U.S.-China relationship teetering

By Rodger Baker
Senior analyst for Stratfor, the leading provider of global intelligence over the Internet

The on-again, off-again halt to all military exchanges and contacts with China is in itself innocuous. Last week's statement by Defense Secretary Donald Rumsfeld — and sudden recantation — had little real impact because U.S. policies there are already under review. The new administration had already begun examining whether or not to continue military cooperation with China past the end of this month.

Li Chenglong, center, deputy mayor of Guigang in the Guangxi autonomous region, was executed last year for bribery. There is a growing consensus that China must repair its internal fragmentation. Associated Press library photo • April 23, 2000

The decision, dated April 30, but reported then recanted Wednesday, comes amid growing tensions between Washington and Beijing, including a collision between a U.S. surveillance plane and a Chinese jet fighter and Washington's approval for a massive arms sale to Taiwan. These incidents, rather than building into a crisis, are instead symptoms of an already existing crisis underlying China-U.S. relations — and a fundamental miscalculation on Washington's part as to the forces driving Chinese behavior.

Washington views relations with Beijing as fundamentally secure, and it believes therefore the current tit-for-tat brinksmanship will blow over and the relationship will ultimately remain intact. Underpinning this view is a belief that China is too economically dependent on the United States and too militarily weak to take confrontation with the United States much further than a war of words. While this has been an apparently effective strategy for years, its fails to take into account the pressures mounting in Beijing that may alter the equation.

Within the Chinese government, a fundamental debate is raging, one that has been repeated for centuries. China's leadership is split over whether the economic benefits of contact and integration balance out the potential social and political consequences of that integration.

On one side of the debate are those arguing that China must choose between national unity and stability or the inevitable political fragmentation that comes with economic reform. The absolutists cite a pattern played out in China of central authority and national unity undercut by regionalism brought on by economic contact with the Western world. Coastal China — increasing trade with the outside — is experiencing economic prosperity. Meanwhile, the interior lags behind. This creates a regional disparity, raising tensions between the interior and the periphery while weakening the center.

These concerns are being played out every day in modern China. Demonstrations and protests are growing increasingly frequent by unemployed and unpaid workers — victims of Beijing's economic reforms and the privatization and subsequent collapse of many former state-owned enterprises. Corruption has reached alarming proportions among regional and local officials, particularly in the heavily export-based southern coastal provinces.

Countering this rather bleak absolutist position are other factions among China's leadership arguing that there are ways to control and mitigate the negative effects of economic integration. Beijing's Go West campaign, designed to bring the economic benefits of the coastal economic boom to the interior, is one such policy. In addition, recent changes in the tax structures on farmers and the promotion of village-level democracy through elections are also ways to maintain social stability and control amid rapid economic changes brought about by China's reform.

While the absolutists represent a small faction of Beijing's elite, the second group is itself fragmented, thus having no unified strategy to deal with the social effects of China's economic changes. All are in agreement, however, on one key issue — that China is facing a dangerous domestic situation. Social unrest, rampant corruption and widespread economic disparities are weakening the authority and control of the central government.

These concerns are exacerbated by Beijing's fear that Washington is using the economic opening to undermine the central government and the Communist party leadership. Since the time of Mao Tse-tung, Beijing has harbored suspicions that the U.S. economic and political contact with China was part of former Secretary of State John Foster Dulles' plan of "peaceful evolution" to foster a gradual peaceful change away from the communist system. This view has only been strengthened by Beijing's view that Washington consciously exploited the economic policies of former Soviet leader Mikhail Gorbachev to bring about the disintegration of the Soviet Union.

With most of China's leadership in agreement on the dangers facing the system and the potential for Washington to exploit it, there is an emerging convergence of views that Beijing must regain control of China's internal fragmentation and that Beijing must engender more respect from Washington. In essence, Beijing needed a showdown with Washington, both to re-center Washington's view of China and to gain some internal unity by stirring up Chinese nationalism. The spy plane incident could not have come at a better time for Beijing.

The minority "hard-line" faction in Beijing views this initial confrontation as just a first step in the inevitable degradation of relations between Beijing and Washington. They are confident that as relations continue to decline, their position will be vindicated. As Washington continues to operate under the principle that relations are ultimately stable and thus pursue a policy of brinksmanship, it may in fact expand the influence of the absolutist position inside Beijing.

As Beijing intensifies internal security operations, the final decision on whether to stem economic reforms and opening has yet to be made. Ultimately, internal security concerns and national unity will likely take precedence over economic growth. As the internal factors underlying China's decision-making process become increasingly focused on internal stability and control, Beijing's range of possible actions will move into areas hitherto thought of as unlikely.

Still, Washington views the relationship as fundamentally stable. The discontinuity in viewpoint of Washington and Beijing will only lead to more — and potentially worse — confrontations as the underlying crisis intensifies.