Huang Renwei makes good points about U.S. strengths and weaknesses while extrapolating a steady rise for China. What Chinese commentators sometimes miss is that the world is greater than the United States and China: other countries are also growing and rising and the relative influences of both the United States and China can be expected to decline somewhat in the decades ahead. As China settles down to the slower growth rate characteristic of mature economies.
Other factors affecting China’s trajectory will be the aging of China’s population (and whether reversal of its population control policy can affect it) and likely more serious competition from other countries that are for now a bit lower on the economic food chain of world economics and trade. Premier Li Keqiang recently discussed China’s current economic problems in a video conference with provincial leaders — see 2022 Transcript: Li Keqiang at Special Economy Stabilization Conference. As Professor Huang notes, the U.S. has problems and as he does not, China also has problems. General Secretary Xi Jinping’s apparently has the same ‘president for life’ lust for power that has led to political paralysis and instability in other countries. China has the static stability of repression yet not the dynamic stability that vigorous debate (and even more important staying out of trouble after the debate) brings.
Another wild card in the coming decades may be the rise of Africa. With greater political stability and improved health (especially malaria control) , and investement, the extraordinarily young average population of Africa has great potential for rapid economic growth.
Related translations here on US – China relations:
- 2022: Wang Jisi: Has the U.S. Really Declined? Chinese Need to Have a Clear Understanding About This
- 2021: PRC Party United Front Journal on US Political Decline, Perspectives on Chinese and Foreign Political Defense Issues
- 2021: Tian Feilong: The New China-US Cold War, Westlessness and the Reconstruction of the World Order
- 2021: Xiao Gongqin on U.S.-China Relations I: Avoid a Vicious Cycle
- 2021: “History and Experience of the Chinese Communist Party’s Engagement with the United States”: A Lecture by Professor Zhang Baijia
- 2020: PRC Scholar Yin Jiwu: Comparing US and PRC Concepts of National Security
- 2015: PRC academics on “Temporal evolution and mechanism of Sino-US geopolitical influence in South Asia”
- 2014: Prof. Yang Zhizhen: “Interactions Between US – China Relations and China’s Relations with its Neighbors”
Huang Renwei likens the U.S. – China situation today to the strategic stalemate China had with Japan during the War of Resistance Against Japan that Mao Zedong discussed in his article “On Protracted War“. Xi Jinping’s New Era has many echoes of Mao so here it is as we think of parallels in U.S. – China relations in our own latter days:
The second stage may be termed one of strategic stalemate. At the tail end of the first stage, the enemy will be forced to fix certain terminal points to his strategic offensive owing to his shortage of troops and our firm resistance, and upon reaching them he will stop his strategic offensive and enter the stage of safeguarding his occupied areas. In the second stage, the enemy will attempt to safeguard the occupied areas and to make them his own by the fraudulent method of setting up puppet governments, while plundering the Chinese people to the limit; but again he will be confronted with stubborn guerrilla warfare. Taking advantage of the fact that the enemy’s rear is unguarded, our guerrilla warfare will develop extensively in the first stage, and many base areas will be established, seriously threatening the enemy’s consolidation of the occupied areas, and so in the second stage there will still be widespread fighting.
In this stage, our form of fighting will be primarily guerrilla warfare, supplemented by mobile warfare. China will still retain a large regular army, but she will find it difficult to launch the strategic counter-offensive immediately because, on the one hand, the enemy will adopt a strategically defensive position in the big cities and along the main lines of communication under his occupation and, on the other hand, China will not yet be adequately equipped technically. Except for the troops engaged in frontal defence against the enemy, our forces will be switched in large numbers to the enemy’s rear in comparatively dispersed dispositions, and, basing themselves on all the areas not actually occupied by the enemy and co-ordinating with the people’s local armed forces, they will launch extensive, fierce guerrilla warfare against enemy-occupied areas, keeping the enemy on the move as far as possible in order to destroy him in mobile warfare, as is now being done in Shansi Province.
The fighting in the second stage will be ruthless, and the country will suffer serious devastation. But the guerrilla warfare will be successful, and if it is well conducted the enemy may be able to retain only about one-third of his occupied territory, with the remaining two-thirds in our hands, and this will constitute a great defeat for the enemy and a great victory for China. By then the enemy-occupied territory as a whole will fall into three categories: first, the enemy base areas; second, our base areas for guerrilla warfare; and, third, the guerrilla areas contested by both sides. The duration of this stage will depend on the degree of change in the balance of forces between us and the enemy and on the changes in the international situation; generally speaking, we should be prepared to see this stage last a comparatively long time and to weather its hardships. It will be a very painful period for China; the two big problems will be economic difficulties and the disruptive activities of the traitors.
The enemy will go all out to wreck China’s united front, and the traitor organizations in all the occupied areas will merge into a so-called “unified government”. Owing to the loss of big cities and the hardships of war, vacillating elements within our ranks will clamour for compromise, and pessimism will grow to a serious extent. Our tasks will then be to mobilize the whole people to unite as one man and carry on the war with unflinching perseverance, to broaden and consolidate the united front, sweep away all pessimism and ideas of compromise, promote the will to hard struggle and apply new wartime policies, and so to weather the hardships. In the second stage, we will have to call upon the whole country resolutely to maintain a united government, we will have to oppose splits and systematically improve fighting techniques, reform the armed forces, mobilize the entire people and prepare for the counter-offensive. The international situation will become still more unfavourable to Japan and the main international forces will incline towards giving more help to China, even though there may be talk of “realism” of the Chamberlain type which accommodates itself to faits accomplis.
Japan’s threat to Southeast Asia and Siberia will become greater, and there may even be another war. As regards Japan, scores of her divisions will be inextricably bogged down in China. Widespread guerrilla warfare and the people’s anti-Japanese movement will wear down this big Japanese force, greatly reducing it and also disintegrating its morale by stimulating the growth of homesickness, war-weariness and even anti-war sentiment. Though it would be wrong to say that Japan will achieve no results at all in her plunder of China, yet, being short of capital and harassed by guerrilla warfare, she cannot possibly achieve rapid or substantial results. This second stage will be the transitional stage of the entire war; it will be the most trying period but also the pivotal one. Whether China becomes an independent country or is reduced to a colony will be determined not by the retention or loss of the big cities in the first stage but by the extent to which the whole nation exerts itself in the second. If we can persevere in the War of Resistance, in the united front and in the protracted war, China will in that stage gain the power to change from weakness to strength. It will be the second act in the three-act drama of China’s War of Resistance. And through the efforts of the entire cast it will become possible to perform a most brilliant last act.from “On Protracted War” (May 1938) by Mao Zedong, Peking, 1967, Foreign Languages Press
Huang Renwei profile on the Fudan University website:
Huang Renwei, born in 1954 in Shanghai, is now a Distinguished Researcher at the Center for Contemporary China Studies of Fudan University, Vice President of the Shanghai Academy of Social Sciences, Professor and PhD supervisor.
Major academic experience: Participated in the study of Pudong development and opening-up strategy (1992-1993), the study of Shanghai development strategy in the 21st century (1994-1995), the study of World Expo and Shanghai’s new development strategy (2003-2004), the study of Shanghai’s medium and long-term science and technology development strategy (2004-2005); the study of relevant topics in the Central Taiwan Office (2004-2005); Research on “China’s Peaceful Rise and Development” at the Central Party School (2003-2005); China-US Strategic Dialogue at the China Foundation for International Strategic Studies (1997-); China-US-Japan Trilateral Strategic Dialogue at the China Institute of International Studies (1998-); China-US High-Level Dialogue on Taiwan at the China-Taiwan Office (2000-) Dialogue (2000 – ); and other major research projects and important strategic dialogues.
Publications: Roosevelt’s Political Speeches (1989, Jilin Education Press); American Colleagues (Volume III) (1991, People’s Publishing House); The Historical Evolution of the American Land System (1992, Shanghai Academy of Social Sciences Press); Where to Go in Sino-American Relations (1995, Sichuan People’s Publishing House); Independent Peaceful Foreign Policy (1998, Shanghai People’s Publishing House); The Rise of China Shanghai People’s Publishing House); Time and Space of China’s Rise (2002 Shanghai Academy of Social Sciences Press); A New Theory of State Sovereignty (2004 Current Affairs Press); Report on China’s International Status (2004-09 People’s Publishing House); Frontier Issues of Economic Development (2004 Shanghai People’s Publishing House), The Historical Choice of China’s Peaceful Development Path (2008 (Shanghai People’s Publishing House); and numerous other papers, articles and research reports.
By Huang Renwei (the author is Executive Vice President and Professor of the Institute of Belt and Road and Global Governance at Fudan University, and formerly Vice President and Researcher of the
Shanghai Academy of Social Sciences)
Originally published in International Relations Studies, No. 2, 2022 (bimonthly) 原载于2022年第2期《国际关系研究》（双月刊）
I. Historical Origin and Stages of the “Strategic Stalemate Phase” between China and the United States
The concept of “strategic stalemate” was coined by Mao Zedong in his “On Protracted War” published during the Anti-Japanese War. He proposed that the war of resistance against Japan consisted of three stages: the Japanese strategic offensive, the Chinese strategic standoff with Japan, and the Chinese strategic counter-offensive. This paper borrows this concept to express the development trend of Sino-American relations.
Compared with the War of Resistance Against Japan, there are three main differences between the strategic standoff between China and the United States today. First, the most fundamental difference is that the Sino-U.S. strategic competition is not in a state of war, while the strategic holdout of the War of Resistance against Japan is entirely in a state of war. Second, the next stage of the Sino-U.S. strategic rivalry was not a strategic counter-offensive stage, nor was there a strategic counter-offensive stage. China does not have the strategic goal of defeating the United States completely. Third, after a longer period of strategic stalemate, U.S.-China relations will enter a state of coexistence and co-governance. The so-called new type of great power relationship can only be formed after a long period of strategic rivalry.
From the theoretical point of view, “strategic stalemate” should include three characteristics:
- The two sides of the strategic stalemate are relatively balanced in power. Neither side has an overwhelming advantage in order to maintain the state of “strategic stalemate”.
- Over a longer period of time, it is difficult for either side to defeat the other side, and there is no difference between victory and defeat.
- Both sides have strong institutional confidence in order to maintain the resilience of strategic stalemate. The United States is certain that it will maintain world hegemony for more than 50 years, and China is certain that it will achieve the great rejuvenation of the Chinese nation by 2050, the second 100-year goal.
How long will the strategic holding phase be? It is about 30 years from 2021 to 2050. This depends not only on the conditions for China to achieve its goal of modernization and power, but also on the change in the balance of power between the United States and China. Because of China’s Two Centenaries Goals [Note: referring to the hundredth anniversary of the Chinese Communist Party in 2021 and the hundredth anniversary of the founding of the PRC in 1949. End note] the U.S. think tank’s long-term strategic scenario for China also defines the time frame as 2050. The 2020 strategy report released by the Center for International Strategic Studies (CSIS), a U.S. strategic think tank, defines the time frame for the U.S.-China strategic competition as 2020-2050. Another major think tank, The Project 2049 Institute, also sets the time frame for the U.S.-China strategic competition at 2020-2050. “The name of The Project 2049 Institute is based on China’s second century goal as its hypothetical target. As can be seen, 2050 is the expected strategic goal of both sides, and this target position determines the time orientation of the holding phase. Within these 30 years, as long as the power differential between the two sides is not reversed, strategic competition will always exist as the new normal in Sino-U.S. relations.
II. Three characteristics of the Sino-U.S. strategic stalemate phase
One of the characteristics of the U.S.-China strategic stalemate phase is the duality of the power structure between China and the United States. The duality of the respective structures of China and the United States is a basic feature of the strategic holding phase. The United States has maintained a relatively strong power during its long decline, and China has always been weak during its rise. This duality between the two sides is the main axis through which the unprecedented changes of the century will be transformed over time.
The duality of the United States is reflected in the widening gap between its hegemonic power and its goals. During the 1970s and 1980s, the United States and the Soviet Union were ranked as two superpowers, and U.S. world hegemony was incomplete. After the collapse of the Soviet Union, the U.S. became the only superpower in the world and its hegemony constituted a “unipolar world” with “one superpower, many powers”. The withdrawal of troops from Afghanistan and the crisis in Ukraine have further demonstrated the existence of this trajectory.
The decline of U.S. hegemony is a longer historical process in which the United States has remained the most powerful nation in the world. The U.S. still has the strongest financial control, technological innovation, military striking power and public opinion shaping power in the world. The decline of hegemony is not the same as the weakening of U.S. comprehensive national power. The current international system, including the United Nations system, the Western allied system and the international monetary and financial system, was established by the United States after World War II, and the United States still has decisive influence. International rules, especially international economic rules, are largely created by the United States. The so-called “rule-based international order” is essentially a “world order based on U.S. rules”.
The decline of hegemony refers to the declining status and declining capacity of the United States to lead international affairs, including the right to shape the international system, the right to create international rules, the right to dominate international discourse, the right to guarantee international security, and the right to mint the U.S. dollar as the world currency are gradually weakening. In the maintenance, reform, innovation and public goods supply of the international system, the U.S. has increasingly shown a serious lack of capacity. Under Donald Trump, the U.S. has been breaking rules and “withdrawing” from the group. After Joseph Biden took office, the U.S. began to restore the rules and to regain dominance over them. As a world currency, the U.S. dollar hegemony serves the U.S. strategy, controls the economic lifelines of other countries, and imposes economic sanctions on other countries at will. Based on its function as a world currency, the “dollar hegemony” is increasingly serving its own interests, and its function and credibility as a world currency are weakening. The decline of the dollar hegemony is one of the important manifestations of the decline of U.S. hegemony.
The rise and fall of national power is relative to the contrast in power between different countries. Relative to the rapid rise of China since the 21st century, the growth of U.S. power is in relative decline. But relative to Europe and Japan, the power of the United States is rising significantly faster than them. The power gap between the U.S., Europe and Japan has further widened. The U.S. still has the dominant power among its Western allies, and there is even a tendency for the U.S. to strengthen its control over its Western allies. If we look at the comprehensive power of the U.S. and its allies as a whole, the power gap between China and the U.S. is still quite large, and the historical inertia of the U.S. as a superpower will remain for a long time.
At the stage of strategic stalemate, the power contrast and power shift between China and the U.S. is producing structural contradictions, but such contradictions can have two developmental tendencies of confrontation and cooperation. Several issues need to be considered here.
The first issue is whether confrontation between rising and defending powers is inevitable in the process of power transfer between major powers. Will the scale and speed of the transfer of power from the defending state to the rising state lead to or avoid a full-scale confrontation between the two, and will this transfer of power be reversed and lead to the defeat of the rising state; or lead to the accelerated decline of the defending state?
The second issue is whether the narrowing of the power gap between the rising powers and the defending powers will create a limit and lead to a strategic showdown. China and the United States are the world’s first and second largest economies of great weight and equal size, respectively. The gap between China and the United States is rapidly closing. In 2001 China’s economy was 10 percent of that of the U.S.; by 2022 it will be 77 percent of the U.S.. Historically, the “iron rule” that the second largest economy in the U.S. was acceptable up to 60% of the U.S. has been broken. China’s economic growth from 70% to 100% of the U.S. economy is much shorter. If the U.S. cannot prevent China from reaching or exceeding the size of the U.S. total, then what is the acceptable limit of China’s rise and whether exceeding this limit will lead to a strategic showdown between the two.
The third issue is whether structural contradictions between China and the United States can be transformed into an adversarial relationship under certain conditions and into a cooperative relationship under other conditions. China and the United States have a large degree of interdependence and correlation of interests, and neither side can completely abandon the complementary relationship with the other and implement the so-called “decoupling”. Various problems, whether global, regional or bilateral, require cooperation rather than confrontation between China and the United States in order for them to be mitigated or resolved. The U.S.-China relationship will be in a permanent state of oscillation between quasi-confrontation and quasi-cooperation.
The structural contradictions between China and the U.S. are reflected in strategic competition in three major areas: global markets, two systems and geopolitics, and are characterized by the coexistence of confrontation, compromise and cooperation. As China maintains its upward momentum and reaches a state of equilibrium with the United States, the degree of confrontation in the structural contradiction between China and the United States will decline, and the confrontation will shift to compromise and cooperation.
The second characteristic of the U.S.-China strategic standoff phase is the long-term nature of the transformation of the international system. The transformation facing the contemporary international system is different from any system transformation in history. Most of the system transformations in the past changed the international system by war, and the Cold War pattern was also largely determined by the confrontation between two military blocs. Contemporary international system transformations are largely non-war transformations (not excluding war transformations triggered by sudden crises) and are characterized by their gradual and long-term nature. This characteristic remains largely parallel to the long-term nature of the strategic standoff phase between China and the United States.
First, the Western-dominated world system is in trouble. The West’s absolute dominance of 80% to 90% of the world economy for a long time has now dropped to a slim 50% to 60%. The West’s dominance in wealth distribution and international affairs is being weakened, and emerging economies and developing economies can to some extent constrain the rise and fall of the Western economy. China, which accounts for 1/3 of the world’s economic growth and 1/3 of the total developing country economies, is also increasing its weight of influence on the Western economy.
Second, because of the inertia of the Western-dominated world system, the Western economy remains at the center of the international system for a long time, even if it drops below 50% of the global economy. The Western-dominated global governance, or “Western governance” system, can neither reflect the rise of emerging forces nor give them enough room to rise. It is difficult for the West to accept the concept and power structure of emerging forces and coexist with them, but the globalized economy does not allow the West and the non-West to be cut into two market systems. This will require a long process of mutual adjustment.
Moreover, Western countries (including some developing countries) habitually accept the U.S. leadership and find it difficult to accept an international order dominated by emerging powers. This “Pax Americana” mentality will take a long time to change. It is also difficult for the emerging powers to create a new international system from scratch. Only when the hegemonic powers themselves are unable to support the old international system will it be possible for a new one to take its place.
From China’s perspective, for more than 40 years, from 1980 to the present, China has been in the process of integrating into the Western-dominated international system. In the next 30 years China will face the rejection of China by the U.S.-led Western system and will have to shift from a process of integration to one of shaping and changing the existing international landscape and system. This requires a strong global governance capacity and an advanced global governance philosophy, which will take several generations to develop and promote before it can be established. For example, the lack of capacity encountered in the Belt and Road Initiative does not reflect inadequate investment and construction capacity, but a lack of China’s ability to convince other countries to accept the Belt and Road initiative within the world system. China’s relationship with the world and the interchange of positions in the U.S.-China relationship require a long and iterative process before qualitative changes can occur.
The third characteristic of the U.S.-China strategic stalemate stage is the limited nature of the confrontation between China and the United States. The confrontation between China and the United States in the strategic stalemate phase is limited. China itself does not have the will to engage in a full-scale confrontation with the United States, which is inconsistent with China’s strategic goal of development by 2050. The U.S. ability and will to confront China is also limited, as such a confrontation would require the U.S. to expend several times its own national power and thus it may not be able to achieve its goals. The limited nature of the confrontation, which exists on both sides, is a fundamental condition for the relative stability of the strategic standoff phase.
During the four years of the Trump administration, the United States has tried to pursue a bottomless confrontation strategy against China. At one point, the U.S. gathered all its resources for an “all of government, all elements of national power into an all-round” offensive against China, including economic, technological, public opinion, some military, and extreme pressure through allies and China’s internal channels. The U.S. has not only proven itself unable to defeat China, but it has also paid too high a price in damage to its own economy in the process. In the case of the U.S.-China trade war, for example, Trump imposed high additional import tariffs on $500 billion worth of Chinese goods. Ninety-two percent of that tariff burden was shifted to U.S. domestic consumers and producers, leading to a significant increase in domestic prices and triggering inflation.
The consequences of the U.S. technology war against China will be similar. The negative consequences of the U.S. technology crackdown on China will gradually become manifest. U.S. high-tech companies will lose the Chinese market as their largest source of profits. This in turn will reduce their capacity to fund R&D and so lower their development potential and also stimulate China’s own ability to innovate. If the U.S. were to launch a full-scale financial war against China, it would cause an unprecedented shakeup or even collapse of the dollar system and a complete shutdown of the world economy, with far greater consequences than any trade and technology war.
An all-out military war with China would be extremely risky. The U.S. lacks adequate financial resources to support a regional war with China, let alone a nuclear war. The federal debt is now over 150 percent of U.S. GDP. If the United States were to engage in a military war with China, it would need to more than double its current military spending to at least about $1.5 trillion. If the war continues for several years, even without a nuclear war, the U.S. dollar credit, U.S. finances and U.S. stock market would collapse completely, and it would be difficult to win militarily. The United States would need at least twice the national, financial and military power of China to defeat it. Obviously, there is no possibility for the United States to mobilize such huge resources to defeat China.
Based on these basic estimates, President Biden declared to Chinese President Xi Jinping that “the United States does not seek to change China’s system, does not seek to fight a new Cold War with China, does not seek to oppose China through strengthened alliances, and does not support Taiwan’s independence.” Although there is a problem here with the U.S. saying one thing and doing another, it is, after all, an official determination and expression at the highest levels of the U.S. of the limited nature of strategic confrontation between the U.S. and China, and a full-scale confrontation with China is not in U.S. interests. There are only two possibilities for changing the limited nature of the U.S.-China confrontation: the first, a subversive strategic mistake by China that interrupts its peaceful rise, the probability of which is low. The second, the probability that U.S. anti-China forces will absolutely dominate its decision-making hierarchy and recklessly launch a full-scale cold war or even a hot war against China. The probability of this happening is also relatively low. With the passage of time, China’s power will fully catch up with that of the United States. The strategic confrontation between China and the United States will turn from limited to non-confrontational only when the United States is unable to confront China and can only face reality and compromise with China.
III. The Three Decades of the Strategic Stalemate Phase: Continued Changes in the Power Contrast
The length of the strategic stalemate phase depends on the speed of change in the power contrast between the two sides. This power refers to a comprehensive competitiveness that includes all factors such as economic, military, diplomatic, political and public opinion. The biggest gap between China and the United States at present is in the field of science and technology. This gap determines the advancement of manufacturing and also relates to cultural and institutional competitiveness. Scientific and technological competitiveness is the decisive factor of contemporary comprehensive national power. The speed of China’s S&T development determines the length of the strategic holding phase. In the four areas of science and technology, military, finance, and soft power, the United States still dominates at present, and the gap between China and the United States is narrowing, but still significant. China has made breakthroughs in individual areas, such as Huawei’s leading 5G technology. The advanced level reached by Huawei in the field of communication technology can be achieved by Chinese companies in other fields in the next 10 years or so. The fact that China’s high-tech industry has been tightened by the United States in the last two years has instead prompted China to speed up the pace of independent innovation in science and technology. By 2035, it will be possible for China to approach the U.S. level in basic technology areas; then by 2050 there will be a basis to be on par with the U.S. in science.
In April 2021, the International Monetary Fund predicted that China’s total GDP will reach about 90 percent of that of the United States by 2026, and could equal the United States in 2027-2028. The International Institute for Strategic Studies in London predicts that China’s total GDP will catch up with that of the United States in 2028. The assessments of these international institutions are somewhat more optimistic than China’s own. In terms of exchange rate calculations, tying China’s GDP with the U.S. in 2030 is a more modest projection. If the U.S. maintains an average annual growth rate of 2 percent over the next 10 years and China maintains a 5 percent growth rate, by 2030 China’s total economy will catch up with the U.S., with a GDP per capita of $20,000 and a total between $25 trillion and $28 trillion, which is a more modest expected target. Although China is crossing the warning line for the U.S. to strike the second largest power, the 10-year period from 2021 to 2030 remains the most intense and dangerous period of strategic competition between the U.S. and China, where all conflicting points of conflict are most likely to be concentrated.
If China’s total economic output catches up with that of the United States in the first decade from 2020 to 2030, and China’s overall national power catches up with that of the United States in the second decade from 2030 to 2040, a decisive shift will occur in the contrast of power in the strategic standoff phase between China and the United States. During the third decade from 2040 to 2050, China will catch up with the United States in major fields, including major science and technology. By 2020, China will have surpassed the United States in two important indicators: the number of corporate patents and the number of papers published in core natural science journals. In higher-end indicators such as the number of Nobel Prizes won, China is still significantly behind. Based on the large number of innovations and basic research results, there exists hope that China will be able to catch up with the US in the field of science and technology during the third decade of the twenty-first century.
The biggest gap between China and the United States is in the area of soft power, including the “broad soft power” and “institutional resilience” of various cultural vehicles and communication capabilities. The ability of the U.S. ideology and institutional model to infiltrate and subvert other countries is almost ubiquitous. The difficulty factor in promoting widespread acceptance of Chinese information and culture around the world is very high. In the next 30 years of strategic stalemate, the U.S. will make greater use of its soft power advantage, whose cost-benefit ratio is far more favorable to the U.S. in its hard power confrontation. Therefore, the intensity of U.S.-China soft power competition will exceed that of hard power competition. This is a long-term trend, the more rapidly the U.S. hard power declines, the more it will use its soft power advantage to confront China.
There are both explicit and implicit factors in the U.S.-China power contrast. Explicit factors include “visible” factors such as military power, technological power, and dollar power. Implicit factors refer to “invisible” factors related to soft power, which are difficult to put a number on, such as the extent to which China is able to produce the same quantity and quality of scientific and technological talent as the United States. China’s disadvantage is also evident in terms of hidden factors. The cultural and educational gap between China and the United States is obvious. Eight of the top 10 universities in the world are U.S. universities, and 50 of the top 100 are U.S. universities. Peking University and Tsinghua University are currently ranked in the top 30 in the world, and it will take a long time to shorten the gap with the top U.S. universities. The U.S. use of public opinion warfare to distort China’s image is the key to the invisible power gap between China and the United States.
It is necessary to dialectically understand the power gap between China and the U.S. and realize the conversion of China’s power advantages and disadvantages. Transform quantitative growth to quality enhancement, i.e., achieve high-quality development. Achieving a qualitative transformation of China’s economy and domestic governance in the 30 years of the strategic holding phase is the core task for China in the next 30 years, and this domestic development strategy issue, placed in the framework of the strategic holding phase between China and the U.S., is an international strategy issue. It will determine whether we will be able to turn our disadvantages into advantages and strategic resources into strategic capabilities in the strategic standoff phase.
Having the world’s largest market capacity is China’s greatest strategic advantage. This will have a decisive impact on the contrast of power between China and the United States in the strategic standoff phase. China currently has a population of 1.4 billion and a GDP per capita of $10,000; if the GDP doubles, it becomes $28 trillion and $20,000 per capita. This is a goal that probably could be achieved by 2030. If the U.S. GDP were to rise to $28 trillion, it would need to achieve $90,000 per capita in 2030, which is quite difficult. China’s market potential is so huge that its ability to absorb imports of foreign goods can be transformed into international economic cooperation capacity, and its ability to export goods can be transformed into foreign investment capacity and infrastructure construction capacity. The “Belt and Road” is actually the transformation of China’s domestic market potential into overseas market projection capacity. Market capacity is also, to some extent, cultural communication capacity, which can be translated into the ability to create the rules of the international system. The size of the market will determine the power to create the rules of the market. The countries along the “Belt and Road” will implement the “four-in-one” new international rules of Western rules, UN rules, Chinese rules and local rules, instead of the single US rules. The battle over rules will be a combination of market competition and strategic competition between China and the United States.
There are also limits to U.S. power during the strategic standoff phase. The limitations of U.S. power essentially reflect the potential crisis of the United States. The most obvious one is the federal fiscal crisis, with the U.S. federal debt reaching $30 trillion in the first quarter of 2022, or 140% of U.S. GDP; interest on the federal debt alone will take up 1/3 of the annual federal budget. Moreover “robbery” in international affairs, causing serious damage to the credit and image of the United States. The gap between the near bankruptcy of U.S. finances and the enormous expenditures required for strategic competition between China and the United States is the greatest limitation of U.S. power. Kissinger once judged that the greatest threat to U.S. security comes from the federal debt, and the larger the federal debt, the more dangerous the United States is. This warning hit the nail on the head.
The current U.S. economy is in the middle of three huge bubbles: one is the U.S. debt bubble, the second is the inflation bubble, and the third is the U.S. stock market bubble. The U.S. inflation rate has reached 8%, the highest in nearly 40 years. Inflation will continue to rise after the Ukraine crisis. Stimulated by ten consecutive years of easy monetary policy since 2011, the U.S. stock market rose from being at over 10,000 to over 30,000 at the beginning of 2020. With a serious new coronavirus epidemic and the risk of recession, the stock market is irrationally exuberant amidst a false boom. The consequence of unlimited dollar issuance will inevitably lead to a decline in the value of the dollar. The Federal Reserve is issuing large amounts of money to buy treasury bonds. The debt, stock market and inflation problems coming all at once are negative factors. The U.S. abused its power as the issuer of the U.S. dollar – which functions as the world’s reserve currency world currency – to transfer the U.S. crisis to countries around the world by spilling over and absorbing the U.S. inflation into the world economy. During the Ukraine crisis, the U.S. has used both the SWIFT system to attack both Russia and the Euro with energy price hikes. After both Europe and Russia were weakened, abusing the hegemony of the dollar to strike China was the next option. But China has a superb resistance to these strikes that neither the European Union nor the Russian Federation possess. The result will be that the dollar will encounter unprecedented countermeasures, and all countries will be cautious about the consequences of dollar hegemony abuse. Thus, the dollar hegemony crisis is the biggest strategic limitation of the United States.
The growing centrifugal tendencies within the United States will make it harder for the U.S. to contain China. In the last two years, divisive tendencies within the United States have reached their highest point since the 20th century. These divisions are more complex than those that led to the U.S. Civil War. Severe racial divisions and deep divisions between rich and poor are intertwined, highlighting the dichotomy between the 1 percent and the 99 percent. The regional split between Republican “red states” and Democratic “blue states” coincides with a split between federal government at the center and state governments was triggered by the epidemic. These problems are compounded by the fact that America’s strength is in the stock of capital and resources. This stock keeps getting smaller and smaller while flows keep getting bigger and bigger. This is an insurmountable constraint for the U.S. in the strategic holding phase.
IV. Seize the battle relaxation period and postpone the strategic showdown between China and the United States
The concept of “strategic holding phase” is conducive to the overall grasp of the trend of U.S.-China relations and the maintenance of strategic stability, so that we will not follow the oscillation because of the policy adjustment of the U.S. presidential change. Taking advantage of the cyclical changes in the phases will help us gain strategic initiative. The buffer period is characterized by no change in U.S. strategic goals and directions, a decrease in the intensity of U.S.-China confrontation, and a partial restoration of dialogue, compromise and cooperation between the two sides.
Assuming that the strategic standoff phase is divided into three decades, at least two presidents will change in each decade, and U.S. policy will be adjusted or even turned around when each president takes office or leaves office. During this adjustment and turnaround process, there will be battle phases of intensification and buffering, which can be called “battle intensification period” and “battle relaxation” period. The strategic stalemate phase is completed in the alternating process of intensification and relaxation.
The U.S.-China relationship during the strategic stalemate period is characterized by a longer period of intensification (3-5 years) and a shorter period of relaxation (2-3 years). Seizing the battle relaxation period is a key step to avoid a full-scale confrontation between China and the U.S. during the strategic standoff phase. If we want to avoid a U.S.-China strategic showdown in 20-30 years, we have to seize several of these relaxation periods to digest the aftermath left by the previous period of intensification and prepare for the crisis that may arise in the next period of intensification. During the intensification period, we should address the incoming enemy moves tit-for-tat, while during the relaxation period, we should pay attention to being reasonable, seeking benefits, and maintaining a good tone in relations, maintain and expand the content of cooperation, extending the relaxation period as much as possible, and postpone the breaking point of the strategic showdown between China and the United States. This is the dialectical relationship between strategic holding and battle relaxation. Time is on our side and the direction of power shift is in our favor. Making good use of the buffer relaxation period is an important condition for us to transform the phase of strategic stalemate into a period of strategic opportunity.
Biden’s rise to power triggered the first battle relaxation period. The first alternating cycle of battle intensification and battle relaxation occurred during the turnover between the Trump and Biden Administrations. During 2019 and 2020, key members of Biden’s foreign policy team, including Anthony Blinken, Jake Sullivan and Kurt Campbell, published several articles on China policy in Foreign Affairs, Foreign Policy, and mainstream media such as the Washington Post and the New York Times, setting out the next administration’s policies. The fierce clash in the U.S. presidential election at the end of 2020, in which the Republicans and Democrats engaged in a deadly power struggle, foreshadowed Biden’s rise to power. All of these indicate a relaxation period after Biden takes office.
The difference between the main members of Biden’s team and the far-right wing of Trump’s team, such as Pompeo, Bolton and Bannon can be said to be the difference between “rational suppression” and “irrational anti-China”. This will result in a relaxation period. The difference can be seen as the difference between “rational suppression” and “irrational anti-China”, which results in the alternation of “relaxation period” and “intensification period”. If Pompeo and others had remained in power after 2021, U.S.-China relations would have fallen off a cliff and there may well have been a dangerous prospect of a strategic showdown. In contrast, the emergence of a period or periods of “battle relaxation” to avoid continued intensification and a precipitous fall in bilateral relations is objectively conducive to the stability of the strategic stalemate phase.
However, we have seen no significant relaxation in the six months after Biden took office, or the degree of relaxation is also less than expected. There are three reasons for this:
- The obstacles set by Trump are very large, eliminating policy inertia is hard to do over the short term, and the political atmosphere in Washington is still “anti-China political correctness”.
- The two parties have formed a consensus to position China as the number one strategic opponent, and no matter which party comes to power, this strategic positioning will not change even during the relaxation period.
- The ideological factor of Biden’s China policy is very strong, and his “small yard, high fence” strategy of precision strikes is more confusing and less appealing to the public than the strong anti-China posture of Trump’s team.
The Biden Administration’s new China policy adjustment has two main components. The first is to lock China in with rules (i.e., “regulation lock-in”), and to characterize China’s international behavior as much as possible as being in the “non-compliant” or even “illegal” range. “The other is to establish new multilateral mechanisms. The second is the creation of a new multilateral mechanism (the so-called “pseudo-multilateral”), which is essentially a U.S.-led “united front” against China. The U.S. targeting of multilateral mechanisms at China has been one of the features of policy adjustments that Biden has made toward China since his inauguration. This is the only difference from Trump’s unilateralist approach to China is in the way it is being done.
The relaxation period for this round of battles can be long or short. If the Republicans gain majorities in both chambers in the 2022 midterm elections, the Biden administration will enter “lame duck” status early and the relaxation period will be difficult to maintain. Even if the Democrats retain both houses of Congress, 2024 will be a presidential election year, the two parties will again be amidst fierce political campaigns. The political atmosphere will have become seriously poisoned and the battle relaxation period will be basically over. Therefore, this round of battle relaxation period will last only one to two years. By 2025, when a new administration takes office, China and the United States will enter a new period of intensified battles, and both the far-right wing of the Republican Party and the Democratic Party establishment will inevitably launch a fierce attack on China when they take office. Because the first decade of 2030 is so close, the psychological pressure of the United States being overtaken by China in aggregate is already hard for China to bear.
The cycle of alternating periods of battle intensification and battle relaxation in the first round provides us with a typical template for the sometimes-aggravating and sometimes-buffering relationship between China and the United States. Careful analysis of the internal logic of this cycle will help us reveal the regularities within the strategic standoff phase, and moreover, help us promote the transformation of Sino-U.S. relations in a healthy direction, and help China and the United States share the responsibility of maintaining peace and development. (Notes omitted)