The Beijing Olympics officially opened yesterday with a Xi-Putin joint message
of solidarity, showing once again that the Olympics can bring together dictators around conviviality and power like few spectacles can.
With fireworks in the background and the one year mark of the Biden Administration passing by, the chattering class is starting to assess the status of America’s response to China’s rise. Let’s just say that unlike Hanyu Yuzuru, America’s attempt at a quad axel jump in diplomacy remains a very distant dream.
, who until recently was a lead writer on U.S.-China trade coverage for the Wall Street Journal before retiring, penned a piece for Politico
this week observing that the administration’s entire economic strategy for Asia remains roughly 2.5% the length of this humble newsletter:
But 13 months into the Biden presidency, the administration’s plan for competing in the region consists of a single 51-word paragraph … They say they are only at the start of a months-long process to develop an Asian economic plan — but as yet, that paragraph is the closest thing to a public strategy that the White House has announced.
The paragraph lists a half-dozen topics where the U.S. will seek agreements with Asian nations, including on infrastructure, climate and digital technology. But so far, the White House has not released any supporting documents or held any press briefings to explain its plans, and Biden officials acknowledge they haven’t come up with specific proposals yet.
The challenge is, of course, politics and the factionalization of the response to China. Free traders, anti-free traders, globalists, nationalists, engagers, anti-engagers, pragmatists, idealists, fatalists — you’ve got them all trying to cohere around a strategy, the outline of which any one faction (and probably many) will immediately defect. “But the more specific the plan gets, the more the political constraints kick in,” Davis writes, observing pithily, “The result: inaction. Policy options are debated, teed up for release and then pulled back — a kind of vaporware China economic policy.”
The U.S. and the West are taking small steps, but ones that may well do more harm than good to our technology sector. On the “Securities” blog, I wrote about how Berlin declined to approve the acquisition
of Germany-based Siltronic
by Taiwanese competitor Global Wafers
. It’s a decision grounded in technology sovereignty, but one that will ultimately damage Siltronic, the only Western provider of silicon wafers among the top five companies by market share. With strategic M&A options off the table, its value in the eyes of investors is consequently lessened, ultimately limiting its ability to raise the capital it needs to compete with Japanese, Korean, and Taiwanese firms.
Meanwhile, the U.S. Commerce Department is working to build what I dubbed this week a “nuclear option
” to shut down apps that it deems a threat to national security, with a very clear eye focused on TikTok
(which at this point seems to be walloping Meta Platforms
). There are clear and valid concerns about privacy (particularly around China), but much like the administration’s strategy toward Asian economies, there’s similarly no strategy around data privacy. If China shouldn’t see an American user’s data, why should Russia, or Saudi Arabia, or Europe, or Canada or even just Google
Countries are not startups or companies — they have a broad spectrum of valid views and interests, and it’s fair to say that managing a democracy of 330 million is complicated. Yet, our competitor faces no barrier to developing and implementing comprehensive strategies. China’s blueprint for … well, pretty much everything has been published and is regularly updated. As can be seen in books like Rush Doshi
’s The Long Game: China’s Grand Strategy to Displace American Order
, China has centered much of its strategic planning on defeating America, the West, and the liberal international system that they built.
Let’s just say it is much longer than 51 words.
There is only one way forward, and that is action. Inaction is a policy, as is spending more than a year to assemble a few words in a document while continuing to debate in corridors and wood-paneled conference rooms. When things are going badly, you sometimes just have to set out and jump in one direction. It won’t be a quad axel, and it won’t be graceful or score well with the judges, but at least you will be on the ice, competing.