Washington's China Strategy: Same Playbook, New Target

June 12, 2024

About the author:

It is often tempting to view things from the myopia of the moment. When considering AUKUS, the Quad, American Defense White Papers, gunboat diplomacy, Freedom of Navigation Operations (FONOPs), containment policies, tariffs, blacklists, and Tonya Harding defenses, it is easy to focus on the moment, but looking at recent history can be more revealing.

 

In the 1970s, the US faced numerous challenges: the oil crisis, the retreat from Vietnam, the opening of relations with China, Watergate, the creation of the petrodollar, rising inflation, declining productivity, and industrial decline, as sectors like automobiles, electronics, and steel moved to more competitive markets like Japan.

 

On one hand, America's military weaknesses were exposed. On the other, the stage was being set for America's future financial dominance through the petrodollar. What started as admiration and a desire to emulate Japan's miracle rise eventually transitioned into fear and loathing. A rise that many who think in linear, zero-sum terms linked to America's decline. The same cycle is being repeated today, only this time the target is China.

 

Military defeats in Afghanistan, stalemates in Yemen, Syria, Iran, Somalia, and Gaza, the failure of, but continued use of sanctions, the Ukraine conflict, broken treaties, the undermining of international institutions like the World Trade Organization (WTO), the decline of dollar dominance, rising inflation, declining productivity, industrial decline in sectors like automobiles, electronics, and steel as these industries moved on to more competitive markets, polarized domestic politics, and unpopular leaders have all contributed to a bipartisan search for an appropriate scapegoat for Washington's institutional failures. This is underscored by the decline of the middle class, from 61% of the population 50 years ago to 50% today.

 

With Washington's weaknesses on full display, China has replaced Japan as America's scapegoat, but Beijing will not be willing to suffer Japan's fate.

 

The success of Japan's Ministry of International Trade and Industry's (MITI) economic coordination efforts went from being widely admired and something to emulate to a nefarious scheme to undermine America.

 

Similarly, the success of China's National Development and Reform Commission, once lauded as a seminal factor in China's rise, is now seen as a nefarious scheme to undermine America.

 

Books in the 1970s and '80s presented Japan, variously, as a model for America's future economic development or as a malign juggernaut intent on overtaking the US:

•  Jean-Jacques Servan-Schreiber's The World Challenge (1981)

•  Edward A. Feigenbaum and Pamela McCorduck's The Fifth Generation: Artificial Intelligence and Japan's Computer Challenge to the World (1983)

•  New York Times Magazine article "The Danger from Japan" by Theodore H. White (1985)

•  Donald Trump, full-page ads in The New York Times, The Washington Post, and The Boston Globe stating that "for decades, Japan and other nations have been taking advantage of the United States" (1987)

•  Members of Congress smash Japanese electronics with sledgehammers on the lawn of the US Capitol (1987)

•  Paul Kennedy's The Rise and Fall of the Great Powers (1989)

•  Pat Choate's Agents of Influence: How Japan's Lobbyists in the United States Manipulate America's Political and Economic System (1990)

•  Michael A. Cusumano's Japan's Software Factories: A Challenge to US Management (1991)

•  George Friedman and Meredith Lebard's The Coming War with Japan (1991)

•  T. Boone Pickens, Pat Choate, and Christopher Burke's The Second Pearl Harbor: Say No to Japan (1992)

 

By the 1980s, fears about Japan Inc.'s success, growing trade imbalances, and Japanese purchases of properties like the Rockefeller Center and Pebble Beach had reached a crescendo, with some citing the "real possibility that economic squabbles between countries would boil over into another conflict in the Pacific." Coincidentally, those pushing anti-Japanese hysteria, based on Japan's superiority in "strategic" emerging technologies like computer chips, software, and AI, saw it as an existential economic and security threat to America's future.

 

Washington's answer to Japan's rise was the Plaza Accords, an agreement to prop up the US economy through currency devaluation. US manufacturers were allowed to use favorable exchange rates to boost their profitability. As a result, Japan is worth less today, in real dollar terms, than when it signed the Accords in 1985.

 

Today, China faces the same litany of books, articles, actions, and predictions as Japan did. The difference lies in China's economic footprint, understanding of history, and in its worldview. It is the difference between zero-sum and win-win "building a community with a shared future for mankind."

 

The larger question is why the US needs a scapegoat when it fails.

Most of the Asian leaders aligning with Washington's "China threat'' narratives and containment policies have short-term political priorities, rather than long-term economic goals.

 

In Japan and South Korea, unpopular leaders have turned to the international stage to assign blame for domestic situations that defy easy fixes. Meanwhile, the rest (the majority) of China's neighbors are cognizant and wary of US political and military actions in Asia, having experienced them before (Vietnam, Laos, Cambodia, Indonesia, etc.) and having seen what they have brought and are bringing to the world (Afghanistan, Iraq, Somalia, Yemen, Ukraine, Gaza, etc.).

 

In terms of China, its rapid economic rise and the prosperity it has brought to Asian economies are admired, but the sheer speed and size of China's growth has caused unease, especially among countries that are concerned that China might act like the US. Unfortunately, those concerns are being warped and fanned by a nervous Washington elite, who sees China in the same way they saw Japan in the 1970s, as a threat to US economic hegemony.

 

Washington's response to China has been to use economic and military pressure to push political interests, specifically aiming to replace the Communist Party system. This marks a significant change from the past, when the US used politics and the military to push economic interests.

 

America Is an Empire vs. China Is a Civilization

All civilizations started as empires, but not all empires became civilizations.

 

One way of looking at the issue is in terms of the difference in their development levels and approaches.

 

Empires are outward-facing: they are aggressive and dominate others as a means of building power and legitimacy. For the US, this has meant being in conflict for all but 17 of its 248-year history. It has insisted that its powers as an Exceptional nation allow it to extend its control over South America (the Monroe Doctrine) to the Middle East, Africa, and Asia.

 

What gives the US the right to declare itself an "Indo-Pacific" power, let alone claim dominion over all parts of the Earth? The answer is simple, and is what the US as an empire has always done: whatever means, politically, economically, and/or militarily, might makes right.

 

Commodore Matthew Calbraith Perry forced Japan to open up its ports to resupply US whalers, setting in motion Japan's imitation of imperialism, which led to Japanese aggression before and during WWII. The US Yangtze Patrol in China was put in place to protect US interests without regard to sovereignty. South Korea, Vietnam, Laos, Cambodia, Indonesia, the Philippines, and others suffered under the same aggression.

 

Civilizations tend to be inward-facing: they defend what they have as they deal with the societal issues that come after their empire periods. For China, its civilization took a radical change from an outdated and corrupt system to the progress it has achieved over the last 75 years. What remains though are the societal, cultural, and legal values that are endemic to China.

 

Empires fall when they are either defeated militarily or decline internally.

Civilizations used to fail due to wars or famines, but as societal expectations have changed, governments are now expected to provide individual (safety, order, food, shelter, clothing, predictability) and societal (roads, water, sewer, communications, opportunity) essentials. The key difference is that civilizations develop and live by laws and social values, whereas empires rely on force.

 

The relevance of this distinction is that, historically, conflicts erupt when values fail. 

 

American Exceptionalism is a logical fallacy: insisting on moral superiority whilst ignoring personal failings. Today, it is increasingly wearing thin.

 

For example, according to the February 21, 2024 Congressional Research Service (CRS) Report, US trade policy has generally sought to advance US economic growth and competitiveness by reducing international trade and investment barriers, fostering an open, transparent, and nondiscriminatory rules-based trading system through the WTO.

 

Except, since Obama's presidency, Washington has refused to allow any WTO appellate judges to be seated, which means if a party appeals a lower tribunal ruling, there can be no binding ruling.

 

In this case and many others, Washington's hypocrisy and accusations of others of doing what the US has done, and is doing, have become the standard operating procedure. However, this tactic becomes less persuasive the more it is used.

 

It is a pity, given that if the US practiced 60% of the values it preached from trade, finance, human rights, self-determination, primacy of law, and respect for international institutions, it would have at least some credibility. Instead, Washington has become a rogue state, financed by a Ponzi scheme that practices the opposite of what it preaches.

 

Into this toxic brew, Washington has returned to the old playbook used in South America, Africa, the Middle East, Europe, and Asia: to divide and create chaos as a means of maintaining American hegemony. AUKUS and the Quad are strategies to contain China's rise. The question arises: to what end? It is a question that no one in Washington is willing to answer, other than to recite their faith in American Exceptionalism.

 

Domestically, things are no better, with Gaza calling into question America's values. Money flows freely for wars and weapons, while domestic concerns about voting rights, free speech, abortion, guns, drugs, poverty, homelessness, literacy, immigration, and hope for a better future are given lip service but no resources.

 

The biggest question facing America, and the world, is the Trump question. Will the king of MAGA, even if convicted, be the next president, and will he follow through on his campaign promises to put "America First" at the expense of the rest of the world? As an unapologetic transactionalist, Trump is expected to press America's interests without regard to values. However, if Biden is re-elected, he will continue to blindly follow his notion of American Exceptionalism, which espouses values but does not exemplify them.

 

This means that neither Trump nor Biden is expected to embrace a vision of "building a community with a shared future for mankind," but we can hope the next generation of American leaders might. This means China's economic and security concerns will have to be addressed without the US, perhaps collectively through consensus with those who are actually involved, like ASEAN and the "rest of the world." 

 

 

Please note: The above contents only represent the views of the author, and do not necessarily represent the views or positions of Taihe Institute.

 

This article is from the May issue of TI Observer (TIO), which zooms in on new developments of those minilaterals in the Asia-Pacific and examines how these changes will redefine strategic dynamics and the security situation in the region. If you are interested in knowing more about the May issue, please click here:

http://www.taiheinstitute.org/UpLoadFile/files/2024/5/31/1327268243b64df50-7.pdf

 

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