They are the world’s two most powerful economies, deeply interlocked. But China and the U.S. are increasingly at odds — with vast implications.

China,U.S.

A Taiwanese Air Force fighter in the foreground flies on the flank of a Chinese bomber as they pass near Taiwan, 10 February 2020. (Republic of China Ministry of National Defense via AP)

The United States and China are increasingly at each other’s throats because of deep-seated distrust, a growing range of disputes and festering wounds from the 19th Century. The current deterioration in bilateral relations risks jeopardizing the global economy and could presage a new chapter in post-1945 great-power competition.

Their mutual antagonism has not been deeper since U.S. President Richard Nixon embarked on a landmark trip to “Red China” in 1972 to pave the way to normalized relations.

Ahead of the U.S. presidential election on November 3, disputes have flared over the handling of the coronavirus pandemic, Taiwan, the South China Sea, digital security, trade, journalist expulsions and human rights in Xinjiang, Hong Kong and Tibet.

Some experts describe the rancor as verging on a “new Cold War”, with the potential to disrupt bilateral cooperation in the fight against COVID-19, climate change, terrorism and the spread of nuclear weapons.

U.S. President Nixon in China

Nixon traveled to China during the Cold War struggle between the United States and the former Soviet Union. The start of formal ties between China and the United States was a game-changer: the two had been on opposite sides during the Vietnam War, but each was at odds with Moscow.

The trip set the stage for an effort to shape China’s strategic choices after the upheaval spurred by Chinese Communist Party Chairman Mao Zedong. Mao had sought to instill the spirit of China’s revolution in the younger generation during his tumultuous last decade in power (1966-76).

Mindful that the two countries’ systems were radically at odds, Nixon said in his 1972 icebreaking toast in Beijing: “If we can find common ground to work together, the chance of world peace is immeasurably increased.”

Nearly 50 years later, the relationship lies largely in tatters. Tensions have risen in recent days over self-ruled, U.S.-armed Taiwan, which China deems a breakaway province that must return to the fold. Taiwan scrambled fighter jets last week after Chinese aircraft buzzed the island in response to a visit by the highest-level U.S. State Department official in four decades.

Washington and Beijing have entered into a fundamentally new phase of their relationship, and that strategic distrust between them is likely to intensify regardless of who wins this November’s presidential election,” Kurt Campbell, a former U.S. assistant secretary of state for East Asian and Pacific Affairs, and Ali Wyne of the Atlantic Council’s Scowcroft Center for Strategy and Security, wrote recently.

Analysts attribute the mounting friction to a more confrontational U.S. administration under U.S. President Donald Trump and a more assertive China under President Xi Jinping.

Xi became General Secretary of the Chinese Communist Party in 2012 and added the state presidency in March 2013. Later in 2013, China began building military outposts in the contested South China Sea, and Xi launched the Belt and Road Initiative, a vast plan to build infrastructure links — and increase China’s influence — across the globe.

The China-U.S. rift could put pressure on some nations to choose sides, as during the 1947-91 Cold War, or to tweak the hedging strategies that some have adopted to remain neutral.

Trump and Xi, loath to compromise

The path to warmer China-U.S. ties is very narrow, “as the required compromises go against the instincts of both countries’ current leaders,” Carnegie Asia research program’s Yukon Huang, a former World Bank country director for China, wrote this month in an analysis.

Both Xi and Trump came to power with strong populist agendas, each vowing to return their countries to some vision of past greatness. Seeking reelection, Trump has accused his Democratic opponent, former Vice President Joe Biden, of being soft on China.

“If Joe Biden becomes president, China will own the United States,” Trump said last month.

Referring to COVID-19 by turns as “the China virus,” “Wuhan virus” and “Kung Flu,” Trump has faulted China for “secrecy, deceptions, and cover-up” in its handling of the disease that emerged in the central Chinese city of Wuhan late last year.

“We must hold accountable the nation which unleashed this plague onto the world, China,” Trump said in taped remarks delivered to the United Nations General Assembly this week. More than 200,000 Americans have died from COVID-19, more than in any other country.

Xi, in his address to the General Assembly, called for enhanced cooperation over the pandemic and said China had no intention of fighting “either a Cold War or a hot war with any country.”

At home, Xi cannot afford to appear weak in the face of foreign demands, and he is bound to his signature “Great Chinese dream,” a drive for greater prosperity for the 1.3 billion Chinese, a larger role on the world stage and international respect consistent with China’s military, financial and economic influence.

Beijing is angry over what it calls foreign provocations, including protests in Hong Kong it claims were stirred by outsiders, growing U.S. arms sales to Taiwan, visits by senior U.S. officials to Taipei and U.S. moves against Chinese companies including telecom giant Huawei and social media apps TikTok and WeChat.

U.S. Secretary of State Mike Pompeo has stepped up criticism of the ruling Communist Party of China, which he says is seeking global hegemony.

We must admit a hard truth that should guide us in the years and decades to come,” he said in a July 23 speech at Nixon’s boyhood home and library at Yorba Linda, California.

“That if we want to have a free 21st century, and not the Chinese century of which Xi Jinping dreams, the old paradigm of blind engagement with China simply won’t get it done. We must not continue it and we must not return to it,” he said.

Alluding to the 90 million-plus member Chinese Communist party, Pompeo added: “We must also engage and empower the Chinese people – a dynamic, freedom-loving people who are completely distinct from the Chinese Communist Party.”

 “Century of National Humiliation”

In Beijing’s eyes, the Trump administration has been meddling in Chinese internal affairs, threatening its core interests and leading efforts to contain China, which still smarts from what it calls “a century of humiliation,” largely at Western hands.

The “long century” of 110 years was marked by carve-ups of Chinese territory by Britain, the United States and other Western powers, as well as by Russia and Japan, from 1839 to 1949, when Mao’s Communist Party seized power after a five-year civil war.

A trade war that roiled the world in 1839 pitted Britain against China’s Qing Dynasty. Britain had been buying silks, porcelain and tea from China. But Chinese consumers had scant interest in British-made goods, and Britain started running a significant trade deficit with China.

To address the trade imbalance, British firms began illegally smuggling in Indian-grown opium, fueling drug addiction in China. The balance of trade soon turned in Britain’s favor, but a Chinese crackdown led to the first Opium War between Britain and China from 1839 to 1842.

After defeating the Chinese in a series of naval conflicts, the British put a series of demands to the weaker Qing Government in what became the Anglo-Chinese Treaty of Nanjing. Not to be outdone, U.S. negotiators sought to conclude a similar treaty with the Chinese to guarantee the United States many of the favorable terms awarded the British, according to “Milestones in the History of U.S. Foreign Relations,” a U.S. State Department publication.

Long underpinning the Chinese Communist Party’s hold on power have been inequitable treaties, lingering resentment over the earlier era’s losses and extraterritorial laws imposed on China.

China learnt its lessons from this period of time,” Lu Jingxian, deputy editor of the state-controlled Global Times tabloid, wrote in a column last year. “Lagging leaves you vulnerable to bullying.”

“Chinese people have walked out of the pathos of century of humiliation, though the West seemingly wants its century of bullying to continue,” he said.

Meteoric Rise

China stunned the world with the depth and breadth of its economic growth after embracing market-based reforms in 1978, just before formal relations with the United States began in January 1979.

It is now projected to supplant the United States as the world’s biggest economy by 2030 or 2040. Scholars consider the bilateral relationship to be the 21st Century’s most consequential for the international order.

China’s meteoric rise began under Deng Xiaoping, who gradually rose to power after Mao’s death and earned the reputation as the architect of modern China. His market-oriented policies transformed one of the world’s oldest civilizations from crushing poverty to a modern powerhouse in military matters, finance, technology and manufacturing.

China has become the world’s largest manufacturer, merchandise trader, holder of foreign exchange reserves, energy consumer and emitter of greenhouse gases.

It became the world’s largest economy on a purchasing power parity basis in 2014, according to the McKinsey Global Institute.

With economic growth averaging almost 10% a year since 1978, China has doubled its Gross Domestic Product every eight years and lifted an estimated 850 million people out of poverty, according to the World Bank.

China is the largest foreign holder of U.S. Treasury securities, which help fund U.S. federal debt and keep U.S. interest rates low — reflecting the interdependence of the two economies.

South China Sea

Since Trump was elected in 2016, tensions have risen in the disputed, resource-rich South China Sea (SCS).

They spiked in mid-July when the U.S. State Department for the first time formally opposed China’s claim to almost all of these waters, calling it “completely unlawful, as is its campaign of bullying to control them.”

The United States will keep up the pace of its freedom of navigation operations in the SCS, which hit an all-time high last year, U.S. Defense Secretary Mark Esper said at the time.

Four Southeast Asian states — Brunei, Malaysia, the Philippines and Vietnam — have maritime claims that conflict with China’s, as does Taiwan. An estimated $3.37 trillion worth of global trade passes through the SCS annually, which accounts for as much as a third of global maritime trade.

Over the next 18 months, “a let-up in tensions is unlikely,” Ian Storey, co-editor of Contemporary Southeast Asia at Singapore’s ISEAS Yusof Ishak Institute, wrote in a recent survey of the dispute.

“China and the United States will increase their military activities in the South China Sea, raising the risk of a confrontation,” regardless of who wins the U.S. presidential election, he said.

Beijing’s actions in the region have strengthened a conviction on the part of some U.S. strategists that Beijing is seeking control of an area of strategic, political and economic importance to the United States and its allies.

Taiwan

The future of Taiwan, an island democracy of 23.6 million people, is a core concern for Beijing.

Taiwan has been ruled separately since Chiang Kai-shek’s Nationalists fled there after losing the Chinese civil war in 1949. Beijing views Taiwan as sovereign territory that must eventually be unified with the mainland.

Last month, Alex Azar, the U.S. Secretary of Health and Human Services, met President Tsai Ing-wen of Taiwan in the highest-level visit by a U.S. official since Washington cut formal ties to the island in 1979. As a condition for establishing bilateral relations with Beijing at the time, the United States committed to maintaining only unofficial relations with Taiwan.

In a further poke at Beijing, a senior State Department official traveled to the island this month in another high-profile visit. The decision to send Keith Krach, Under Secretary of State for Economic Growth, Energy and the Environment, amounted to a rebuke of China’s efforts to isolate Taiwan.

Chinese military drills off Taiwan’s southwest coast this month were a “necessary action” to protect China’s sovereignty, Beijing said on September 16, after Taiwan complained about large-scale Chinese air and naval drills.

Hong Kong, Xinjiang

Another rub has involved Hong Kong, a former British colony and a world financial center that was guaranteed a measure of autonomy by China as part of negotiations for its 1997 return from Britain.

In May, Trump said he was taking steps to end Hong Kong’s preferential trading status with the United States after China enacted a harsh new security law. The law in effect rolls back the semiautonomous status that had been promised to Hong Kong by Beijing under the mantle of “one country, two systems.”

In June, Beijing threatened retaliation after Trump signed legislation calling for sanctions against those responsible for repression of ethnic Uighurs and other Muslims in western China’s Xinjiang region. The U.S. State Department has accused Chinese officials of subjecting Muslims to torture, abuse and “trying to basically erase their culture and their religion.”

Trump did not hold a ceremony to mark his signing of the legislation, which came as newspapers published excerpts from a new book by Trump’s former national security adviser John Bolton. Among other allegations, Bolton said Trump sought Xi’s help to win reelection during a closed-door 2019 meeting and that Trump said Xi should go ahead with building camps in Xinjiang.

Trump and Xi have refrained so far from ad hominem personal attacks on each other, leaving a door ajar for possible one-on-one efforts to halt the deterioration in ties.

Three questions to consider:

  1. Why have Chinese-U.S. relations spiraled downward?
  2. What are the main concerns of each country?
  3. What are the implications of the situation for the world?
Alistair Lyon author news decoder-150x150

Jim Wolf reported for AP-Dow Jones, AFP, Jane’s Defence Weekly and Reuters for nearly 40 years, based in New York, Paris, Bangkok and Washington. Wolf taught at the Shanghai International Studies University in China 2015-17.

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World China Decoder: Why China and the U.S. are on a collision course