The U.S. has gained enormously from Chinese economic and foreign policy over the last 30 years. If nothing else, Chinese growth has lifted umpteen millions from poverty, which is certainly in our interests. The growing Chinese economy has reduced costs for our businesses, reduced the cost of living for our consumers, provided a market for exports, and opened opportunities for U.S. investment.
Certainly there are going to be conflicts in any relationship between great powers. Chinese strength is growing, their objectives are not our objectives and will often conflict with our objectives. It's easy to focus on parts of the picture:
Dick D'Amato, the commission's chairman [Congress' US-China Economic and Security Review Commission - Ben], argues that - unlike when Americans were concerned about Japanese acquisitions of US assets - there is little goodwill to ease difficulties with China. "There is a currency issue, the intellectual property issue, on North Korea they are not helping us, we have this big military build-up . . . What in this relationship is working?" asks Mr. D'Amato.
("A new Asian invasion" by Dan Roberts, Richard McGregor, and Setphanie Kirchgaesser, Financial Times, June 23)
It's not clear to me from the quote if D'Amato is trying to characterize his view of the man-in-the-street's perception, or if these are his own views.
D'Amato points to real issues, but here's a very different, and broader, perspective. William Overholt's book about China (The Rise of China. How Economic Reform is Creating a New Superpower) was published at the start of the Clinton Administration, in 1993. China's economic liberalization, which began in 1978, was about 15 years old. Its diplomatic opening to the West , in 1972, was about 20 years older. Overholt had a very optimistic view of China's economic growth and growing power.
Late in the book he surveyed the impact recent Chinese policies had had on the world. He starts this section by pointing to the importance of economic development, and the U.S. diplomatic and military presence, for regional stability:
...For centuries in Southeast Asia, regimes have enriched themselves by plundering their neighbors. Most of regional politics previously consisted of territorial aggression and irredentism. The possibility of sustained development at 7 percent annually has made it much more attractive to seek prosperity via domestic development. Moreover, with development swept in modern military technology, which has drastically increased the risks and cost of plundering one's neighbors. Thus the whole calculus of international politics has been transformed. War is now far more costly and peace the only sensible path to property and power.
The change in economic environment has not worked alone, of course. The U.S. presence has allowed countries - including notably Japan and 1960s South Korea - to enhance their growth further by reducing military expenditure and relying on U.S. protection. Moreover, the United States strongly discouraged most forms of regional conflict. Such a policy worked well in the context of Asian growth and post-World War II West European recovery; but the absence of rapid economic growth in Africa and Latin America deprived the policy of leverage in those areas.
And in the 1970s, the Chinese bought into this:
China's strategic reorientation in 1968-72 preceded its change in economic strategy, but after 1978 economics became the core of national strategy. In the mid-to late seventies, China bought the whole Pacific Asian policy package, including:
- a reduced military budget;
- subordination of geopolitics to economic growth;
- strategic reliance on the United States;
- subordination of ideology to economic pragmatism;
- substantial subordination of politics to economics;
- acceptance of foreign corporations and technology;
- an increasingly market-oriented economy;
- encouragement of domestic economic competition; and
- an increasingly outward-looking economic and social posture.
There was a considerable payoff for the U.S. in the Cold War:
Washington used the Beijing connection to press for a solution to the Vietnam War, to play the China card against the Soviet Union, and to obtain a site on Chinese territory from which to monitor Soviet missile and nuclear testing. China played the Washington card in its dealings with Moscow; when Moscow put out a feeler about bombing Chinese nuclear facilities, Washington firmly sided with Beijing. These developments created a China that was militarily and ideologically non-threatening to its neighbors and to U.S. interests, and which was locked, however uncomfortably, into doing business according to Western rules.
And profound implications for regional security in East Asia:
China benefited, and followed the Pacific Asian pattern; Beijing gradually made peace with all its neighbors. Rapprochement with the United States and Japan in the 1970s was followed by rapprochement with the Soviet Union in the 1980s. The solution of troubling border problems began much earlier. China peacefully resolved major border disputes on the basis of the status quo with all those neighbors who would negotiate with it, including Burma, Thailand, Afghanistan, and Pakistan. (A few minor ones remain.) India and the Soviet Union were the two major countries that refused to negotiate, and in both cases this led to clashes, but by the 1980s these clashes were ancient history.
China abandoned international revolutionary fervor and embarked on a conservative policy of getting along with its neighbors. It withdrew support from revolutionary movements in Asia and elsewhere. In particular, the communist parties of Thailand, Malaya, the Philippines, Indonesia, and Burma, and revolutionary communists in India, lost the subsidies, arms transfers, revolutionary training, and propaganda support that China had once provided. Chinese scholars and officials made unusually frank apologies for their former support of revolutionary movements in southeast Asia....
In the course of improving its relations with ASEAN countries, and especially while normalizing diplomatic relations with Indonesia, China made a series of specific promises not to tamper in the affairs of its neighbors and to promote positive economic and political ties. By all accounts, Beijing has honored those promises. China also retracted its concrete support for revolutionary movements in Africa and Latin America. It ceased to frown on U.S. military bases in the region; particularly in private diplomatic discussions, China acknowledged that the U.S. military bases played a useful role in stabilizing the region. Previously, China had celebrated instability and even made great efforts to enhance it.
China went on the peace path in Southeast Asia, opening up diplomatic relations with both Singapore and Indonesia. Relations with Indonesia had been strained since the countries 1965-66 revolution, which Jakarta believed to have been triggered by a Beijing-supported abortive communist coup. Trade and travel increased with Singapore and Indonesia as well as with Malaysia. The latter had long been profoundly suspicious of China because of its past support for the Communist Party of Malaya, relayed through Malaysia's huge Chinese community. China also moved from antagonism toward Thailand's very capitalist, U.S.-aligned government to an effective alliance with it in opposition to Vietnam's takeover of Laos and Cambodia. In 1990-92, Beijing cooperated increasingly with Western diplomatic efforts to resolve the warfare in Cambodia; it curtailed weapons to the Khmer Rouge from 1990 onward. In 1990, China restored diplomatic relations with Vietnam, and in 1992 Premier Li Peng personally visited that country, following an earlier visit to Laos, in an effort to improve relations. Rapprochement with India came in 1993.
Most noteworthy of all was China's newfound conservatism toward its erstwhile ideological enemies, South Korea and Taiwan. The Chinese abandoned support of the North Korean confrontation with South Korea; on several occasions they actively intervened to prevent North Korean actions from threatening war on the peninsula. Most important, China intervened to dissuade North Korea from invading South Korea in the wake of the 1975 U.S. defeat in Vietnam. Recently, China has refused to help North Korea with its nuclear programs....
In addition, China conducted first an economic and then a diplomatic accommodation with South Korea, establishing normal diplomatic ties on August 24, 1992. Formerly, China had held that it would not recognize South Korea until the United States recognized North Korea. Now, North Korea was isolated...
...Perhaps most dramatically, China has conducted a rapprochement with Taiwan, which harbors Beijing's greatest opponents...
And really, world-wide US interests benefitted:
China also recognized Israel, signaling its abandonment of attempts to profit from extreme positions in the Middle East political disputes. When the question arose in the UN Security Council whether to permit "Operation Desert Storm" against Iraq, China merely abstained. This permitted the rescue of Kuwait to occur...
Remember the third world, and the North-South split mindset:
The sponsors of the New International Economic Order (NIEO) represented a majority of the world's countries and an overwhelming majority of the world's population. They believed that the world economy was unfairly organized by the rich countries in a way that condemned the poor countries to permanent dependence on the rich countries and therefore to insurmountable poverty. In this view, the rich countries were not partners in development but rather class enemies. The only way to break out of this poverty was a program that rejected multinational corporations, repudiated international banks, insisted upon national self-reliance rather than increasing interdependence, replaced the market for raw materials with a system of cartels, and reshaped world politics by building on the movement for such a new economic order. The real core of this program was a system of cartels. Each major commodity was to be controlled by a Third World cartel which would raise prices above market levels. Over all the individual cartels would be a supercartel. Similarly, the resources of the seabed would fall under the control of a gigantic organization run by the United Nations....
This political coalition, the institutions of the New International Economic Order, and the associated ideology of dependency theory were shattered by the rise of the smaller Asian economies and the subsequent success of China in following their lead.
China's example played a decisive role in the decline of the NIEO, even though China never disavowed the movement. Its switch into the Western camp moved a fifth of humanity out of the NIEO camp, and destroyed the alliance between communist radicalism and NIEO pauperism. While the success of the smaller countries had damaged the theory that Third World countries could not escape impoverished dependency, China's success undercut the popular argument that Taiwan and the others were just small special cases, and that the world economy could not accommodate any more entrants with this strategy...
Extracts from Overholt, pages 319-335
The past is not the future, and Chinese and US interests will inevitably collide in places like Central Asia. But the key message of this abstract from Overholt's book is that they do not collide on every margin; in many, important, areas, they have coincided in the past, and may continue to coincide.
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