Wednesday, 22 October 2014

China/US war? Doesn't have to happen

A wide-angle lens shows the 21st Century already turning into one of the safest periods for humans than almost any time in antiquity. Yet the headlines still seem to say otherwise. A creeping Ebola virus, whack-a-mole Jihadists, revanchist Russians, nuclear-bent Persians, fiscally imprudent Europeans and combustible Central Africa. It’s been a wild year indeed.

But is China going to be one of the world’s dangers? Is the much-discussed US/China conflict actually going to happen? The answer can only be: probably not, but it’ll require finesse from both parties to avoid.

Travelling down the motorway of bilateral foreign policy, a cool reading of international relations suggests that almost all the offramps towards a US/China peace are ahead of us, and not behind us. That’s a very good thing for future security.

But those offramps demand focused concentration. The economic path that China is tiptoeing is essentially do or die. Asia watchers, including Chinese political elite, worry just as much about Chinese failure as Chinese success.

The dominating theme for China’s foreseeable future is a gradual development towards a new economic model that best fits its evolving demographics and economics.

One issue is that the country’s demographic pyramid has inverted and despite deep treasury pockets the social safety net to deal with a rapidly aging population is inadequate. Put it this way: you think Kiwisaver will struggle? Well…

China’s horrific environmental problems also stagger belief. Some estimates put the cost of China’s pollution at 11% of its GDP per year. Needless to say, the central government is looking very closely at this issue.

No one thinks this shift won’t be painful for a good chunk of middle-class and even elite Chinese. A lot of deeply vested interests run a very real risk of disappearing entirely if the transition to a domestic consumer model isn’t gently managed by the central government.

In the big picture, the international system is working on the question of how to accommodate a powerful new nation-state. Yet the real question for China is: what is the legitimacy of Communist Party (CCP) rule? The answer will tell us where we’re going.

It’s painfully clear that it is not Marxism. It’s not Lenin either, and it’s not even Mao. Their legitimacy might come from Confucianism, which has upheld the CCP as trained scholars who are intellectually and morally superior. But anyone with even a passing knowledge of the Chinese blogosphere knows the Confucian pillar is dust. The CCP’s insidious corruption has wiped it all away.

It used to be the economy. CCP rule has depended on the promise of 10% GDP growth per year. Unfortunately almost everyone knows Beijing’s reported GDP figures probably weren’t ever accurate. Whether they were or not, the Chinese economic rocket is losing thrust and won’t maintain its steep trajectory.

So if it’s not Marx or Confucius, and it can’t be the economy for ever, then where are CCP elites turning? Worryingly, the answer for legitimacy is being increasingly found in nationalism.

As China changes direction, the central government is using regional tension to distract attention from a slowing economy by piling on nationalistic fervour. Nationalism has its merits, but it also has its pitfalls. The key for Chinese elites will be how it’s all managed because history is a cruel mistress.

Graham Allison of Harvard University studies how status quo powers (like the United States) accommodate up-and-coming emerging powers (like China). History, Mr Allison says, counts about 24 instances of this dangerous dynamic dating all the way back to Sparta and Athens.

He discovered that the mechanism by which the world reaches the new equilibrium between an emerging and a status quo power is commonly referred to as: global war. This mechanism held in two out of three historical cases. The ‘globe’ being defined by that era’s field of view.

So the China question deserves close attention. Think back to the 20th Century to get an idea of what Mr Allison is talking about. The underlying thread of that century is largely defined as the story of Germany coming to grips with being a powerful new nation-state. That process wasn’t managed so well. Hopefully we’ve learned some lessons since then.

Although this accommodation of China doesn’t have to heat up, it’s all being complicated by the nationalistic path China appears to have decided on taking. A further complication is that the Chinese don’t view themselves as an emerging power. To them this whole experiment is about restoration.

That particular worldview greatly concerns China’s neighbours. Most Asia Pacific countries would consider themselves United States allies, which now aims, through its “Asia Pivot” strategy, to turn the Pacific Ocean into an American lake. Sure, that paints the strategy a little too cartoonish, but the direction coming from Washington D.C. isn’t very far off that.

This means that any territorial argument the Chinese might have with, say, the Japanese ultimately ends with the carrier groups of the US Seventh Fleet. No one - on any side - wishes to bring aggressive economic competition to a point where the world’s three strongest navies begin to exchange fire. Everyone loses here. We’ve seen it happen a few dozen times before.

Despite its nationalistic brinksmanship, China is not presently an enemy of the United States. In fact, there aren’t any good reasons for China to ever be an enemy of the United States.

The two nations fiercely compete economically and technologically - the latter being a particular bugbear of US cyber security agencies. And competition is intertwining the nations together more symbiotically than any two superpowers perhaps have ever been. Considering the stakes, it’s a good sign that a little thing like trade will probably keep the two behemoths from colliding.

Thankfully, most foreign policy signals predict the emergence of China should occupy a spot in Mr Allison’s peaceful one-third of history’s two-dozen emerging power processes. The international system really can’t afford for China’s accommodation procedure to fall into the other, more violent, two-thirds.

Almost all the offramps remain in sight and both China and the US have a wide range of rational, non-heroic policy choices available to keep their relationship competitive. At times this dynamic could become confrontational, that’s to be expected. But conflictual? It doesn’t have to happen.

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