U.S.-China relations: The search for a new equilibrium

U.S. Army and China's People's Liberation Army (PLA) military personnel attend a closing ceremony of an exercise of "Disaster Management Exchange" near Nanjing, Jiangsu province, China November 17, 2018. REUTERS/Aly Song

Executive Summary

Learn more about Global ChinaFor over 40 years following President Richard Nixon’s first tentative steps in China in 1972, the relationship between the United States and the People’s Republic of China (PRC) navigated many ups and downs, but generally developed along a trajectory of deepening social, economic, people-to-people, and diplomatic ties. In recent years, that trajectory has been broken. Now, the relationship has reached what respected China scholar David M. Lampton describes as a “tipping point.” This paper will explore how the relationship reached its current moment, why the relationship has been nose-diving, and what steps the United States could take to protect its interests in its relationship with China going forward.

This paper argues that neither the United States nor China own a monopoly of responsibility for the downturn in relations. Donald Trump and Xi Jinping are more symptoms than sources of the current downturn in bilateral relations. There are deeper structural forces at work on the relationship than the personalities or specific actions of the two leaders.

The paper examines four major structural discontinuities that have put the relationship on a steep decline. First, both countries have grown dissatisfied with the previous regional security status quo. Second, China’s emergence as a global rule-maker has heightened tensions. China arguably is the first non-Western power in the post-World War II era with the weight and the ambition to seek significant adjustments to international rules, norms, and institutions to better suit its interests. (While the Soviet Union posed its own challenges to the international order, it did not actively seek to change the existing order on a magnitude corresponding to China’s ambitions today, nor did it have the capabilities to do so.) Third, China’s rise from a low-wage manufacturing hub to a technology power has introduced friction into the economic relationship, as both economies increasingly move from being complementary to competitive with one another. And fourth, unresolved questions about the nature of ideological or systems competition are fueling tensions.

Looking ahead, the paper argues that Washington and Beijing each will need to take steps to allow conditions to emerge over time that would make possible the emergence of a new equilibrium for the relationship. Such an outcome would bolster each side’s confidence in their ability to protect their own vital interests, prevent a mutually harmful deterioration in relations, and enable both sides to focus more on improving their own national conditions by addressing their own shortcomings.

The paper offers four recommendations for the United States in addressing challenges posed by China. First, the United States needs to right-size the risks that China presents to U.S. interests, including by considering China’s abundant strengths alongside its considerable vulnerabilities. Second, both countries need to develop a shared understanding of the geostrategic environment in which their competition is playing out. Third, the United States will need to update its toolkit for influencing how China identifies and pursues its interests. The experiment of concentrating unilateral pressure on China and relying on tariffs to compel capitulation has generated concrete costs that exceed the benefits. And fourth, the United States needs to get back on track in terms of nurturing its sources of strength — its alliance partnerships, its international prestige and leadership, and its ability to foster national cohesion to confront pressing challenges.

There will not be quick fixes or absolute victories in a relationship as complex and consequential as the U.S.-China relationship. Each country is too big and strong to be dominated by the other. Working toward coexistence within a state of heightened competition will not come naturally or quickly for either side. It will require statesmanship, patience, and fortitude. It will result from a shared recognition of each side’s requirements for coexistence over conflict or ceaseless confrontation. The relationship is not pointed there yet, but that is the direction it is likely to head, not out of amity or goodwill, but rather out of shared necessity.