For at least the past ten to fifteen years, there has been an extensive debate about China’s rise. In particular, many in the scholarly and policy communities are interested in whether China will surpass the United States as the world’s predominant power. Chinese GDP is already greater than that of the U.S. (in PPP terms), and China is also the world’s largest trading nation. China also leads in a range of other indicators, such as total foreign investment and STEM graduates. Despite this, the U.S. maintains important advantages. For one, it has an entrenched institutional advantage given that it was the one that established much of the current international order (UN, IMF, World Bank, and later WTO). The U.S. also has far more and far stronger military allies than China. Finally, America continues to have a clear lead in university quality and innovation. The future balance of power is thus far from clear.
Predictions are further complicated by the fact that China’s rise and America’s fall are not necesarilly synonymous. That is, China could be significantly improving its absolute position without gaining relative to the United States. The opposite could, of course, also be true. The problem with this lack of clarity is that it complicates policymaking. The optimal American grand strategy varies depending on the relative strength of the United States. If China is destined to remain in second place, the U.S. can and should work to bolster its hegemonic position. If the rise of China is inevitable, however, there is a good case to be made for some degree of American retrenchment. But policy is not neutral, and in some sense it shapes the systemic balance of power by affecting a state’s capabilities and posture. If American policymakers think their country is in decline and begin adopting policies based on this assumption – namely retrenchment – then they may force an otherwise avoidable diminution in power and status. By cutting back the size of the American military and shrinking foreign aid budgets to adjust to their weakened position, these policymakers do weaken their position. In other words, they create a self-fulfilling prophecy. The opposite is also true: the U.S. could invest heavily in its network of alliances, international institutions, and its military under a false belief in American power. This strategic investment, while precipitated by erroneous assumptions, could have the end result of making America’s position unassailable.
It is not always the case that these kinds of self-fulfilling prophecies will occur. The United States could weaken its position by overestimating its strength and engaging in a ruinous competition that it objectively lacks the resources to win. Indeed, this is exactly what happened to the Soviet Union. Sometimes systemic pressures are too great to overcome through simple policy tweaks. The problem is that we do not know just how much of China’s rise and America’s decline is systemically baked in as opposed to the result of policy choices on the margins. Perhaps it is the case that China’s tremendous rise is simply the result of some fortuitous policy choices by leaders like Jiang Zemin and Hu Jintao. Indeed, myriad China experts are now predicting a huge slowdown in growth due to the regressive politics of Xi Jinping (see here, here, and here). More likely is that China will continue to grow for structural reasons; its 19th and 20th-century economic malaise was a massive aberration, after all. Either way, American policymakers have to make some tough choices with highly uncertain information.
I am not enough of a China expert to say what the United States should do. In fact, I hope this post has left you more confused and less certain about the U.S.-China relationship! But what should be clear is that, given the potential for self-fulfilling prophecies, there is no “prudent” option. It is risky for American leaders to keep acting as if nothing has changed because there is good evidence that the rise of China has changed quite a bit. By deluding themselves into thinking America will be an eternal hegemon, policymakers risk underestimating a very serious adversary and destroying the position of the United States through unwinnable arms races or even wars. But the same dangers exist for preemptive retrenchment. If American leaders overestimate China and unnecessarily cede their country’s position as the preeminent power, they could also severely weaken the United States. At some point, the U.S. is going to have the roll dice and pick a strategy. No matter what it chooses, the decision might permanently weaken it.