On Political Books

January/ February 2014 A Middle Course for the Middle Kingdom?

Competition with China really isn’t a zero-sum game. So why does it feel that way?

By Daniel Kurtz-Phelan


The Contest of the Century: The New Era of Competition with China—and How America Can Win
by Geoff Dyer
Knopf, 304 pp.

The pursuit of power among nations,” President Barack Obama said in his first major speech on China, “must no longer be seen as a zero-sum game.” In the four and a half years since, leaders in both Washington and Beijing have stuck to that message with conspicuous discipline. Chinese President Hu Jintao kicked off his 2011 state visit on the South Lawn of the White House with a paean to “win-win progress through cooperation.” Last summer, Hu’s successor, Xi Jinping, stood next to Obama in Rancho Mirage, California, and called for “a new model of major country relationship based on mutual respect and win-win cooperation for the benefit of the Chinese and American peoples.”

In 2012, a Dartmouth political scientist named Benjamin Valentino tried to figure out what, exactly, the American people think about this “new model of major country relationship.” As part of a broader study of public opinion on U.S. foreign policy, he had pollsters describe two scenarios for the coming twenty years. In the first, both the United States and China experience strong economic growth: “The average American’s income doubles, but China grows faster than the United States and China’s economy becomes much larger than America’s.” In the second, both economies hardly grow at all: “The average American’s income increases by only 10 percent, but the U.S. economy remains much larger than China’s.” By a factor of more than 2 to 1, Valentino’s respondents chose the latter: they would rather have historically low growth—and its attendant unemployment, poverty, and general hardship—than live in a world dominated by China.

Most Americans, in other words, have not been persuaded by the sunny proclamations of their government. To them, we are already in a zero-sum game with China. And they would rather lose-lose than win-win.

In The Contest of the Century: The New Era of Competition with China—and How America Can Win, Geoff Dyer, a correspondent for the Financial Times who has done tours in both Washington and Beijing, identifies a similar dynamic on the other side of the Pacific. China’s top leaders may recognize that their most important tasks, and possibly their very survival, require a stable and reasonably cooperative relationship with the United States. But a proud popular clamor often drowns out calls for prudence.

A growing and increasingly globalized middle class, raised on tales of the “century of humiliation” at the hands of the West, has embraced “raucous internet nationalism.” Hawkish military figures decry criticism of China’s human rights record as evidence of an elaborate foreign plot to dismember the country. Anxious and ambitious politicians turn to jingoism to fill the vacuum left by discarded Marxist dogma, their “domestic insecurity … feeding, not inhibiting, the desire to stand tall overseas.” And all of this, Dyer argues, can drive policy in unsettling ways. He considers the recent instance of China’s “new assertiveness” that has most worried both U.S. policymakers and the rest of Asia: Beijing’s pursuit of territorial claims in the South and East China Seas. “It is tempting,” he writes, “to think of this activity as a calculated, long-term plan to assert control gradually over the region,” but the real explanation may in fact be “a simmering pressure from below to take more action.”

Dyer starts out his analysis of the U.S.-China relationship with the fairly conventional claim that “the growing competition … will be the single most important factor in world politics in the coming decades.” Yet neither a Cold War nor a shooting war, in his view, is an inevitable outgrowth of this competition. Nor is a booming and bellicose China destined to supersede the United States on the global stage. If Washington can get a few basic policies right, at home and abroad, “it will still hold many of the best cards in the twenty-first century.”

But as Dyer gets deeper into his survey—chatty in tone, scattershot in approach, acute in insight—a dissonance starts to emerge. Beneath his optimism lies a disheartening tangle of dangers and complications: the simmering pressure of nationalism, the exigencies of military planning and alliances, the vexations of economic reform and renewal, the vagaries of domestic politics. Ultimately, his case for optimism hinges on the wisdom, skill, and consistency of leaders and citizens on both sides of the Pacific. Dyer has spent enough time in the two countries to know how dicey a bet that is.

Around the time when participants in Benjamin Valentino’s poll were expressing their dread of falling behind, China was marking a major milestone in its economic rise. In 2012, it surpassed the United States to become the world’s largest trading nation. Just twenty-five years after accounting for less than 1 percent of global trade, it was now the top commercial partner of 124 countries. If it kept growing at a similar rate, economists projected, it would unseat the United States as the world’s largest economy in roughly a decade.

Dyer dispenses quickly with the standard lavish recitation of China’s economic record in the three decades since Deng Xiaoping’s reforms began: the historically unprecedented growth, the mighty new factories, the gleaming airport terminals, the cities springing up from farmland. To him, the key question is how and whether the Chinese Communist Party can sustain that success without undermining its own power—or, as Timothy Garton Ash has put it, “how long the fantastic centaur of Leninist capitalism will endure.” November’s Third Plenum of the 18th Central Committee made clear just how carefully and intently Chinese leaders are approaching that challenge, deploying a mix of incremental economic reforms, cautious expansions of personal liberties, and stringent authoritarian political controls.

This attempt at perestroika-without-glasnost—“left on politics, right on economy,” as one slogan has it—is an experiment with enormously high stakes. Can further economic modernization proceed without risky political opening? Will a richer society insist on more choice and accountability, on everything from pollution to land rights to corruption? Will authoritarian capitalism eventually collapse in on itself? Chinese officials are well aware of how most political scientists and economists would answer these questions. “The more developed and prosperous the country becomes, the more insecure and threatened they feel,” Susan Shirk, a scholar and former State Department official, has written. “From the Communist Party leaders’ perch in Beijing, Chinese society looks like a cauldron boiling over with unrest.”

Similar tensions run through China’s global economic ambitions. Dyer considers the designs of some Chinese hawks to strip the U.S. dollar of its “exorbitant privilege” as the world’s reserve currency. “For the renminbi to eclipse the dollar,” he notes, the country would “have to tear up its economic model” and “the Communist party would lose a vital element of its current political control over the economy.” Those global ambitions, accordingly, boil down to a stark choice for China: “It can keep its particular model of state capitalism. Or it can have a global reserve currency. But it cannot have both.”

From an American perspective, the challenge is that, for all of these dilemmas, every plausible option unleashes complicated dynamics in the U.S.-China relationship. Burdened by sputtering growth or faltering control, anxious Chinese leaders could have a hard time resisting the lures of nationalism, and, as Dyer points out, “a party that loudly claims the mantle of national salvation cannot afford to look weak in the face of perceived slights.” Blessed with economic preeminence and increasing relative power, they could have a hard time preventing expansive new ambitions and interests from arousing new tensions or setting off new conflicts—finding, “like new great powers before,” Dyer writes, “that success creates its own expectations.”

Avoiding such conflicts, or anything else that might threaten stability and growth at home, has been the central tenet of Chinese foreign policy ever since Deng Xiaoping delivered his much-repeated dictum, “Hide your strength, bide your time.” But Dyer argues that “Beijing is starting to channel its inner great power,” attempting “to shape the world according to its own national interests” and “inevitably finding itself pulled into geopolitical competition with the U.S.” China’s most recent white paper on defense states, “We will never seek hegemony.” Dyer doesn’t entirely trust it.

Both sides, he recognizes, have overwhelming incentives to avoid outright hostility—a point that has become a staple of the win-win rhetoric. “Interdependence,” as former Secretary of State Hillary Clinton put it, “means that one of us cannot succeed unless the other does as well.” That is true when it comes to export markets, to the buying and holding of U.S. debt, to the security of sea lanes, to the health of the world trading system, the fight against climate change, and on and on and on. China has managed its spectacular success within the global system the United States built, giving it, along with today’s other rising powers, compelling reason to help ensure that this system does not collapse.

Dyer does not identify any particular tendency toward belligerence or malevolence on Beijing’s part. His skepticism stems from his analysis of China’s expanding interests (an economy “fed by iron-ore mines in Peru, copper mines in Congo’s Katanga province, and oil fields in south Sudan”) and capabilities (several years of “the biggest military expansion in the world,” which have brought it a long way from the days when American planners would dismiss a Chinese attack on Taiwan as a “million-man swim”). In its own neighborhood, it remains to be seen just how forcefully Beijing will resist an ongoing U.S. security role. Yet already, in Dyer’s view, “China is starting to push back against the United States in part because it can.” In the rest of the world, he writes, “[i]t is facile to suggest, as some do, that China is trying to recreate an old-fashioned empire, but it is fair to say that China’s overseas investments are repeating elements of the same imperial dynamic, the old story of the flag following the trade.” Eventually, global economic interests will create global strategic interests; new capabilities will create new intentions.

Still, even accepting Dyer’s sense of an “inner great power” and the projections of economic preeminence, China remains a long way from matching the United States’ global presence. As Andrew J. Nathan and Andrew Scobell summarize persuasively in their book China’s Search for Security,

It would have to acquire access to military bases in South Asia, Africa, Latin America, and the Middle East, where it has important interests to protect. Within a few decades, the Chinese navy would roam the oceans the way the American navy does now, even patrolling along the American coasts. The renminbi would replace the dollar as the largest international reserve currency. Chinese culture and values would achieve global influence along with Chinese products.

The Obama administration’s strategy—once called “the pivot,” more recently “the rebalance”—has tried to reassure China’s neighbors and, to use Dyer’s phrase, “restrain Beijing’s worst instincts,” without sending the U.S.-China relationship off the rails or letting places with names like Mischief Reef and Scarborough Shoal become the twenty-first-century equivalents of Alsace-Lorraine. To the extent that approach has worked, it is in large part, Dyer observes, because of “the open door that was waiting for Washington in a region where anxiety about China was soaring,” helping demonstrate to Chinese leaders what regional swagger and strong-arming would get them. As the White House’s first adviser on Asia policy, Jeff Bader, later recounted, “In the wake of Obama’s [November 2010] tour of China’s neighbors and his warm reception in each capital, China began reflecting on the unhappy state of its own relations with its key neighbors,” prompting “a concerted pushback against the advocates of unnuanced assertiveness.” Or as one Chinese analyst tells Dyer, “If Bismarck were in Beijing today, he would say this is our worst nightmare.” Before long, a top leader had publicly recommitted to Deng’s policy of “prudence, modesty, and caution.”

“The United States,” Dyer instructs, “will need to avoid turning China into an implacable enemy. But it also needs to demonstrate to both China and its allies that it has staying power, and that, despite Chinese predictions, it is not about to retreat back across the Pacific for evening cocktails in Hawaii.” He rejects strategies at either extreme—on the one hand, neo-containment, and on the other, plaintive acceptance of Chinese preeminence, at least in Asia—in favor of the pragmatic middle course that has largely characterized U.S. policy for the last several years. But if that is the path of wisdom, going forward it will be gut-wrenchingly difficult to follow in practice.

When it comes to Dyer’s emphasis on U.S. staying power, it is hard to take issue but also hard at the moment to take heart. “The single most important thing the U.S. can do to enhance its influence overseas,” he writes, “is to get its domestic house in order.” There could be no better example of both what he means and how far we are from achieving it than Obama’s canceled trip across the Pacific during the government shutdown. As Chinese state media ran essays on “a de-Americanized world” and Xi Jinping went on a charm offensive at the East Asia Summit—which the United States had committed to attending as one of the signature diplomatic elements in the pivot—Obama moped amid the dysfunction of Washington, quipping to reporters, “I’m sure the Chinese don’t mind that I’m not there right now.” A few weeks later, the prospects of the signature economic element in the pivot, the Trans-Pacific Partnership, started to look uncertain as well, after Congress resisted granting Obama fast-track trade negotiating authority.

Yet it will be similarly hard to avoid “provocation,” or what looks like it when viewed from Beijing. Washington has little choice but to hedge against the possibility of future Chinese misbehavior. But the hedging steps it takes—the Pentagon’s Air-Sea Battle doctrine for war in the western reaches of the Pacific, reinforced alliances in Asia, investments in cyberwarfare capabilities—feed the suspicion of those who believe that the United States is out to keep China down: the classic vicious spiral of the security dilemma. Even steps the United States has not taken can feed that suspicion. In one “fit of self-induced paranoia,” in the words of an Obama adviser, angry Chinese officials insisted that Liu Xiaobo’s Nobel Peace Prize was given on the orders of the U.S. State Department.

When policymakers in Beijing look around, they see American allies, troops, and ships, backed by military spending still many times higher than their own. They see outside powers with an interest in internal territorial issues that cover nearly half of their country. They see Western companies in control of most of the globe’s key resources. They see some of the world’s longest land borders shared by wary neighbors with whom they have gone to war in recent decades. They see plenty of reasons, from a coming demographic cliff and a rickety banking system to increasingly intolerable air and water pollution, to worry about the future of the economic success that is at the root of their power. And they look across the Pacific and see a United States with certain enduring relative advantages—of geography, of demographics, of resources, even of latent economic potential. Americans may be most anxious about Chinese strength, but that sense of vulnerability could come to trouble us even more.

Buy this book from Amazon and support Washington Monthly: The Contest of the Century: The New Era of Competition with China—and How America Can Win

Daniel Kurtz-Phelan an adviser to Secretary of State Hillary Clinton from 2009 to 2012, is currently a fellow of the Centre for Policy Research in New Delhi and the Woodrow Wilson Center in Washington. He is writing a book about George Marshall.

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