Thank you very much for the kind introduction. I want to thank the World Trade Center, The Carter Center and the China Research Center for inviting me to be here with you. I am honored there are many people on this call who know a tremendous amount about China and have deep roots in China, so I am very honored to have the opportunity to talk with you and share a few of my ideas. But the first thing that I would like to share with everybody is my New Year’s greetings. I hope that your year is already off to a good start that you enjoy health and prosperity.
Thank you, Yawei [Liu, China Program director at the Carter Center and China Research Center board member], for your comments about engagement and the role of The Carter Center, because that is a great foundation on which to start the conversation tonight. Unfortunately, it is not the foundation that most people are on right now. It is no secret there is a lot of controversy and tension in U.S.-China relations. Right now in Washington, I do not know if it is confusion but certainly a searching for answers and a sense that past practices, past policies are no longer a guide for us going forward. But I do believe that engagement and focus on common purpose and common benefit is the path that will take us forward.
I will come back to this point in terms of what specifically I mean, but I want to lay out that I think it is important to be grounded in hope for the future as we just heard from Yawei, but also be cognizant of reality and not be naïve about where we are in terms of the challenges currently facing us.
When I say “us” I mean all of you who are involved in U.S.-China relations, including commercial relations, or in my case, educational relations or whatever other relationship you have with China. All of us feel this tension between the growing importance of China globally and the need to engage but also challenges that are being brought about by virtue of China’s changing role in the world. China is becoming much more assertive in a lot of different dimensions, which is challenging global norms, and that has unsettled people.
This situation is different than when I first became involved in China in 1989 when I joined the State Department. Today, we find ourselves with the United States and China as the two most powerful, most consequential nations in the world. In 1989 we all saw that future, but now it is here. We need to have the wisdom and the patience and skill to be able to deal with what is a very new reality. What people are feeling on an individual level again is a degree of uncertainty and frustration and concern. For example, there’s a lot of frustration on the part of U.S business about market access, about an unequal playing field within China, and China’s been very forthright about an assertive industrial policy. These things have unsettled the commercial relationship between our two nations and pose significant challenges for the path forward. Another example is workers concerned about lost jobs here in the United States due to China’s success in exporting and particularly in the wake of the WTO accession about 20 years ago. We’ve seen that rumble through our political landscape.
A third example is considerable concern among national security experts about how to engage with China on issues such as how to deal with China in the South China Sea or with cybersecurity. Finally, human rights groups are concerned about recent events in Hong Kong or what’s going on in Xinjiang. At this point, people have more questions than answers.
The Biden Administration
The old measures of dealing with these issues when viewed from policymakers or interested parties’ points of view, particularly in Washington, no longer seem to be applicable. There is a growing consensus that the United States needs new thinking regarding its relationship with China. We’ve seen some of that already coming from the Biden administration.
For example, we’ve seen some tough signals that the administration will try to distinguish itself from the policies of the Obama administration. That was necessary to acknowledge because there’s a pretty firm bipartisan consensus in support of a more firm China policy. This may not include all the things that we’ve seen in recent years with the trade war and some of the other things that the Trump administration did, but definitely there is a general consensus that the United States needs to be more active in defending what people consider to be U.S. interests.
There are also important signals in terms of what we have not seen, such as discussion over decoupling. In fact, President Biden has talked about intense competition, which is a nod to the reality of the political climate currently in Washington. But he is trying to frame it in a way that provides for a more productive agenda as opposed to confrontation or decoupling or some of these other words that have gotten tossed around in recent years.
I’d like to offer a few thoughts on how to go forward in this environment. I’d like to frame my comments by being cognizant of my assumptions and things that I’ve learned in the 30 years of being involved in U.S.-China relations. I’ll go back to my first day on the job, which was June 4, 1989. Things changed on that day in the U.S.-China relationship. We were thrown into a period of turmoil, which meant that my first years dealing with China were dominated by the fallout of that day. During the time I was in the embassy working in China throughout the ‘90s, in addition to rebuilding bridges on the ground, our job was to go back to Washington to explain to members of Congress who were mainly opposed (from the executive branch’s point of view) to engagement with China at that point. Our job was to explain how China was changing in terms of openness or human rights or commerce, among other trends. We were met by strong skepticism on the Hill. It was a tough road because there was a desire to punish China. There was also the sense that China had a different political model that we didn’t agree with and so we should not engage. We talked past one another, and in retrospect, we were both wrong. Today we’re having that same discussion, but again we are talking past one another and even within Washington, we’re taking positions that are extreme. That is not going to bring us to a consensus.
Let me give you a couple of specific lessons that I’ve learned from those early experiences. A key takeaway was the idea that China could be isolated or that its rise could be thwarted by strong U.S. pressure. In hindsight, this was clearly naïve. What was happening in China was related to dynamics within Chinese society. Of course, the accession to the WTO was obviously a choice on the part of the U.S. administration, but it was not a real choice in that China was heading in that direction anyway, becoming more and more connected to the global economy. So, bringing it into the WTO, yes, was a choice, but it was an eventuality that the United States could not really stop.
So, to re-emphasize, the idea that the United States could somehow stop, or block or thwart China was naïve then, and that idea is still naïve now. The idea that Chinese development would automatically lead to a political model that looked like the United States, what we would call a Liberal Democratic model, was also naïve. I was one of the ones who probably believed more in that eventuality than being able to block China’s rise, but in retrospect, again, what we misunderstood then, and in some cases we misunderstand now, is that China’s development has its own internal dynamic. External forces can maybe shape or adjust that but cannot significantly bend that trajectory.
Given these lessons, then, in thinking about what we can do with China, or what should we do vis-à-vis China, is we need to drop this false dichotomy of either trying to stop China or leaving China alone because it will become a western liberal democracy if we just give it enough space. The past 30 years have proven that both of those views are wrong. So, we’re not going to isolate China, as it’s not North Korea or Cuba, and decoupling would certainly hurt the U.S. economically and strategically. We’ve already seen some decoupling to the detriment of the United States both commercially and strategically. China has started to build its own — I won’t call it a world order — but at least regional structures and alliances and supply chains. The less the United States is a part of changes in the world order, the more our interests are damaged, but at the same time, we can’t force China to adopt American values and should not see shared values as a precondition for engagement.
To repeat, China is not going to become the United States, and U.S. policymakers and Americans more generally need to understand that. The ultimate goal for the United States should be to find an acceptable, reasonable, and realistic role for China in a rules-based global order. When I say acceptable, I mean acceptable to the United States from the United States perspective. Not ideal, but acceptable.
An Eight-Point Strategy
Let me lay out my eight-point strategy. This could have been a six-point or 10-point strategy, and I am sure once I share these things, you could add or subtract your own, but since eight is a lucky number, I am going with eight.
Number one is we need to put the U.S. house in order. We have heard some talk about that in Washington and just as China’s source of global strength and global emergence was the result of changes happening domestically within China so should the United States’ global strength be grounded and emanate from domestic strength, such as the strength of our economy, our educational system, our technology, etc.
Number two is the United States needs to champion a rules-based international order. As I mentioned, we cannot stop China’s emergence, we cannot block China, we cannot isolate China, but we can steer it by championing a rules-based order. That will be a change from previous years where there was a lot of concern about the international order not serving U.S. interests. But the international order was largely built by the United States principally to serve American and western European interests. In my view, it still does that quite well, and we are better served strengthening and updating the order rather than stepping outside it.
Third, we need to rebuild alliances with like-minded nations. We have seen traditional American allies head in different directions on China policy, but there is strength in numbers. This will help us shape the rules-based order if we have allies who are working in concert, maybe not on everything, but with a general shared interest in strengthening international institutions and by building international cooperation that steers China toward outcomes that we believe are more aligned with a stable, long-term relationship.
The fourth issue is we need to live up to our values and for those of you who remember June 4, 1989, you’ll remember that there was a makeshift Statue of Liberty built in Tiananmen Square. Fast-forward 30 years and the Chinese people do not see the U.S. as a model to emulate and that is largely our fault. The values upon which this country was built have served us well in times of crisis and the values that made the United States a model for others are ones that we need to embrace to strengthen our leadership. Doing so will not corrode our power.
Fifth, we need to be realistic about what China will and will not do in response to outside influence. China’s dynamics are domestic dynamics. There are things that are core to Chinese interests that will not bend to outside pressure just like there are things in the United States that are core interests which will not bend to pressure.
Sixth, we need to compete hard where our interests are really at stake. I’m encouraged by President Biden’s choice of characterizing the relationship as “intense competition.” I hope that gains traction and helps to frame both the reality but also to center the thinking of American policymakers and others here in the United States in terms of what we need to do to deal with all these U.S.-China issues that have caused so many concerns. We need to win in technology, but this requires a different approach in terms of the public-private division of labor. In the U.S. model of individual responsibility and somewhat limited government, there are public goods that government needs to invest in. We have lagged in investing in things like basic research, education, infrastructure, and I would add primary health care and public health, as we’ve seen in the past year. Also, having a society where some people are providing fewer and fewer contributions to economic activity so there’s an increasing inequality of wealth distribution does not serve our interests well. If you are a sports team and 30 percent of your players can’t play, you’re not going to be a very competitive sports team. Similarly, with a nation, if you have large segments of your population who, just by virtue of their birth, are destined to unproductive economic lives, even leaving out all the other sufferings, you are holding yourself back as a nation.
Seven is to separate issues where we can and link them where we must. In my 30 years of watching China relations, trying to link issues has led us to dead ends where we couldn’t reach agreements. We tended to assume that negotiations were a zero-sum game, and if any of you who has studied or taught negotiation knows that in zero-sum games you better be considerably stronger than your opponent to win consistently. If we take a zero-sum approach against China, which is an immensely powerful nation in so many dimensions, the likelihood that we are going to end up with significant net benefits is highly naïve in my view. We need to be smarter about how we connect issues and be more thoughtful in how we negotiate.
Finally, the more we can tone down the political rhetoric and focus on tangible outcomes that really matter, I think all of us will be better off.
In conclusion, I hope that outlines at least a framework and a starting point for discussion that provides a realistic, yet hopeful, view of a path forward.
Thank you very much.