China and the Strategic Imperative for the United States

Executive summary

This essay examines the implications of China’s rise and calls on the U.S. to address the domestic bases for national power and to reassume a leadership role in Asia by executing a grand strategy that is fully cognizant of political, historical, economic, and strategic realities.

Main argument

The U.S. has deep and long-standing interests in the strategically complex Indo-Pacific region. Now, however, Beijing’s multi-decade strategy is bearing fruit as Chinese power and interests are beginning to predominate there. U.S. regional interests and leadership are challenged, and U.S. economic and security policies relevant to Asia are incoherent. Washington must craft effective policies that coordinate economic and diplomatic instruments of power with military instruments of power, and these policies must be executed in a manner consistent with historical yet achievable strategic imperatives.

Policy implications

• • Xi Jinping is committed to consolidating his and the Chinese Communist Party’s grip on Chinese society, basing much of his and the party’s legitimacy on nationalism. China appears determined to replace the U.S. as the dominant regional force and compete for global hegemony.

• • The U.S. must address the threats to its economy and at the same time remain engaged in crafting the rules of the international economic order. It should improve as needed and consider rejoining the Trans-Pacific Partnership to accelerate economic growth and coordination among coalition members. The U.S. should seek opportunities to strengthen liberal economic behavior in the region.

• • The U.S. must develop an appropriate, well-resourced military strategy for the Indo-Pacific and deploy the required weapons and related systems to execute it.

• • The U.S. must build coalitions to keep a stable balance of power, as well as reform and lead the institutions that play critical roles in the post–World War II economic and political order.

• • The relationship between China and the U.S., together with the actions and strategies of each power, will be the most important determinants of the 21st-century world order. The U.S. has the capacity to rise to the challenge, but it must make serious assessments of what is needed and act accordingly and expeditiously.

China’s accession on December 11, 2001, to membership in the World Trade Organization (WTO) was hailed by many in the United States as a breakthrough that could lead to political liberalization in China, peace and security in Asia, and greater prosperity for the American people.¹ This optimism has faded away, replaced by rising pessimism. The first two goals have not been achieved, nor are the prospects for achieving them bright, and the third is a major continuing political issue and increasingly questioned by economists.²

Fueling the pessimism are years of muddled, uncoordinated U.S. policies toward China. These policies have been a Procrustean mix of robust yet distorted economic engagement, ad hoc strategic and diplomatic responses to events, and constrained defense planning due to budgetary paralysis. Neglect of the influence that China is deriving from its enormous economic success and the growing challenges in the U.S.-China relationship, coupled with a failure to properly consider this relationship in the context of a U.S. grand strategy, have constituted a profound policy failure. The situation has been made worse by a succession of Chinese leaders who, in contrast, have carried out a consistent grand strategy in the face of U.S. policy incoherence.

To address this failure, the Trump administration issued in December 2017 the new National Security Strategy, which seeks to clarify the challenges presented by China, especially to the U.S. economy. The Trump administration is also conducting major investigations of Chinese industrial and trade practices.³ In December, with China the clear target, the administration agreed with Japan and the European Union to work together “to enhance trilateral cooperation in the WTO and in other forums, as appropriate, to eliminate…unfair market distorting and protectionist practices by...