This post is a continuation of my previous post. I had initially planned a summary of some interesting perspectives on Chinese doomerism but couldn’t get to it. However, last week I read a couple of articles on the US vs. China debate that give you a sense of how this entire discussion has gone off the deep end. Both these articles perfectly encapsulate the lack of nuance in this debate and how ideological blinders lead supposed “experts” to not just misguided but dangerous conclusions.

China’s Trump Strategy

The first article, titled China's Trump Strategy by Yun Sun, a senior fellow at the Stimson Center, gives a decent overview of the measures China is taking to “Trump-proof” itself, given that it more or less knows what to expect this time: tariffs, pressuring allies to choose between the US and China, saber-rattling, etc.

1. Domestic Economy and Stimulus
   One element of China’s strategy to deal with Trump’s potential measures to damage its economy is to improve the resiliency of its domestic economy. The recent stimulus measures to boost consumption and deal with the local government debt problem have, in part, been motivated by Trump’s arrival.

2. Not Just a Reaction
   It’s important to emphasize that these Chinese reforms aren’t just a reaction to Trump; they also stem from urgent domestic imperatives.

3. Signaling and Trade Deals
   China has also been sounding out US policymakers, signaling its intent to fulfill its side of the bargain agreed upon during Trump’s first term.

4. Interest in CPTPP
   Beijing has expressed interest in joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the successor to the Trans-Pacific Partnership (TPP).

5. Repairing Strained Ties
   On the international front, China has been mending relationships with countries like Japan, India, and Australia, with whom it has had longstanding conflicts of varying intensity.

6. Deepening Ties With the Global South
   To alleviate the downsides of Trump’s looming tariffs, China has been deepening ties with Global South countries, offering them backdoor access to the United States.

Quotes from the article:

“China has options for a direct response to additional tariffs or other trade measures Trump may impose: its toolkit includes export controls, sanctions on U.S. companies, Chinese currency depreciation, retaliatory tariffs on U.S. exports to China, and more. Which of these measures China deploys and when will depend on what Trump decides to do. Unlike its largely reactive approach during Trump’s first term, however, this time around Beijing will have not only a tactical response but also a bigger strategy. Ultimately, China hopes to use Trump’s policies to its own advantage. Chinese leaders could use a U.S.-instigated trade war to rally various domestic interest groups around meaningful reforms at home and to expand ties to countries the United States alienates, strengthening China’s position in a reoriented global trade system.”

“Yet Chinese leaders remain confident that, even if the country’s economy suffers, four years of Trump is unlikely to send it into a full-blown crisis. And they anticipate that if Trump follows through on his declared policies, such as those on trade and territorial expansion, he could do severe damage to the United States’ credibility and global leadership. Beijing thus sees Trump’s second term as a potential opportunity for China to expand its influence farther and faster. In this view, competition with the United States is not in itself the driving force behind China’s grand strategy. It is instead one component of a larger process: China’s rise and displacement of the United States as the world’s leading superpower, what Xi often describes as ‘changes unseen in a century.’ Beijing assumes that Washington’s own policies will dismantle the foundations of U.S. global hegemony, even if it creates a lot of turbulence for other countries in the process. China’s top priority, then, is simply to weather the storm.”

This article isn’t as overtly adversarial as the next one, but it still uses elements of an “us vs. them” frame—though not as strongly as the second piece.

Know Your Rival, Know Yourself

The second article, titled Know Your Rival, Know Yourself, was written by Jude Blanchette and Ryan Hass of RAND and Brookings, respectively. This piece aims to address perceptions of China’s spectacular rise—its growing technological and military capabilities—and the supposed decline of the United States.

The authors begin by highlighting China’s dominance in manufacturing, especially in green technologies like electric vehicles, batteries, and solar panels, as well as critical minerals and 5G telecommunications technologies. They also describe China’s growing capabilities in producing advanced weapons systems, such as fighter jets, stealth bombers, and hypersonic missiles.

Then they quickly pivot to outlining the daunting array of challenges China is facing: slowing growth, rising debt, poor local government finances, falling productivity, an aging population, and rising tensions with its trading partners. Their conclusion: despite the United States’ own problems, it is ultimately in a much better position than China.

American Overestimation and Underestimation

The most interesting framing in the article is the authors’ discussion of the American tendency to either overstate or underestimate adversaries. In the case of the Soviet Union, the US overestimated Soviet capabilities. The fear of being overtaken led to the establishment of NASA and massive investments in scientific research, which arguably cemented US dominance for decades.

On the other hand, the US has also consistently underestimated adversaries, such as Nazi Germany in the 1930s, al Qaeda in the 1990s, and Russia in 2022. Although it might seem prudent to err on the side of caution and overestimate threats, the downside is that it can lead to costly misallocation of resources—Vietnam and Iraq being prime examples, with immense costs and no real strategic gain.

China’s Structural Problems

The article then doubles down on the ills China faces, listing:

1. Slowing growth
2. The collapse of the real estate sector and its domino effect on local government finances and household balance sheets (housing makes up over 70% of household assets)
3. Growing capital outflows
4. Rising youth unemployment
5. Falling foreign direct investment into China
6. An unpredictable regulatory environment (exemplified by the tech crackdown)
7. Overreliance on exports and the weariness of trading partners
8. Xi’s authoritarian leadership style

US Strengths

In contrast, the authors devote considerable attention to what they see as America’s enduring might: its economy, the dominance of US companies, its military advantages, alliances in Asia and Europe, AI capabilities, energy security, and the power of the dollar. They also downplay the challenges facing the US economy. The ending of the article is telling:

It is vital to remember that Beijing’s greatest wins have tended to occur not in spite of American efforts, but in their absence. Take 5G telecommunications: China developed and deployed next-generation wireless networks at breakneck speed, cornering markets in Africa, Asia, and parts of Europe. This did not happen because the United States lacked the capacity to compete, but because it was slow to invest in domestic alternatives and unwilling to mobilize resources to scale a national strategy at China’s pace.

China’s especially rapid advancements in quantum communications and satellite networks underscore the extent to which it has prioritized leadership in technologies that the United States has been slower to embrace or fund at scale. This success has been driven by government subsidies, aggressive industrial policies, and a singular focus on securing critical raw materials, often at a high geopolitical and environmental price. These gains come with other costs, too. The Chinese government’s laser focus on specific strategic domains has diverted its attention and resources from projects that would drive longer-term economic growth, such as reforming the social safety net and boosting domestic consumption.

As China struggles, the United States should press its advantages. To do so, U.S. policymakers must make significant investments in areas in which the United States appears strong, boosting funding for research and development and cutting-edge industries, attracting global talent through targeted immigration reform, fortifying alliances in Asia and Europe, and rebuilding the U.S. defense industrial base. If American leaders continue to wring their hands over China’s ascendancy instead of taking these crucial steps, Washington’s strategic advantage could quickly erode.

My Take

Reading both articles, I couldn’t help but wince at the naked adversarial framing of China—especially in the second one. Far too many pundits and think tanks have made peace with the assumption that conflict with China is inevitable, and that all descriptions about China vs. the US (and the prescriptions that follow) should start with that frame.

Again, I want to reiterate, as I did in my previous post on this topic, that “good vs. bad” frames are terribly unhelpful in thinking about these nuanced issues. A perfect example is that one country’s perfectly logical decision to prioritize its own citizens’ interests can often be perceived as anti-competitive, protectionist, or illegal by another country.

This tension between national priorities and international cooperation has been constant throughout history and will remain so. What matters is how countries address these tensions. Barring the obvious basket cases, there are no saints or sinners. By resorting to explicit “us vs. them” frames, some of the idiots we often elect to positions of power aren’t doing us any favors. History is littered with examples of ideological posturing ending in misery and bloodshed.

When thinking about such devilishly complex issues, it’s important not to give in to wishful thinking, lazy conclusions, or shallow ideologies. It’s important not to look for yes-or-no answers or rely on “us vs. them” frames. It’s also crucial to learn how to hold two opposing ideas and be comfortable without reaching a neat conclusion—because these are complicated issues.

Ultimately, both articles showcase the “us vs. them” mindset—albeit in different ways—that pervades much of the current conversation about China. When learning about this insanely complex issue, it’s vital to stay vigilant and not fall into the obvious ideological traps.

Archived links

China’s Trump Strategy

Know Your Rival, Know Yourself

Image

"FIght! Fight! Fight! (painted)" by drewbrockington is licensed under CC BY-NC-SA 2.0.