To the Brink With China

To the Brink With China

Kevin Lamarque/Reuters
Kevin Lamarque/Reuters

A Sino-American cold war, or even an actual one, is not inevitable, but either is more likely now than just months ago.

Originally published at Project Syndicate

August 13, 2020 8:00 am (EST)

Kevin Lamarque/Reuters
Kevin Lamarque/Reuters
Article
Current political and economic issues succinctly explained.

Observers of US-China relations increasingly talk of a new cold war. On top of a long-running trade war, the two countries now find themselves in a destructive cycle of mutual sanctions, consulate closings, and increasingly bellicose official speeches. Efforts to decouple the US economy from China’s are underway as tensions mount in both the South China Sea and the Taiwan Strait.

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A cold war between the United States and China would leave both countries and the world worse off. It would be dangerous and costly – not least because it would preclude needed cooperation on a host of regional and global issues.

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The good news is that such an outcome is not inevitable. The bad news is the chances of a second cold war are far higher today than they were just months ago. Even worse, the chances of an actual war, resulting from an incident involving the countries’ militaries, are also greater.

Why is this happening? Some say Sino-American confrontation is inevitable, the result of friction between the established and rising powers of the day. But this overlooks the various episodes in history when such power shifts did not result in war. Even more, it underestimates the importance of decisions already made and yet to be made. For better and for worse, little in history is inevitable.

A more serious assessment of how we got here begins with China. In recent years, and increasingly in recent months, the Chinese government has embraced a more assertive path at home and abroad. This is reflected in China’s crackdown in Hong Kong in the wake of its enactment of a harsh new national security law; the inhumane treatment of its Muslim Uighur minority; the clashes along its unsettled border with India; the sinking of a Vietnamese vessel in the disputed South China Sea; and regular displays of military strength near both Taiwan and the Senkaku Islands, which both China and Japan claim as their own.

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This has triggered deep disillusion with China in the US, compounding underlying tensions stemming from China’s consistent theft of American intellectual property, trade practices that many blame for the disappearance of US manufacturing jobs, a concerted military buildup, and mounting repression at home. Hopes that integration into the global economy would bring about a more open, rules-abiding China have not materialized.

Why is China becoming increasingly assertive now? It could be that President Xi Jinping sees an opportunity to advance Chinese interests while the US is preoccupied with the fallout of COVID-19. Or it could be an outgrowth of China’s desire to distract domestic attention from its initial mishandling of the virus and the economic slowdown exacerbated by the pandemic. This would not be the first time a government turned to nationalism to change the political conversation.

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A third explanation is the most worrisome. In this interpretation, China’s recent behavior is not so much opportunistic or cynical as representative of a new era of Chinese foreign policy, one that reflects the country’s growing strength and ambitions. If this is the case, it reinforces the view that a cold war or worse could materialize.

Of course, all this is taking place during a US election campaign, and President Donald Trump’s administration is seeking to blame others for its own inept handling of the pandemic. To be sure, China bears more than a little responsibility, as it initially suppressed information about the outbreak, was slow in responding, and failed to cooperate as much as it should have with the World Health Organization and others. But China cannot be blamed for the lack of adequate testing and contact tracing in the US, much less for Trump’s failure to accept science and support social-distancing and mask-wearing mandates.

But it would be wrong to attribute changing US views of China primarily to American domestic politics. A tougher China policy will last regardless of who wins the upcoming presidential election. Indeed, US policy toward China could become even more critical under a President Joe Biden, whose administration would be less preoccupied with negotiating narrow trade agreements and more focused on addressing other troublesome aspects of Chinese behavior.

In the short run, both sides should ensure that crisis communications are in good order, so that they can respond quickly to a military incident and keep it limited. More positively, the two governments could find common ground by making any COVID-19 vaccine available to others, helping poorer countries manage the economic fallout of the pandemic, or both. 

After the US election, the two governments should start a quiet strategic dialogue to develop rules of the road for the bilateral relationship. The US will need to abandon unrealistic hopes that it can foster regime change in China and instead focus on shaping China’s external behavior. China will have to accept that there are limits to what the US and its allies will tolerate when it comes to unilateral acts that seek to alter the status quo in the South China Sea, Taiwan, or with the Senkaku Islands.

In the long run, the best hope is a US-China relationship of managed competition, which would avoid conflict and allow for limited cooperation when it is in both countries’ interest. This may not seem like much, but it is quite ambitious given where things are and where they are heading.

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Sign up to receive CFR President Mike Froman’s analysis on the most important foreign policy story of the week, delivered to your inbox every Friday afternoon. Subscribe to The World This Week. In the Middle East, Israel and Iran are engaged in what could be the most consequential conflict in the region since the wars in Afghanistan and Iraq. CFR’s experts continue to cover all aspects of the evolving conflict on CFR.org. While the situation evolves, including the potential for direct U.S. involvement, it is worth touching on another recent development in the region which could have far-reaching consequences: the diffusion of cutting-edge U.S. artificial intelligence (AI) technology to leading Gulf powers. The defining feature of President Donald Trump’s foreign policy is his willingness to question and, in many cases, reject the prevailing consensus on matters ranging from European security to trade. His approach to AI policy is no exception. Less than six months into his second term, Trump is set to fundamentally rewrite the United States’ international AI strategy in ways that could influence the balance of global power for decades to come. In February, at the Artificial Intelligence Action Summit in Paris, Vice President JD Vance delivered a rousing speech at the Grand Palais, and made it clear that the Trump administration planned to abandon the Biden administration’s safety-centric approach to AI governance in favor of a laissez-faire regulatory regime. “The AI future is not going to be won by hand-wringing about safety,” Vance said. “It will be won by building—from reliable power plants to the manufacturing facilities that can produce the chips of the future.” And as Trump’s AI czar David Sacks put it, “Washington wants to control things, the bureaucracy wants to control things. That’s not a winning formula for technology development. We’ve got to let the private sector cook.” The accelerationist thrust of Vance and Sacks’s remarks is manifesting on a global scale. Last month, during Trump’s tour of the Middle East, the United States announced a series of deals to permit the United Arab Emirates (UAE) and Saudi Arabia to import huge quantities (potentially over one million units) of advanced AI chips to be housed in massive new data centers that will serve U.S. and Gulf AI firms that are training and operating cutting-edge models. These imports were made possible by the Trump administration’s decision to scrap a Biden administration executive order that capped chip exports to geopolitical swing states in the Gulf and beyond, and which represents the most significant proliferation of AI capabilities outside the United States and China to date. The recipe for building and operating cutting-edge AI models has a few key raw ingredients: training data, algorithms (the governing logic of AI models like ChatGPT), advanced chips like Graphics Processing Units (GPUs) or Tensor Processing Units (TPUs)—and massive, power-hungry data centers filled with advanced chips.  Today, the United States maintains a monopoly of only one of these inputs: advanced semiconductors, and more specifically, the design of advanced semiconductors—a field in which U.S. tech giants like Nvidia and AMD, remain far ahead of their global competitors. To weaponize this chokepoint, the first Trump administration and the Biden administration placed a series of ever-stricter export controls on the sale of advanced U.S.-designed AI chips to countries of concern, including China.  The semiconductor export control regime culminated in the final days of the Biden administration with the rollout of the Framework for Artificial Intelligence Diffusion, more commonly known as the AI diffusion rule—a comprehensive global framework for limiting the proliferation of advanced semiconductors. The rule sorted the world into three camps. Tier 1 countries, including core U.S. allies such as Australia, Japan, and the United Kingdom, were exempt from restrictions, whereas tier 3 countries, such as Russia, China, and Iran, were subject to the extremely stringent controls. 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