Andy’s Notes: Granted, The Economist is a very biased publication although to give credit where it’s due they don’t do much to hide their positions. Why post this article? Because, like it or not, we are at war on multiple fronts, many of which have nothing to do with bombs or bullets. Economic warfare, trade warfare, and even information warfare are what dot the landscape today – along with war of the variety Eisenhower warned us about all those years ago. This is not going away and that’s the point of making the post. Those who are treating this state of permanent warfare as a fad have been wrong for nearly two decades and will continue to be wrong. This is the new ‘normal’.
FIGHTING OVER trade is not the half of it. The United States and China are contesting every domain, from semiconductors to submarines and from blockbuster films to lunar exploration. The two superpowers used to seek a win-win world. Today winning seems to involve the other lot’s defeat—a collapse that permanently subordinates China to the American order; or a humbled America that retreats from the western Pacific. It is a new kind of cold war that could leave no winners at all.
As our special report in
this week’s issue explains, superpower relations have soured. America
complains that China is cheating its way to the top by stealing
technology, and that by muscling into the South China Sea and bullying
democracies like Canada and Sweden it is becoming a threat to global
peace. China is caught between the dream of regaining its rightful place
in Asia and the fear that tired, jealous America will block its rise
because it cannot accept its own decline.Get our daily newsletter
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The
potential for catastrophe looms. Under the Kaiser, Germany dragged the
world into war; America and the Soviet Union flirted with nuclear
Armageddon. Even if China and America stop short of conflict, the world
will bear the cost as growth slows and problems are left to fester for
lack of co-operation.
Both sides need to feel more secure, but
also to learn to live together in a low-trust world. Nobody should think
that achieving this will be easy or quick.
The temptation is to shut China out, as America successfully shut out the Soviet Union—not just Huawei, which supplies 5G
telecoms kit and was this week blocked by a pair of orders, but almost
all Chinese technology. Yet, with China, that risks bringing about the
very ruin policymakers are seeking to avoid. Global supply chains can be
made to bypass China, but only at huge cost. In nominal terms
Soviet-American trade in the late 1980s was $2bn a year; trade between
America and China is now $2bn a day. In crucial technologies such as
chipmaking and 5G, it is hard to say where commerce ends
and national security begins. The economies of America’s allies in Asia
and Europe depend on trade with China. Only an unambiguous threat could
persuade them to cut their links with it.
It would be just as
unwise for America to sit back. No law of physics says that quantum
computing, artificial intelligence and other technologies must be
cracked by scientists who are free to vote. Even if dictatorships tend
to be more brittle than democracies, President Xi Jinping has reasserted
party control and begun to project Chinese power around the world.
Partly because of this, one of the very few beliefs which unite
Republicans and Democrats is that America must act against China. But
how?
For a start America needs to stop undermining its own
strengths and build on them instead. Given that migrants are vital to
innovation, the Trump administration’s hurdles to legal immigration are
self-defeating. So are its frequent denigration of any science that does
not suit its agenda and its attempts to cut science funding (reversed
by Congress, fortunately).
Another of those strengths lies in
America’s alliances and the institutions and norms it set up after the
second world war. Team Trump has rubbished norms instead of buttressing
institutions and attacked the European Union and Japan over trade rather
than working with them to press China to change. American hard power in
Asia reassures its allies, but President Donald Trump tends to ignore
how soft power cements alliances, too. Rather than cast doubt on the
rule of law at home and bargain over the extradition of a Huawei
executive from Canada, he should be pointing to the surveillance state
China has erected against the Uighur minority in the western province of
Xinjiang.
As well as focusing on its strengths, America needs to
shore up its defences. This involves hard power as China arms itself,
including in novel domains such as space and cyberspace. But it also
means striking a balance between protecting intellectual property and
sustaining the flow of ideas, people, capital and goods. When
universities and Silicon Valley geeks scoff at national-security
restrictions they are being naive or disingenuous. But when defence
hawks over-zealously call for shutting out Chinese nationals and
investment they forget that American innovation depends on a global
network.
America and its allies have broad powers to assess who is
buying what. However, the West knows too little about Chinese investors
and joint-venture partners and their links to the state. Deeper thought
about what industries count as sensitive should suppress the impulse to
ban everything.
Dealing with China also means finding ways to
create trust. Actions that America intends as defensive may appear to
Chinese eyes as aggression that is designed to contain it. If China
feels that it must fight back, a naval collision in the South China Sea
could escalate. Or war might follow an invasion of Taiwan by an angry,
hypernationalist China.
A stronger defence thus needs an agenda that fosters the habit of working together, as America and the USSR
talked about arms-reduction while threatening mutually assured
destruction. China and America do not have to agree for them to conclude
it is in their interest to live within norms. There is no shortage of
projects to work on together, including North Korea, rules for space and
cyberwar and, if Mr Trump faced up to it, climate change.
Such an
agenda demands statesmanship and vision. Just now these are in short
supply. Mr Trump sneers at the global good, and his base is tired of
America acting as the world’s policeman. China, meanwhile, has a
president who wants to harness the dream of national greatness as a way
to justify the Communist Party’s total control. He sits at the apex of a
system that saw engagement by America’s former president, Barack Obama,
as something to exploit. Future leaders may be more open to enlightened
collaboration, but there is no guarantee.
Three decades after the
fall of the Soviet Union, the unipolar moment is over. In China,
America faces a vast rival that confidently aspires to be number one.
Business ties and profits, which used to cement the relationship, have
become one more matter to fight over. China and America desperately need
to create rules to help manage the rapidly evolving era of superpower
competition. Just now, both see rules as things to break.
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