When it comes to U.S.-China policy, Washington is broadly separated into two camps: the "functionalists" and the "strategists." And as the two countries have met in Washington this week, the internal debate has begun to unfold. U.S. President Barack Obama told his counterparts that Washington and Beijing should be "partners"; Secretary of State Hillary Clinton and Treasury Secretary Timothy Geithner wrote a joint op-ed in the Wall Street Journal calling for broad "strategic level discussions." Make no mistake: The functionalists are winning.
The functionalists tend to be economists and those concerned with the U.S.-China economic relationship. The United States and China are so economically intertwined, the functionalists argue, that they ought to be strategic partners as well. Win-win cooperation -- not zero-sum competition -- is a very achievable goal. Barriers between the two countries are transactional, and any tensions are usually due to mere misunderstanding. Yes, there are profound disagreements, but fix the practical problems, and many obstacles toward a fruitful partnership will eventually melt away. In fact, they will have to melt away -- out of necessity on both sides. As Clinton and Geithner put it, quoting a Chinese proverb, "When you are in a common boat, you need to cross the river peacefully."
"Strategists," however, don't see quite such a rosy picture. For them, the U.S.-China relationship is one of strategic competition -- an irreversible rivalry already well under way. Sure, Washington and Beijing ought to improve their interactions and mutual understanding to minimize friction. But any such cooperation is tactical, nothing more. Underlying all bilateral interactions, the strategists believe, is a fundamental clash of interests and values that can be managed but never solved unless the values and interests of either Washington or Beijing change -- and that's highly unlikely.
Amid global recession, at a time when China owns a hefty sum of U.S. Treasury bonds, it's easy to see why the functionalists have the upper hand. The Chinese economy is ticking at an enviable pace that many hope will spur global (and U.S.) growth back to life. Encouraging economic growth in China has the doubly touted benefit of accelerating the prospects for domestic political reform. China could, over time, become a willing participant in -- and even defender of -- the liberal regional order in Asia, the functionalists believe.
If China's So Powerful, Why Isn't It More Powerful?
The United States and other nations have long recognized Beijing's economic might. But why hasn't that translated to commensurate political respect?
By Wen Liao
But there's a logic leap here, overlooked to America's peril. As China grows richer, it is the state-controlled sectors of the economy that are growing more powerful, not the independent private sector -- which has been deliberately suppressed. Of the roughly 1,500 companies listed on the Shanghai and Shenzhen Stock Exchanges, less than 50 are genuinely private. As much as 95 percent of Beijing's $586 billion economic stimulus package, announced last November, will go to state-controlled enterprises. This makes China Inc. more powerful but does not push it closer to political reform. On the contrary, it has offered the Chinese Communist Party better and more resources to entrench its power and position in the country's economy and society.
The implications go well beyond China's borders, strategists warn. As Beijing's power grows, it will be less inclined, not more, to uphold the current regional order in Asia. In a recent study of 100 recent articles by more than two dozen of China's top strategic thinkers, I found that four of every five articles spoke of circumventing, reducing, or superseding U.S. power and ideas in Asia. China views the liberal order as one designed to preserve American hegemony in the region. Even if Beijing has so far benefited enormously from rising up within the existing order, it might not be so friendly to it once it's risen far enough.