The ‘trust factor’ in US-China relations

Eduardo Araral
At the heart of the dilemma are uncertainty, distrust and fear about the motivations of both parties and the resulting problem of credible commitment

SINGAPORE – The just concluded 2012 Shangri La Dialogue in Singapore had defense ministers and diplomats in Asia pondering about the future of US-China relations and the implications to their countries.

US-China relations today are faced with an inherent dilemma. China, as the rising power, has to credibly convince the US, the incumbent power, that it is not a threat to its security and is not out to undermine its core interests. Similarly, the US has to credibly convince China that it will not be contained and its core interests will not be harmed.

At the heart of the dilemma are uncertainty, distrust and fear about the motivations of both parties and the resulting problem of credible commitment. China and the US as competitors are inherently suspicious of each other but they also understand the need for cooperation and reassurance.

I call this the 5C dilemma of US-China relations: a credible commitment conundrum with Chinese characteristics. I argue that the 5C dilemma is a useful prism to understand and manage the future of US-China relations. My central argument is that this inherent dilemma need not end up in a tragedy. Let me explain.

The 5C dilemma is driven both by cooperative and non-cooperative elements. The non-cooperative drivers, which heighten the 5C dilemma, include China’s suspicions about regime change as the ultimate goal of the US and the widely held belief in China that the US is moving towards Cold War style containment as evidenced by the Transpacific Trade Partnership and military power balancing by the Pentagon. Likewise, the US has legitimate historical, ideological, security, and structural concerns about the rise of China.

On the other hand are cooperative factors that help mitigate the 5C dilemma: mutual economic dependency; China’s strategic interests, albeit noisy, are transparent, stable and limited (at least for now); China is not a military threat to the US (at least in next 20 years); China’s form of authoritarianism is constrained unlike the USSR; the increasing level of maturity of US-China relations and the pragmatism and realpolitik of China’s top leaders.

These factors make it possible for both countries to cooperate with each other despite their inherent rivalry.

Indeed, the 5C dilemma suggests that US-China relations have inherent potentials for a security dilemma and spiral of fear but it also present possibilities for reassurance and cooperation. The spiral of fear hypothesis, for instance, suggests that while the relationship can be characterized as steady for now, it is inherently unstable because of the growth of China’s relative power.

To make the relationship stable, both parties can signal their core interests and motivations to remove or reduce the element of uncertainty. In practice, this is what the US and China has been doing.

However, in a strategic setting between a rising power and an incumbent power, these signals will be discounted as cheap talk because both parties have incentives to send mixed messages (cooperate and not-cooperate) or play a game of strategic ambiguity.

Thus, to mitigate this dilemma of cheap talk, a regime of credible verification, assurance and threat would have to be established.

The 5C dilemma raises a central question on the future of US-China relations: could the competition-enhancing tendencies inherent in the growth of China’s wealth and power eventually be overcome by the cooperation-inducing tendencies produced by the liberalization of its domestic political system?

Here, I am a pessimist. Even with a rising but discontented middle class and an angry under class and despite the inevitable slowing down of its economy, the threat of the Party losing power is small for a number of reasons.

First, it has effective controls over its military through the budget lever; no regime change will succeed without support from the military.

Second, political and economic power is effectively decentralized making the structure more stable.

Third, institutionalized and stable succession mechanisms such as intense intra-party competition, accountability and meritocracy, term and age limits, consensus based decision making and dual generation succession makes the process stable.

Fourth, China has an effectively functioning accountability with Chinese characteristics, which helps legitimize and hence stabilize the system.

Fifth, the emergence of organized national opposition that can credibly threaten the ruling party remains unlikely.

Finally, China’s leaders have time and again demonstrated pragmatism in adopting to changes and in resolving crises. The trajectory and path dependence of these political reforms suggest that the liberalization of China’s political system is unlikely, dashing the aspiration of liberals, realists and constructivists in international relations.

However, I agree with Aaron Friedberg, a scholar on US-China relations, that neither history nor theory can provide any assurances that the relations will be steady and stable.

This is why I argue that managing the relationship requires an understanding of the 5C dilemma and why it needs a steady and careful engagement backed up by a credible regime of verification, assurance and threat along with pragmatism on both sides.

A credible regime of verification reduces but not fully eliminates the uncertainties and suspicion in the future motivation of both parties especially between a liberal democracy and an authoritarian state. Regular and credible reassurance through costly signaling from both parties could help maintain the threshold of trust necessary to maintain a cooperative equilibrium.

As I have argued, the extent to which the US can trust China is also dependent on its ability to verify what China is doing. So long as the US has this capacity to verify, then it should be able to conditionally trust China.

Likewise, the ability of the US to trust China also depends on its ability to influence with credible threat China’s strategic calculations today and in the future.

However, China and the US need not fully trust each other to cooperate – contrary to conventional wisdom – but a minimum level of trust is needed to prevent the 5C dilemma from descending into a security dilemma and going out of spiral. If these conditions hold, then US-China relations need not end up in tragedy. –

This piece was first published in The Straits Times.

The author is Assistant Professor and former Assistant Dean at the Lee Kuan Yew School of Public Policy, National University of Singapore.

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