US-China trade dispute: a productive approach

Trade negotiators for the US and China will face off this week in Shanghai, when US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin arrive on Tuesday to meet with China’s top negotiator, Vice-Premier Liu He. In recent months the two sides have taken only limited steps on the thorny issues of Huawei and agricultural purchases, but moving beyond these minor successes could prove difficult, making a quick end to the trade war between Washington and Beijing anything but a certainty.

Trade relations between the world’s two biggest economies have been volatile under US President Donald Trump, whose aggressive stance on China trade has been marked by a lack of preparation and understanding of the main issues involved. By failing to prepare the United States for the duration or cost of a trade war, the administration has risked enormous longer-term costs that will have seriously negative consequences for both countries.

Over the last couple of decades, the US and China have enjoyed a mutually beneficial trading relationship whose cooperation has seen both sides profit. Such a non-zero-sum game is what advances society. Instead of obsessing over China’s perceived violations of trading norms, the United States must now deal with the Asian giant’s legitimate aims. How can this be done in a productive manner, and what should Trump’s policy look like? Here are some reciprocal solutions to the US-China trade war:

• The United States should not make China their enemy, but neither should the US pretend they are friends. We are beginning to see China attempting to impose its product standards worldwide. China is building a network of bases intended to dominate sea lanes, and is moving to to appropriate the entire South China Sea. Washington ignores these attempts at hegemony at America’s peril.
• The Trump administration is allowing China to divide and conquer instead of using the best tools it has available: the international consensus and networks that have worked so well for America in the past. The US should avoid going out of its way to alienate allies like the EU,  Japan, Canada and Mexico. These countries are friends and Washington should work with them strategically to counter China’s expansionist tendencies.
• Although China has set itself the goal of having a world-class military by mid-century, it still faces immense hurdles before it can become a globally dominant military power. American policy seems to assume that the US will remain “in charge,” which smacks of the West’s ongoing underestimation of China. Why does America appear to be in a race to see who can weaken Western democratic norms more, China or Trump? Commentators around the world accuse Trump of being far more damaging to world order than China has been.
• With the right balance of competition and cooperation, US actions can strengthen the hands of Chinese leaders who want their country to play a constructive role in world affairs. How exactly do Trump advisers propose to navigate Beijing’s often opaque policies under paramount-leader-for-life, Xi Jinping? How can they expect to build bridges with senior figures in such a regime?
• The trade war is characterized by nervousness, but Washington intransigence will not prevent the continued expansion of the Chinese economy, a greater global market share for Chinese companies, and an increased Chinese role in world affairs. Moreover, the United States cannot significantly slow China’s rise without damaging its own economy. In other words, resistance is indeed futile.
• China has been a full WTO member since 2001, despite flagrant, repeated violations. It has had open access to virtually every market, without granting reciprocity, while violating intellectual property laws for years. How much more one-sided participation and cooperation can China expect to exploit? A wiser policy is to work with allies to maintain deterrence, emphasizing defensive-oriented, area denial capabilities, resiliency and the ability to frustrate attacks on US or allied territories, while strengthening crisis-management efforts with Beijing. The best American response to these practices is to work with allies to create a more open and prosperous world in which China has the opportunity to participate.
• The United States’ interests are best served by restoring its ability to compete effectively in a changing world and by working alongside other nations rather than by promoting a counterproductive effort to undermine and contain China’s engagement with the world. However, this poses a limited, binary choice on the horns of a false dilemma: that you either secure a cooperative modus operandi with allies or you act unilaterally. But the essence of US foreign policy since World War II has been to engage in both. The problem is not doing both, it is a misalignment of the two, a common feature of the Trump administration’s blundering foreign policy.
• One of the main problems facing America is its widely-held belief that America’s way is the only way. Moreover, America is trying too hard to dominate the world through military power, while China instead targets economic power. America has to remember that China is a country in upheaval. To see China only as a threat is a grave mistake. Instead of making enemies of its allies, America should work together with them to try and point China in the right direction.
• I honestly believe that, given its economic might, China poses a greater long-term threat than Russia or any other country. But what makes China increasingly assertive and even aggressive are the actions and policies of the Trump administration, which send a message to the Chinese that America is weak and, most importantly, has lost its moral compass.
• Efforts to isolate China will simply weaken those Chinese who are intent on developing a more humane and tolerant society. Trump’s conduct towards China has been largely maladroit and will probably be ineffectual if not actually counterproductive in the long term. I also contend that better co-operation with allies is absolutely crucial.

The rapid rise of the Asian giant to the status of economic powerhouse has caused serious disruptions between the US and China. Washington’s ongoing efforts to disrupt China’s rising strength in the global economy could end up damaging and isolating America. A successful US approach must focus on creating enduring coalitions with China in support of economic and security objectives. Given China’s actions and goals, the US must try a different, more aggressive approach. This must be based on a realistic appraisal of Chinese perceptions rather than counterproductive efforts to undermine and contain China’s engagement with the world. Washington must stop treating China as the enemy.