Managing U.S.-Relations with China

Managing U.S.-Relations with China

April, 1996

No one would now dispute the judgment of Chinese Premier Li Peng that "Sino-American relations are highly volatile." The uncertainties affecting Washington�s ties with Beijing have raised a large question mark over prospects for continued peace and stability in the Asia-Pacific region. There is rising apprehension among businessmen and academics in both countries that escalating political and military tensions between the two governments over a widening range of issues could soon blight their flourishing economic and cultural interaction. In both Beijing and Washington, discussion of Sino-American relations now ponders the adverse consequences of estrangement and strategic hostility rather than the advantages of friendship and entente. Some in both China and the United States foresee a twenty-first century dominated by contention between Beijing and Washington. Few are optimistic about Sino-American relations. Almost no one seems to envision the possibility of broad cooperation between the United States and China in the coming decades.

The contrast with the late Cold War period, from 1971 to 1989, when five successive American and Chinese administrations worked to advance a positive vision of Sino-American relations, could not be more stark. Over those years, relations between Washington and Beijing improved fairly steadily, though with some setbacks. They did so under three guiding principles.

Sino-American Rapprochement

First, in the words of the Shanghai Communiqu� of 1972, both sides recognized that "there are essential differences between China and the United States in their social systems and foreign policies." By mutual agreement, Washington and Beijing nevertheless avoided ideological arguments. Instead, they conducted an active dialogue to seek common ground for joint, parallel, coordinated or at least deconflicted policies. By adopting this approach, both sides sought to create an auspicious context for isolating and narrowing their differences step-by-step. This worked. China changed a great deal more than the United States as a result.

Second, the two sides worked together to integrate China into global and regional institutions. Washington sought thereby both to expand the effectiveness of these institutions and to transform China from a threat to the existing world order into a stabilizing element of it. This also worked. When China was admitted to the "club," it accepted and learned to play by club rules. For example, China's accession to the World Bank facilitated its adoption of a market economy. Its membership in the United Nations led in time to its accession to the Nuclear Non-Proliferation Treaty, its support of UN actions to liberate Kuwait from Iraqi aggression, and its participation in the successful UN peacekeeping effort in Cambodia.

Third, the two sides sought to promote conditions conducive to peaceful resolution of the problems arising from China's division into very different societies on the Chinese mainland, in Hong Kong and Macao, and on Taiwan. This also worked. By contrast with India, which took Goa by force, China negotiated the peaceful retrocession of both Hong Kong and Macao. Tensions in the Taiwan Strait abated, allowing Taiwan to end martial law and blossom into a prosperous democracy. Peaceful dialogue and interaction replaced confrontation between Taipei and Beijing.

Sino-American Estrangement

The two U.S. and two Chinese administrations that have been in power since 1989 have abandoned these principles in favor of a different approach. The results speak for themselves. Rather than continuing the search for common ground, Washington and Beijing have focused on their differences, especially essentially irreconcilable ideological differences over issues like human rights and Tibetan separatism. They have deferred discussion of possible common interests and the harmonization of their policies to a later date, which never seems to come. The result has been bickering and posturing by both sides, punctuated by occasional acts or threats of retaliation by each side against perceived slights from the other. Each side distrusts the other.

Meanwhile, neither Chinese nor American leaders have made any real effort to develop a post�Cold War rationale for cooperative relations. The policy vacuum left by the collapse of the Soviet Union and the consequent disappearance of the Washington-Beijing-Moscow strategic triangle has, therefore, remained unfilled. The result has been strategic drift in Sino-American relations; U.S. policies driven by Congress and special interests rather than the administration; and Chinese policies based on the conviction that the United States seeks to dismember China, overthrow its government, and frustrate its economic modernization.

At the insistence of Asian nations, China has been admitted to regional institutions like the Asia-Pacific Economic Cooperation (APEC) forum and the ASEAN Regional Forum (ARF). The United States, however, has ceased to make any effort to integrate China into global institutions. New organizations, like the Missile Technology Control Regime (MTCR), the World Trade Organization (WTO), and the "New Forum" (the successor to CoCom), exclude China. The end of the effort to include China in international regulatory regimes has slowed the process of bringing Chinese behavior into conformity with global norms favored by the United States. This has let China pick and choose the rules it will play by. Even more damaging, it has left matters of worldwide and regional concern to be dealt with as issues in U.S.-China bilateral relations, rather than as multilateral concerns. American attempts to act as the world's conscience in forcing global norms on China have, more often than not, left the United States isolated from or unsupported by its allies.

Taiwan's newly democratic politics have led it to challenge the diplomatic status quo, and hence to upset the previous modus vivendi in the Taiwan Strait. Taipei has enlisted the support of the U.S. Congress in its drive to overturn long-standing agreements between Washington and Beijing. Under congressional pressure, the U.S. executive branch has altered its policies on arms sales and cabinet-level dialogue with Taipei, as well as on visits by Taiwan's leaders, while brushing aside Beijing's protests with increasingly unpersuasive denials that there has been any policy change.

Meanwhile, Washington has shrunk from dialogue with either Beijing or Taipei about how to preserve and enhance the prospects for peaceful cross-Strait relations. In the absence of such dialogue, Beijing has lost confidence in the U.S. administration's willingness to adhere to Sino-American agreements on the management of the Taiwan problem, while Taipei has fallen into the habit of using Congress to end-run or roll the administration. Lee Teng-hui's visit to Cornell last June�a private visit undertaken for official purposes and for domestic political advantage in Taiwan�is a case in point. This event, more than any other, served to convince Beijing that Washington might collude with separatist forces in Taipei to detach the island once and for all from China. Chinese on both the mainland and Taiwan read the visit as a signal that Taipei could count on American backing for policies provocative to Beijing, regardless of the views of the U.S. executive branch.

The absence of an American vision of how to manage relations as China rises to wealth and power equivalent to that of the United States has been matched by the absence of a vision in China of how it should conduct itself as a great economic and military power. Both countries stress the need to talk with each other but neither seems to know what to talk about. In practice, the United States has talked to China only when it has had a congressionally mandated peeve to register or a sanction to threaten. China has talked to the United States only when it has had a protest to register or a retort to deliver. There has been no broader dialogue to set a positive agenda for Sino-American relations.

Why Talk?

The sudden return of tensions in the Taiwan Strait after more than a decade of peace has stimulated Washington to propose more frequent and intensive high-level talks with Beijing. This again raises the question: talks about what? What does the United States want from China? How does the United States propose to get it?

The answer is that the United States needs to talk to China about American interests that cannot be advanced and issues that cannot be managed or resolved without contributions from China. There is a rapidly growing list of such interests and issues.

1) China is the world's most populous country and the world's fastest growing economy. Many economists predict that China will overtake the United States as the world's largest economy sometime in the next twenty-five to thirty years. No effort to regulate global trade and investment to assure the common prosperity can succeed if China is not part of it.

2) China is now the only great power to have had significant parts of its territory detached by the actions of other great power�European powers in the cases of Macao and Hong Kong; Japan and the United States in the case of Taiwan. China is determined not to allow these imperialist and Cold War divisions of its territory to become permanent. The United States has an indirect but substantial stake in the success of the agreed transitions in Hong Kong and Macao. America has an even larger stake in assuring that changes in the relationship between Taipei and Beijing take place peacefully, by agreement between them, rather than through unilateral action from either side.

3) China lacks secure and recognized borders. It will establish such borders�by negotiation, if possible; by force, if necessary. The list of minor territorial adjustments to be worked out between China and its neighbors is long: seabed boundaries with both Korean states; the Senkaku (or Diaoyutai) archipelago with Japan; and in the "no man's land" of the South China Sea, territorial disputes with the Philippines, Vietnam, Malaysia, and Brunei, as well as a seabed dispute with Indonesia; and an unsettled border with India. The United States has a big stake in peaceful adjustment of these disputes. Each requires only relatively small compromises for resolution. In the aggregate, however, how such adjustments are arranged will determine whether the Western Pacific is peaceful or tense, and whether United States�China relations are cooperative or confrontational.

4) China's industrial and technological capacity are rapidly advancing along with China's involvement in international trade. No effort to regulate the global transfer of sensitive technology or weaponry can hope to succeed if China is not part of it.

5) China is the fastest growing contributor to greenhouse gas emissions on the planet. It is now second only to the United States as a contributor to global warming, and will soon overtake the United States. No attempt to address global environmental problems can succeed if the United States and China are not full partners in it.

6) China is the largest country in Asia. Its territory is now being used by international drug traffickers and organized crime. Its people are being smuggled to the United States and other countries under conditions that rival those of the African slave trade of two centuries ago. Neither drugs, crime, nor illegal migration can be combated successfully without effective cooperation between the United States and China.

A Positive Agenda for U.S.-China Dialogue

The failure of the approach to United States-China relations adopted since 1989 suggests that both countries would be wise to return to a broad dialogue under the principles that worked from 1971 to 1989. The factors listed above suggest a ten-part agenda for positive American engagement with China to advance U.S. interests.

1) What are the responsibilities of the United States and China�as two of the world's greatest powers, both permanent members of the United Nations Security Council�for the maintenance of a stable and decent world order? This is not an abstract question. The recent Sino-American contretemps over the extension of UN intervention in Haiti illustrates the perils of Sino-American discord in the Security Council. The successful UN operations in the Gulf and Cambodia illustrate the benefits of a harmonious Sino-American working relationship.

2) What are the responsibilities of the United States and China, as two of the world's largest economies, for the management of trade and investment policies to maximize global, regional and bilateral prosperity? How can we promote Sino-American cooperation to these ends? In this connection, it is clearly an anomaly that Russia's declining, semi-marketized economy is represented in the G-7, while China's rapidly growing market economy is not. Should China not be invited to join the G-7? Similarly, the global trading system envisaged by the WTO cannot hope to function effectively if China's economy is outside it. How can the United States achieve the most rapid feasible phase-in of WTO policies and practices by China? Given the relatively primitive state of Beijing's legal and administrative capabilities, does China require assistance to enable it to speed up such a phase-in and make it fully effective? If so, how can the United States and other major members of the WTO most efficiently provide such assistance to China?

3) How can the United States and China work together to ameliorate the effects on the global environment of China's rapid industrialization and urbanization?

4) How can the United States and China best assure strategic stability in Asia? Specifically, how can Japan be reassured that its national security will not be threatened as Chinese power grows? Neither China, nor the United States, nor the Japanese people themselves wish Japan to feel forced to rearm or to pursue independent military policies in Asia. How can the United States and China best help Japan to avoid feeling it faces such choices? How do the two countries manage the inevitable reemergence of Russia as an active strategic player in the region early next century so as to buttress rather than threaten Asian strategic stability? How can the United States facilitate peaceful settlement of the long list of relatively minor Chinese territorial disputes with its Asian neighbors.?

5) Can the United States and China, as the two greatest military powers in Asia, translate their common interests in the prevention of war and the relaxation of tensions in Korea, South Asia, and the Persian Gulf into parallel or coordinated policies that promote these objectives?

6) If the two countries can do this, how can they work together to prevent the proliferation of weapons of mass destruction and their delivery systems to these regions�all of which are far closer to China than the United States? It has clearly not been effective to insist bilaterally that China harmonize its policies and export control practices with those of the United States and other members of the Missile Technology Control Regime, the Australia Group, the Nuclear Suppliers Group, and the New Forum. If China is not a member of the club, it does not feel bound by club rules. China needs to be brought into these groupings as a member in its own right, rather than left outside them to act in disregard or defiance of their decisions.

7) How can the United States and China work most effectively together to suppress the international trade in narcotics, to frustrate international crime, to curb illegal migration, to prevent hijacking, piracy, and terrorism?

8) Can China build the central government institutions and national administrative and judicial structures it needs to be able to do what we want it to do? Where China has reached agreement with the United States but lacks the administrative skills and capabilities to assure the immediate, full, effective implementation of what it has agreed to�as is the case with the Sino-American agreement on intellectual property rights� it does little good and much harm to charge the Chinese with lack of sincerity. Rather than threatening to cut off billions of dollars in American sales to China and cost tens of thousands of American workers their jobs, Washington should be prepared to spend a few hundred thousand dollars to work with China to fix problems both sides agree need fixing. If the U.S. Government can't find the money to do this, could it not help coordinate a private sector effort to fund foundations or other non-governmental organizations to do the job?

9) Is there not room for American cooperation, as well as contention, with China on human rights? Beijing increasingly recognizes the need for the rule of law. China wants to build a modern legal and judicial system. Such a system is essential not only to protect the rights of individual Chinese but also to provide the dispute resolution mechanisms and predictable business climate essential to trade and investment decisions in a market economy. The United States helped the Chinese authorities in Taipei to strengthen legal institutions and the rule of law even as Washington continued to call violations of human rights to Taipei's attention. This approach also worked Korea. Why abandon it in favor of an approach to human rights in China based only on public castigation and condemnation?

Washington needs to put its money where its mouth is on human rights in China. If China's nineteenth-century living standards produce Dickensian horrors in Chinese orphanages, the United States should not hesitate to call these horrors to the attention of the Chinese government. But, at the same time, Americans should work with the National People's Congress and relevant Chinese ministries to help them correct such abuses. Similarly, Americans should work with the Ministry of Justice and the Chinese judiciary to strengthen legal education for judges and to improve judicial administration. It took time for Koreans and for Chinese in Taiwan to build the rule of law and respect for human rights. It will take time for Chinese on the mainland to do the same. But, it will take less time with American. help than without it.

10) How can the United States manage the question of Taiwan and promote the American interest in a modus vivendi and peaceful settlement between Beijing and Taipei? Taiwan's politics may have changed, but its geographic position has not. Taiwan cannot enjoy security without either a working relationship with Chinese across the Strait or strong backing from a powerful enemy of China. Does the United States wish to play the role of such an enemy of China?

The Taiwan Problem Reemerges

Until last year, under conditions buttressed by American diplomacy, both Taipei and Beijing assumed that there were only two possible futures for Taiwan�the status quo, as amended by peaceful interaction across the Taiwan Strait, or some sort of agreement on reunification. In these circumstances, there was a modus vivendi. Taiwan was not an urgent issue for Beijing. Nor were relations with the Chinese across the Strait an urgent issue for Taipei. Tensions in the Taiwan Strait greatly diminished. Reassured by restrained but substantial U.S. sales of defensive weapons, Taiwan's growing sense of security allowed it to end martial law. The island prospered and emerged as a wealthy, democratic society. Chinese on the mainland did not object to this. Indeed, they benefited from it.

Over the past decade, interaction across the Strait increased at a dizzying pace. A million and a half people from Taiwan now visit the mainland each year. The mainland is Taiwan's largest export market. Taiwan's entrepreneurs have invested perhaps $25 billion there. Taiwan's experience in the modernization of Chinese society is being successfully exported to the Chinese mainland. There is no part of the mainland, however remote, that Taiwanese are not involved in modernizing. The influx of ideas from across the Strait, including the staging of local elections throughout the mainland under procedures modeled on the initial stages of democratization in Taiwan, has steadily increased the prospects for the ultimate emergence on the mainland of a more decent civil society. These developments have been good for Taiwan, good for China, good for Asia, and good for the United States. They have represented a major achievement for U.S. foreign policy.

U.S. policies have been based on the recognition that American interests are far better served by the gradual coming together of the two sides of the Strait than by their separation. These policies heretofore have promoted rather than opposed rapprochement across the Strait. They have favored the creation of conditions conducive to negotiation between Taipei and Beijing and resisted unilateralism from either side.

The rebirth of tensions in the Taiwan Strait is the result of the breakdown of this policy framework. It arose as a result of Taiwan's dissatisfaction with the status quo, which denied Taiwan the international recognition to which it felt entitled as a modernized, democratic society and a major trading economy. In the absence of a firm hand in Washington, Taipei's unilateral actions to alter the status quo have led to Beijing's unilateral actions to enforce it. As Taipei has sought to introduce the idea of "two Chinas" or "one China, one Taiwan" as alternatives to either the status quo or reunification, the modus vivendi that had benefited both sides (as well as the U.S. interest in peace and stability in the Western Pacific) has collapsed. American diplomats brokered the emergence of that modus vivendi. If it cannot be restored, the United States will face a stark choice between joining Taiwan in war with the People's Republic of China or accepting the eventual conquest of Taiwan by the People's Liberation Army (PLA). In either case, Taiwan's prosperity and democracy are likely to be among the principal victims.

From Beijing's point of view, Taipei's "pragmatic diplomacy" over the past two years has seemed intended to acquire the attributes of independent statehood one by one, on the diplomatic installment plan. This diplomacy has sought to raise Taiwan's international profile as a political entity separate from "China." Taipei has worked hard to establish diplomatic relations and set up embassies in capitals where Beijing is also represented. (This approach has registered success mainly in impecunious African capitals.) Taipei has also offered the United Nations $1 billion for a separate seat for Taiwan in the General Assembly. Beijing, not surprisingly, has interpreted these initiatives as an effort to establish Taipei as the capital of a separate state� something Beijing has always said it would not tolerate.

Beijing Confronts Taipei

When political means failed to produce a change of course by Taipei, Beijing turned to military means. Despite the sound and fury in the Taiwan Strait, however, Chinese objectives have remained limited. Beijing has not sought to make Taiwan do anything in particular. It has aimed instead at persuading Taiwan to stop doing things that appear to challenge the status quo or to prejudice prospects for ultimate reunification across the Strait. But the strategic costs to China of its military shows of force have been quite disproportionate to Beijing's modest objectives. The PLA�s actions in the Taiwan Strait have provoked U.S. naval deployments to counter them. American and Japanese concern about long-term Chinese intentions toward Taiwan and other territorial issues has grown. The rise of anti-China sentiment in the United States and Japan has been matched by an upsurge of anti-Americanism in China. Even under the best of circumstances, the resulting suspicion and hostility will not soon abate.

Ironically, Beijing does not seek reunification with Taiwan anytime soon. Chinese leaders have said they will address this issue with Taipei only after the reintegration of Hong Kong and Macao has been accomplished. That means sometime well after 1999, under a new generation of leaders in both Beijing and Taipei. Even if Beijing is determined that it must invade and conquer Taiwan, it would take at least a decade to complete the military buildup necessary to guarantee success.

Nor does Beijing propose to roll back Taiwan's democratization, though it has been convenient for some politicians in Taiwan to make that claim. Even under its proposals for reunification, Beijing does not seek to alter Taiwan's political or economic system. The issue for China is not how Taiwan selects its leaders or how these leaders make decisions. The issue is the decisions Taiwan's leaders make.

Toward a Renewed Modus Vivendi in the Taiwan Strait

Taiwan's newly reelected president, Lee Teng-hui, has given every indication that he understands the need to restore a modus vivendi with Chinese across the Strait. To do this, he will have to refrain from further actions that provoke Beijing, standing down from "pragmatic diplomacy" while stepping up emphasis on cross-Strait relations. China's leaders, in turn, must respond by halting further military maneuvers and reopening dialogue with Taipei. The PLA's actions have greatly increased the percentage of Taiwan's electorate that prefers prolonging the status quo to making decisions about either reunification or independence. Similarly, the strategic costs of military confrontation with Taiwan have given China's leaders pause. A basis thus exists for mutual restraint to refashion a new cross-Strait modus vivendi.

Unfortunately, the Sino-American naval confrontation over Taiwan complicates the prospects for such restraint in both Taipei and Beijing. It has re-emboldened those in Taiwan who count on being able to enlist the United States (or at least the U.S. Congress) in backing their drive for separation from China. This will make it harder for Lee Teng-hui to face down hotheads in Taiwan who favor continued defiance of the mainland. The U.S. deployments have inflamed anti-American sentiment on the Chinese mainland, especially in the PLA. This will make it harder for President Jiang Zemin and other civilian leaders in Beijing to argue for a return to peaceful engagement with Taipei and Washington.

U.S. Policy on the Taiwan Issue

The objective of U.S. policy must be to promote alternatives to conflict and to avoid having ever to answer the question of what we would do if our policy failed and long-term confrontation and conflict were actually to occur in the Taiwan Strait. This will require an intensified dialogue with both Taipei and Beijing as well as careful public articulation of the limited purposes behind American naval deployments to the Taiwan area. The Taiwan Relations Act provides appropriately discreet channels for such a dialogue between Washington and Taipei. The recent decision of the Clinton administration to step up high-level contact with China's leaders provides the opportunity for such a dialogue with Beijing.

Unless the United States is prepared to settle into a long-term relationship of hostile confrontation with China, Washington cannot afford to leave Taiwan with the impression it has a blank check that it can fill out with American blood. Nor can Washington afford to leave Beijing with the impression that Americans do not care what happens to the admirably modernized, democratic Chinese society which has emerged in Taiwan or that Americans would not resist its subjugation by force. Equally important, Washington cannot afford to leave either Taipei or Beijing with the impression that it sees any advantage in supporting Taiwan's permanent separation from the rest of China. The United States must make it clear to both Chinese parties that it favors rapprochement, encourages negotiation, and seeks to promote an end to military tension and arms races between the two sides of the Taiwan Strait.

Conclusion

There are many reasons for the United States and China to cooperate in their mutual interest. No such cooperation will be possible if the situation in the Taiwan Strait is allowed to drift into long-term confrontation. The United States and China therefore share an interest in avoiding such conflict. It would poison Sino-American relations, risk Japanese rearmament against China, engender disastrous alterations in the Asian strategic balance, severely damage Taiwan's democracy, and set back prospects for successful economic and political modernization on the Chinese mainland. The failure to refashion a modus vivendi in the Taiwan Strait can only lead to a Sino-American military confrontation that would rival the costs of the Cold War and replicate its perils to the United States and China.

Taipei and Beijing will not find it easy to refashion such a modus vivendi, yet it is very much in the interest of the United States to help them do so. Beyond this, both Washington and Beijing need to recognize the extent to which problems of importance to both countries cannot be addressed without cooperation between them. The United States and China have much to gain by refocusing on common purposes while launching a patient effort to narrow differences in their views and policies. This approach worked when there were fewer common interests and many more points of difference between the two countries than there are now. There is little reason to doubt that, with sufficient effort on both sides, it can work again.