The high-official U.S.-China meeting in Alaska gives a foretaste of how the new Biden administration will address the challenges with China. In the opening statement, U.S. secretary of state Anthony Blinken said the U.S. would “discuss our deep concerns with actions by China, including in Xinjiang, Hong Kong, Taiwan, cyberattacks on the United States and economic coercion toward our allies. Each of these actions threatens the rules-based order that maintains global stability.”The Biden administration is thus continuing on the path taken by Trump vis-à-vis China, although Biden favors a multilateral strategy with allies to address challenges with China, as evidenced by the Quad dialogue with leaders of Australia, India, and Japan.
Regardless of how to evaluate Trump’s handling of China, it broke with path dependencies in U.S.-China relations, especially trade policy. President Trump began a trade war with China leading to tariffs on $250 billion worth of Chinese goods. By citing U.S. security risks to impose tariffs on steel and aluminum and ban G5 technology from Huawei, trade became a major security issue under Trump. Even if the Trump administration reached the so-called “phase one” deal with China, it can be rather seen as a trade ceasefire than a lasting trade peace.
There is no sign that Biden will lift tariffs against Chinese goods. He ordered a review of supply chains for critical technologies to reduce U.S. dependence on China. Even the public rhetoric continues to be agnostic and aggressive as seen at the U.S.-China talks in Alaska. In addition to trade, issues such as territorial disputes in the South China Sea led to growing tensions between the U.S. and China during the Trump presidency and continue to do so.
Trump’s “maximum pressure” strategy toward China undeniably had an impact on public opinion; with other events such as China’s aggression in the South China Sea, the protests in Hong Kong, and reports about the genocide against Uighurs doing their part. The result is anall-time high in unfavorable views of China. Among the American public,77 percent have an unfavorable view of China and45 percent view China as the greatest enemy. Despite talk of a divided America, Democrats and Republicans are united in their negative views of China. As a result, the president and members of Congress, regardless of party affiliation, have to promise a tough stance on China to avoid being labeled soft.
Trump also shifted the stance of the Republican Party on trade and economic policy, especially addressing China. The Republican Party was known to be the party of free trade for decades. Trump has not only silenced free-trade supporters but altered the Republican paradigm. Sen. Marc Rubio (R-Fla) called fora “pro-American industrial policy” and recognizing “the perils of free-market fundamentalism” when addressing the challenge of China. The Biden administration supports an industrial policy that could pump billions of dollars into the US economy to advance competition in future technologies such as artificial intelligence and quantum computing.
But not only on trade, but also on other issues such as territorial disputes in the South China Sea, tensions over Taiwan, and protests in Hong Kong, there is a bipartisan consensus to get tough on China. All in all, whether it was Trump’s rhetoric and policies, shifting public opinion, or actions by the Chinese Communist Party, Washington across party lines increasingly sees China as a strategic threat.
The growing tensions, aggressive rhetoric, and confrontational policies between the U.S. and China raise the issue salience and public attention. Increasing issue salience makes negotiation failure more likely when negotiations are agonistic. The reason is so-called audience costs and reputational losses. Audience costs are losses that a domestic audience imposes on a political leadership if it backs down from its own demands or threats, regardless if such giving in would be good from an economic or security standpoint. Reputational losses describe the long-term loss of credibility a negotiator would suffer if she would back down from a threat.
Concerns about potential audience costs and reputational losses tie a negotiator’s hand. On the one hand, this can be a bargaining advantage for a negotiator because it makes threats more credible. On the other, it also makes it difficult for a negotiator to give in, and therefore increases the risk of negotiation failure. Research shows that audience costs and reputation can lead to bargaining failures and escalation. Because the hand-tying effect of both increases as an issue becomes more salient, public aggressive rhetoric as in Alaska is not just cheap talk but prevents conflict resolutions by tying the hands of negotiators in the future (although the effect may still be small because the demands and threats were vague).
The resulting tensions and negotiation failures initiate a vicious cycle in which both sides perceive the other more and more as an economic and security threat or enemy. Overtime, disputed goods can then become intangible and indivisible. For example, a trade conflict is then not anymore just about economic gains and losses, but related to security or even symbolic value and national honor. Conflict research shows that disputes about intangible stakes fuel tensions and increase the risk of escalation. An initial win-win situation can turn into a win-lose or even a lose-lose situation where I want to hurt the other side even if it hurts myself.
The described mutually reinforcing trends supplement the so-called Thucydides trap. The Thucydides trap describes a tendency toward war because an existing great power feels threatened by a rising power. While the Thucydides trap describes abstractly how power shifts lead to war, research on international negotiations and conflict helps to better understanding inherent dynamics in negotiations that prevent conflict resolution and are key to achieve cooperation.