question to nominees rarely and only to the national security nominees at the Department of Defense and State Department. This will change considerably during the process to confirm Biden nominees in the Senate this winter and spring. China policy issues will come up not just in the national security committees but also for nominees at Treasury, Commerce, Justice, Education, and the Energy Department. Something of a China litmus test will be on display where both Republican and Democratic members will be probing the views of nominees to understand their perspective on U.S. policy towards China and how they will approach Beijing from their respective positions. Some senators may even withhold support for nominees if they do not give sufficient assurance that they understand the China challenge. This focus is not specific to the Biden administration but is a bipartisan concern that will apply to future presidential appointees as well.

Build Collective Resilience Against Non-Military Coercion

The return of major-power competition has intensified focus on economic linkages and the ways in which they can be exploited by adversaries or used to undermine national competitiveness. Beijing has not hesitated to use that interdependence in an effort to dictate policies and veto sovereign decision-making. Growing technological prowess will give Beijing a range of new coercive tools that can be weaponized via global 5G telecommunication networks, data collected by Chinese-owned apps, smart-city infrastructures, and Chinese mobile payment platforms. The collective concern of Washington and its partners and allies is not the fact that the American and Chinese economies are interconnected, but rather the specific ways in which they are integrated and the leverage that this affords China. A strategy of “collective resilience should be deployed to counter this mounting pressure. Using this approach, those governments will work collaboratively to reorganize sectors of their economic relationship with China and to deflect attempts at coercion and limit their impact. This process will not be a short one — and will be especially challenging in developing countries that benefit from Chinese economic engagement — but should be undertaken if countries are to begin to free themselves from the coercive pressures that Beijing is able to deploy.

Leadership at the Treasury and Commerce Departments Is Critical

Alliances, swing states, and the military balance in Asia will be defining characteristics of the U.S.-Chinese relationship, but the true nature of this competition may be economic and technological. This is an uncomfortable conclusion for someone like me who has focused most of my career on military policy in the Pacific, but it is the reality of power in the Indo-Pacific. First, this means the center of gravity for China-related policy may not be at traditional national security departments like the State Department and Department of Defense, but instead at the Commerce and Treasury Departments, where key authorities related to China policy reside and where there is perhaps the largest divergence of opinions between the national security and business communities. Second, nominees for these positions will require an increased knowledge and background in China-related policy matters because they have powerful tools at their disposal for addressing technology competition, supply chains, and human rights issues. Finally, Congressional oversight on China should not overlook the importance of nominees at these departments.

Counter China’s Military-Civil Fusion With Tools Across the U.S. Government

If the technology rivalry with China is the center of gravity in the competition, then degrading China’s military-civil fusion strategy should be Washington’s central focus. Military-civil fusion is a national strategy to break down the barriers between China’s civilian economy and defense sector to maximize Beijing’s military power. Put another way, this strategy aims to ensure that commercial developments can be utilized to enhance the lethality of the People’s Liberation Army. Throughout 2020, the Trump administration deployed tools across the government targeted at military-civil fusion, including restricting visas for research by officials linked to the People’s Liberation Army, identifying Chinese companies doing work with the Chinese military, restricting investment and exports to those companies, and deploying the various legal tools available to the Justice Department.

Surge an “Offensive” Domestic Investment Agenda to Balance “Defensive” Mechanisms

Washington’s technology policy towards China was largely out of balance in recent years as the Congress and Trump administration focused their attention almost entirely on a defensive agenda to restrict Chinese investment in America and key technology exports to China. This “defensive” approach was long overdue. Throughout 2019 and 2020 it was legislated and administered through executive action that the Biden administration is likely to keep. However, towards the second half of 2020 a rebalancing of this agenda emerged as Congress turned its attention to investing in America’s competitive advantages in technology. A new “offensive” agenda emerged focused on reorganizing and increasing funding at the National Science Foundation, incentivizing semiconductor manufacturing and research and development, and investing in an open radio access network as a solution to offering affordable alternatives to Huawei in the 5G competition. Democrats and an increasing number of Republicans in Congress are ready to move forward with an investment agenda focused on technology competition with China. A Biden team can be expected to work with Congress to continue this agenda and create more balance with other defensive restrictions.

Digital Currency Matters

The case of Huawei and global 5G leadership is a great lesson for U.S. policymakers. It was a failure to imagine the new tools Beijing was pursuing to generate control and power in the future global economy. Washington viewed telecommunication issues as regulatory and economic policy, while Beijing viewed them as national security and invested heavily in the industry to position the company as a leader in the 5G space and “lock in” countries to its products. The same theme is now unfolding with a number of issues but none more so than digital currency and electronic payment. If China is able to achieve its goals for digital currency and electronic payment by making this new currency ubiquitous around the globe it could challenge the central role of the U.S. dollar, gain more access to data on its citizens and other users, and grow the yuan’s financial power on the international stage. Like Huawei, digital currency is as much a national security issue as it is an economic and regulatory one. The United States has a range of options to respond, including developing credible alternatives, identifying Chinese technology firms involved with China’s digital currency strategy and their ties to U.S. companies, monitoring risks of data collection of Americans, and taking steps to restrict the use of digital currency in the United States. Congress should make a focus on China’s digital currency plans a part of their oversight agenda this year.

A Counter-China Bloc Won’t Work — Washington Needs to Build Overlapping, Interest-Based Coalitions

Another area where Cold War history shapes contemporary thinking in the wrong direction is the idea that a Sino-American competition will be defined by “blocs” of countries on one side or the other. This organizing principle was never truly applicable during the Cold War, but it certainly isn’t appropriate today when Beijing is a complex regional economic, military, and technological power. Washington should avoid thinking in terms of blocs where countries have to make large, single choices about their relationship with Beijing. Instead, U.S. policy should look to build coalitions with counties around specific interests, including defense, maritime security, technology security, supply chains, and human rights. This presents a more enduring approach to cooperation in the face of Beijing’s regional economic and political position.

Make China the Explicit Priority in the Next National Defense Strategy

The bipartisan support for the 2018 National Defense Strategy was an encouraging sign that a consensus on making China the Department of Defense’s priority was obtainable. While both China and Russia are revisionist powers and pose considerable risk to U.S. interests, the magnitude of the challenge posed by China now and over the coming two decades far exceeds that of Russia. For the sake of bringing greater clarity to the application of the department’s time, energy, and budget resources, the next National Defense Strategy should go further than its predecessor by being explicit that China is the principal priority for the Defense Department. This will have the immediate effect of ending a debate within various parts of the department, where some factions give priority to the European theater and others to the Pacific. While this may open up the United States to criticism for engaging in “Cold War thinking” — a key talking point used by Chinese officials — it’s more important that the Biden administration signal to domestic and international constituencies that China is its most serious competitor.

Bulk Up the Blunt Force

The 2018 National Defense Strategy calls for an investment in a “blunt layer” of forces forward to delay, degrade, and deny the enemy’s attempt to achieve a fait accompli. This war-preventing force is expensive and at heavy risk because it must be deployed close to China’s borders, often in allied territory, and be exposed to a greater magnitude of China’s offensive force. While the blunt layer concept is a good one, the Trump administration has done little, if anything, to bolster it in the Indo-Pacific. The Biden Department of Defense should look to conduct an early review of conventional posture in the region and identify ways to qualitatively enhance these forces with the goal of raising the costs of the People’s Liberation Army’s path to a fait accompli. This will be a test of America’s ability to prioritize budget resources for forward-deployed forces as much as that of allies and partners to provide critical access.

Continue to Deepen the U.S.-Taiwanese Relationship and Avoid Making it a Subset of U.S.-Chinese Policy

The U.S. relationship with Taiwan has gone through so many positive changes in the last several decades. During this time, Taiwan has emerged as a vibrant democracy that has become a social, technological, and public health example to the world. Washington’s relationship with Taipei has also made great strides, including in recent years. Congress can be expected to continue bipartisan efforts to enhance this relationship, including advocating aggressively for a bilateral trade agreement. The Biden administration will have to consider ways in which it can continue to strengthen the relationship, in the security domain but also in the areas of health policy, technology competitiveness, and supply chain security. Instead of a distraction or a hindrance, America’s relationship with the vibrant island democracy is a competitive advantage for U.S. foreign policy.

What’s Next?

The months ahead will see a slow rollout of Biden’s China policy as the team continues to staff up and review existing policy. Early signs of support for Taiwan, a continuation of maritime presence in the Western Pacific, a focus on China’s human rights record, and clear and direct messaging from the State Department are encouraging. Biden also singled China out in his first major foreign policy speech as America’s “most serious competitor” and insisted that his administration will engage in “extreme competition” with Beijing. There have also been stumbles, including the administration’s inconsistent signaling on the Huawei threat. However, just like the Truman-Eisenhower-Kennedy early years of the U.S.-Soviet competition, it appears for now that the Biden team is prepared to adopt the same macro-level approach to Beijing as the Trump administration while adopting their own priorities and methods to address the challenge. Republicans on Capitol Hill should be prepared to support the spirit of this agenda while offering thoughtful criticism when warranted and continuing to expand the successful bipartisan legislative agenda of 2018 to 2020. For their part, the Biden administration should expect that Democrats in Congress won’t shy away from rigorous and public oversight of their decision-making. Policy differences will not fade away — nor should analysts want them too — but the most successful China policy for the United States will be one where the two parties complement one other’s strengths and find ways to disagree without being disagreeable.

 

 

Eric Sayers is a visiting fellow at the American Enterprise Institute. He previously worked as a professional staff member on the Senate Armed Services Committee and as a consultant to U.S. Pacific Command, where he worked as special assistant to the commander.

Image: U.S. Marine Corps (Photo by Cpl. Cody Rowe)

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