Another Perspective

Addressing the Chinese Threat

If that's what it is! How did Ronald Reagan put it -- trust but verify?

By 5.11.07

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Iraq is a tragic problem for the U.S., but hopefully a temporary one. America's substantial military presence is unlikely to outlast the Bush administration. And though the threat of jihadist terrorism persist, it does not pose an existential threat to America as did the Soviet Union.

Thankfully, like Humpty Dumpty, the old USSR is gone, no matter how hard Vladimir Putin might attempt to put it together again. But there is another potential superpower that makes many Americans uneasy: China.

China is increasingly asserting itself around the globe. With the world's largest population, swiftly growing economy, ancient culture, and authoritarian politics, the People's Republic of China is seen as an almost inevitable American rival. Some analysts even view war as likely.

Last month, the Council on Foreign Relations released a new task force report on U.S.-China relations, bound to join many similar volumes on the over-burdened bookshelves of scholars across the nation. The panel's recommendations are sensible, but generic: "Improving economic relations," "Enhancing security relations," "Encouraging political reform," etc. Whether there is will on both sides of the Pacific to achieve these ends is the real issue.

Much depends on getting U.S.-China policy "right." Even today, any confrontation with the PRC, a nuclear-armed power with regional reach, would be far different from the wars with Serbia and Iraq. A future U.S.-China conflict could become a global conflagration.

Moreover, a friendly PRC could help resolve a range of lesser security and political issues, such a potential nuclear North Korea. Finally, there's the potential benefit of a continuing economic relationship.

WHITHER RELATIONS BETWEEN the two nations? There's no cause for the touch of paranoia that afflicts some U.S. policymakers. Today America stands astride the globe as a colossus, with the world's most productive economy, dominant military, and ubiquitous culture. Equally important, the People's Republic of China is no substitute for the Soviet Union.

Unsurprisingly, PRC officials disclaim any interest in confrontation. They acknowledge domestic weakness and emphasize the benefits of cooperation.

Undoubtedly more hostile voices also join in Beijing's policy councils -- as in Washington as well. Uncle Sam need not be a Pollyanna, following an "anything goes" policy so long as American companies make money, Ronald Reagan's policy of "trust but verify" can be applied to Asia's great new rising power.

But the worst strategy would be to treat the PRC as an enemy. First, China is no longer communist in the traditional sense. With as much as two-thirds of the economy outside of government control, increasing personal autonomy, and an outward orientation, today's PRC is quite different from that of Mao Zedong.

With only a hint of a smile Chinese officials spoke of "socialism with Chinese characteristics" when I visited last year. There no longer is any pretense of Beijing promoting world revolution.

Second, international integration has helped erode China's old totalitarian state. Membership in the World Trade Organization has nudged the PRC towards something closer to a rule of law. Foreign investment and trade have given China a stake in a peaceful global order.

Third, though Shanghai, Beijing, and other leading cities should impress visitors, rural China remains a century behind the PRC's modern urban landscape. Chinese officials estimate Shanghai's per capita GDP at about $14,000, but that of China nationally at only $1,700. As a new book by a study team from the Center for Strategic and International Studies and Institute for International Studies observes, "China remains firmly in the ranks of the world's low-income economies."

In 2005 America's per capita GDP ran $42,000. Assuming recent growth rates continue -- unlikely as the Chinese economy matures -- the PRC's GDP won't surpass that of the U.S. until 2035, and even then America's per capita production will be four times as great.

China faces potential labor shortages as its population ages. Moreover, China's vast gulf between urban and rural creates social dynamite that might be difficult to defuse.

Fourth, trade with China is largely beneficial to America. Although disputes dominate news headlines -- with the U.S. lately bringing cases before the WTO -- similar concerns emerged and ultimately disappeared regarding Japan. Today few Americans worry about Japan overtaking the U.S.

Fifth, the PRC isn't likely to catch up to the U.S. militarily until mid-century at the earliest. Beijing will be able to match America in East Asia more quickly, but Washington's current advantage has always been artificial and is bound to ebb: the U.S. cannot expect forever to dominate every region on earth.

Maintaining American influence will require thoughtful diplomacy and economic openness. But Washington has the advantage of being allied with most of China's neighbors.

OF COURSE, THE PRC PRESSIMISTS could be right. Freedom gains might be lost. Economic liberalization can coexist with nationalism. China could eventually turn its growing power against America. All of these are possible, but not probable.

Treating China as an inevitable enemy and embarking upon a strategy of containment are far more likely to turn the PRC hostile. Nor is such a policy sustainable. None of Washington's friends in East Asia are likely to voluntarily turn themselves into a target of China.

Engaging in economic war makes no more sense. Even if such a policy hurt the PRC more than America, it would be mutually destructive.

Perhaps most important, the U.S. should put its own house in order. Washington should push freer trade throughout Asia, develop a cooperative strategy towards China with allied states, and improve its international image, all to better position itself for future competition with the PRC. America also should improve its economic competitiveness.

China today is more free, more prosperous, and more responsible than China only a few years ago. There still is reason for America to be watchful and wary about Beijing's policies. But the U.S. is acting from a position of strength, and should confidently engage, rather than timidly isolate, what is likely to be the world's next great power. The benefits of maintaining a mutually constructive, peaceful relationship would be enormous for both nations, and the rest of the world.

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About the Author
Doug Bandow is a senior fellow at the Cato Institute. A former Special Assistant to President Ronald Reagan, he is the author and editor of several books, including The Politics of Plunder: Misgovernment in Washington (Transaction).