The Name Game

Dec 18, 2023

The pundits never seem to tire of putting a label on the US-China relationship. This goes back to the early days of Nixon and Kissinger who dubbed the two nations “strategic partners.” Over time, the characterizations have spanned the gamut, from competitors and rivals to, more recently, revisionist and existential threats. And now we have the latest twist from the eminent Harvard political scientist, Joseph Nye, who argues that the US and China should be thought of as “cooperative rivals.”

There is nothing intrinsically wrong with using labels in an international relations context. They are basically shorthand for describing the behavior of nations toward each other. There can, however, be a problem with “time consistency”—what a static snapshot implies about the future. To me, the name game makes best sense if it hints at where the relationship is headed in the future.

The focus of my work on the US-China relationship is on the dynamics of conflict escalation. I use labels to describe an historical sequencing—from the “marriage of convenience” of the 1980s to the “interdependency” of the 1990s, to the “codependency” of the early 2000s. And, of course, since 2016, I argue that the US-China relationship has entered the classic phase of a “conflicted codependency.” Grounded in the political economy of Sino-American tensions, I fear that conflict escalation now risks taking on a life of its own.

Nye’s perspective is more about conflict management—in effect, the grand strategy of “peaceful coexistence” (yet another popular label). He argues that the inevitability of “low intensity conflicts” can best be managed by America’s judicious use of hard and soft power to counter China’s increasingly aggressive external behavior.

Nye’s hope for the standoff of a cooperative rivalry hinges on the interplay of political and economic considerations. While I agree with that basic premise, I worry that he is overlooking a critical twist that hinges on the economic growth trajectory. When growth fails to deliver on the political promise of leaders, codependent partners turn on each other. That is true if the growth shortfall arises in quantitative or qualitative terms.

In China, there is a good deal of discussion these days on shifting attention away from the quantity to the quality of growth. To some extent that is occurring because of the dramatic declaration in aggregate economic growth—with the five-year average of real GDP growth having slowed from 11.7% in 2007 to an estimated 4.6% in 2024. Beijing argues that since the “law of large numbers” has long implied a certain inevitability to a quantitative growth shortfall, it’s time to shift attention to quality.

As such, debate over the quality dimension of the Chinese growth experience has intensified—focusing on matters such as income and wealth inequality, deleveraging, energy efficiency, and ultimately productivity enhancement. Ironically, these same considerations are equally important in shaping the quality of US economic growth as well. That gets me to a very different bottom line than Joseph Nye: With both China and the US likely to keep struggling to deliver on their growth bargains, the political economy of conflict escalation appears to be far more powerful than Nye is allowing for in his standoff equilibrium of a cooperative rivalry.

You can follow me on X/Twitter @SRoach_econ

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