International relations are shaping up to be one of the key economic and financial risks in the years going forward. With tensions heating up with Russia over Ukraine and with China over Taiwan, the terrifying specter of great-power conflict once more looms over the world. We econ bloggers would love to be able to ignore the threat of war and conflict, but we can’t. So since I’m not an expert in this area, I’ve decided to interview a few people who are. And where better to start than my once-and-future Bloomberg Opinion colleague, Hal Brands?
In fact, Hal does much more than just write for Bloomberg. His main job is in academia; he’s the Henry Kissinger Distinguished Professor of Global Affairs at Johns Hopkins SAIS. He’s also the author of the new book, The Twilight Struggle: What the Cold War Teaches Us About Great-Power Rivalry Today. And that’s why I thought he would be the perfect person to ask about parallels between the Cold War and today’s great-power tensions.
In the interview that follows, I ask Hal about those parallels, about U.S.-China policy in general, and about whether the U.S. can afford to deter both Russia and China at the same time. We also discuss the economic and trade aspect of great-power competition. Hal generally gives good marks to the Biden administration on its approach toward China, and offers a few suggestions for improvement.
N.S.: You've been writing a lot about tensions in Asia, and you've just come out with a new book about the lessons of the Cold War. Would you say it's fair to label the current tensions with China as "Cold War 2"?
H.B.: The US-China rivalry isn't the Cold War, but it is a Cold War. The original Cold War happened in a specific time, place, and context--we live in a very different world today. But the U.S.-China Cold War is a struggle over the future of world order, one in which clashing geopolitical interests and clashing ideological values play a key role--as was the case with the U.S.-Soviet Cold War. And this cold war, like that one, features sharp, dangerous competition in the shadow of hot war. Add in the fact that the U.S.-Soviet Cold War is America's only prior experience with long-term geopolitical competition—a rivalry that plays out over years or even decades—and we really have to study the first cold war to understand what is happening and how we can succeed today.
N.S.: In Cold War 1, we used strong nuclear deterrence along with a strong conventional military posture. Nowadays, some people -- notably the folks at the Quincy Institute -- are urging us to adopt a more conciliatory tone toward China, and to avoid the kind of strong deterrence strategies we used in the first Cold War. Which should we do, and why?
H.B: Deterrence was perhaps the most terrible, and essential, art of competition during the Cold War. Our strategy hinged on lining up a global network of allies to contain the Soviet Union. But we had to be able to defend those allies in a crisis, and since we didn't have enough conventional military power to deter Soviet aggression everywhere along the East-West divide, we had to back up our conventional forces with threats of nuclear escalation. Our whole approach to the Cold War basically involved threatening to start a nuclear war to avoid losing a conventional one.
Today, I think reasonable people can argue about where, exactly, to draw the line against Chinese expansion in the Western Pacific or elsewhere, and what sort of risks (nuclear or otherwise) the U.S. should be willing to run to defend its allies. But anyone who doesn't think that Xi Jinping is determined to establish a Chinese sphere of influence in East Asia--which means pushing the U.S. out of the region--hasn't been paying attention. And anyone who doesn't think that he may be willing to use force--against Taiwan or elsewhere--to achieve that goal is living in a dream world. Don't get me wrong: A major war in the Western Pacific would be awful--something we absolutely should try to avoid. But avoiding that sort of conflict will probably require a strong deterrence posture so that Xi doesn't think that aggression might be worth the price.
N.S.: As I understand it, the U.S. currently has a so-called "hub-and-spoke" alliance system in Asia, in which the U.S. individually maintains bilateral alliances with various countries that aren't allied with each other. Should we try to change that by moving to a more NATO-style multilateral alliance? In addition, some of the potential partners we'd need to balance China, like India or Vietnam, aren't official U.S. allies. Should we try to formalize those alliances? Do loose quasi-alliance groupings like the Quad have any hope of becoming something like an Asian equivalent of NATO?
H.B.: An Asian NATO would be great if we could get it, because the strongest deterrent to China using force against Taiwan or some other important country is the fear that it would have to fight a huge coalition of countries that would come rushing to the defense. But we probably can't get it, just because the geography of maritime Asia is so different from the geography of Europe. And some of the countries we need to balance Chinese power--you mention India and Vietnam--are interested in American support but not in formal alliances.
So for now, we have to make do with the next best thing: A network of overlapping, mutually reinforcing alliances and partnerships that serve to thicken and reinforce the barriers to aggression. The Quad is part of that; AUKUS helps; the Japan-Australia defense cooperation act signed recently is a good sign. It's great when six or seven nations get together in military exercises, as happened in the Philippine Sea in October, or when the U.S. and Japan subtly advertise (mostly through media leaks) their plans to cooperate militarily in the defense of Taiwan. Perhaps one day we'll get to a more formal, multilateral organization for collective defense in the region, but for now we need a lot of little things that add up to the threat of a very big, multilateral response if China uses force.
N.S.: How should economic relationships be part of that effort? Along with many others, I was dismayed to see the U.S. withdraw from the Trans-Pacific Partnership in 2017. That treaty had its flaws, but it seemed like the U.S.' best hope for drawing Asian economies closer to itself and away from China's sphere of influence. Now, the biggest regional trade pact in Asia is the China-centered Regional Comprehensive Economic Partnership, which just went into effect. Does this present a danger to our efforts to balance China in the region, and if so, is there still time to salvage things?
H.B.: The clock is definitely ticking. There is no winning U.S. strategy toward China that doesn't include a stronger effort to put America at the center of the economic future of Asia. And while the U.S. has some inherent strengths in that regard (hugely attractive consumer market, deep capital markets, etc.), the situation could actually get worse, because China--in addition to doing RCEP--has now applied to join CPTPP, which is essentially the rump trade agreement that emerged after Washington bailed on TPP.
If China gets in, it will do its normal thing where it exploits the benefits of economic integration while never really playing by the rules it signed up to. And it will become even more deeply enmeshed with the countries America needs to hold on its side. The Australians and Japanese will be able to keep China out for a while, but not forever, because Beijing will buy off and bully other members to isolate its opposition. The U.S. doesn't really have a play other than getting back into CPTPP: The Biden administration knows this, and the politics aren't impossible. The problem is that it would take a major investment of presidential political capital to make this happen, and so far Biden hasn't shown much willingness to make that investment.
N.S.: Gotcha. Let's talk about the Biden administration, actually. A lot of people thought, during the primary campaign, that Biden would be the presidential candidate most favorably disposed toward China. But in office, he's proven very hawkish -- keeping Trump's tariffs in place, pressing China strongly on human rights, and even declaring that the U.S. would defend Taiwan (before subordinates sort of halfway walked his comments back). What explains Biden's unexpectedly hard line toward China?
H.B.: I think Biden changed because China changed--and because American politics changed, as well. You probably recall that Biden got pilloried during the primaries for scoffing at the idea that China is a serious competitor for the U.S.. That was a very Obama-era sentiment, and the sentiment underlying it was just impossible to sustain.
China had, by 2020, done a lot of things that made its challenge impossible to deny--destroying "one country, two systems" in Hong Kong, undertaking one of the largest peacetime military buildups in history, putting increasing pressure on Taiwan and U.S. allies in Asia, trying to dominate the high ground of tech innovation, and so on. Its leaders then lied relentlessly about COVID while exploiting the chaos it created to become more assertive on several fronts at once.
Partially as a result, American domestic opinion soured dramatically on China--look at the dropoff in positive views of China over the past few years, especially since 2019. There is now unmistakable evidence that China poses a severe threat to the status quo not just in Asia but around the world. And that has created a new political climate in the United States that no president can ignore.
N.S.: I see. But let's talk a bit about the dissenters from the new policy consensus, because there are some. The Quincy Institute, and some progressive groups, have urged the U.S. to take a softer line toward China. Do they have a point at all? Is America being too aggressive, or making choices that unnecessarily raise the risk of a new Cold War?
H.B.: It's a fair question, and there are things that the U.S. could do that might seem tough but would actually be counterproductive. Wholesale economic decoupling won't work; making a formal defense commitment to Taiwan without having the capabilities to defend it in a crisis might just provoke China. But in general, it is premature to start easing off the gas pedal when it comes to competition with China, because we've only recently begun to take the challenge seriously. The United States had to put containment in place during the Cold War before it could get to negotiation, de-escalation, and detente. Something similar will be necessary today.
N.S.: So are you basically saying that our choice isn't between a Cold War and peaceful coexistence, but between a Cold War and a hot war? That because of China's actions and attitudes, peaceful coexistence is not possible until and unless we shore up our defenses and draw red lines that China's hawks are afraid to cross?
H.B.: That's about right. Whether we like it or not, China is waging a cold war against us. And Xi Jinping will be tempted, in the years to come, to use force to achieve long-sought objectives like grabbing Taiwan or putting one of its neighbors--India, Vietnam, the Philippines, Japan--in its place. The United States will need to compete more strenuously and effectively just to hold its own; it will have to prepare more seriously for a hot war to prevent one from happening. Remember: It wasn't as though there was some principled agreement between Moscow and Washington to conduct a cold war in 1947. One of the reasons that the West was eventually able to win a cold war was that it never stopped trying to deter a hot war. That is a very depressing parallel, but we should probably be thinking in similar terms today.
N.S.: One question I have is, will there be buy-in from the American public for a Cold War style confrontation? Americans remember quite vividly how the Bush administration lied about WMDs in Iraq and pushed us into a pointless and horribly destructive war. On the other hand, negative opinions of China are running quite high, and a recent poll showed that for the first time, a majority of Americans support using military force to defend Taiwan. So where do you see public opinion going on this issue?
Also, a follow-up question here. Some people are worried that a Cold War style confrontation with China will result in a racist backlash against Asian people in the U.S. That seems plausible given the recent wave of anti-Asian attacks, which seems to have been exacerbated by Trump's "China virus" language in 2020. And of course the memory of how the U.S. treated Japanese Americans during World War 2 looms large. What can we do at the policy level to ensure that there's no such backlash?
H.B.: Let's side aside Iraq for a moment: I think the idea that Bush lied is an overstatement, but that's a separate debate (and the war was indeed destructive and counterproductive). There are certainly the makings of a bipartisan consensus on China in the United States. COVID turned Americans against China to a degree that Beijing building bases in the South China Sea never did: It showed how the CCP's cynicism and irresponsibility could cause concrete harm to Americans and their livelihoods. There is bipartisan support in Congress for measures to strengthen America's competitive posture. And, while we shouldn’t make too much of "would you want to defend X" sort of questions, Americans are clearly more concerned about the fate of Taiwan than they were before. For now, the consensus is still broader than it is deep--politicians want to compete with China, but not if it means doing something that would cause even a minor correction in the stock market--but I think this may change over time.
As for the racism issue, this is something that good leadership can help with. We didn't have a massive anti-Muslim backlash after 9/11, in part because Bush, whatever his other failings, modeled good behavior in that regard. And while the Cold War left some ugly political legacies--red-baiting and the like--it also led the United States to invest in domestic reform and rejuvenation. The breaking down of segregation, the creation of the world's best university system, the building of our interstate highway system, and other constructive measures were all rooted, at least partly, in the imperative of making America more attractive and competitive in the Cold War. So hopefully our leaders will treat competition with China not as a reason to bring out our worst impulses, but as an opportunity for America to become a better version of itself.
N.S.: Obviously a lot of people are paying attention to the system with Russia and Ukraine. Is it possible for the U.S. to wage a two-front Cold War here, deterring China in Asia and deterring Russia in Europe? If Russia and China are now de facto allies, is that a combination that overmatches the U.S.? Is there a collection of allies we could assemble that could match that coalition?
H.B.: It's a disadvantageous strategic situation--facing two rivals who both dislike us more than they dislike each other. But I'm not sure that we have much choice other than trying to deal with both challenges at once.
Ideally, we'd like to peel the weaker rival (Russia) away from the stronger one (China)--an updated version of what we eventually did with the opening to China during the Cold War. But Putin has made clear, during this crisis, that his price just for stability in Eastern Europe--to say nothing of detente with the U.S. or cooperation vis-a-vis China--is the neutering of NATO and the abandonment of the eastern half of the alliance. Conciliating Russia, in other words, would require jettisoning interests that we have previously deemed as vital.
The good news is that, even together, Russia and China can't overmatch the U.S. and its allies. Even a distracted U.S. plus NATO is still capable of competing with Russia; the U.S. plus its allies and partners in Asia has significantly more geopolitical heft than China. I don't want to make this sound easier than it is. But the balance of power still favors the democracies.
N.S.: OK, time for the big question. Overall, what is the Biden administration getting right with regards to geopolitical great-power competition? And what are the most important things it's getting wrong?
H.B.: Biden has done a good job framing the competition with China: It is not just a geopolitical competition, but also an ideological competition between different models of government. There have also been some good moves in that competition--the AUKUS deal with London and Canberra, enhanced military planning and cooperation with Japan, progress on Huawei and semiconductor supply chains, and others. And not gratuitously trashing alliances is, sadly, an improvement as well.
But I think the Biden team would admit that they have a long way to go and haven't made much progress on harder issues. They haven't put forward anything compelling to replace TPP. They have only begun to deal with the problem of U.S. investment in Chinese firms that are closely linked to the Chinese government and its predatory policies. They aren't moving quickly enough to shore up the balance of power in the Western Pacific. And they are learning, in real time, that the US has two great-power competitors rather than one. So it's fine to say that the U.S. is going to focus like a laser on the Indo-Pacific, but Vladimir Putin may not allow us that luxury. It all goes to a larger point: I think we're only beginning to realize how severe the overall global challenge we face really is.
N.S.: So if you were the Biden administration's top foreign policy advisor, what concrete recommendations would you make for improving policy in the areas of A) U.S. investment in China, and B) shoring up the balance of power in the Pacific?
H.B.: There should be much stricter curbs on outbound U.S. investment in firms that: a) are closely linked to the PLA; b) are complicit in China's human rights abuses or the construction of its surveillance state; or c) have engaged in intellectual property theft or otherwise violated American law. The Biden administration (following on some Trump-era initiatives) has made a start in this area, but only a start. On the balance of power in the Pacific, the Pentagon has some good initiatives in train to ensure we aren't overmatched in the medium-term. But as Michael Beckley and I have written elsewhere, we're not moving fast enough to deter Chinese aggression in the next 5-6 years. What we really need is to flood the region with anti-access/area denial capabilities--anti-ship missiles, sea mines, mobile air defenses, long-range artillery, and other small, relatively cheap things that can turn the Taiwan Strait into a death trap for an invasion fleet. The good news is that most of these capabilities already exist--we just need more of them, and we need more of them right now.
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Why is the sky near 
Keith's note: Like many other people in the DC area I have been going to these Arlington memorial events as often as I could for more than 30 years - especially when I served on the board of directors of the Challenger Center For Space Science Education. This event is held in a huge public outdoor place but NASA now uses COVID as an excuse to limit attendance. Anyone who has been there knows that this is a vast open space. This really sad. 
Market Design
As Rajagopalan and I argued in 
the joy of sox
Inspired by our recent acquisition of Bernard Sleigh’s six-foot long “An Ancient Mappe of Fairyland, Newly Discovered and Set Forth,” (1918) we have selected thematic maps, books, and ephemera from our collections that reflect whimsy and visionary thinking. This exhibit invites visitors to ponder the ways in which myth, fantasy, and fiction have, for centuries, provided both an escape into alternate worlds in times of great strife, as well as an opportunity to create alternate worlds and imagine new realities.”
