The United States and China recently held their Sixth Annual Strategic and Economic Dialogue here in Beijing. U.S. Secretary of State, John Kerry, and Secretary of Commerce, Jacob Lew, were in attendance.
The American Chamber of Commerce in China (AmCham), of which I am a member, issued a summary to members noting that it “is encouraged by the continued commitment to the Third Plenum reforms, and the marketization of the economy.” There was discussion, according to AmCham, about the opening of more industries to foreign investment, particularly in the service sector, the protection of intellectual property rights, and creating a level playing field between wholly-owned foreign enterprises, or WOFE’s, and domestic Chinese firms, including the huge state-owned companies that dominate key industries such as banking and energy.
All pretty dry stuff to the average American and Chinese citizen. And, from what I’ve read, not a lot of iprogress was made on the issues that are most important to the American side – namely, financial services. A commitment from both sides to continue the dialogue but not a lot of actionable conclusions.
And this, of and by itself, I find to be quite notable. Politically, the relationship between China and the U.S. is quite strained at the moment over the U.S.’s well-publicized and actionable Pivot to Asia. That the Dialogue steered clear of the tensions, at least publicly, speaks to the degree to which the two countries need each other economically, the priority China puts on harmonious economic development, and China’s ability to segment business and politics.
From the Chinese side I believe there are a couple of logical explanations for the reticence. The Dialogue, after all, was held on Chinese soil and they could have used it to stir up the citizens and promote their political agenda. (One of the advantages of the one-party system is that there is no need to turn every appearance in front of a microphone into a campaign rally.)
One explanation is the point I’ve made before that while President Xi Jinping is the first modern leader of China as an established world power, his legacy will be a domestic one. His first priority is to move the economy away from the investment/export model that created the world’s second largest economy toward a service/consumption model that will improve the quality of life, relieve the unsustainable pressure being the factory to the world has put on the environment, and give China the economic and political independence it needs to pursue its own interests free of outside influence.
The second explanation is equally straightforward. The Chinese are simply confused by the American Pivot to Asia. What are its real objectives? And how far will the United States go to achieve those objectives?
Part of the reason for the confusion is the simple fact that while Americans talk a lot about action, our communication style is very dialogue-oriented. Intent carries a lot of weight, even in the legal system, so we put a lot of weight on written and verbal communication. What did he say? What did she really mean?
As receiver-oriented communicators, on the other hand, the Chinese are much more behavior-centric in their communication. What you do carries far more weight than what you say. While words are the very foundation of communication in the West, they are mere window dressing here.
When President Obama recently toured Asia but left China off his itinerary, that fact alone outweighed his numerous verbal attempts to assuage Chinese fears that the real purpose of his trip was to blunt China’s emergence in the region and further America’s regional influence.
During the time of the Dialogue, by coincidence – or not – CNBC aired an investigative report on the current dispute between Vietnam and China relating to deep-water oil rig HD – 981, owned by the China National Petroleum Corporation (CNPC), and it’s placement in disputed territory near the Paracel Islands. (The Chinese refer to them as the Xisha Islands, while the Vietnamese know them as the Hoang Sa Islands.) In that report one senior Chinese official, I believe, insightfully got to the heart of the matter. I paraphrase: ‘When it come to geo-politics, sometimes the Americans want to be the coach. Sometimes they want to be the referee. And sometimes they want to be a player. In the end, this confuses the Chinese side.”
And I think he makes a reasonable point. But it does seem unlikely to me that this is an act of intentional obfuscation on the American side. Obfuscation is a strategy normally employed when one party to an argument is attempting to defend itself.
The ‘Pivot to Asia’, however, is an offensive move. And while the emergence of China seems an obvious cause, I have yet to hear or read of any clear explanation as to why the emergence of China is of concern to the U.S. What self-interest, exactly, is the U.S. trying to protect? And why do they feel it is threatened?
The Chinese clearly believe that the U.S., through its Asian pivot, is enabling, if not promoting, regional conflict. Would Vietnamese fishing boats be so brazenly ramming Chinese boats surrounding the rig if it was not confident that the U.S. Navy would step in in the event of an actual confrontation? (There were 1,547 incidents of Vietnamese boats ramming Chinese ships according to a report in China Daily.)
In the end the Chinese are holistic pragmatists when it comes to geo-politics while the Americans are theoretical doers. Cause and effect. We see conflict and we want to resolve it. The Chinese see conflict and want a harmonious stand-down. Co-existence above resolution.
Territorial disputes are as old as the earth itself. Nationhood is a continuous work in process. Which is why settling territorial disputes is such a tricky business. If you turn back the clock of time where do you stop? Who, exactly, does Europe belong to?
It’s easy to see why the Chinese are confused. The Middle East, as it has for centuries, is once again a hotbed of geo-political unrest. And who is in the thick of it trying to sort it all out? The Americans. And in this case they have an understandable and defensible objective – national security.
Economically, however, no one has more at stake in the Middle East than the Chinese. China, the world’s largest energy user, imports 60% of the oil it uses, mostly from the Middle East. And yet, if they are involved in resolving the many conflicts currently flaring there, they’re doing so pretty quietly. In part, I think, because they don’t consider it to be their business and, in part, perhaps, because they see little hope for resolution.
In the end, whatever the objectives of the Asian Pivot ultimately are, I don’t see how confusing the Chinese can help. More than anything else, it seems to me, what you want in the world of global politics is rational behavior. Friends are friends and enemies are enemies but you at least want to know who is who.
The Chinese accept conflict as a fact of life. Conflict is not a moral issue to them to the extent that it is for Westerners. They are holistic pragmatists, as I’ve noted. But pragmatists, more than anything else, want/need clarity. You can’t be pragmatic about what you don’t know or understand. If anything, a pragmatist will assume the worst in the face of uncertainty. That’s the most practical response.
In the case of the Asian Pivot I think the Chinese are genuinely confused. Both because it seems to be based on some deductive logic that is simply foreign to their worldview. And because, from what little I know, no one has taken the time to really articulate its whys and wherefores.
And perhaps we/Washington really don’t know. Perhaps to those with the power and responsibility to come up with geo-political strategy it just seemed liked the thing to do.
It’s a basic law of organizational behavior that if you give someone a job to do they will attempt to do it. At the very least, they will do something.
With the Cold War behind us, the foreign policy gurus are not just going to collectively hand in their resumes and go back to wherever it is they came from. It is, however, the job of the elected politicians, and the voters who put them there, to insure that such policy is both logically sound and has both a moral and defensible purpose.
So whatever the goals and boundaries surrounding the Pivot to Asia are, I think it’s very much in the U.S.’ best interests to clearly articulate what they are. Confusing China, it seems to me, is to open the door to irrational behavior. And isn’t that, in the end, what everyone wants to avoid?
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Copyright © 2014 Glassmaker in China
Notice: The views expressed in this post are strictly those of the writer acting in a personal capacity. They are not in any way endorsed or sanctioned by his employer or any other individual with which he may be personally or professionally affiliated.