American Policy Toward China: Getting Beyond the Friend-or-Foe Fallacy

The question for this paper is this: Which approach makes sense for better policy making in Sino-American relations? 

If this strikes you as potentially trivializing or overly colloquial, consider the pressure on policy analysts and the media to “score” U.S.-China summits and meetings, like the Washington summit of January 2011 or the Strategic and Economic Dialogue, as a “plus” or a “minus,” an “improvement” or a “deterioration” in relations. This tendency to reduce a complex relationship to a dichotomous “index” points to a conceptual-analytic fallacy in thinking about Sino-American relations. This paper dissects the fallacy, explains briefly where it comes from, explores in a bit more detail why it is a significant problem from a policy-making perspective, and suggests a few ways to overcome it in the interest of making  better policy.

The ASI Fallacy in Practice 

Twice a year, the U.S. Treasury Department must (under a 1988 law) report on whether countries are manipulating their currency's exchange rate with the U.S. dollar “for purposes of preventing effective balance of payments adjustments or gaining unfair competitive advantage in international trade.” In practice, this semi-annual report has become a stark verdict on China’s currency policy, an up-or-down vote.  The law allows discretion on the part of the executive branch as to what the U.S. would actually do in response to a down vote—but it doesn’t limit the political consequences of the label “currency manipulator.” 

Dichotomous indicators of this sort are part and parcel of complex bureaucracies and decision-making processes. Sometimes they have an appropriate, even essential place in decision-making. Consider this everyday analogy:  the warning lights on your car's dashboard have only two possible information states—on and off. These 'idiot lights' (as they are commonly known) are off most of the time. When one of them flashes red, the driver has to act quickly, in a clearly predefined fashion, to prevent serious damage or personal risk.  If the oil light comes on, you stop driving. If the airbag light comes on, you get to a repair shop as soon as possible. 

Of course, the dashboard also has some metered measures (the speedometer) and some cumulative measures (the odometer). Without even thinking about it, you look at different indicators at different moments, depending on your needs. One of the reasons why dashboards are essentially equivalent in almost all cars and haven't changed much in 20 or more years is because the system works pretty well to help you as a driver deal with a complex environment that floods you with too much information all the time.

But what if the overall state of your car, your driving habits, the roads you are traveling, and the behavior of other drivers, were all boiled down to a single indicator on our dashboard? And what if that single indicator didn't even have a real metric attached to it, but only directionality—an arrow pointing either up or down at any moment? Would that help you make better decisions as a driver?

The contemporary U.S.-Sino relationship is at least as multifaceted, complex, noisy, and dynamic as any driving situation. So why would anyone try to boil it down to a single “getting better” or “getting worse” indicator on a geopolitical dashboard?

There's no doubt that indices like this have rhetorical and political power. To claim responsibility for an “improvement” in relations with the other superpower matters; so does getting stuck with the blame for having caused relations to “deteriorate.”  The D.C. milieu loves a simple scorecard. And a simple dichotomous index can indeed sometimes help people make decisions—if on no other basis than a felt need to “reverse” the arrows at one point or another.  But these are unlikely to be high-quality decisions, for reasons we will expand on later. 

The fallacy of aggregation in U.S.-Sino relations looks something like this in common practice. First, assess a particular issue for whether there is cooperation, competition, or conflict. (In the next section, we'll explain the source of those terms and what they've come to mean). Second, add up the “pluses” (cooperation) and the “minuses” (competition, conflict) through some equation (whose precise terms and weighting is usually unclear) to yield what might be called an American-Sino Index (ASI) for where the relationship is at any moment. Third, establish directionality—is the ASI better or worse than it was last week/month/year, and in what direction does it appear to be heading next? Fourth, use that first derivative to frame decision-making, action, and the evaluation of the likely consequences of both with regard to their impact on the Index going forward.

This adds up to what information science calls a “lossy algorithm,” a formula in which a great deal of (potentially valuable) data is lost. That's worrying from a strategic perspective, but our fundamental concern is that it represents a dysfunctional platform on which to make policy decisions. The most profound failure of the ASI is that it leads almost inexorably to expectations of a single, clear “outcome” for the relationship, via two dominant but distorted conceptual frames.

The Dominant Conceptual Frameworks: China as Friend or Foe

What is the ASI actually pointing toward? Simply put, toward a dichotomous end-state where China is either America's friend and ally, or foe and enemy. These aren't just silly, oversimplified categories that serious people don't pay attention to. They are concrete expectations embedded in conceptual frameworks, or mental maps, that are themselves based loosely upon academic models but have become self-sustaining outside of those debates. 

The first, sometimes referred to as power transition theory, draws analogies from the rise of Imperial Japan and Nazi Germany. According to this narrative, states that rapidly accrue power will be increasingly dissatisfied with the existing rules of the international game. As their power grows, global rules and the institutions that embed them appear more like constraints than enablers to rising states. At some point, the benefits of overturning those rules and institutions appear to exceed the risks and costs. But a defender of the existing order stands in the way: A tired, over-extended “hegemon” who refuses to decline gracefully and is unwilling to forgo international leadership without a struggle. From this perspective, the result is great power conflict—in the past, a large war—that resets the rules, norms, and institutions of international politics, re-aligning them with the emergent distribution of power. And from there, the cycle begins anew.

If you start with that mental map, it's easy to see traces in contemporary global politics. China’s economic rise has outpaced even the boldest of predictions, and its rapid military modernization is already a cause for serious concern in the region. The United States is fighting multiple grueling land wars with borrowed money and waiting for the bond market to force an inevitable fiscal consolidation. The interdependence of Chinese exports with U.S. consumer demand notwithstanding, the broader global interests of these two states are diverging in important areas. The result will be acute conflict. Full-on great power war might be off the table for other reasons, including nuclear deterrence (although some are uncertain of this). But at a minimum, China becomes a hardcore antagonist to U.S. interests and objectives, and achieves the power transition result by other means. 

There is a second and quite different mental map that starts from a liberal internationalist perspective. In this view, there's simply no reason why Chinese and American global interests must diverge. Quite the opposite, in fact: They are inextricably linked together by broad economic ties that both countries value much more than the occasional spat over the precise distribution of costs and benefits. It's common in Washington, D.C. to hear that: “No country has benefited more from the current international order than has China.” (Whether this is true and/or anyone in China actually believes this is a question for another day.) What's unsaid is the obvious corollary: that the United States has benefited enormously from this order as well.

If you start with this alternative mental map, it's easy to ground all your assessments in the foundational premise that the two most important global powers share a deep interest in preserving contemporary global rules, institutions, and ways of doing business. They'll certainly argue at the margins about mild re-equilibrating moves, but the intensity of the argument will always be constrained by each country's dependence on the other, and on the system that the two together would not place at serious risk. 

Here's where the ASI fallacy becomes part of the picture either way. If your mental map is power transition, then you're anticipating an end-state of conflict, where a hostile China seeks to press its way to the top. The ASI arrow tells you how strongly and how fast the world is moving in that direction—and suggests what options are available and how much time you have to respond. 

If your mental map is liberal interdependence, then you're pointing toward an end-state of cooperation, where an economically liberal China integrates into the global system to enhance its competitive edge, according to familiar rules of the game that get modified only on the margins. The ASI arrow tells you how that process is unfolding—two steps forward, one step back—or whether it's at risk of undergoing some reversals that need to be compensated for in the short term.

And if you're holding both those mental maps in your head at once, then you're seeing “mixed” evidence that could be interpreted as consistent with either map. The ASI arrow then points to one or another map as the one that is in logical ascendance at that moment:  Arrow Up means liberal interdependence is the more likely path of the future, Arrow Down favors power transition. 

The unstated expectation is this: We are in an evolutionary period of transition which will at some point give way to a clear resolution in favor of one or another of these maps. 

The broad outlines of policy debate follow from that logic. If your mental map is power transition, the policy challenge for the United States is to drive forward military modernization (and get public finances fixed to enable that) while laying the diplomatic groundwork to firmly resist China’s coming attempt to disrupt the prevailing international order. If your mental map is liberal interdependence, then the policy challenge is to gently push and incentivize Beijing down the road of assimilation, while holding on to competitiveness advantages along the way. 

And since Washington's policymaking machine is in fact holding both of these maps in continuing tension with each other, the policy outcome (with bipartisan support) is generally what’s been known as the “hedge.” The preferred U.S. response has been sometimes called “congagement,” an awkward but evocative combination of engagement and containment. The logic here is that, given future uncertainties (i.e. given that China’s final end-state is not yet clear), the United States should continue trying to draw China into the prevailing international system, while preparing for a possible Chinese challenge to it. The ASI supports this hedge by providing a soft adjustment formula, so the hedge can be tweaked towards one or another end of the continuum over time.

This conceptual framework, however, is dysfunctional for at least three reasons.

The Deeper Pathologies of the ASI

Talking, thinking, and making policy with regard to a single, aggregate relationship index generates a series of pathologies, for which re-conceptualization is in order. Here we outline three downsides to seeing the world through the ASI prism.

First is the tyranny of magnified and unrealistic expectations that, under the ASI, become linked together. Scoring the relationship means that each and every specific decision is consequential to the entire set of issues that the United States and China must manage.  “If issue X goes badly, then A, B, and C will surely follow.”

Issue-linkage is a highly valuable strategic tactic—but only as long as you can carefully control when and how it gets deployed. Indiscriminate linking of issues undermines strategy. When it occurs, the breakdown at Copenhagen, U.S. arms sales to Taiwan, maritime disputes in the South China Sea, Chinese currency manipulation, and more all get summed up into a single narrative. Just as bad, each issue risks being over-interpreted as being important, verging on critical, to “the relationship.” Problems in one are seen to create problems in another. Government officials have referred to Beijing’s policy toward North Korea as a “litmus test” of their current approach to international politics. Other analysts have talked about China’s actions in the South China Sea as a “leading indicator” of their broader international behavior. You don't need a complicated game theoretic model to see that this risks creating a series of self-fulfilling prophesies biased toward the downside, where antagonism spills over into unrelated issue-areas that could be handled more effectively on their own.

There’s an illuminating analogy here to what happens periodically in another kind of index: the Dow Jones Industrial Average. Some 30 stocks make up the DJIA, which is of course commonly quoted as a measure of the broader stock market (it’s actually not a particularly good measure) and said to “go up” or “go down” on a daily basis. So what happens when an “old” stock that is no longer thought to be quite so important or representative of the economy is removed from the index to make way for a ‘new’ stock that is going to be added? (This happens at irregular intervals. In 2008, for example, the DJIA added Bank of America, Chevron, and Kraft and dropped Altria, Honeywell, and AIG.) The price of the newly added stock goes up, simply by virtue of the fact that it has been added to the index. Part of that is likely psychological—people pay more attention to a stock that is in the index. Part of it is a function of what the index gets used for—since many institutional investors have to hold specified portfolios that include stocks in particular indices, demand for the stock will rise. 

But the underlying value of a share according to efficient market theory—a fractional claim on future profits that the firm will generate—hasn’t actually changed as a result of its inclusion in the index. In practice, the index itself is causing the change in value. That has the potential to mislead an investment strategy, just as the inclusion of any particular issue in the ASI can mislead a foreign policy strategy.

The “index expectations problem” also drives a constant “search for direction,” that frequently takes on a life of its own. The analogy is obvious: Is this a bull or a bear market? Viewing Chinese behavior through the lens of aggregation creates similarly schizophrenic interpretations of Beijing’s intentions, as commentators search for early evidence that Beijing is finally making the definitive turn toward friend or foe. As if the relationship itself were “searching for direction,” the way “the market” is said to turn by financial news analysts. 

Consider the Chinese “indigenous innovation agenda” and other related technology initiatives. One day Americans tout the Chinese as leading a revolution in green technologies via their vast investment in (and yes, subsidies to) electric vehicles and windmill technology. The next day we call it a predatory industrial policy that is designed to drive leading-edge economic sectors to China. Guess what? It’s both, and there’s little to be gained by believing otherwise.

This adds up to what is almost a compulsive need to attribute a grand strategy—or more precisely, a grand stratagem—to Chinese decisions, no matter how unconnected they may be from each other. Why is that a problem? Because one of the most common sources of over-reaction in international politics is the over-attribution of strategic foresight and strategic discipline among adversaries who miss the sometimes disconnected, often ad-hoc decision-making of real live governments.

We can easily imagine that this operates in both directions.  For example, what would the Chinese conclude when Treasury Secretary Timothy Geithner assures his Beijing counterparts that the United States is open to Chinese FDI, and only a few weeks later Huawei is backed into a corner (again) by the Committee for Foreign Investment in the United States (CFIUS) and more or less forced to divest from a two million dollar investment in a small technology company (3Leaf)? We’re not taking a position on the merits of this particular case, but rather pointing to a plausible assessment on the part of the Chinese that America in fact welcomes its investment as long as it remains largely confined to very low interest yielding Treasury bonds and stays away from important technologies and other leading sectors.

Ultimately, raising the stakes “too high” on any particular issue can be tactically useful but only when it’s part of a self-conscious and tightly controlled strategic game. 

A second pathology of the ASI is the problem of viewing U.S.-Sino cooperation as absolutely essential, or at the very least, terribly important, in circumstances where it may be less than a necessary condition for policy success. If you believe that there is an aggregate ASI that is pointing toward some final state of cooperation or conflict, then getting an agreement and getting China on board with each and every issue becomes more critical than it often really is. 

Cooperation for cooperation’s sake is generally a bad idea. One reason why, is that it diverts attention from seeking alternative solutions. If you assume that U.S.-Sino cooperation is a sine qua non for success rather than just one option, then your attention is diverted from other ways of solving problems. Another reason it’s a bad idea is that it quickly becomes known to the other side, which can then design its negotiating strategy to take advantage of constraints that the United States is, in practice, imposing upon itself. When the other side knows that you think you can’t live with the “reversion point” of no agreement, that’s a major bargaining resource you’ve just handed them for almost nothing in return.

Even when Beijing’s interests clearly suggest otherwise, there appears at times to be a “Waiting for Godot” phenomenon; precious time passes by and novel pathways are forfeited. In many instances, if and when China finally comes to the table, it is simply too late for collective action to make a difference. Chinese foot-dragging has been “effective” in this manner over the course of the near 20-year international effort to keep North Korea non-nuclear. First, Beijing rejected sanctions, and then agreed only while ensuring the existence of sufficient loopholes to render them ineffective. The result is a near fait accompli where even strong Chinese cooperation could likely now fail to have any meaningful effect on North Korea’s nuclear status.

Of course, diplomatic heavy lifting should be applauded and its successes even more so. The U.S. position would be strengthened, however, if decision makers asked this question: How would we modify our policy approach—on Iran, North Korea, climate, trade, the Sudan—if we were certain that Beijing would never cooperate in any meaningful way? If the answer is not much at all, then there’s no harm in trying. But we suspect otherwise. When an attachment to cooperation weakens the American negotiating position and gets in the way of problem solving, it is time to recalibrate.

The other side of an excessive hunger for cooperation is an excessive desire to avoid conflict at almost all costs. Refusing to discuss or acknowledge sensitive issues because they risk getting into a quarrel means forgoing opportunities to manage them. Of particular note here are issues related to “China threat theory,” a phrase frequently used in Beijing to discredit the notion among Americans in particular that the rise of China poses real security challenges to the United States and Asia more broadly. Those who frequently engage with Chinese defense analysts have likely encountered this glaring juxtaposition: On the one hand, there is broad acknowledgement that Taiwan is a potential flashpoint that could lead to the first great power war in 60 years. On the other hand, there is constant reassurance that China poses no threat to the United States. Both cannot be true.    

American diplomats repeatedly assure Beijing that Washington is not seeking to constrain China’s rise. Meanwhile, the United States is actively reinforcing its alliances in East Asia, building partner capacity in Southeast Asia, and strengthening security ties with Australia and India. Are we doing the same in Latin America, Africa, or Europe? The Chinese of course aren’t blind to the comparison.

And when it comes to issues of currency reform, the United States continues even after the financial crisis to lecture the Chinese about how a revaluation of the renminbi is good for the global economy and good for China. The presumption must either be that American economists have access to a transcendent truth that others don’t; or that we know better than the Chinese what would be good for their economy. Regardless of the long- or short-term truth or fiction in either claim, they both encounter deep skepticism in Beijing, along with more than a little sense of irony. And who can blame the Chinese for feeling that way just now? 

There are costs to being reticent to speak openly and honestly about particularly difficult issues. There is little question that a predictable, already emerging security dilemma will intensify as collective U.S. and Chinese military power increases in the region. Rather than trying to actively manage the resulting risks, such issues have been often left off the table for fear of contaminating other bilateral issues where “cooperation” is more likely. Taiwan received barely a mention from either side during President Hu’s recent visit to Washington. Of course, it’s hardly just an American failing: Beijing is mostly to blame for repeatedly severing military-to-military relations (in protest of U.S. arms sales to Taiwan) and for being generally unwilling to engage on sensitive security questions, such as strategic weapons, space, and cyber-security issues. But in the classic logic of the security dilemma, it's already quite late in the day on many of these issues. 

A third pathology of the ASI is the peculiar discounting of data that does not immediately and directly affect the bilateral ties that are the kernel of such a dichotomous index. The rise of China is conflated with U.S.-Sino relations, and the rest is noise. 

But of course the policies of large countries affect global political economy and security systems through many channels, not just through direct impact on each other.  An obvious case:  The secondary and tertiary effects of Chinese foreign economic policy on other emerging economies.  If China's industrial and currency policies crowd out foreign investment and the growth of manufacturing in a country like Mexico, then weaker growth and employment in Mexico in turn contributes to drug-related violence and state weakness, along with immigration pressures, directly on America's borders. 

China’s burgeoning influence in the developing world has a much broader profile. In many parts of the Global South, Beijing has built unprecedented economic ties, challenged the normative primacy of political liberalism, and limited the influence of international lending institutions. But the U.S. strategic response to these phenomena has been muted, in part because something like the China-Africa Forum doesn’t easily lend itself to the ASI. As a result, we pay less attention than we should to slow-burn dynamics that could bear significantly on U.S. interests.  

This is not an isolated phenomenon. Americans tend to dismiss the China-Africa Forum, the Shanghai Cooperation Organization, and other “second tier” institutions because they appear to Washington’s eyes as poor cousins of the more familiar and (supposedly much more robust) Western institutions. The same is true of the growing market for renminbi bonds in Hong Kong (the “dim sum trade”) because it looks and feels like a “toy” in comparison to “real” foreign exchange markets. Chinese special economic zones in Egypt were on very few radar screens until early 2011. And who in Washington paid attention to the fact that the vast majority of rare earth elements were being supplied to global technology firms from Chinese mines—until the moment that China put constraints on those supplies?

Taken together, the ASI creates a cascade of distorted expectations and incentives in Sino-American relations: cooperation is sought that will never be achieved; conflict is avoided to the detriment of its management; and the lens remains too tightly focused on a narrow set of issues. Meanwhile, each and every thing China does can take on significance beyond its real importance and the stakes are raised too high in interactions that don't deserve it.

These are characteristics you'd associate with a relationship tilted toward the downside not necessarily because it is bound to go there, but precisely because the pathologies associated with indexing create a self-fulfilling momentum to the relationship. 

Have We Seen this Movie Before?

It’s been almost 40 years since the American policy community was quite so focused on an effort to build “cooperation” into the management of a single great power or superpower relationship.  Are there lessons from that history worth paying attention to?  The détente experiment did not go well, and it’s a cautionary tale. If you date the start of détente at the 1972 Moscow Summit, then its effective life span was probably less than three years. Skeptics argue it ended even sooner, in the aftermath of the 1973 Yom Kippur War. 

It’s really how détente failed that matters for our argument here. The corrosive mismatch of expectations between Washington and Moscow led quickly to sharp disappointments and disagreements, from which both sides moved toward more aggressive policies, bolder assertions of unilateral prerogative and advantage, and greater distrust and hostility toward the other. The counterfactual question is a reasonable one: In a history without détente and its accentuated rise and fall of sentiments in the U.S.-Soviet game, would the relationship have worked better? We think so, and some of the reasons why are directly relevant to today’s ASI problem.

With the exception of a small number of analysts who “blame” the failure of détente simply and directly on Soviet or American bad faith, most explanations for détente’s collapse place real emphasis on a mismatch of expectations about the supposed terms of “competition” and “collaboration”—most importantly—what those terms would actually come to mean in real foreign policy practice. This mismatch was formalized in the Basic Principles Agreement of 1972, an overly ambitious effort to define in general terms a set of norms that would guide the development of superpower relations. The BPA contains this language:

“differences in ideology and in the social systems of the USA and the USSR are not obstacles to the bilateral development of normal relations based on the principles of sovereignty, equality, noninterference in internal affairs and mutual advantage…

they will always exercise restraint in their mutual relations…

discussions and negotiations on outstanding issues will be conducted in a spirit of reciprocity, mutual accommodation, and mutual benefit…

both sides recognize that efforts to obtain unilateral advantages at the expense of the other, directly or indirectly, are inconsistent with these objectives…”

This was a flawed agreement in many respects, the most important of which was that neither side understood what the other meant by the same words. For example, the Russians believed that Washington had endorsed and agreed to “peaceful coexistence” as the Russians defined it, which included the right to support “national liberation movements” in what was then called “the Third World,” movements that were frequently seeking to undermine American-supported or American client governments. Brezhnev, in particular, also took more seriously than he should have the use of the term “equality” to indicate that Moscow was now recognized in Washington as America’s “equal” when it came to critical global issues including, of course, the Middle East. The Americans, for their part, held vague expectations about the meanings of “restraint” and “unilateral advantage” when it came to what the Russians would or would not do to press their advantage in a time of significant American relative decline.

With predictable results, disillusionment corroded into accusations of bad faith, cheating, and exploitative behavior on both sides. Perhaps most perniciously, unmet expectations kicked in a series of domestic political reactions. The consequences of the downturn were particularly visible in Washington: the Jackson-Vanik and Stevenson amendments to the U.S.-Soviet Trade Agreement in 1974; the collapse of support for ratification of SALT II; bolder moves toward Beijing; and a general rise in zero-sum thinking about U.S.-Soviet relations within think tanks like the Committee on the Present Danger.  The word “détente” was off the table during the 1976 Presidential campaign, in favor of much more muscular attitudes that were soon backed up with increases in military spending. All of this, of course, before the Russians invaded Afghanistan in 1979.

We recognize that no one would make precisely the same mistake again. But the ASI logic is similar enough in its potential consequences to raise concern. The issue remains, at least on the American side, a problem of unrealistic and insufficiently granular expectations. If you think the ASI is pointing toward Chinese “assimilation” into the American-led liberal world order, what do you do with the discrepant data points that drive the index down? Many observers will discount them as temporary deviations from trend—until one day they've added up sufficiently to change a lot of minds. Then we'll likely see an exaggerated flip of the switch to the power transition mind-state. And in American domestic politics, that's not a switch that you can just as easily flip back in the other direction (particularly during presidential campaigns). 

The lessons are multiple:  Unrealistic expectations yield big disappointments that get embroiled with accusations of bad faith. Oversimplified indices that try to collapse many dimensions of a relationship into one, almost by necessity create unrealistic expectations. Domestic political dynamics, both in the United States and China, can create dysfunctional ratchets. And what might have been managed as a complicated, multi-faceted relationship that in reality is neither cooperative nor competitive in an aggregate sense, can deteriorate toward conflict faster and more vigorously than almost anyone expected. 

Guiding Principles for Moving Forward

In almost any situation of high complexity and uncertainty, people will be drawn to simplifying indices for real reasons. Breaking the chains of the ASI will not be easy. This is not, however, simply an abstract intellectual or academic problem: ASI thinking that influences policymaking and public opinion will be detrimental to U.S. interests across a broad range of international issues.

As a first salvo at moving toward a different mindset, we offer three alternative guiding principles.

One. View ties with China as a set of loosely connected bargaining relationships, and manage particular issues, not “the relationship.”

The alternative is to try to “improve ties” without addressing underlying dynamics and interests.  But this approach will prove to be hollow and short-lived.  As President Hu’s visit demonstrated in January, without substantive progress, the benefits of “getting relations back on track” quickly disappear. The real costs should be seen for what they are: “improving ties” can get in the way more than they help to focus attention on what needs to be achieved.

In this sense, a rapid succession or conflation of difficult issues and policy disputes should be seen as just that, rather than a trend or “downward turn” in relations. Similarly, there will be times of confluent cooperation, which should not be interpreted as the arrival of a long-term harmonization of interests. This isn't a market that is “trying” to go up or go down.  Connecting the dots is positively distracting, unless the case can be made that there have been underlying structural changes to either countries’ national interests or their leadership’s perceptions of those interests. And that is a different argument than the ASI can handle.

We know this principle places real demands on domestic political discourse and institutions. It means handling gray areas as gray (not heading toward black or white). It means pushing back against particular interests that will seek to drive the grays out in order to bolster some other objective. It means working to reconfigure a public conversation that is being trained by the Facebook “like” button to vote up or down and leave it at that.  None of this is easy, but all of it is necessary.

Instead, we should recognize this as a normal bargaining game, and get good at playing it that way. Both sides need to seek clarity on what is agreed to and what is not. We need to get the easy stuff done and be thankful for that success. And then we need to normalize expectations about seeking advantage; most of the win-win space still has room for one side to “win” more than the other. 

What does not make sense is to burden these agreements with overblown expectations and elaborate strategic notions like “responsible stakeholder” and “strategic reassurance.” Those grand concepts are good for scholars and book titles, but bad for politics and decision-makers, in part because they are unrealistic and un-operational, and in part because they are just too subtle for the system to bear. The real relationship can't handle their burden—the requirements to make these complicated concepts “work” are just too high in the real world.

For better or worse, the multiplicity of issues in U.S.-Sino relations has likely become too diverse to accommodate a single mantra or theme. Taking a step back, it becomes hard to imagine that America’s dealings with China—on issues like climate change, North Korea, trade, and human rights—could possibly be governed in its entirety by a single guiding principle or grand strategy.  In fact, understanding the stark and subtle differences between these issues will be more valuable than finding a homogenous approach to address them.

Two. Bringing China to the table may require demonstrating the will and ability to proceed without China's help or agreement.

To work constructively with Beijing will be a vital component of 21st century world politics, but the United States must also demonstrate to the Chinese leadership that it is capable of achieving American goals without their help. 

The Obama administration proved particularly deft in this regard following North Korea’s aggressive provocations in 2010. After both the Cheonan incident and the shelling of Yeonpyeong Island, Beijing refused to deliver public condemnations of Pyongyang. The initial knee-jerk reaction in Washington was to express dismay and call upon China to more actively use its leverage against its neighbor—to little effect.

The message from Washington, however, eventually turned from “We need your help” to “If you’re not going to do anything about this then we will, and you’re not necessarily going to like the result.” What followed were massive displays of U.S. naval power throughout Northeast Asia, practically on China’s doorstep. Beijing quickly found out that doing nothing could backfire if the United States decided to route around Chinese intransigence. And there were subsequent reports that behind-the-scenes pressure from Beijing contributed to North Korea’s muted response to South Korean live-fire military exercises in December 2010. This should serve as one model for how being willing and able to forgo cooperation can actually help to foster it.

But this means letting go of the idea, as Henry Kissinger wrote in the New York Times on the eve of Hu’s visit, that the two powers should seek to “build an emerging world order as a joint enterprise.” That's old “détente thinking” or at least détente rhetoric—and in the Sino-American relationship, it's more likely to get in the way of solving problems. 

The same logic applies to the complex and inter-linked issues of currency valuations, current account balances, public finances, debt, and reserves.  Economic theory notwithstanding, Washington and Beijing are unlikely to agree in a policy-relevant time frame about the underlying cause(s) of continuing global imbalances.  The question that the United States ought to be asking itself is this:  What would it take to reduce its current account deficit and repair U.S. public and private finances in a world where we received no explicit “assistance” or cooperation from the Chinese?  

Three. Acknowledge and wall off areas of disagreement in order to reduce negative issue linkages that you can't control and can't afford.

2011 will be a busy year for official visits—the bane of strategic efforts to link issues only when you want them linked. Chief of the PLA General Staff Chen Bingde recently visited the United States, Vice President Biden will soon travel to China, and heir apparent Xi Jinping is slated to visit Washington. Already, questions have arisen about the potential timing of additional U.S. arms sales to Taiwan, for fear that they may disrupt these diplomatic efforts. But does it really have to be this way?

There is undoubtedly a set of issues where—for domestic political and economic reasons—one side is simply unwilling to compromise, regardless of the protestations of the other. For the United States that probably includes arms sales to Taiwan. For the Chinese it may very well include important aspects of currency policy. It's likely that we would all be better off if both sides made clear those issues that are absolutely not on the table. It would remove false expectations, sever uncontrolled issue linkage, and open doors for working together on other fronts. Whether this is possible is a fair question, but China has managed to separate distinct issues with the United States before—and it’s worked. Look no further than the manner in which human rights and economic policy have been almost entirely severed in bilateral negotiations.

Might strategists on either side try to take advantage of this playing field, by misrepresenting their inability to compromise in order to gain excessive concessions from the other side? Of course they would—but that doesn't have to be a fatal flaw. It just places real demands on analysis and diplomacy to test propositions about the status of such claims.

A considerable controversy erupted last year as Chinese officials reportedly intimated that the South China Sea was joining the ranks of Taiwan and Tibet as a “core interest.” In other words, China was declaring that this was an issue that would clearly justify escalation to violence. This suggestion, intended or not, was soundly rejected by the United States and was further frustrated by Secretary of State Clinton’s rebuke at the ASEAN Regional Forum in Hanoi in July 2010. Chinese public statements and media reports have since refrained from making official proclamations that put claims in the South China Sea on par with their more near and dear territorial disputes. This was evidence that an honest discussion of differences need not lead to the establishment of new and unacceptable redlines. Nor must true and existing redlines get in the way of cooperation in other areas.

Ultimately, breaking away from the ASI as a basis for analysis and policymaking will not be easy. But the Sino-American relationship is too important to simplify in this dysfunctional manner. The U.S. foreign policy leadership needs to move itself and the rest of the system past the ASI and its associated pathologies with a real sense of urgency.