Henry Kissinger, the doyen of the foreign policy elite and the China engagement school, made the latest of his entreaties last month to the Biden Administration to avoid a U.S. confrontation with Beijing. This is well received by the administration, as it too seeks to hinder an effective U.S. response to the growing China threat. The most significant occurrence of the last 50 years has been the rise of China and the dispositive question of the 21st century is whether the United States or China will determine the rules, principles, and values of global politics in this century.
The expansion of China’s power is one of the most remarkable developments of the second half of the 20th century, rivaled only by the Cold War remaining cold and its peaceful end. In 1980, China’s gross domestic product of $191 billion. In 2000, it was about $1.2 trillion. Today it is approximately $17.7 trillion and the equal or just a bit below the size of the U.S. economy.
In 1980, China’s military was large but militarily ineffective, its nuclear forces were modest, and its power projection capabilities extended only to its borders. Today, China’s military is a rival of the U.S. military, its nuclear forces are expanding at a pace that Admiral Charles Richard, the head of U.S. Strategic Command, calls “breathtaking.” China is developing the ability to project and sustain military power far beyond its borders and possesses or is developing de facto bases in Cambodia, Djibouti, Equatorial Guinea, Kiribati, Pakistan, and the Solomon Islands.
The consequence of China’s expansion is a relative change in the balance of power in China’s favor and so the United States once again has a global rival, which it had not had since the dissolution of the Soviet Union in 1991. This expansion is a stark development and defines the end of the post-Cold War period which was unique and defined by unrivaled U.S. power and the genesis of the return to an era of great power competition, which is a return to the norm in international politics.
How Did This Happen?
China’s rise is an accomplished fact. That this occurred when its rise was clear to all, decade after decade, delegitimizes America’s foreign policy elite, its intelligence community, its political leadership, and its foreign policy foundations and think tanks. Their job was to prevent the rise of a challenger to the global position of the United States. They failed. If there were accountability, they would be fired, as few will admit their failure and resign.
The three causes must be understood so that the United States never repeats its error: the victory of Deng Xiaoping’s strategy; the triumph of the foreign policy elite and Wall Street; and the failure of the U.S. strategic community.
First, the architect of this epochal development was Deng Xiaoping. Deng is a strong candidate for the 20th century’s greatest strategic thinker. He took a desperately poor nation, still reeling from the disasters of Mao Zedong’s leadership, and placed it on the path to world domination without generating opposition from the United States, but, indeed, with the support of the U.S. elite. Deng’s strategy of hiding China’s growth while biding its time was uniquely successful.
Chinese leadership under Deng was shaken to its core by the Tiananmen Square massacre and, more significantly, by the collapse of the Soviet Union. China was determined not to repeat Moscow’s mistakes. This included ensuring that there would be no political reform as Gorbachev had attempted and which had unleashed the desire for freedom, political change, and nationalism.
Second, Deng recognized that isolation from Western technological progress guaranteed subordination in the world order. What China needed was technology, foreign direct investment (FDI), and knowledge and skill from the West. That, in turn, meant joining the rules-based trade system and ultimately the World Trade Organization. Even before China entered the WTO in December 2001, it prioritized export-oriented growth, the reform of state-owned enterprises and FDI, which provided a foundation for its economic miracle beginning in the 1990s.
Consequently, the rise of China was met by a historically unique case of threat deflation in the United States. Regrettably, this remains. China’s deception started under Deng, projecting an image of itself as a benign and responsible great power that fully accepted the liberal international order. From the perspective of Beijing, the Chinese Communist Party’s leadership must be thanking its lucky stars and secretly amazed they got away with it for so long.
Willing Allies in the West
But Deng could not accomplish China’s rise alone. The second cause was Western elites who were willing allies. The U.S. foreign policy elite and Wall Street’s elite willingly embraced and sustained China’s rise. They also profited handsomely from it. They consistently—and gravely—underestimated the dangers and implications of China’s rise, including its threat to U.S. interests and the security of the American people.
Lamentably, the West’s failings were multiple and maintained for decades. While Deng provided the foundation, China’s success was made possible because the United States allowed it to enter the world’s free-trade system. For decades, China has used the West’s economic ecosystem to grow like kudzu. And like kudzu, it has come close to killing the indigenous flora in the economic and technological ecosystem. Western businesses gained access to, and thus lucre, through the PRC’s market. In exchange, they traded the transfer of industries, wealth, and knowledge to the PRC. Countless American CEOs and financiers profited from this sordid exchange. Through their actions they exposed the American people and economy, as well as the national security of the U.S. to enormous vulnerabilities. Few said anything to stop this while the PRC looted the intellectual capital and property of the West with the help of Western elites.
Over 30 years, China has snatched an astronomical $4.4 trillion from the United States. Additionally, the United States has lost $200 billion to $600 billion annually because of China’s theft, not to mention the several million good-paying manufacturing jobs. China achieved economic success in large measure by taking advantage of the working classes in both China and the United States. The Chinese working classes continue to pay a high price for the regime’s ambition: wages are artificially low, and labor conditions are Dickensian. Once workers leave factories, they encounter other dangers for their health from chronic air and water pollution in Chinese cities. A consequence of China’s entering the West’s ecosystem has been to weaken the West’s manufacturing power and introduce dependency on China’s products.
The United States helped to create its most powerful enemy by giving the PRC access to talent, markets, capital, technologies, and universities. This permitted China to build its economic might, which, in turn, allowed it to create a formidable military with an increasing capability to project its power globally.
Washington supported Chinese economic growth and membership in the WTO, facilitating both with the expectation that they would be beneficial for the U.S. economy and that the integration of China into the Western economic ecosystem would compel China to democratize.
This colossal blunder was rooted in the hubris and ignorance of Western political leaders from the 1990s until Donald Trump’s presidency. Predictions that China was on the wrong side of a Hegelian conception of history are painful reminders that our elites are far from grasping any teleological reality. In fact, their views easily lead to a hubris, ignorance, and conceit that is self-destructive. Instead of forcing its democratization, China’s economic growth fueled the CCP’s position and control, its aggressiveness, and its global ambition. Economic prosperity legitimized China’s flawed political system and made it possible for a dictator such as Xi to rise to power.
The United States and European Union (EU) lost any hope of compelling change when both supported investment, trade, and WTO membership for China without linking these “carrots” to the “stick” of political reform and respect for human rights. In truth, the West never even insisted upon such measures as capital account convertibility and a floating exchange rate, which would have allowed adjustments, particularly in the financial system, to occur at the expense of the CCP’s control of the economy. Instead, Western elites naively accepted China’s willingness to accept the rules of the liberal international order and reform its political system to become democratic.
That effort was doomed to fail as it did too little to compel compliance. In sum, the insouciance of the foreign policy elite and Wall Street was a result of their capture by the Party or their willful neglect to employ the tools they might have used to force political change in China.
Finally, the third cause was the defeat of American strategic thinkers. Far stronger during the Cold War, the defeat of the Soviet Union fractured their strategic focus, which turned to ethnic conflict and the breakup of Yugoslavia, terrorism, and the subsequent wars in Afghanistan and Iraq, almost anything other than the rise of China. The defeat of America’s peer allowed finance to triumph, to place wealth creation before the national security of the United States.
Those who warned about the profound and adverse strategic consequences of China’s growth, such as the late Andrew Marshall, who directed the Pentagon’s Office of Net Assessment, were effectively ignored. It also hindered the ability of strategic thinkers to replace their ranks as universities and professional military education focused on other topics. Unfortunately, America’s strategic thinkers did not have the power to defeat the expansion of China’s influence and the financial, foreign policy, and political elite. They lost the fight. Now the country faces the consequences of when money (for a few) defeats strategy.
The end of the Cold War disarmed the West strategically and ideologically. It yielded triumphalism, and, ironically, ideological disarmament, and allowed China to expand its power and influence in the West and globally without effective resistance.
What Is to Be Done?
Although we need a new elite, we are extremely unlikely to get one in the immediate or near term. The next steps require that the elite we have embrace a singular strategic focus on the China threat. This must be sustained and always first in order of priority for leadership, personnel, resources, and budget despite competing threats from other states. None are the equal of the China threat.
This attention is also necessary for Wall Street. Funding the Chinese Communist Party should never have occurred. Regrettably, it has. It should have ended decades ago and the fact that it continues borders on criminal negligence. It is a painful reminder of how far Chinese influence has penetrated, the foreign policy elite’s and Wall Street’s continued threat deflation, and how much Americans must accomplish to compel their financial, business, media, and political elites to change course.
The most pernicious aspect of threat deflation is the assumption of time—if a threat is on the horizon, there remains time to change course and address it. In fact, the United States is out of time. It must recapture its strategic focus immediately. This begins by recognizing that the Chinese Communist Party is the enemy and must be defeated.
Cato the Elder always ended his speeches in the Roman Senate—no matter the topic—with the recognition that Rome’s peer competitor, Carthage, must be destroyed (Carthago delenda est). Carthage was finally vanquished after the end of the Third Punic War in 146 B.C., three years after Cato’s death. His focus on the peer competitive threat perpetually reminded Roman leaders of the danger to their position and of Carthage’s determination to defeat them. Today, Americans need to institutionalize Cato’s clear and powerful insight concerning the necessity of identifying and vanquishing the enemy.