The escalating hostility between the United States and China, with its threat of a new cold war, has far-reaching and little-understood implications for the country and the world.
No sooner did the U.S. successfully complete the first round of trade negotiations with China than a highly contagious unknown virus broke out that forced China to shut its economy, which did more damage than the trade war. Commerce Secretary Wilbur Ross predicted the outbreak would bring jobs back to the U.S., something the trade war has struggled to accomplish.
But China quickly tamped down the spread of the virus and the most devastating effects from the virus ended up in America – an ironic “truth is stranger than fiction” scenario – even though you would think that a medically sophisticated country like the U.S. would be in the best position to respond to an outbreak. The COVID-19 pandemic weakened the United States’ standing in the world while emboldening China.
Scapegoating China for the pandemic may distract from the poor U.S. response, but beyond election year politics deeper issues contribute to the U.S.-China estrangement. The U.S. has struggled to come to terms with China’s rapid rise as a world power and its threat to our hegemony. We are frustrated that China has taken advantage of the world liberal order while dismissing democratic governance, a state/free-market economy and respect for human rights and international norms.
China has aggressively promoted its authoritarian governance model as more effective than democracy in handling the COVID-19 pandemic. It has taken advantage of the world’s preoccupation with COVID-19 to crush the democratic uprising in Hong Kong, redefining the long-standing one state-two systems principle, and has sought to extend its sphere of influence to countries that may be receptive to its brand of governance.
Our tariffs and the pandemic have weakened both the U.S. and Chinese economies. When China retaliated to our tariffs to spread the pain equally between the two countries, it hurt our farmers, lobstermen and consumers. The hardliners in Washington have been advocating decoupling the two economies, as if a Soviet-style cold war were possible. But China has become one of the largest trading partners of our allies and as a result of our tariffs China has given our allies more favorable trading terms. If the two economies decouple, we might find ourselves isolated rather than leading a world coalition.
When America stepped back from world leadership, China stepped forward to fill the void. But despite increased diplomacy to aid countries suffering from COVID-19 and its Belt and Road initiative, China has struggled to win friends in the international community. It has been blamed (perhaps unfairly) for its inability to contain COVID-19. Its nationalism has worked against its attempt to improve its international reputation and its heavy reliance on surveillance as a tool for social control has made the world uneasy, which has undermined its leading technology companies like Huawei, TikTok and WeChat from reaching global markets.
A trade war and a cold war only increase the probability of a hot war. Our current hostility to China must evolve into a more balanced relationship to address the pressing global issues that threaten both countries – future pandemics, climate change, financial instability, human migration and nuclear proliferation. We cannot effectively address these issues without cooperation with China, despite our differences.
China remains the United States’ largest trading partner, its major competitor and its geopolitical adversary. We must manage all three relationships. We mutually benefit from trade, but long term we risk becoming uncompetitive without a coherent industrial policy with investments in infrastructure, innovation and immigration to attract the world’s best talent.
The tariffs proved that the U.S. cannot go it alone in dealing with China but must become the leader of a multilateral coalition of countries that seeks a liberal international order, the rule of law, democratic values, human rights and strengthened international institutions. To provide a counterweight to illiberal regimes, we must become the world’s coalition builder to foster a safe, just and more democratic world.
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