Some thoughts on the Beijing Summit...

US President Donald Trump adopted a more hawkish stance toward China during his first term and even at the beginning of his second term. Trump now appears to have stepped back from that hawkish posture. He may have realized that the deep interdependence of the US and Chinese economies makes it difficult to exert greater pressure on China. During his first term, Trump argued that China had taken American jobs away from Americans and promised to bring those jobs back to the United States. He reinforced this campaign promise with the slogan “Make America Great Again.”

Trump traveling to Beijing with a plane full of businessmen showed that decoupling the American and Chinese economies, as previously promised, is not an easy task. Trump’s new policy appears aimed at reducing the trade deficits the US runs with China. Chinese President Xi Jinping also signaled that he is prepared to offer Trump certain gestures on this issue. Trump may believe these gestures will provide his party with an advantage in the November elections.

However, this new relationship does not mean that the global hegemonic rivalry between the US and China has come to an end. Although the Chinese side insists that China’s rise is not intended as a challenge to displace the United States from its place on the global stage, China hawks in America do not see it that way. It should also be remembered that China hawks exist in both parties.

Many American analysts agree that any rising power will inevitably be viewed as a threat to US global hegemony. Indeed, Japan’s technological rise in the 1980s deeply alarmed Americans. The arguments now being made against China were once directed at the Japanese as well. The Japanese managed to deflect American pressure by “playing dead.” They stepped back and accepted a status subordinate to the United States.

Americans who see themselves as an “exceptional nation” and argue that a world without US hegemony would descend into chaos cannot afford to lose their influence over the global system. The advantages provided by a global economic system in which the dollar serves as the reserve currency play a crucial role in sustaining American military power. The United States’ military presence, with bases spread across the world, depends on its continued position as the hegemon of the global system.

“Dollar dominance” helped cushion the damage caused by the transfer of American jobs to China. At the same time, cheap Chinese goods enabled ordinary Americans to meet their daily needs affordably. Yet it now appears increasingly clear that this situation was neither sustainable nor destined to remain so. Massive inequality in income and wealth distribution has meanwhile pushed American politics toward greater polarization.

It is obvious that China’s participation in the global economic system played a major role in its rise. Western liberal globalists had long promised that globalization would benefit every country. China hawks in America, however, argue that the US-led liberal global economic system enriched China while impoverishing Americans. Yet it is also true that the relocation of jobs to China made large American corporations even wealthier.

Trump initially appealed to voters who had lost industrial jobs, but later chose to reconcile with corporate America. His additional tariffs, however, placed producers exporting goods to China under severe pressure while also making life considerably harder for ordinary Americans. It appears Trump has been politically forced into pursuing a trade-focused relationship with China in order to escape this trap.

China, meanwhile, expects the United States to respect Beijing’s “red lines” in return for commercial gestures. Indeed, some of Trump’s statements following the “Beijing Summit” give the impression that there may be changes in US policy toward Taiwan. While Xi Jinping approached the summit with a strategic and long-term perspective, Trump adopted a much shorter-term position largely confined to his own presidency.

According to Taiwanese observers, Xi Jinping is making gestures in order to persuade the US to loosen its grip on Taiwan. This strategy is described as “removing the firewood from beneath the boiling cauldron.” This ancient Chinese strategy is viewed as part of China’s broader grand strategy against American hegemony.

China is pursuing a policy of “strategic patience” against a United States whose imperial expansion has reached its limits and which is therefore entering a period of decline. Beijing seeks to continue its economic — and military — growth without obstruction. It prefers to wait and watch the weakening of the international foundations of American power. The essence of the strategy of “removing the firewood from beneath the boiling cauldron” is captured in the following saying:

“A good warrior first makes himself invincible, then waits for the enemy to become vulnerable.”