National Security Adviser Jake Sullivan’s private talks with China’s top diplomat Wang Yi this week are the latest in a relationship that saw the two sides exchange abuse in Anchorage in 2021. This is another sign that the snow is melting. Inter-military talks have resumed. Treasury Secretary Janet L. Yellen and Commerce Secretary Gina Raimondo both made constructive visits to China. The U.S. Indo-Pacific Command noted earlier this month that Chinese military aircraft appear to have stopped making dangerous flights since the Biden-Xi summit in November. Over the past two years since fall 2021, there have been nearly 300 similar incidents against U.S. aircraft and those of U.S. allies and partners. And while the Taiwanese election went against China’s expectations, both sides responded in a mature manner.
This is all good. The mistrust, misunderstandings, and lack of contact that characterized the relationship during the first two years of the Biden administration were dangerous. This conflict could easily descend into an open-ended arms race in everything from artificial intelligence to space weapons, splitting the global economy and sparking the first great power war since 1945.
Both men adjusted their attitudes. But the bigger changes came from Beijing. President Xi Jinping came to power convinced that America’s power was declining in the wake of the global financial crisis. He clearly said, “The East is rising and the West is declining.” He wanted China to reduce its economic dependence on the United States and develop future technologies at home. He began a more ambitious and aggressive foreign policy.
Let’s take a look back at the past few months. Mr. Xi publicly declared in front of American business executives that China has no intention or desire to replace the United States as a global hegemon. He and Wang Yi have argued that cooperation between the United States and China is essential. Mr. Xi courted American companies in San Francisco, and Premier Li Qiang did the same in Davos, Switzerland. Much of this change in rhetoric likely stems from Beijing’s recognition that while the U.S. economy is booming, its own economy is in decline. But more generally, we must see the failure of “wolf warrior” diplomacy, alienating people from India to Australia to Germany. A recent Pew Research Center survey showed that 22 out of 24 countries surveyed view the United States more favorably than China.
The U.S. government has come to realize that U.S.-China relations could go far off track and lead to dangerous spirals, crises, and conflict. In particular, if Taiwan is treated badly, everyone will suffer, including Taiwanese, the majority of whom want to maintain the status quo. There are also positive aspects to improving relations between the two countries, which are deeply intertwined economically. Many of America’s allies have made it clear to Washington that China remains its largest economic partner, while seeking U.S. security assistance.
None of this suggests that the situation is currently warm and friendly. A new crisis will emerge. As China’s affordable EVs flood the market, some Western countries are expected to spark a big debate over how to respond. For Germany, China was a great savior for the automobile industry, absorbing most of Germany’s exports. But now Chinese cars pose the biggest threat to the industry. There will be new tensions over pharmaceuticals and biotech products. However, these will likely be realized in the future through cooperation between Washington and China. That’s reassuring.
One of the factors that enabled Washington’s change in attitude was the recognition that China is not 10 feet tall. As in Japan in the 1980s, policymakers in Washington predicted China’s future growth and panicked. But, as the German proverb goes, “trees don’t grow towards the sky.” China’s growth has slowed considerably, made worse by a number of bad policies in recent years. Demographics and productivity, key factors for economic growth, are both stagnant. China is still a great power, but it has no intention of conquering the world.
A key feature of the era of American hegemony that began 80 years ago was that Washington created a security system that allowed other countries to grow and prosper. As long as we did not seek to disrupt the international order, we were able to prosper economically, politically, socially, and culturally. This attitude was rooted in confidence that the United States could compete and do well with its rivals. However, the country insisted that the conflict not turn into a geopolitical conflict. There is no win-win solution to the geopolitical conflict and the world system will collapse. If China is to play by these rules, the US government should give it some leeway. As the American economy moves forward strongly, this nation would be wise to maintain confidence in itself and base its foreign policy on its precise premises, rather than one built on doom and despair. Dew.