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The lopsided nature of the Sino-American cold war

Chinese President Xi Jinping with then-U.S. Vice President Joe Biden inside the Great Hall of the People in Beijing, December 2013. (Reuters)
Chinese President Xi Jinping with then-U.S. Vice President Joe Biden inside the Great Hall of the People in Beijing, December 2013. (Reuters)
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18 Apr 2021 12:04:51 GMT9
18 Apr 2021 12:04:51 GMT9

As Albert Einstein put it: “Life is like riding a bicycle. To keep your balance, you must keep moving.” At present, both superpowers would do well to heed Einstein’s very personal advice. Currently, both the US and China find their regional policies in the crucial Indo-Pacific entirely out of kilter, as Beijing’s overly bellicose strategic policy is matched in folly by Washington’s tone-deaf misunderstanding of the importance of geoeconomics. The first superpower to keep moving and balance its geoeconomic and geopolitical strategies in the region will be the nation most likely to triumph in today’s incipient cold war.

In my last book, “To Dare More Boldly: The Audacious Story of Political Risk,” I look at the riveting tale of former Chinese Paramount Leader Deng Xiaoping, the most important person of the 20th century that the average Westerner has absolutely no knowledge of. Deng almost single-handedly changed the course of Chinese and world history by (after December 1978) rationally opening up the Chinese system, thereby laying the groundwork for Beijing’s astounding economic rise. The genius of Deng, following the chaos of Mao Zedong’s Cultural Revolution, was to re-harness the Chinese Communist Party’s political legitimacy — traditionally called “The Mandate of Heaven” — around two forces that are both organically and indelibly a long-standing part of China’s political culture: Capitalism and nationalism.

But Deng, even as he re-annexed Hong Kong and Macau, advanced his program in a characteristically cautious, understated way. He understood that foreign and domestic policy are about limits, and that China’s overall foreign policy strategy must be indelibly tied to its specific domestic circumstances. For Deng, this meant that, just as China was taking off — albeit from a very low economic base — Beijing’s foreign policy had to be characterized by caution, almost quietism. Nothing could be allowed to get in the way of economic growth, which Deng knew would at last bring China back to the top table of the world’s great powers within a generation.

Suffice it to say, this doctrine of geopolitical quietism has been ruinously overturned by President Xi Jinping, who has instead (in true Communist fashion) tried to hurry history along. Championing China’s resilient rebound from the coronavirus pandemic it unleashed upon the world, Xi has become ever more triumphalist in his public statements, even as he has seemed to take on the whole of the Indo-Pacific region at once.

The laundry list of China’s aggressive moves has grown startlingly long: The brutal suppression of the Uighurs in its western Xinjiang province; the crackdown on Hong Kong’s democracy movement; the ceaseless jockeying for position in the South China Sea; the economic bullying of Australia; the armed conflict with India over Chinese territorial expansion in the Himalayas; and the constant overflights and general increased pressure on Taiwan. Throwing caution to the wind — as well as Deng’s astute geostrategic policy — Xi has made it clear that China intends to call the tune for the whole of the Indo-Pacific, not at some future date, but right now.

Expressly because of Xi’s folly, US ties to India are presently better than they have ever been, as is the case for US-Vietnamese relations. Long-term allies Japan and Australia are clamoring to enhance their already highly integrated strategic partnerships with America. The Association of Southeast Asian Nations states also want to drift closer to the US. As a result of all this, America finds itself in a very favorable geostrategic position in the Indo-Pacific, not because of any particularly brilliant Kissingerian diplomatic moves on its part, but merely because it is the recipient of Xi’s strategically disastrous impatience.

Neither the US nor China has an attractive, holistic pitch that will definitively win the Indo-Pacific nations over to their side.

Dr. John C. Hulsman

But never underestimate America’s vexing ability to snatch defeat from the jaws of victory. At present, in both US political parties’ protectionist withdrawal from the world (and here, if anything, Joe Biden’s Democrats are even worse than the Republicans), America, for the first time in its history, finds itself with not one but two protectionist parties, even as both have fled the mantle of fiscal responsibility.

These are the political reasons that the US is, in turn, committing a gigantic geoeconomic blunder, definitively closing off economically from the Indo-Pacific, the most important future economic region in the world. This is epitomized by both parties calamitously committing an act of immense geoeconomic self-harm in rejecting the pro-Western Comprehensive and Progressive Trans-Pacific Partnership trading deal. At the same time, China continues (presently through the guise of the Regional Comprehensive Economic Partnership free trade deal) to further economically integrate with the region.

From a regional perspective, the lopsided nature of what both superpowers provide is clear: Most of the region wants to shelter under the US security blanket, even as they also want to further their booming trade ties with China. At present, given their respective follies, neither the US nor China has an attractive, holistic pitch that will definitively win the Indo-Pacific nations over to their side. Whichever great power manages to balance its geopolitical and geoeconomic strategies — for China to be seen as an unthreatening regional neighbor and for the US to be seen as a viable trading alternative — will win the brewing superpower contest that defines our new age. It is as simple as that.

  • Dr. John C. Hulsman is the president and managing partner of John C. Hulsman Enterprises, a prominent global political risk consulting firm. He is also senior columnist for City AM, the newspaper of the City of London. He can be contacted via
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