Jan 19, 2018 04:40 PM

Opinion: Understanding America’s China-Phobia

The Wall Street Journal’s bombshell story on Wendi Deng Murdoch’s close ties to Trump son-in-law Jared Kushner, and her lobbying for a Chinese-funded project – which were deemed potential national-security risks – sparked a battery of concerns over China’s influence in the United States. Why is China’s business activity in the U.S. often linked to “national security risks,” with typical China-phobic rhetoric? Why does the panic towards Chinese economic influence still prevail in the U.S., even as the two countries’ economies become increasingly interconnected?

The Murdoch case clearly indicates that this phenomenon hasn’t changed much under the Trump administration, and continues to haunt U.S.-China relation as before. When it comes to China’s development, the U.S. government remains guided by the Thucydides Trap (wherein tensions escalate as an existing power grows fearful of a rising power) and zero-sum theory (which holds that for one side to gain another must lose). The most obvious example is the positive impact of China’s economic development on the U.S. – an aspect imperfectly understood and often distorted.

According to an analysis by the Rhodium Group, employment by Chinese-owned firms in the U.S. has jumped nine-fold since 2009 to 140,000 jobs, while China’s investment in the country has climbed to a record high. Yet the U.S. government doesn’t seem to acknowledge this. Based on datasets published by the American Enterprise Institute (AEI), since 2005 more than 30 investments valued above $50 billion related to Chinese companies faced trouble in the U.S. – most of which were blocked under the guise of national security.

Not long ago, when the Committee on Foreign Investment in the U.S. (CFIUS) blocked China’s Ant Financial from purchasing MoneyGram, AEI columnist James Pethokoukis bashed the foolish decision, saying it had nothing to do with national security but rather was blatantly protectionist. Moreover, Congress is planning to reform CFIUS to tighten scrutiny of Chinese investments.

This situation raises a series of question. Why does China’s economic influence unsettle the U.S., even though it makes positive contributions to its economy? Why doesn’t the U.S. fear other emerging powers, such as India’s economic influence, especially considering there are dozens of Indian CEOs heading large American corporations?

China panic goes beyond the U.S., to other western countries. Recent cases include the Australian prime minister’s claims of Chinese interference and the Economist magazine’s cover story on China’s “sharp power,” which fretted over the prospect that China might use its economic leverage as a strategic threat to put political pressure on western countries.

Scapegoating China as a threat to national security is a long-standing political trick among western countries, especially in the administration of U.S. President Trump and his team have failed to deliver a coherent strategy for engaging with China, even though Chinese leadership has called for developing a new type of shared major-power relationship. Instead, they continuously play the “Who is winning?” game to provoke China-phobia.

America’s insecurity not only reflects the Trump administration’s lack of knowledge of China’s complex reality, but also its dwindling confidence in dealing with a rising China, owing to the absence of strategy and decline of power.

Last October, when I spoke to senior China expert David Lampton, he pointed out that overwrought concerns about the China threat are unnecessary. He pointed out that it would not be in China’s best interests to position itself as opposed to the U.S.

“I would suggest President Trump to travel to China’s countryside. Then he will see that the Chinese leaders have to deal with lots of domestic issues to improve life for Chinese people. Their first priority is obviously not spending all their time thinking about how to make life more difficult for Americans.” he said.

Another leading China expert, David Shambaugh – who defines China as a “partial power” in his book “China Goes Global” – expressed a similar perspective, that China won’t soon take over global leadership from the U.S., despite its growing prominence on the international stage.

But because President Trump’s newly unveiled national security strategy marks a hawkish turn against China and shows that this sense of paranoia won’t disappear soon, China must address the issue rationally.

Above all, China must reassure the world that its rise will be peaceful, by acting as a more responsible major power as it wields growing influence. China should find smart ways to merge itself into the prevailing world system, by finding a balance between collaborating with the U.S. and expanding its influence externally.

Meanwhile, the U.S. should also have a balanced understanding of China’s rise. For the Trump administration, allowing China-phobic shenanigans to drive public policy may not stop China from achieving its goal of national rejuvenation, but it could cost America its global leadership, since it limits the opportunities for real dialogue and cooperation between the two nations.

So, what will it take to surmount China-phobia, which is the roadblock to constructive U.S.-China relations? I would suggest looking for the answers in history. When there are disparities in global rules, they often generate political conflict and insecurity. So why shouldn't China and the U.S. create common standards or mutual rules to affect how national security weighs on foreign investment decisions, instead of falling prey to China-phobia? As we all know, China’s success lies in the prosperity of the U.S., and vice versa.

Wang Xiaofeng is currently a Humphrey Fellow funded by William Fulbright Scholarship Board. Previously, as a Beijing-based journalist, she covered China’s foreign affairs with a focus on its relationship with the U.S. and its Asian neighbors.

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