The following is an English translation of an article by Martin Jacques that appeared in the People’s Daily, 24th December 2018. Read the Chinese version published in a shortened form here.
In 2016 populism, as it became known, burst onto the Western political stage in two dramatic events: Britain’s decision in a referendum to leave the European Union, followed by the election of Trump as US president. There was much debate as to what they meant, in particular to what extent they marked a deeper and longer-term shift in Western politics. Both events took most Western commentators – and, indeed, others elsewhere including China – by surprise. Initially the predominant view was that Trump’s election would not mark such a sharp break in policy as his rhetoric suggested. For most, continuity was still the prevalent expectation. But this argument became increasingly difficult to sustain and now, as we look back on 2018, it is clear that rupture rather than continuity has been the overriding characteristic of US politics, and Western politics more generally, since 2016. We are in very new times.
The reasons are profound. The trigger for the shift was undoubtedly the Western financial crisis in 2007-8, though the political repercussions of this took the best part of a decade to become apparent. The crisis served to undermine the previously dominant ideology, neo-liberalism, and, even more pertinently, respect for and a belief in the governing elites and their institutions. This is clearly the case in the United States but is no less true of most European societies: indeed, the UK and Italy, and to a lesser extent France, are facing a huge crisis of governance. The previous overarching commitment to globalisation, which for most had become an article of faith, was undermined, most obviously in the United States, but in varying degrees in every Western country. This process has been driven by a growing realisation that a large number of people, previously ignored but now increasingly vocal, had been negatively affected by globalisation. In its place has come a resurgence of nationalism and a revival of the nation-state. During the heyday of globalisation between 1980 and 2006, there was an overwhelming view in the US that globalisation was in the country’s interests, that the process of globalisation was synonymous with westernisation: that attitude has now been reversed and globalisation has been increasingly painted as in the interests of other countries, notably China, and against that of the US.
A central feature of Trump’s presidential election in 2016 was his argument that China was responsible for many of America’s economic problems, that it had cheated its way to economic growth and prosperity at America’s expense. It was not until 2018, however, that this argument began to be implemented in practice with the introduction of 10% tariffs on a range of Chinese imports and the threat of extending this to all Chinese imports and raising the level of tariffs to 25%. This was combined with a demand that China should cease insisting that US firms engage in technology transfer and that China should stop giving state subsidies to the key growth industries of the future. As a result, relations between China and the US have seriously deteriorated and become increasingly tense. Exactly how far this will go is not clear, but the move against Huawei’s Meng Wanzhou and Vice-President Mike Pence’s no-holes barred demonization of China in his speech at the Hudson Institute in October, which would not have out of place in the worst days of the Cold War, are hardly encouraging. The direction of travel of US policy is all too clear.
The relationship between the US and China is very different to that between the US and the USSR. The latter was a completely bifurcated system, the two existing in virtual economic and political isolation from each other. In contrast, China is deeply integrated with the rest of the world, such that the growth and prosperity of many countries – and indeed many US corporations – is intimately bound up with that of China. That is one of the great achievements of Deng Xiaoping’s reform and opening up. Many parts of the world – most notably East Asia and Africa – enjoy a much closer economic relationship with China than they do with the US. It is impossible for the US to excise China from the global economic system in order to create a bifurcated system in the manner of the Cold War. We are witnessing something different: an attempt to denigrate China and thereby turn other countries against it, to create more disadvantageous circumstances for China’s development, especially in the crucial technology industries of the future, and to weaken multilateral institutions in order to strengthen the position of the US and weaken that of others, be it the European Union or, above all, that of China. This helps to explain the present American attempt to undermine the WTO and to render it increasingly impotent; likewise, its refusal to allow an increase in the IMF’s resources, which in part is driven by a concern about China’s increasing influence within it and in part because the US objects to the IMF giving financial assistance to countries like Pakistan which are heavily involved in the Belt and Road Initiative.
Whatever some in the Trump administration might like, it is impossible to unwind history and recreate a world in which the United States enjoys the kind of overwhelming power that enabled it to dominate its relations with all others in the postwar period: the growth of globalisation and interdependence, the transformation of the developing countries and the dramatic rise of China means that such a scenario is now inconceivable. But try they will – and fail they will – but it remains to be seen in the meantime how much progress the Trump administration can make in this direction. For the time being at least, ever since he took office in January 2018, Trump has succeeded in changing the prevailing mood music and contributed to a certain global momentum in this direction. The obstacles that face him, however, are formidable and will ultimately prove insurmountable; but it would be a mistake to count on any such reversal being imminent. On the contrary, we should think of this as the new long game not a relatively transient moment.
Certainly it would be a mistake to think of the shift in US strategy as a temporary phenomenon. It is a belated response to the progressive decline in relative US economic strength and influence, well-captured in the slogan ‘Make America Great Again’. It has deep roots in those sections of American society, most importantly the white male working class in the mid-West, that have suffered from globalisation. And it is also a response to the failure of the consensual belief amongst America’s governing elite that China would never pose a threat to the hegemonic position of the United States, which underpinned the relatively benign American attitude towards China from 1972 to 2016. The latter was based on two closely related assumptions: first, that China would never rival the US economically; and second that, as China modernised, it would inevitably become a western-style democracy, failing which its economic transformation would prove unsustainable. On both counts, this shibboleth of American thinking was profoundly mistaken: China’s economic transformation continued unabated to the point where its economy is now second in size only to that of the United States and closing rapidly; and its political system, far from disintegrating, is proving to be both robust and highly effective. This is the great achievement of reform and opening up in 1978, one of, if not the, most significant event of the twentieth century.
The causes of the shift in US strategy, in other words, are profound and, certainly in the case of China, essentially bipartisan. We should not expect a return to the status quo ante either in regard to the new contours of US foreign policy or concerning the US attitude towards China. We are witnessing a major historical shift. The last great shift in US international strategy was in the early 1980s when it embraced globalisation and neo-liberalism. It is now clear that the US-China relationship between 1972 and 2016 depended in very large measure on the fundamental inequity in the relationship between the two; as that gap closed, so the relationship became increasingly tense and difficult. The US could not – and cannot, at least for the foreseeable future – bring itself to countenance the idea that the rise of China might threaten its global primacy.
We have entered a new era in the China-US relationship. There will be no return to the previous era. The new one, which should be seen as more or less indefinite, certainly lasting for a minimum of a decade, probably much longer, will be characterised by conflict, tension and rivalry. It will be a major challenge for the Chinese leadership, requiring a new mindset and strategic approach. On the one hand, China must stand firm on those things that it regards as fundamental to the Chinese interest, for example the essential principles of reform and opening-up, crucially the role of the state sector, including its support for China’s burgeoning technology sector. On the other hand, it needs to find a way of working with the US and constraining its most aggressive instincts. This will be very important for the health of the global economy and global peace. But in the new and very different global context, the United States is not the only audience or party that matters. As the United States seeks to decouple from China, or at least to reduce its dependence on China, it is also trying to persuade others to do likewise. China must resist this. This will demand that China finds new ways of collaborating with other countries, seeks new areas of common ground, most importantly, in this context, with the European Union and Japan. The danger is that, under intensified US pressure, they will move away from China and play in some degree the American game. The recent improvement in Sino-Japanese relations is a step in the right direction.
It is already clear that the US is seeking to weaken China’s influence in the developing world. Where previously the former largely ignored the Belt and Road Initiative, during 2018 the US has become increasingly vocal in its opposition to it. Likewise the US is now seeking to make up for lost ground in Africa. It is highly unlikely that the US will make much progress in these areas given how little it has to offer in comparison with China: nonetheless, we should expect the developing world to become an area of growing competition between the two countries.
The importance of how China handles its relations with other countries has been magnified by its growing strength. When it was weak, China was largely ignored, invisible to most. But now China is in the process of becoming a great power, and in some respects has already achieved that status, it is far more visible and is seen as far more accountable for its actions than was previously the case. What China does, its views and its achievements, are now the subject of global debate. There is a negative aspect to this. China’s sheer demographic size, huge compared with every other country in the world apart from India, is a cause of anxiety and sometimes fear. China cannot do anything about its size, it is a fact of its existence, but by the same token the nervousness that it kindles will also not go away. And as China grows ever stronger, this anxiety is likely to grow. The era of being good at maintaining a low profile and never claiming leadership may be over but it remains a valuable lodestar even when China is strong, in some ways even more so. As China becomes ever more powerful, it should not lose the caution and humility that has accompanied its rise. In the increasingly conflictual world that is unfolding, hubris would be China’s worst enemy. It must redouble its efforts, as it is seeking to do, to build friendly relationships with as many countries in the world as possible.