America’s New Cold War with China

Where the differences happen, most of them actually reinforce the Cold War narrative, because unlike the first Cold War, we have a tech war going on in semiconductors, and AI, as part of this competition with China. 

Does China see itself in a Cold War with the United States? 

I absolutely think so. This does not start with Xi. If you look at the overarching guidance Deng Xiaoping gave to the Chinese nation back in the 1970s, it was: “hide your strength, bide your time.” The natural question is: Who are you hiding your strength from? And what are you biding the time for? The answer is quite obvious. 

It’s not an accident that for the last 40 years, as China has undergone this miraculous economic transition that they then parlayed into a military buildup, that the military buildup is almost exclusively focused on two things: a) taking Taiwan and b) pushing the U.S. out of the Indo-Pacific region. It is very clear they want to dominate the Indo-Pacific, it is very clear they want to then extend that dominance across the world. They’re very open about their ambitions. 

I guess the goal of a Cold War is to avoid a hot war, which is the other pillar of the book: the U.S. should do everything possible to avoid a military conflict with China over Taiwan. It would be lose-lose for the U.S. – catastrophic to defend Taiwan, but world-order-altering if we decline to do so. Yet, given the potential casualties – for us and our allies, and for civilians – and the possibility of a nuclear confrontation, why shouldn’t the U.S. just sit this out? 

As I write in the book, there are three scenarios here. One is that we deter China from ever trying to invade Taiwan. That is the Goldilocks scenario that is absolutely in our power to strive for. 

The other scenario is China goes, and it wins or it loses. Both of those scenarios, you’re absolutely right, would be just devastating for U.S. casualties if we fight, for a global economy that would go instantly into global depression, potentially as much as $10 trillion worth of economic value wiped out in the first year. But losing Taiwan to China is also a terrible scenario, because of what Taiwan represents.

There’s this very reductionist view across a fairly large portion of the U.S. public that just sees Taiwan – to the extent they even think about it – as basically a manufacturer of chips. We should get rid of our dependence on Taiwan for chips, and once that happens, Taiwan no longer matters to us. 

There are two problems with that argument. One is we’re not getting rid of our dependence on Taiwan for chips in the foreseeable future, like the next 10 years. That is an impossibility, given how much they produce and the investments we’re making through the Chips Act, which are necessary, but not sufficient to dominate the industry. 

Perhaps even more importantly, Taiwan mattered to U.S. strategy long before even the age of computing. In 1950, General Douglas MacArthur called Formosa, as it was called at the time, “the unsinkable aircraft carrier.”

If you put yourself in [China’s] shoes, looking out at the vastness of the Pacific Ocean, what do you see? You see yourself completely contained by U.S. allies and U.S. military bases. If you’re China, and your objective is to be the world’s greatest power, military, economic and political, you cannot allow yourself to be contained by another power, where you are at the whim of America for allowing your commercial shipping in and out of the country.

From both a defensive and offensive perspective, taking Taiwan will change everything. Taiwan keeps China bottled up – it is that cork that keeps them contained. If you remove it, you can establish your own naval bases on the island, then you can project power across the Pacific, push the U.S. out of that region, and start setting the rules of the road for Asia, the most important region in the world, where you have 50 percent of the world’s GDP, most of the economic growth, most of the world’s supply chains. 

I’m not necessarily of the view that once China takes Taiwan, they’ll be on a march across the Pacific, occupying one country after the other. Frankly, that’s really, really difficult. But you don’t need to invade to bully and to be the dominant power in the region. 

The analogy here is what happens in Central Asia, where you have states within Russia’s sphere of influence, who really have no choice but to accommodate Russia because the United States is far away, it can’t do anything for them. That is what’s going to happen in that region to Japan, to the Philippines, to [South] Korea. This is not a hypothetical. I’ve had officials in those countries tell me that’s what the loss of Taiwan to China would mean to them.

That sounds bad for American interests, certainly. But still. 

It’s a retrenchment of American power and American economic capabilities from the most important economic region of the world, which will then be parlayed by China into extending its influence that already is significant in Latin America and Africa, in Europe, and elsewhere. It’s going back into sort of Fortress America mode, where we no longer dominate the world’s oceans, where we no longer set the rules of trade and economic growth and the democratic system of government around the world.

It is a weaker America. It is an America that is losing allies because those allies no longer can depend on us. 

It will mean that America will be eclipsed by China as the world’s greatest superpower. Less economic prosperity for the United States, an impact on national security. I don’t think it’s a world that most Americans want to live in.

You argue in the book that the United States is too often distracted abroad. You also make the case the U.S. needs allies, even those outside the Indo-Pacific, in this Cold War. But crises happen, and our allies seek our help in their neighborhoods. How does the U.S. accomplish this balance?  

I’m not advocating – and I know some do – of complete retrenchment from the world to focus on China. I think that would be absolutely counterproductive to our interests, which are global in nature, not just focused on Asia. 

But I do want us to be much more humble about our capabilities and end goals. So, when it comes to Russia, to Iran, and to North Korea, I think that our ideals and desires do not match our capabilities. 

This idea that we are going to be policing the rest of the world and being the dominant security provider, I think we just no longer can afford to do so. Doesn’t mean retrenchment but it means scaling down on ambitions and relying much more on friends in the region and playing a supporting role as much as we can.

Your book reinforced for me how unprepared the U.S. might be to fight a war with China – we would need a lot of weapons, and American efforts to arm Ukraine have revealed some big issues with the U.S.’s defense industrial base. On the one hand, it seems the United States should have a sense of urgency there. On the other, does a massive arms buildup potentially come off as a provocation? 

On the latter point, absolutely not. China is undergoing a massive military buildup, the largest and most rapid the world has ever seen. I do not think responding to it is provocative in the least bit, despite the fact that they would certainly like to make that argument.

In terms of our preparedness, we are absolutely trying to invest in certain capabilities. The legislation that just passed – everyone focused on Ukraine, but there is aid directly to Taiwan, as well as significant investments in our own defenses in Guam, and in Japan, and other areas around the region, which is really, really important. 

The question is really time. I started out the book with this quote from Tolstoy from War and Peace, that the two most powerful warriors are patience and time. You could argue that we have no patience, and we’re out of time. As I write in the book, China has wanted to take Taiwan since 1949, and this is unfinished business since the civil war. 

But what’s driving the urgency is one man, and that’s Xi. And the similarities with Putin are remarkable because both men are in their seventies. Both men have consolidated power where it’s their decision, and their decision alone. Xi is also looking at his own mortality, and for the end of his power, just as Putin was. 

I believe that 2028 through 2032 is going to be an incredibly dangerous period. In 2027, Xi will almost certainly get reelected as the Communist Party leader for a five-year term. In 2028, he gets past the transition period, and the window opens up for him.  I think, in his mind, at least, it is likely to close in on 2032, because he’ll be seventy-nine, unclear whether he would still have support of the party at that age, to get reelected – unlike our system, they don’t tend to elect their leaders in their eighties. He may be thinking how long will he live. 

America has a pretty big election coming up. How do you see U.S. domestic political tumult affecting your blueprint for deterring China?

Despite the dire title of the book, I argue that China is weak, and we have numerous strengths. The big question mark is: do we have the political will to marshal them to achieve victory? I can’t answer that question. The American people will ultimately answer that question in our representative democracy. 

The only thing I will tell you is that this moment is not unique in American history. We have always been very divided politically, even in times of great peril. History suggests that despite that robust debate, Americans ultimately consolidate, and in the face of an existential threat, pick the right outcome. We shall see if history repeats itself this time around. It’s impossible for me to predict. 

The one thing I will say is, obviously, there’s a lot of concerns about some of the statements that Donald Trump has made with regards to allies. But Donald Trump was also the person that put China front and center in U.S. politics, and really deserves credit for unifying the debate across the political spectrum, that China is a threat and needs to be confronted.

There isn’t agreement on anything in this town, as you know, except for one thing. There are tactical disagreements, but almost no one at this point contends that China isn’t a problem. Donald Trump, I think, deserves credit for changing that debate. Now, whether his policies about how to confront China are the right ones, or whether it’s Biden’s, we’ll see that play out in the election debate.

Yet sometimes that bipartisan consensus leaves blind spots. What’s the biggest one when it comes to China right now?

I think you still have this idea, and it’s very heavily promoted by the Biden administration, that you can compete with China. I’m much more of a zero-sum game view that there’s going to be one victor, us or them. I think they’re of that view, as well. 

As an American, I want us to win. I think the only thing that matters is winning, and that threading the needle of trying to contain their ambitions in certain areas, like advanced semiconductors, for example, and AI, but allowing it to continue in other areas, like green technology or critical minerals, is not going to get us there. 

We need to pick a side. We’re either going to try to appease them – obviously, I don’t think that’s the right approach. Or we’re going to go fight the Cold War in every area of technological competition. 

The U.S. did work with the Soviet Union during the Cold War, including on arms control. We had periods of détente. Can we do the same for this United States-China Cold War?

This is a great question. As I write in the conclusion of the book, détente is absolutely the goal with China. But you could not get to a détente in the 1970s, without going through the Berlin crisis, and the Cuban Missile Crisis that came out of it. 

For the first fifteen years of the Cold War, most Americans forget, but there was an enormous risk of a hot war between the Soviet Union and America over West Berlin, beginning with the Berlin Airlift in the 1940s, and ending in 1961, when Khrushchev and Kennedy met in Vienna. Kennedy came away convinced that Khrushchev was going to invade West Berlin, and had made the decision to defend it, even at the risk of nuclear war, all for this little piece of land, surrounded by East Germany. 

But he made the case to the public that this is crucial to American interests. In August of 1961, after that incredibly tense summer, Kennedy’s woken up, and he’s told that the East Germans are building the wall. And Kennedy celebrates. He says, ‘thank God, he’s building the wall. That means he’s not going to invade.’ 

The wall, I argue, was absolutely essential to get into détente in the 1970s because it ended the prospect of a hot conflict between the Soviet Union and the United States because there was no other hotspot really where we would go to war over. Cuba, yes, but that was a momentary outcome of the West Berlin crisis. 

I argue in the book if we managed to deter this invasion of Taiwan, if we built a metaphorical wall across the Taiwan Strait, and make [invasion] an impossibility, then you could get to détente because there’s no other place over which the United States and China will go to war. It won’t be over some rocks in the South China Sea.

Taiwan is that one place. And if we manage to get past that point and deter conflict and change that military balance of power, we can get to better relations. The Cold War will not end, just like it didn’t end with the Berlin Wall. But you could have a conversation with China that is not dominated by Taiwan issues as it is today. 

What’s the metaphorical wall?

That’s really the bulk of the book. The military deterrence piece. There’s also a huge economic trends piece to this. I don’t argue for decoupling – it’s not realistic, and it’s counterproductive because if we have no relations with China economically, that means we have no leverage.

I argue for this new strategy of what I call “unidirectional entanglement,” where we make China more dependent on us, while we’re becoming less dependent on them in areas of these four critical technologies: AI and autonomy; biotech and synthetic biology; space; and green tech – and the semiconductors and critical minerals that go into them. 

Deterrence is this funny thing, right? It’s very ambiguous. You’re trying to influence the decision making of the other party – of one man, Xi, in this particular situation – and you don’t know what would be enough. 

I would argue that the risks here with Taiwan are so high that we have to do it all. We have to do the military piece. We have to do the economic piece. We have to do everything in our power to make sure that Xi Jinping wakes up every morning, looks himself in the mirror as he’s shaving, and says: ‘today is not the date.’