Tuesday, June 4, 2019

"No sweet spot for Singapore in US-China tensions"

An interesting view of the eagle and the dragon from the Straits Times, May 30:

The United States and China are settling into a protracted struggle over trade, technology and geopolitics. Singapore will come under special scrutiny, as an ethnic Chinese majority society with strong ties to both.
On May 20, China's President Xi Jinping, during a tour of Jiangxi province, said: "We are now embarking on a new Long March, and we must start all over again."
Jiangxi was the start point of the best known of several retreats by the Red Army that came to be collectively known as the Long March.

Mr Xi did not explicitly mention US-China relations. But 10 days earlier, what was supposed to be the final round of trade talks ended without agreement and the Trump administration raised tariffs on Chinese exports from 10 per cent to 25 per cent. It was clear enough what Mr Xi was referring to.
A week before, an editorial in the People's Daily had described United States-China tensions as a "People's War".

This is highly charged political rhetoric, infused with deep symbolism that drew on the founding myths of the Chinese Communist Party (CCP).
Not all the symbolism may, however, have been as Mr Xi intended.

In October 1934, mistakes by its inexperienced Military Commission led the CCP's First Army to the brink of encirclement and annihilation by Kuomintang (KMT) forces. It narrowly escaped by embarking on a desperate strategic retreat. A year later, only about a tenth of the Red Army that left Jiangxi reached sanctuary in Yan'an in Shaanxi province.

CHINA'S MISREADING OF THE US
Today, Beijing has clearly misread the direction of US-China relations. It underestimated the Donald Trump administration's determination to confront China, despite the 2017 National Security Strategy and the 2018 National Defence Strategy having labelled China a "strategic competitor".

After the 2009 global financial crisis, China seems to have begun to believe its own propaganda about the US' inevitable decline. After the 2012 Scarborough Shoal incident, Beijing may have mistaken the Barack Obama administration's reluctance to stand up to China as a new norm of American foreign policy. China may also have been misled by the contempt for President Trump that its usual interlocutors in the American foreign policy establishment did not bother to hide.
Towards the end of the Hu Jintao administration, and far more insistently under Mr Xi, China began to pursue its economic and strategic interests with increasing assertiveness. Chinese foreign policy took on a triumphalist tone. By the time of the 19th Party Congress in 2017, Deng Xiaoping's approach of "hiding light and biding time" had clearly been abandoned.
Hubris is not an American monopoly, and these were serious mistakes. Since the trade war started, Mr Xi has been subjected to muted but nevertheless pointed criticism within China.

Among the clearest criticisms was one by Mr Deng Pufang, Deng Xiaoping's son. In a September 2018 closed-door speech that was reported by Mr Jack Ma's South China Morning Post, he said: "We must seek truth from fact, keep a sober mind and know our own place." And that: "We should neither be overbearing nor belittle ourselves... The most important thing at the moment is to properly address China's own issues."

Mr Deng Pufang's criticism was all the more powerfully poignant because he was speaking at a meeting of China's Disabled Persons Federation. He himself had been crippled during the Cultural Revolution.
It was to prevent the reoccurrence of such excesses that his father had introduced the two-term limit that Mr Xi discarded.

Xi Jinping is not Mao Zedong. But the concentration of power on Mr Xi's watch, and the severe penalties for perceived disloyalty, may have reintroduced something akin to a neo-Maoist single point of failure into the Chinese system. There is good reason to wonder what is being reported upwards and how accurately.

In March 2017, I met an American friend who heads a major US corporation in New York. He is a senior member of the US-China Business Council that had just met Vice-Premier Liu He, who was on a visit to try and head off a trade war.

"What did you tell him?" I asked. The friend replied: "We told him it is all of us and not just Trump."
I was surprised. The disenchantment of American businesses with China had been building up since the George W. Bush administration. Surely, he already knew, I said. He didn't seem to, my friend replied.

China's growth was already slowing when Mr Trump raised tariffs. By the time of the annual lianghui or the "two sessions" of the National People's Congress and National Committee of the Chinese People's Political Consultative Conference in March this year, the serious pressures and uncertainties confronting China could not be concealed.

Premier Li Keqiang's report to this year's lianghui was a sober assessment of the dangers China was facing. Earlier, in January this year, Mr Xi outlined seven "major risks": politics, ideology, economy, science and technology, society, the external environment and party-building.

None of this is intended to suggest that China is going to fail. The CCP is an extremely resilient and adaptable organisation and I do not think that China will fail. Corrections have already been announced, for example to Mr Xi's signature Belt and Road Initiative. It remains to be seen how the adjustments to policy will be implemented....MUCH MORE
HT: Marginal Revolution

As noted last month:
Not to take anything away from Xi's accomplishments but Xi is not Deng, or even Hu.