Under Xi Jinping, China has demonstrated a willingness to weaponize its economic power to impose its influence, and countries are waking up to the vulnerabilities created by China’s dominance of critical supply chains. The trade war between the United States and China, begun by President Trump, persists. China boasts the world’s largest army, and its military spending has grown five-fold over the last two decades and continues to grow as it pursues military modernization efforts. Beijing has increased aggressive military actions in the South China Sea and in the Taiwan Strait and is rapidly expanding its nuclear weapons program, which is expected field 1,500 nuclear weapons by 2035. China also has more diplomatic outposts than any other country, and its carbon output is equal to the next three countries combined and likely to increase as it seeks economic growth. Under Xi, mass surveillance and internet censorship have become a central pillar of control and suppression.
A framework of “strategic competition” has emerged as the U.S. approach toward China, characterized by a three-track strategy to invest in U.S. innovation, align with allies and partners for common purpose, and to compete with China to defend U.S. and allied interests. The Biden administration has further implemented a “small yard, high fence” approach to protect critical technologies, leading to a deepening conflation of economic security and national security.
These trends and activities have put the United States and China on a path towards tension, and diplomatic relations between the two countries soured precipitously during the Covid-19 pandemic and over a Chinese spy ballon that was found flying over middle America in early 2023. The Biden administration has worked hard to stabilize the U.S.-China relationship through several high-level dialogues. A U.S.-China summit in November 2023 resulted in important commitments to combat illicit drug manufacturing like fentanyl, restoration of military-to-military communications, and address the risks of advanced AI systems.
Renewed dialogue and diplomacy are critical to preventing misunderstanding and creating space for de-escalation. The U.S. and Chinese economies are too intertwined to risk complete decoupling, nor would this be desirable as the world’s two largest economies. Moreover, transnational, and existential threats like climate change, pandemic preparedness, and nuclear nonproliferation will require the United States and China to work together. Partners and allies also look to the United States to responsibly manage this relationship, many of whom depend on China for trade.
The United States has extraordinary strengths—including our alliances and partnerships around the world and the vitality of our economy and democratic institutions—to draw on in pursuing a future that protects our values, promotes freedom and prosperity, and enables the rights of people everywhere, including Taiwan, to determine their own future peacefully.
