Is a confrontation with China inevitable?

To follow is an excerpt from the CQ Researcher report on "U.S.-China Relations" by Roland Flamini, May 7, 2010
~~~~~~~~~~~~~~~~~~~~~~~~~~~~

The Chinese leadership is “gunning for a paradigm shift in geopolitics. In particular, Beijing has served notice that it won't be shy about playing hardball to safeguard what it claims to be ‘core national interests,’” writes Willy Lam, a China specialist at the Washington-based Jamestown Foundation think tank. [Footnote 22] At the top of those national interests is Taiwan which, The Economist magazine said recently, “has been where the simmering distrust between China and America most risks boiling over.” [Footnote 23]

The chance of a war between China and the United States is generally regarded as remote. The Chinese threat to the United States is indirect — for example, if China should decide to use force to annex Taiwan, and America intercedes — as it is committed to do even though the United States does not recognize the island as an independent state.

China hands like Elizabeth Economy, director of Asia Studies at the Council on Foreign Relations think tank in Washington, downplay the new “Red Scare.” Economy argues that the West — particularly the United States — has “completely lost perspective on what constitutes reality in China today.” Economy concedes that “there is a lot that is incredible about China's economic story, but there is a lot that is not working well on both the political and economic fronts,” distorting the real picture.

In other words, China has enough problems without provoking the challenge of an international nemesis. The Chinese leadership appears to worry about a fragile society: A persistent nightmare is that a sudden significant spike in unemployment, officially kept at 4 percent (but possibly higher because of the huge, hard-to-track migrant-worker population) could lead to widespread unrest. [Footnote 24]

Still, looking at the Chinese as the potential aggressors, does China have the capacity for a military confrontation with the United States?

In the past five years China has spent hundreds of billions of dollars modernizing its armed forces, with special emphasis on the navy. China's 1.7 million Chinese under arms is considerably more than the 1.4 million in the U.S. armed forces, but in 2009 the U.S. defense budget was $738 billion and China's estimated at between $69.5 billion and $150 billion. [Footnote 25]

The government insists it seeks a peaceful solution to the issue of uniting Taiwan to the mainland, but the Chinese have built up a formidable fleet of submarines and developed anti-ship missiles to counter a possible U.S. defense of the Taiwan Strait. The Americans will be ready for them. In its annual report to Congress on China's military power, the Pentagon said it was “maintaining the capacity to defend against Beijing's use of force or coercion against Taiwan.”

Beyond the strait, the Pentagon reported, “China's ability to sustain military power … remains limited.” [Footnote 26] The Pentagon's annual report is a source of irritation to the Chinese, who routinely denounce it. This year, the Xinhua news agency dismissed the assessment as “a largely subjective report with distorted facts and groundless speculation.” [Footnote 27]

Less hypothetical is the threat to the U.S. government's computer system. The Pentagon's 2009 report said U.S. government computers had been the target of “intrusions that appear to have originated” in China, although not necessarily from the military. [Footnote 28] And in his annual “Threat Assessment” to the Senate Select Committee on Intelligence, Director of National Intelligence Dennis C. Blair warned in February that “malicious cyber activity is occurring on an unprecedented scale with extraordinary sophistication.”

As a result, Blair added, the United States “cannot be certain that our cyberspace infrastructure will remain available and reliable during a time of crisis.” Blair did not refer to China directly at that point. However, later in his assessment he called “China's aggressive cyber activities” a major concern. [Footnote 29]

In January, after Google reported that hackers in China had targeted the computers of more than 30 U.S. corporations, including its own, and that the e-mail accounts of human rights activists had also been hacked, Secretary of State Hillary Rodham Clinton called on the Chinese government to investigate and to make its findings public. [Footnote 30]

U.S. officials and business executives warn that a trade war could also erupt if the Chinese don't yield to international pressure and raise the aggressive undervaluation of the renminbi, kept artificially low to favor Chinese exports. China's cheap currency is a serious problem for the global economy by undercutting exports throughout the industrial world, including the United States, and contributing to the trade imbalance. (President Obama has contended that if China lets the renminbi appreciate, U.S. exports would increase.)

The Obama administration has so far avoided picking a public fight with China over its currency — even to the extent of postponing indefinitely a Treasury Department report on worldwide currencies originally due out on April 15. Without any movement by Beijing on the currency front, the report could well label China a “currency manipulator.” If that happens, Sen. Charles E. Schumer, D-N.Y., is ready with draft legislation that would place more tariffs on Chinese goods.

Chinese Commerce Minister Chen Deming recently told The Washington Post that the United States would lose a trade war with China. “If the United States uses the exchange rate to start a new trade war,” he said, “China will be hurt. But the American people and U.S. companies will be hurt even more.” [Footnote 31]

One way for America to increase its exports, said Chen, would be to remove the restrictions on high-tech goods with possible military applications, which the United States imposed following Beijing's repressive crackdown on student demonstrations in 1989 in Tiananmen Square — something the Obama administration shows no signs of doing.

The Issues
* Is a U.S.-China partnership actually possible?
* Is a confrontation with China inevitable, as some predict?
* Has China's “market authoritarian” model of government emerged as an alternative to Western democracy?

For more information see the CQ Researcher report "U.S.-China Relations" [subscription required] or purchase the CQ Researcher PDF.

About the author
Roland Flamini is a Washington-based correspondent who writes on foreign-affairs for CQ Weekly, The New Republic and other publications. Fluent in six languages, he served as Time bureau chief in Rome, Bonn, Beirut, Jerusalem and the European Common Market and later served as international editor at United Press International. His previous reports for CQ Researcher were on Afghanistan, NATO, Latin America, Nuclear Proliferation and U.S.-Russia Relations.

Footnotes
[23] “Facing up to China,” The Economist, Feb. 4, 2010.
[24] Nicholas D. Kristof, “China, Concubines, and Google,” The New York Times, March 31, 2010.
[25] Drew Thompson, “Think Again: China's Military,” Foreign Policy, March/April 2010 .
[26] “Annual Report to Congress: Military Power of the People's Republic of China, 2009,” Department of Defense.
[27] “Pentagon issues annual report on China's military power,” Xinhuanet, March 26, 2009.
[28] Pentagon report to Congress, op. cit.
[29] Dennis Blair, “Annual Threat Assessment of the U.S. Intelligence Community for the Senate Select Committee on Intelligence,” February 2010.
[30] Cecilia Kang, “Hillary Clinton calls for Web freedom, demands China investigate Google attack,” The Washington Post, Jan. 22, 2010.
[31] John Pomfret, “China's Commerce Minister: U.S. has most to lose in a trade war,” The Washington Post, March 22, 2010. Department of Defense.