Introduction – Enduring insights into US-China relations in Jude Woodward’s analyses
By Dirk Nimmegeers (co-translator of the Dutch edition of Jude Woodward’s book)
British China expert Jude Woodward, who sadly passed away recently, had given us the essential The US versus China, Asia’s new cold war? Moreover she left us two documents, which will give us an insight into the true nature of the US-China contradiction in 2020, during and after the COVID-19 crisis as well: the Introduction to the Dutch language edition of her book, published in Belgium (EPO, 2018), and The US offensive against China, her speech at the launch in Brussels, January 2019.
The great contradiction in COVID-19 times
The hawks in the US leadership continue their offensive against China, even now that their own population is suffering terribly from the corona crisis. From the beginning onwards COVID-19 was seen by American ideologues as a golden opportunity for conducting an international smear campaign against China, sowing discord in the country itself, and perhaps even overthrowing Xi Jinping. They haven’t given up their wild hopes yet. And what is worse: this is a bipartisan project in the political culture of the US. In spite of all provocations and attacks, the Chinese leaders try to maintain a constructive and respectful dialogue between the two countries. At the same time, of course, Beijing has to defend China’s core interests. The offensive continues on a great many fronts. American politicians, some at the very highest level, are taking steps and passing laws that menace China’s territorial integrity: especially regarding the Chinese regions Hong Kong, Taiwan, Xinjiang and the islands in the South China Sea. U.S. troops have been taken away from other hotbeds the U.S. created in the past and concentrated in the Pacific. To all that has been added the COVID-19 campaign.
According to official reporting
In prestigious publications and on social media we read that ‘China and the US are rivals’, that ‘China as an emerging power has renounced the modest role advised by Deng Xiaoping and is becoming increasingly aggressive’. China is said to ‘expand its power, by any means, permitted and not permitted, in order to take over world domination from the US or the West’. An eminent American professor describes China’s approach in response to COVID-19 in the following hateful terms: ‘It is as if at every stage the unfolding of the crisis has pulled back another curtain, revealing yet more ugly facets of the regime’s character and highlighting the diverse dangers that it can pose to others.’
A view actually dominating the world press is that Trump is ‘an unreliable, narcissistic leader who attacks China for short-term considerations’ (safe-guarding his re-election, disguising his own failure, etc.) and a serial offender of his own allies. Everything will get better when that man is replaced, and the US, preferably together with an EU ‘with which it shares the same values’, will ‘take on Chinese authoritarianism’ united and effectively.
In 2019 this was foreseen by Jude Woodward who observed: ‘the decisive shift in the international situation to one of confrontation and conflict between the two largest economies and most powerful countries in the world was, according to the Western media, exclusively a response to aggressive foreign policy actions and economic, trade and other culpabilities of the People’s Republic of China. From 2010 onwards this view has been virtually unchallenged in the mainstream media, academic journals and publications in the West’. We must admit: it has been going on until today.
According to Jude Woodward
Challenging the aggressive anti-Chinese and anti-socialist analysis is a continuing task for progressive and peace-loving people. Jude Woodward’s The US versus China, Asia’s new cold war? remains an essential tool for this. Thomas Blommaert, director of the Belgian publishing company EPO where Woodward’s book was translated, understood the necessity of reacting against the fatality of ‘the Thucydides Trap’ or the ‘inevitability of war with China’ which he termed Hollywood scenarios that started to be told in Brussels, capital of the EU, as well. ‘Those who follow the issues of the day, hear and see a lot, but miss the broad framework and often formulate the wrong questions. The danger of being brainwashed is great. Fortunately, there are people who leave Hollywood scenarios for what they are, learn lessons from history, start with facts, sketch context and then produce well-thought-out and hugely readable books about it. Jude Woodward was one such person. We will continue to promote her book. Whoever follows the news knows: it is more topical than ever’.
Reception then and now
Sadly, Woodward passed away on April 26 this year. However, we have two recent documents written by her, which can help us understand the true nature of the great contradiction between the US and China that the world will be dealing with for a long time to come. The English original of the Introduction (until now exclusive) to the Dutch language edition of her book, published in Belgium (EPO, 2018), and US offensive against China, her speech at the book launch in Brussels European Institute for Asian Studies EIAS, January 2019. At the time the book launch elicited a lot of coverage on radio, TV and in the press of Belgium and the Netherlands. Journalists and politicians appeared to be unpleasantly surprised by Trump’s aggressive antics and some were willing to learn about an alternative analysis. This however, was before the escalations regarding Hong Kong, Huawei, Xinjiang, Covid-19. It seems the tide is turning in Europe as well with the EU declaring China ‘a systemic rival’ and EU countries ‘looking to diversify their supply chains, limit foreign subsidies, or review how they regulate sensitive Chinese inward investments’. Stories of ‘Chinese authoritarianism’ and ‘inevitable conflicts’ are gaining traction.
That is why reading Woodward remains so important. She explains where polarization in the US-China relationship comes from, why the US will be stepping up political confrontation in the fields of economy, technology, the military, with propaganda, slander and accusations against China and attempts to isolate the country. Woodward tries to predict how this new Cold War will differ from the previous one, but also what past tactics the US will try again. She assures her audience that powerful individuals and institutions want to curb China’s growth and development and ‘bring it back to a level where China is no longer a challenge for the US’, and warns, ’this hostility is very dangerous to the world. It will not disappear’. Jude Woodward’s 2018-2019 analysis certainly retains its validity. Keith Bennett, China Specialist and Deputy Chairman of the 48 Group Club: ‘There’s so much that is valuable in these documents. Much of them reads as even more relevant, timely and urgent than when Jude wrote them. Her speech notes for her visit to Belgium show the serious, meticulous and painstaking way in which she prepared for it.’
Two world views
According to Jude Woodward, the US (and some of its European allies) essentially has a worldview diametrically opposed to China’s. The US and the West (throughout contemporary history) seek conflict and dominance. China, on the other hand, wants to strive for a common future for humanity and to seek points of cooperation between actors, who can and may differ regarding their social systems.
Why trust this and invite us to take the words of the Chinese leaders seriously? Because, according to Jude Woodward, a convinced socialist, ‘Xi’s thinking about the world rests not on the unscientific, neo-classical mumbo-jumbo of Trump, Cohn and Bannon, but on the understandings of Smith and Marx about the development of production and society… Xi’s key concept for international relations is that of “a common future for humanity”, which is in turn based on the economic foundation of unequivocal support for globalisation. For example Xi, notes: “economic globalisation is a result of growing social productivity, and a natural outcome of scientific and technological progress”. In other words, collectively, socially organised production means that overall output is much greater than the sum of each person’s individual efforts.’
The desire of human beings to go forward and improve their lives if they can see a way to do so
At the end of her Brussels speech, Woodward seems somewhat pessimistic and her concern will undoubtedly be recognisable in these times of COVID-19 and what lies ahead of us. Many will tend to say with her, ‘we can’t look into a crystal ball and see how all this pans out, whether for good or bad. But what is certain is that the confrontation the US has picked with China is not set to end soon and will determine much of the shape of the next decades.
However, she always sees the possibility of a positive alternative:
‘a new, more advanced multilateralism, backed and driven by a number of countries coming together around the common interests of humanity. China is fighting for the latter.’
And, both at the end of the ‘Introduction to the Dutch translation’ and of her book itself, Jude Woodward demonstrates rational thinking based on confidence: ‘China is winning the battle of ideas with Trump; because this is scientific and true, whereas the dog-eat-dog world of Trump will just lead to conflict and economic destruction’… ‘In the end the sword cannot win against the desire of human beings to go forward and improve their lives if they can see a way to do so.’
Jude Woodward’s book The US versus China, Asia’s new cold war? (MUP 2017) was translated under the title America tegen China. De nieuwe Koude Oorlog? (EPO 2018) and in French as USA-CHINE. Les dessous et les dangers du conflit (Investig ‘Action 2020). The publisher EPO gave permission to publish the ‘Introduction to the Dutch translation’, both in English and in Dutch.
The Invent the Future website has a recent video on its YouTube channel summarising Jude Woodward’s book. Carlos Martinez, the site administrator, tweeted: ‘At a time where the US is moving aggressively and dangerously towards a new cold war with China, this book could hardly be more relevant’.
1. Introduction to the Dutch edition of ‘The US vs China: Asia’s New Cold War?’
By Jude Woodward
This book was finished in the early months of Trump’s presidency. The general direction of Trump’s foreign policy was already clear, with a sharpening of conflict with China in particular from day one. His campaign slogans were well known: ‘America First’ in order to ‘Make America Great Again’; and rhetoric against multilateral agreements and threats of protectionist trade measures had been etched into his election campaign.
In his inaugural speech Trump had formulated the US’s global role in terms starkly different from the traditional ‘one indispensable nation’ trope of post-1945 American exceptionalism.
‘From this moment on, it’s going to be America First. Every decision on trade, on taxes, on immigration, on foreign affairs, will be made to benefit American workers and American families… We will seek friendship and goodwill with the nations of the world – but we do so with the understanding that it is the right of all nations to put their own interests first.’
Trump also used Twitter to inveigh against all forms of multilateralism in international relations, attacking the UN, WTO and NATO, trade agreements like the TPP but also NAFTA, multilateral policies like the Paris Climate Accords, the Iran nuclear deal, and berated the intrinsic unfairness of the EU in preventing the US negotiating one-to-one deals with Germany and France.
If Trump truly meant all this, then he was calling time on the whole post-1945 US approach to its role in the world.
Whether or not Trump would follow through on this new US unilateralism took some time to clarify due to the chaos in the first year of his White House – but such statements immediately created an ideological vacuum in the rest of the West, which remains committed to the benefits of multilateral agreements, free trade and globalisation. But no Western leader was prepared to speak out directly against Trump.
Prior to Trump’s election the fact that China had the world’s most rapidly growing economy and had overtaken the US to become the world’s largest economy in purchasing power parity terms meant that it was already having an increasing global impact. China had long been influential among developing countries but, as discussed in this book, from the 2007 financial crisis onwards this influence began extending even to traditional US allies. The most telling example was when, in 2015, Britain enraged Obama by rushing to join China’s Asia Infrastructure Investment Bank without even informing the White House in advance. After a little more hesitation Germany and Australia also signed up. Other initiatives – such as the Belt and Road, the Shanghai Cooperation Organisation, the regular meeting of the BRICS countries, the establishment of the 16-country bloc of Central and Eastern European countries in the ‘16+1’ meetings with China, and China’s improved relations with traditionally less supportive countries such as Singapore, the Philippines and South Korea underlined this.
From early 2017 China began to take this to another level, by directly entering into the battle of ideas with Trump and his supporters by putting forward an alternative vision of global politics. This kicked off with Xi Jinping’s speech at the 2017 Davos forum, where he put forward a coherent defence of globalisation, contra Trump but without mentioning him:
‘Countries have extensive converging interests and are mutually dependent. All countries enjoy the right to development. At the same time, they should view their own interests in a broader context and refrain from pursuing them at the expense of others.’ 
The Western media fell over itself to praise the speech. Nor was the meaning lost on Trump’s team. Steve Bannon, Trump’s chief strategist, urged that ‘…people [should] compare Xi’s speech at Davos and President Trump’s speech in his inaugural…. You’ll see two different world views.’
They would indeed. But between these two world views, most of the US’s chief friends and allies preferred that put forward by Xi Jinping rather than Donald Trump. Martin Wolf, chief economics commentator of the Financial Times, put it succinctly: ‘Xi Jinping, president of China, made a speech last week on globalisation at the World Economic Forum that one would have expected to come from a US president. At his inauguration, Donald Trump made remarks on trade that one would never have expected to come from a US president. The contrast is astounding.’
In May 2017 two senior Trump aides wrote a seminal piece for the Wall Street Journal that took the debate further. Jointly authored by National Security Adviser, H.R. McMaster, and director of the National Economic Council, Gary Cohn, it clearly had the approval of the Oval Office. Most fundamentally the article directly countered Xi Jinping, also without naming him:
‘…the world is not a “global community” but an arena where nations, nongovernmental actors and businesses engage and compete for advantage… Rather than deny this elemental nature of international affairs, we embrace it.’
In Britain we are familiar with such formulations, rooted in right-wing neo-classical economics, because Margaret Thatcher in the 1980s became notorious for the similar statement that ‘there is no such thing as society’, only ‘individual men and women’. This ideology was used as the basis for cutting welfare programmes, ending public housing, restricting trade unions and so on.
In foreign policy, as McMaster and Cohn draw out, this philosophy means the pursuit of American interests irrespective of others. ‘America First’, they argue, signals the intention ‘to use the diplomatic, economic and military resources of the US to enhance American security, promote American prosperity, and extend American influence around the world’.
This is different from the ideological underpinning of the US-led post-1945 international system, based on the argument that the US would use its weight, in line with the common interests of all as expressed through institutions like the UN, to mitigate political conflicts, and further to provide resources to even out dangerous economic hiccups through its contributions to the IMF. The averred aim was to create a harmonious global community, in which – it was claimed – the strong protected the weak thus avoiding the type of conflict and economic crisis of the World Wars and the Great Depression.
Of course the definition of ‘common interests’ substituted the interests of maintaining the position of the US and its allies, particularly in preventing any advance of communism or even genuine post-colonial independence, for the real common interests of all in peace and development, as this book discusses in relation to the US’s post-war record in Asia. But it was not an entirely empty ideology either. As Perry Anderson analysed, in the US-led world created in 1945, the US projected itself globally primarily ‘…as a guardian of the general interest of all capitals, sacrificing – where necessary, and for as long as needed – national gain for international advantage, in the confidence of ultimate pay-off’.
For Trump, this was over: no longer affordable for a US in relative decline, if it ever had been.
But despite Trump’s statements and those of his key advisers, the liberal Western media, and probably most of their political masters, hung on to the hope that this was simply rhetoric to shore up his electoral base.
For six months it seemed this might be true; Sturm und Drang on Trump’s twitter-feed led to very little action. The abandoning of the Trans-Pacific Partnership was not definitive proof of a general course, as Clinton had promised she would too. Demands that South Korea and Japan should pick up more of the US’s military costs in East Asia were dismissed as mainly bluster and anyway negotiable. Similarly his challenges to NATO were unwelcome, but no one believed the US would actually pull out of its main military alliance.
But Trump was not just letting off hot air. He is not a joke, but the outspoken representative of a powerful revanchist strand of opinion in the US ruling elites that believes the US has long made too many concessions to its allies, taken on too great a share of global military expenditure, and at the same time been squeezed on trade not just by China, but close allies as well. This is Trump’s explanation for the German and Chinese trade surpluses with the US, and, to a lesser extent, those of Korea and Japan.
Trump has been open that he wants a large share of these surpluses transferred to the US, through a combination of means: imposing terms of trade and insisting upon exchange rates that preference the US over its competitors; demanding successful economies invest in the US or take up more US debt; and insisting that allies increase their contribution to the West’s military budget.
This is already being met with resistance from key targets China and Germany, which have offered strikingly few concessions to Trump. Therefore it is clear that Trump’s project requires greater leverage than the state of the US economy or its present alliances can necessarily deliver. This is the context for Trump’s remarkably consistent pursuit of an opening to Putin’s Russia, despite huge opposition from Pentagon and foreign policy elites, and from within his own White House. There has long been a serious current of opinion in the US and beyond, that argues that a US-Russia link up could be a reverse ‘Nixon goes to China’, with a US-Russia axis able to bring sufficient pressure to bear on China that it is forced to concede to US demands. But secondly, of course, such an alliance with Russia could encircle Germany, squeezing the EU from East and West; both Trump’s political agent, Steve Bannon and Putin have been actively aiding right wing and anti-EU political forces across the continent. This is why, Angela Merkel, by contrast with other Western leaders, was quick to realise that Trump and his advisors’ threats to Germany and the EU were not just rhetoric but constituted a dangerous, disintegrative force in Europe.
In mid-2017, with the new team in the White House finally more or less settled, residual hopes in the emergence of a tempered Trump were abruptly ended when he walked the US out of the hard-won Paris Climate Change Agreement. Amid global disapprobation of Trump’s wilful sabotage on such a vital issue, China again stepped into the vacuum. Xi Jinping used a major speech in October to stress that China would be ‘Taking a driving seat in international cooperation to respond to climate change’, and that it would be a ‘torch-bearer in the global endeavour for ecological civilisation’. In the same speech he again drew a line against Trump’s approach, remarking that: ‘No country can alone address the many challenges facing mankind; no country can afford to retreat into self-isolation.’
The unilateral move of the US embassy in Israel to Jerusalem and abandoning the Iran nuclear deal reduced multilateral approaches to the region to tatters. Withdrawal from UNESCO and the UN Human Rights Council followed.
Finally in spring 2018, the threatened new US protectionism was launched with tariffs imposed on aluminium and steel not just from China, but also Canada, Mexico and the EU.
The growing ideological and political disorganisation in the West that flowed from these actions was reflected in the chaos at the June 2018 G7 summit in Canada; a meeting which happened to take place almost contemporaneously with the 2018 summit of the Shanghai Cooperation Organisation in Qingdao, China. The smooth functioning and productive outcomes of the SCO meeting – the first to include India and Pakistan as full members meaning it represented a majority of the world’s population and countries responsible for a majority of annual GDP growth – was inevitably contrasted with the tensions and dysfunction at the G7.
The G7 meeting started in acrimony and ended in farce with Trump removing his signature from the proposed closing statement – meaning that the meeting dispersed without one for the first time since its inception – and trading insults with its host, Canadian Prime Minister Justin Trudeau, who he described as ‘very dishonest & weak’.
The ensuing media firestorm highlighted growing concerns for the future of the US-led Western world order, contrasting the G7 to the harmony at the SCO. So the Diplomat headlined its analysis ‘A West in crisis, and East rising?’; The Atlantic asked ‘Has the Western world started shunning America?’
This crisis of relations in the West as a result of Trump’s policies has pushed not only Europe (with the exception possibly of the UK) and Canada in particular closer to China, but has also begun to shake up Sino-Japanese relations. Trump’s current and projected tariffs, on European steel, but particularly the prospect of duties on German and Japanese cars, makes China’s growing market potentially even more important in the long term for both these countries. German relations with China had been generally good and improving for some time, but from the G7 summit onward Abe in Japan also made a turn to improving relations with China. Proposed reciprocal visits between Abe and Xi Jinping in Autumn 2018 have trade at their centre.
Of course, the key target of Trump’s tariff war is China itself, which has already been hit with 25% tariffs on $50bn of its exports to the US and faces the threat of tariffs on a further $200bn goods in September 2018, with Trump also saying that a further $267bn will follow. If implemented this would effectively mean China’s entire export trade to the US was subject to tariffs. Trump embarked on this tariff war with China despite very reasonable alternative proposals from the Chinese and urging from key members of his administration to accept a deal.
China’s negotiators offered the US a ‘win-win’ compromise, aiding the US economically while not damaging China. China proposed to reduce the trade deficit through increasing its own imports from the US in areas where there is rising demand in China, such as luxury foods – for example cherries, lobsters, beef. China also offered reduced tariffs on US cars. This deal would have aided the US’s farming and manufacturing sectors, presenting an attractive proposition from several perspectives.
Trump snubbed this proposal; demonstrating that ‘reducing the trade deficit’ is not the main goal of this tariff war with China; its real aims are to stifle its technological development, stall growth and therefore encourage political discontent and instability.
At the time of writing it is not clear what the final outcome of the trade dispute will be, but it is already clear who is winning the overall propaganda and ideological war, and that is China.
While the other Western leaders have been more or less silent, it has been left to China to assume the mantle of global ‘thought leadership’ that the US is abandoning, at each point advancing, in words and in deeds, an alternative vision of a ‘global community’ run on the basis of mutual benefit and ‘win-win’ diplomacy.
The reason that China is increasingly thrust into the ideological leadership of the response to Trump is not simply because the Western countries are too mired economically and strategically with the US to take on Trump, even though they know he represents a coherent, aggressive and ultimately deeply dangerous international force. But it is also because they do not have the philosophical and theoretical armoury to take on the neo-liberal, ‘winner takes all’ ideology that Trump and co avow.
This is the irony of why China is increasingly able to assume ‘thought leadership’, not just for the developing world, but even for the higher interests of the advanced West; because Xi’s thinking about the world rests not on the unscientific, neo-classical mumbo-jumbo of Trump, Cohn and Bannon, but on the understandings of Smith and Marx about the development of production and society.
Xi’s key concept for international relations is that of ‘a common future for humanity’, which is in turn based on the economic foundation of unequivocal support for globalisation. For example he notes: ‘economic globalisation is a result of growing social productivity, and a natural outcome of scientific and technological progress.’ He acknowledges there are problems with globalisation, from inequality to governance, but these are outweighed by the benefits, therefore, following an old Chinese proverb: ‘One should not stop eating for fear of choking’.
This is a coherent view, and is drawn from the core ideas on economic development of Adam Smith, later developed by Marx. Smith’s ‘The Wealth of Nations’, the founding work of modern economics, opens with the statement that the greatest development in human productivity seems ‘to have been the effect of the division of labour’. The rest of the work is built on this understanding. Marx took over this concept, which he later reformulated as the increasing ‘socialisation of labour’ being the crucial contribution to raising human productivity and economic growth. Fully internationalised socialisation of labour – that is globalisation – is thus the greatest, most advanced scope that can be achieved by the socialisation of labour and the basis for the most productive development of human labour. In other words, Smith and Marx show that, rather than there is no such thing as society and that individualism of persons and countries is the only way forward, it is human beings as producers interacting in production that has been the basis for the entire advance in wealth and economic output in human history; upon which base is built culture, science and other advances. In other words collectively, socially organised production means that overall output is much greater than the sum of each person’s individual efforts.
Or as Xi put it: ‘one plus one can be greater than two.’ And that is why China is winning the battle of ideas with the Trump; because this is scientific and true, whereas the dog-eat-dog world of Trump will just lead to conflict and economic destruction.
2. The US offensive against China
By Jude Woodward
These are the notes for Jude Woodward’s speech at the launch of the Dutch edition of ‘The US vs China: Asia’s New Cold War?’ on 24 January 2019
My book was finished in mid-2017 – so I apologise for not dealing with the trade war and the escalation of confrontation with China by Trump this year. The developments of the last 18 months however have only reinforced the argument of the book. Indeed, a new polarisation has opened up in geopolitics between the US and China. This takes the form of a confrontation by the US on all fronts – economic, military, propaganda, vilification, accusation and isolation. It is aimed at holding back China’s growth and development to a level where it might be seen no longer to challenge the US. This confrontation is very dangerous for the whole world, and it is not going to go away.
Broadly speaking US policy towards China had been stable from the Nixon thaw in the 1970s. It may have had its ups and downs – particularly in the late 1980s – but on the whole a policy of engagement prevailed.
China reciprocated by in general supporting or acquiescing in US policy worldwide, including voting with it in the UN or at least abstaining. This got China into a mess with the left – e.g. over its supporting UNITA in Angola, or not breaking with Pinochet – but gained it a quiet life on the international front. Deng’s dictum, ‘hide strength, bide time’, meant simply China did not intend to intervene, even if it could, in international affairs and instead preferred to concentrate on economic development.
Both sides of this equation have changed, but not in the same way.
Pivot to Asia
A change of line by the US began under Obama, and particularly under Hillary Clinton when she was Secretary of State. There was a sharp hardening of rhetoric and diplomatic or even military intervention against China. This was unlike previous periods of tension in Sino-US relations in that it was accompanied by a formal, long-term shift in policy – the so-called ‘pivot to Asia’.
Military resources began to be shifted to the Pacific. The US gave the green light to substantial Japanese rearmament. And Japan’s series of increasingly nationalist governments stepped up their own rhetoric and diplomatic confrontation with China. The Trans-Pacific Partnership (TPP) was repositioned as a comprehensive trade deal explicitly aimed at excluding China. The US also began to intervene more aggressively in ASEAN to push for it to take an anti-China stance, and in the individual countries of the region.
It had most success with the Philippines, which took up the gauntlet and broke the consensus that had been brokered by ASEAN to defuse conflicts over the disputed islands in the South China Sea. In 2012 a provocation by the Philippines at the Scarborough Shoal (almost certainly encouraged by the US) led to a conflict with China, which intervened to protect its fishing boats in the area. This stand-off then became the justification for referring the whole issue to the international court under UNCLOS.
But with the US still mired in Iraq and Afghanistan; the challenges and opportunities of the ‘Arab spring’; the civil war in Ukraine, etc. Obama was never really able to fully follow through on the realignment of priorities that the ‘pivot’ envisaged.
Trump made a stepped-up offensive versus China – on trade in particular – a key component of his election campaign. From his inauguration in 2017 he had made clear this was his intended course. However, he did not implement it at first and instead praised Xi Jinping and China, claiming they were friends. Trump had other issues on his agenda. This totally changed in the course of 2018 when Trump launched his promised offensive against China on multiple fronts.
National Defence Strategy – China not ‘terrorism’ now US primary concern
This began with a major reformulation of the priorities in US foreign policy set out in the new National Defence Strategy published in January. Titled ‘Sharpening the American military’s competitive edge’ it placed ‘strategic competition’ with key rivals, i.e. China, ahead of the previous priority to the so-called ‘war on terror’. ‘Inter-state strategic competition, not terrorism, is now the primary concern in U.S. national security’, it says. 
And in the document, this is clarified as follows. ‘The central challenge to US prosperity and security is the re-emergence of long-term, strategic competition by what the National Security Strategy classifies as revisionist powers. ‘Long-term strategic competitions with China and Russia are the principal priorities for the Department, and require both increased and sustained investment, because of the magnitude of the threats they pose to US security and prosperity today, and the potential for those threats to increase in the future.’
The National Defence Strategy concludes: the US military has to ‘build a more lethal force’, able to win a war with any enemy. It puts forward precise proposals based on simulations of how the US could win in an all-out war with China and/or Russia. In line with this, in the summer of 2018 Congress agreed to increase US defence spending to $718bn in the coming year, an increase of 13% in one year. This compares to China’s defence budget in 2017 of $228bn.
Nuclear weapons and withdrawal from the INF
Part of this budget is allocated to updating and improving the US nuclear arsenal. In October 2018 Trump announced that he intended to withdraw from the 1987 Intermediate Range Nuclear Forces Treaty (INF). This proposal was widely seen as mainly targeted at China, to allow the US to develop new intermediate range missiles and permanently base these in Guam, Japan or even South Korea – although any such steps would create major political divisions in the region. This would strengthen the US’s military position to attack China and potentially force China into an economically damaging arms race.
Militarisation of China’s seas
Alongside this, the US has been behaving more aggressively in the South China Sea and the Straits of Taiwan. Since late 2017 the frequency and size of flotillas of US warships that have sailed within 12 nautical miles of Chinese-claimed islands in the South China Sea has increased. They are now more frequent than under Obama. In mid-2018 France and the UK announced that they intended to join the US operations. Australia is already a participant.
The excuse for this militarisation of the South China Sea is defending ‘freedom of navigation’ – but this has never been threatened by China, which urgently needs free navigation through international waters to conduct its vast international trade. In July 2018 US warships sailed through the Straits of Taiwan, again on the claimed basis of defending free navigation. China has never objected to the passage of any commercial shipping through the Straits, but it does object to hostile navies sending warships so close to Chinese home shores. The only ‘freedom of navigation’ this defends is the right of the US to send its Navy right up to China’s coasts; a freedom that the US would hardly accept around its shores.
All these military steps are directed to two goals. Firstly, to change the military balance in the region to make it possible for the US to wage an offensive war against China, which US military planners believe under current conditions would be a very risky enterprise. Secondly to force the Chinese to divert economic resources into a damaging arms race that would reduce its competitivity internationally, and with the US in particular. An arms race, it was hoped, would eventually create a domestic economic squeeze that would undermine support for the regime and even promote popular sentiment in favour of caving in to the US based on the illusion that the US would then ‘allow’ China to develop again.
China is showing no sign of falling into an ‘arms race’ trap though.
The US’s offensive against China in 2018 has been most concentrated on seeking to apply pressure on its trade. This has correctly commanded most international attention. This has involved Trump’s threatened escalating imposition of up to 25% tariffs on over $250bn worth of Chinese imports into the US.
It is not currently clear whether there will be some easing of this tariff war through ongoing talks. There is some chance as most commentators suggest that the US and world economy are entering a cyclical downturn. Volatility and falls on stock markets over December 2018 may well be signs of this. There may be an impact on Trump’s popularity. It is already trending down in the polls, as the current shutdown is unpopular. Also, a trade war with China has a boomerang impact on the US economy in pushing up prices and pushing down stocks and shares. The administration is clearly divided with Lighthizer taking a harder line and Mnuchin flagging up the likelihood of a deal.
China has not shown any signs of giving in – although it has offered reasonable concessions and compromises to reduce the trade deficit, to improve action on Intellectual Property Protection, to open up some greater opportunities for Western companies.
But if Trump judges that the problems created domestically begin to outweigh the value in putting pressure on China, then he will probably organise some face-saving retreat. The US economic offensive however does not just take the form of a tariff war.
ZTE, Huawei and attacks on Chinese companies
The imposition of the first tranche of tariffs in April was preceded by an unprecedented US attack on ZTE, one of the top Chinese telecoms companies. The company was found to have broken a previous agreement with the US on trade with Iran. It was a stupid step bound to provoke a response from the US, but the level of sanction that the US imposed in punishment – prohibiting ZTE from using US parts or technology for seven years – threatened to completely destroy the company.
After intense negotiations, China managed to get the sanction lifted in July. The confrontation had been an object lesson in how the US’s lead in major technologies gives it huge international leverage, even as its growth rates falter and it runs major trade deficits with key competitors.
More recently Huawei has been in the firing line. There was the arrest of Meng Wanzhou in Canada and that of an executive in Poland for alleged spying. A range of countries, ‘The Five Eyes’, an intelligence alliance comprising Australia, Canada, New Zealand, the United Kingdom and the United States was trying to ban Huawei’s 5G technology. Oxford University recently banned R&D projects with Huawei.
US vs China: a new Cold War?
Other aspects of this offensive are: accusations of spying and hacking; allegations about treatment of Muslims in Xinjiang; support to separatist politicians in Taiwan; attacks on Chinese investments in Africa and elsewhere as ‘debt diplomacy’. China is targeted for supporting the ‘wrong’ regimes (e.g. Venezuela). Recently Vice-President Pence even claimed: ‘China has initiated an unprecedented effort to influence American public opinion, the 2018 elections, and the environment leading into the 2020 presidential elections…’ The evidence for which was one advert opposing the trade tariffs in one magazine.
However, Trump, like Obama, faces obstacles in carrying through this 360-degree campaign against China. The US is far from out of the Middle East and Trump has stepped up US involvement in Yemen. The US is also extensively engaged in many unstable African states. Despite Trump’s own preference for a détente with Putin’s Russia, this has not been delivered against opposition within his administration and the Pentagon. Army chief-of-staffs warn that the US military remains over-extended globally and even the large budget hike cannot allow it to upscale sufficiently to believably challenge China and without full-blown retreats elsewhere.
But, even if obstacles remain to the launch of a full-blooded Cold War with China, there is now no equivocation that this is the intent of major sections of the current administration and is at the heart of Pentagon strategising. The recently retired Commander of US forces in Europe, Lt Gen Ben Hodges, told the Warsaw Security Forum in October 2018, that he thought ‘it is a very strong likelihood that we will be at war with China’ within 15 years.
And while tactics may differ, it is clear that in general this is a bipartisan policy and return of a Democratic administration would not eliminate this geopolitical confrontation.
Who was to blame for this?
Such a decisive shift in the international situation to one of confrontation and conflict between the two largest economies and most powerful countries in the world poses the question as to what or who was to blame for this?
According to the Western media from 2010 onwards this was exclusively a response to aggressive foreign policy actions and economic, trade and other culpabilities of the People’s Republic of China. This view has been virtually unchallenged in the mainstream media, academic journals and publications in the West.
Study of China’s actions throughout this period does not bear this out.
Firstly, many of the accusations made against China have been made without evidence. They are mere assertions. For example, the claims against Huawei are made without any substantiating evidence. It is purely that Huawei ‘could’, not that it does. And everyone knows that US tech companies effectively have to keep a backdoor open to the US security services.
Secondly many Chinese actions that have been cast as ‘aggressive’ were almost always in response to the new confrontational stance adopted by the US. Let’s take the example of the South China Sea. The US points to China’s steps to build naval installations on a number of islets in the South China Sea as evidence of its new aggressive stance. For many years however, China had held off taking any new steps to establish its presence in the Sea, in order to preserve the ASEAN compromise framework, despite the fact that other claimants did not hold back. China’s physical presence on these islets in fact only began to develop after the US had challenged China’s claims in the Sea at the 2010 meeting of ASEAN and particularly after the stand-off at Scarborough Shoal and UNCLOS. By this point Vietnam for example already had installations on 21 disputed islets. Thus, when China built an airstrip on Fiery Cross Reef in 2015 it was used to justify US naval exercises in the area. But it was hardly mentioned that the province of Taiwan had long had an airstrip on Taiping Island, Malaysia on Swallow Reef, Vietnam on Spratly Island and the Philippines on Thitu Island. As China said: ‘We have simply repeated what everybody else was already doing.’
And as regards trade, many of the accusations on trade or currency manipulation are either just false, or China made it clear it was prepared to take any reasonable action. For example, contracts that US companies willingly entered into for two decades and more, offering technology transfer for highly profitable deals in China, are post facto recast as having been unfairly forced upon hostage US companies. The claim that the burgeoning Chinese trade gap with the US is down to unfair Chinese trading practices or an undervalued RMB, ignores the declining competitivity of the US economy reflected in trade deficits not just with Chinese producers, but German, South Korean and Japanese producers as well. In reality China allowed the RMB to revalue by about 20% from 2007 onwards. It reduced tariffs on a range of Western imports, including soy and liquid natural gas. It stepped up action against intellectual property theft, both in the market and in industry. It bought up US debt.
Of course, China did and does refuse to meet many of the US’s demands. It will not entirely deregulate its financial system and banks, surrender state control over the national bank and the exchange rate of the RMB. China is not going to privatise the main state-owned companies, or end state-led investment into the economy, especially infrastructure and technology. It will not take any steps that would compromise its military security from attack.
China has also rejected the US’s extensive conditions for lifting the tariffs, which included, inter alia: ‘China must lift all restrictions to US investment in China while agreeing not to object to any restrictions the US imposes on Chinese investment in the US; China must withdraw its appeal to the WTO on its status as a market economy and any other matter’ and ‘China must take no retaliatory action against new US tariffs or other restrictions on trade’. China also rejected that ‘compliance with the agreement should be monitored by the US, which might impose sanctions if it found China non-compliant’ and ‘to abjure its right to object to any such sanction imposed by the US’.
Martin Wolf – Financial Times chief economics commentator and no particular friend of China – said of all this: ‘…the idea that the US will be judge, jury and executioner, while China will be deprived of the rights to retaliate or seek recourse to the WTO is crazy. No great sovereign power could accept such a humiliation. For China, it would be a modern version of the “unequal treaties” of the 19th century.’
Thus, it is very hard to form any conclusion other than that the US has chosen to create a conflict with China; making impossible demands; provoking an arms race in the region; and picking fights that China did not want and had not initiated.
We then have to ask why?
Clearly the US feels threatened not by alleged aggression by China, but by the speed and scale of China’s catch-up with the West and with the US in particular. For the first time since it overtook Britain in the 1870s, an economy is emerging that – unless it can be halted – will imminently be larger than the US itself. The US views this possibility as an existential challenge to its hegemonic position in geopolitics irrespective of what China actually does.
Indeed, the speed of China’s development in GDP per capita terms has been astonishing. Following an initial take-off in the 1980s China’s GDP per head doubled in a single decade, whereas it took Britain six decades to achieve the same after the Industrial Revolution in the late eighteenth century and America five decades after the Civil War.
China’s advance towards overtaking the US economy in absolute size and eventually in fundamental strength heralds the end of more than a century of American pre-eminence. This is not a small matter. No one living can remember a time when the US was not the largest economy. The last such transition in the modern world was when America itself overtook Britain in the 1870s. Within 70 years the Pax Britannica – based on sterling and the gold standard – had yielded before US attempts to establish a Pax Americana and the dollar as the world currency. This transition also involved fending off other contenders, particularly Germany and in a different way Japan, and two bloody and costly world wars.
Given this history, contemplating such a shift leads to understandable anxieties about what the coming decades will bring. But it is clear that not only is China not seeking to replace the ‘Pax Americana’ with a ‘Pax Sinica’, but it couldn’t do so even if it wanted to.
Firstly, China strongly argues for a strengthened multilateralism, within which all nations are able to fully contribute and the ‘great powers’ seek beneficial compromises, not just in their own interests but in the interests of all. Xi Jinping, in particular, refers often to ‘the common future of humanity’ as the framework for how individual countries should think about their role in geopolitics. He argues that while all countries and nations are different, the decisive issue is that they all contribute in different ways to the richness of humanity as a whole and have to be facilitated to do so. This approach, and the steps that China promotes like the Belt and Road Initiative, and the Asian Infrastructure Investment Bank (AIIB), breaks from the underlying ideology of the ‘Pax Americana’, which was to put US and Western interests first, and instead proposes a real multilateralism that addresses the interests of all.
Secondly, the situation in the world is entirely different from 1945. In 1945 the size and scale of the US economy made it not just primus inter pares, but the absolutely dominant power in the newly emerged imperialist world of the post war era. 1945 saw the US the victor in a global struggle which had left its economy larger than the sum of all 29 countries of Western Europe as well as Japan, Canada, New Zealand and Australia put together; and only marginally smaller than all these and the USSR. Its share of industrial production was even greater. This gave it an unprecedented advantage from which to embed its interests and leadership in the post-war political and economic settlement.
There is no possibility whatsoever of a similar Pax Sinica replacing this. China may be on the verge of overtaking the US economy in absolute size (if it hasn’t already), but it is not, in any scenario whatsoever, about to become bigger than the US and the next 28 largest countries in the world taken together. In other words, not only does China in no way aspire to create a Chinese dominated world order of the type imposed by the US in 1945, but it is in no position to achieve this even if some megalomaniac fantasy of this type was lurking unspoken – which it is not.
The inevitable end of the Pax Americana will either lead to conflict and chaos or to a new, more advanced multilateralism, backed and driven by a number of countries coming together around the common interests of humanity. China is fighting for the latter. We can’t look into a crystal ball and see how all this pans out, whether for good or bad. But what is certain is that the confrontation the US has picked with China is not set to end soon and will determine much of the shape of the next decades.
 See Chapter one
 See Chapter four
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 Maddison, World economy, Vol. 2. 1945 GDP (measured in 1990 Geary Khamis dollars): US GDP $1.65tr; total GDP of other countries mentioned (ex. USSR) $1.37tr; inc USSR $1.70tr.