Sam Seitz

The economic growth of China augurs a significant change in international politics, as it suggests that the United States’ previously unquestioned position as the world’s unipolar power might no longer be sustainable. Focusing exclusively on the growing economic and military might of the PRC, however, risks distorting our understanding of China’s rise by privileging traditional metrics of power over more relevant but less well-defined forms of influence. A more holistic view of Chinese power suggests that the PRC will fail to emerge as the global hegemon even while it becomes ever more entrenched as Asia’s leading power. Nevertheless, its rise as a regional hegemon will make conflict in Asia more likely as the U.S. and China increasingly compete for regional influence. The U.S. should, therefore, seek to accommodate China’s rise in Asia while working to retain its global preeminence and reassure Asian partners.

China’s economic growth is staggering, as is the size of its population and total economic output. Some studies project that China will account for 20% of global GDP and 15% of world trade by 2030, 1.33- and 2-times American levels, respectively.[1] China is already exploiting its substantial economic might to buy influence abroad, using unconditional credit offers to tie countries in Africa and Latin America to its economy. This leverage has also allowed it to manipulate Southeast Asian neighbors who otherwise might have more aggressively resisted Beijing’s exchange rate manipulations or military posturing.[2]

But these indicators mask underlying deficiencies. For one, China will continue to lag the United States in per capita GDP levels.[3] Per capita GDP is not everything – the UAE does not rule the world – but it is useful when comparing similarly-sized economies because it reveals the level of economic development and productivity. As one article notes, “Half a billion peasants will produce a large volume of output, but most of it will be immediately consumed, leaving little left over for national purposes.”[4] Some would respond that China’s robust growth will allow it to improve its position relative to the U.S. This is indubitably true, but one should not evaluate China’s economy through rose-tinted glasses. Yes, the U.S. suffers from low productivity growth, rising public debts, and slower growth than China, but China faces its own economic challenges.

Chinese public debt is not much lower than that of the U.S., and it is arguably even more worrisome because much of it has been incurred by local governments that chronically misrepresent statistics. Thus, China’s actual debt level is not clear, making it all the more difficult to address.[5] China also faces a growing demographic challenge which far exceeds that of the U.S. With fewer young workers to support growth and an increasingly elderly population draining state welfare coffers, China might simply lack the economic resources to project power globally. China is also disadvantaged by the increasing prominence of integrated supply chains, which undermines the efficacy of state-directed industrial policy. Instead of leading innovation, Chinese firms are mired in the less rewarding endeavor of assembling intermediate goods.[6] This is largely borne out by the data: American R&D spending is still greater than China’s,[7] and Chinese research is of relatively low quality even as it increases in magnitude.[8]

The influence that economic growth has bestowed upon Beijing is also exercised inefficiently. One example of this is China’s Belt and Road Initiative (BRI), which seeks to develop infrastructure to link China’s economy to the resource-rich African continent and consumer-rich European continent. This is partially driven by economic necessity, but it also represents a path for China to gain strategic influence over key regions by inducing their dependence on Chinese credit.[9] The problem for China is that BRI loan recipients are becoming wary of Beijing’s ulterior motives; they do not want to become ensnared in a debt trap.[10] Furthermore, most BRI projects are money pits. This is due, in part, to investments that are chosen for geopolitical rather than economic reasons but also because the selection process is corrupt and opaque.[11]

Finally, purely bilateral comparisons of power yield an incomplete picture. The U.S. has a far greater number of military allies both globally and in Asia. Moreover, as the leading architect of the postwar order, the U.S. enjoys the advantage of having established and shaped the key multilateral institutions in its image, which grants it significant agenda-setting power. Some might argue this advantage is eroding as China organizes alternative institutions, like the AIIB, but doing so overstates the case. First, these institutions are regionally focused. Second, China is operating at a disadvantage because its fundamental values are not widely shared. As Kupchan demonstrates, dominant states create international orders based on their “social and ideological proclivities.”[12] This presents a problem for China, as its model of authoritarianism is unpopular,[13] and this means it will struggle to legitimate the institutions it is creating to supplant U.S. power. China will also be undercut by its hypocrisy, which will further delegitimize its rise.[14] Southeast Asian leaders are already decrying Chinese “neocolonialism,” so it appears unlikely that Beijing will successfully convince states that its model represents a superior, more benign version of the American-dominated status quo.[15]

Because China will struggle to supplant the U.S. globally, its rise will have a more limited impact on global international security than some predict. And to the extent China’s rise generates global economic growth and innovation, it could significantly reduce human security concerns by increasing the global capacity to address transnational threats like climate change, disease, and extreme poverty. The real impact of China’s rise will be felt in Asia, as it is here that Chinese influence is most pronounced and Beijing’s ability to challenge Washington greatest. China is also helped by American global hegemony, which demands that U.S. military forces be dispersed around the world while the PLA can focus regionally. Unfortunately, the U.S. has struggled to adequately respond.

The Obama administration famously pursued its “pivot to Asia,” which aimed to reassure allies wary of China’s rise by expanding the American military presence in the region.[16] At the same time, the administration sought to integrate China into the American-led global order, noting that “the scope of our cooperation with China is unprecedented, even as we remain alert to China’s military modernization.”[17] While this approach had the correct intentions, there is little evidence the pivot succeeded. As China increasingly pursued a hardline nationalist approach to foreign policy based upon bellicose statements and provocative actions, Washington redoubled efforts to signal resolve by expanding its military presence and becoming directly embroiled in maritime disputes.[18] This created the perception in Beijing that U.S. policy was “gratuitous, expansionist, and threatening,”[19] leading the PRC to become increasingly antagonistic. This was a problem given the Obama administration’s desire to accommodate China’s rise – the pivot was too aggressive to build comity but too tepid to cow Beijing. Tragically, there is some evidence that China’s initial bout of nationalism was actually an attempt to divert attention from domestic economic woes.[20] Threatening regional stability and American allies, though, triggered a response from the U.S. The result has been a classic security dilemma where each side, in trying to improve its own regional security, makes the other insecure, leading to growing competition and arms racing.

The Trump administration has adopted an even more hawkish approach. The Trump NSS accuses China of dangerous arms racing, theft of American intellectual property, and even fentanyl distribution.[21] It goes on to say that, “Contrary to our hopes, China expanded its power at the expense of the sovereignty of others.”[22] In the policy realm, Trump has imposed increasingly severe tariffs on Chinese goods and reaffirmed American military commitments to regional allies. This tact has successfully forced the Chinese to take American interests seriously but has also raised tensions. At the same time, Trump’s haphazard approach that seems to target allies – withdrawing from the TPP, for example – as much as China, creates confusion about American priorities.

The root of both administrations’ failures has been the uncertainty behind American intentions, which has created mistrust and destabilized the Sino-American relationship. To mitigate this problem, future American strategies should adopt a more restrained approach in Asia. Washington must continue to reassure and reinforce regional partners to prevent them from bandwagoning with China or adopting risky and destabilizing balancing strategies like acquiring nuclear weapons. The U.S. should not, however, seek to aggressively expand its regional influence or court new allies near China – such as Vietnam – as this will only magnify Chinese insecurity and increase the chance of conflict. By identifying key redlines and supporting current allies while concomitantly signaling limited ambitions and benign intentions, the U.S. can deter Chinese aggression and lower the risk of an extreme security dilemma developing. Simultaneously, the U.S. should work to reinforce its global position by further engaging with liberal institutions and working to closely coordinate with allies both in Asia and elsewhere. This will help solidify global American power, which will work to deter Chinese revisionism and provide the United States with a greater margin for error when dealing with Beijing.

 

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Notes:

[1] Arvind Subramanian, “The Inevitable Superpower: Why China’s Dominance Is a Sure Thing,” Foreign Affairs 90, no. 66 (2011), 69.

[2] Ibid., 71.

[3] Michael Beckley, “China’s Century? Why America’s Edge Will Endure,” International Security 36, no. 3 (Winter 2011/2012), 75.

[4] Ibid., 59.

[5] Ibid., 60.

[6] Ibid., 53.

[7] Dennis Normile, “Surging R&D spending in China narrows gap with United States,” Science Magazine, Oct. 10, 2018. https://www.sciencemag.org/news/2018/10/surging-rd-spending-china-narrows-gap-united-states?r3f_986=https://www.google.com/.

[8] Beckley, 65-66.

[9] Tanner Greer, “One Belt, One Road, One Big Mistake,” Foreign Policy, December 6, 2018, 2. https://foreignpolicy.com/2018/12/06/bri-china-belt-road-initiative-blunder/.

[10] Ibid., 3-4.

[11] Ibid., 2-3.

[12] Charles Kupchan, “The Normative Foundations of Hegemony and The Coming Challenge to Pax Americana,” Security Studies 23 (2014), 219.

[13] Ronald Inglehart, et al. (eds.). World Values Survey: Round Six – Country-Pooled Datafile Version: (Madrid: JD Systems Institute, 2014). http://www.worldvaluessurvey.org/WVSDocumentationWV6.jsp;

Tyler Cowen, “Measures of cultural distance,” Marginal Revolution, December 17, 2018. https://marginalrevolution.com/marginalrevolution/2018/12/measures-cultural-distance.html.

[14] Martha Finnemore, “Legitimacy, Hypocrisy, and the Social Structure of Unipolarity,” World Politics 61, no. 1 (2009), 61.

[15] Greer, 4.

[16] Robert Ross, “The Problem With the Pivot,” Foreign Affairs, November/December 2012, 2. http://www.foreignaffairs.com/print/135466.

[17] “National Security Strategy,” The White House, 2015, 3.

[18] Ross, 5-6.

[19] Ross, 6.

[20] Ibid., 4-5.

[21] “National Security Strategy,” The White House, 2017, 8; 21; 12.

[22] Ibid., 25.

References

Beckley, Michael. “China’s Century? Why America’s Edge Will Endure.” International Security 36, no. 3 (Winter 2011/2012): 41-78.

Cowen, Tyler. “Measures of cultural distance.” Marginal Revolution. December 17, 2018. https://marginalrevolution.com/marginalrevolution/2018/12/measures-cultural-distance.html.

Finnemore, Martha. “Legitimacy, Hypocrisy, and the Social Structure of Unipolarity.” World Politics 61, no. 1 (2009): 58-85.

Greer, Tanner. “One Belt, One Road, One Big Mistake.” Foreign Policy. December 6, 2018. https://foreignpolicy.com/2018/12/06/bri-china-belt-road-initiative-blunder/.

Inglehart, Ronald et al. (eds.). World Values Survey: Round Six – Country-Pooled Datafile Version: (Madrid: JD Systems Institute, 2014). http://www.worldvaluessurvey.org/WVSDocumentationWV6.jsp;

Kupchan, Charles. “The Normative Foundations of Hegemony and The Coming Challenge to Pax Americana.” Security Studies 23 (2014): 219-257.

“National Security Strategy.” The White House. 2015.

“National Security Strategy.” The White House. 2017.

Normile, Dennis. “Surging R&D spending in China narrows gap with United States.” Science Magazine. Oct. 10, 2018. https://www.sciencemag.org/news/2018/10/surging-rd-spending-china-narrows-gap-united-states?r3f_986=https://www.google.com/.

Ross, Robert. “The Problem With the Pivot.” Foreign Affairs. November/December 2012. www.foreignaffairs.com/print/135466.

Subramanian, Arvind. “The Inevitable Superpower: Why China’s Dominance Is a Sure Thing.” Foreign Affairs 90, no. 66 (2011): 66-78.