3 Takeaways - Former Australian Prime Minister and China Scholar Kevin Rudd: War Between China and the US (#95)

Episode Date: May 31, 2022

Just as there was nothing inevitable about WW1 which came about because of flawed decisions by political and military leaders, former Australian Prime Minister Kevin Rudd worries that mutual non-comprehension and deep suspicion may lead the US and China into war. He believes that an armed conflict between China and the US is a real possibility. The Chinese Communist Party would see itself as fighting for its very survival in a war and a conventional war could easily escalate into one involving weapons of mass destruction, if Chinese forces begin to lose.Former Australian Prime Minister Kevin Rudd has studied and lived in China and has worked with China’s leaders, including Xi Jinping, for decades. His new book is The Avoidable War: The Dangers of a Catastrophic Conflict Between the US and Xi Jinping’s China. 

Welcome to the Three Takeaways podcast, which features short, memorable conversations with the world's best thinkers, business leaders, writers, politicians, scientists, and other newsmakers. Each episode ends with the three key takeaways that person has learned over their lives and their careers. And now your host and board member of schools at Harvard, Princeton, and Columbia, Lynn Thoman. Hi, everyone. It's Lynn Thoman. Welcome to another episode. Today, I'm excited to be with former Prime Minister of Australia, Kevin Rudd, and I'm excited to find out how he sees the risk of war between the U.S. and China. Kevin's in a unique position to understand the China-U.S. relationship and risks of war. He's a China scholar, fluent Mandarin speaker,

and someone who knows the leaders of both China and the US. He's been a student of China since he was 18 when he majored in Mandarin, which he speaks fluently, and Chinese history at university. He's also worked with Xi Jinping and other Chinese leaders over many years as a diplomat posted in Beijing and subsequently as Prime Minister of Australia. Kevin has also lived in the U.S. and been a friend and advisor to U.S. presidents. Welcome, Kevin, and thanks so much for our conversation today. Thanks, Lynn, for having me on your podcast. I really appreciate it. It is a pleasure. Kevin, there was nothing inevitable about World War I, as you have noted, that it came about because of the flawed decisions of political

and military leaders in 1914. Could the same thing happen now between the US and China? Yeah, Lynn, one of the reasons for writing this book of mine, The Avoidable War, is a deep reflection on how we all stumbled into the Great War of 1914-1918. An Australian compatriot of mine by the name of Chris Clark, a professor of history at Cambridge University, wrote a book a few years ago called The Sleepwalkers and how the world slept walked into World War I. And so that a relatively minor incident in late June of that year spiralled out of control during July against a tinderbox of great power relations as they existed at the time.

And despite the fact that no one saw war as inevitable or even probable or desirable, it happened. And the mass slaughter we're all familiar with in history. So for those sort of reasons, I don't want China and the United States to sleepwalk into major armed conflict, because the consequences of such a regional and global conflagration would rewrite the strategic map in ways which are utterly unpredictable, quite apart from the enormous devastation on the way through. So that's the motivation for writing the book. You have said that there are two things that fundamentally change the US-China relationship. The first has to do with China's relative strength and power. Can you elaborate? Yeah, China's run by Marxist-Leninist party, the Chinese Communist Party, who have a deeply realist analysis of power in their calculation of what they call a comprehensive national power. There's a Chinese phrase for it, which is zhonghe guoli. For students of the Soviet Union, it's not dissimilar to the old Soviet concept of the correlation of forces. So what does that mean in reality?

It means that they look at all the barometers and all the indicators and all the correlation of forces. So what does that mean in reality? It means that they look at all the barometers and all the indicators and all the measures of national power, military, economic, technological, and the rest, and they aggregate them. And according to this analysis, the balance of power between China and the United States is moving rapidly in China's direction in Beijing's calculus. And as a result of that, they therefore have concluded that they no longer need to, to paraphrase Deng Xiaoping, hide their strength, bide their time, never take the lead. Instead, China has become, under Xi Jinping's leadership, much more loud and proud in the assertion of Chinese power and

influence in the world. Of course, that has therefore given rise to an American reaction, starting with late Obama through Trump and now under Biden. But as a consequence, we now find ourselves in a much more precarious strategic environment than we did a decade ago. And Xi is extraordinarily powerful as a leader. He's the most powerful leader in China since Mao. What is his perspective on the U.S. and what are his primary interests? Well, the middle part of the book deals with what I describe as Xi Jinping's 10 concentric circles of interest. If you're a student of Maslow and his hierarchy of needs, this is an attempt for me to

render from a Chinese Communist Party perspective, their set of priorities, starting with keeping the party in power, but moving out to the economy and foreign policy and their security policy interests in the region and the world. Of course, front and center in the latter is Xi Jinping's view of the United States. And Xi Jinping's view of America is that it constrains China's ability to retake Taiwan. It contains China in terms of its ability to push out into the Pacific because of America's treaty alliances with a combination of the Republic of Korea and Japan and the Philippines, and to some extent, Australia. And furthermore, Xi Jinping has concluded in his own terms that as a result of the US-China trade war initiated by the Trump

administration, that the US is hell-bent on preventing China's further economic rise. So for those sorts of reasons, he now concludes that China is in an inexorable period of strategic competition, and to use the Chinese communist term, struggle with the United States. Therefore, we've entered into a very sharp period indeed, through the lens of his own worldview. And he sees the US as the only country that can threaten China. Because the Chinese are deeply realist, they make a clear study of anyone who would be a challenge to China's long-term rise within the region and across the world. And obviously that logic takes them first and foremost to Uncle Sam.

But also on the way through, they've looked at some of the challenges which Russia has posed in the past, but they are no longer real problems as Russia declines as an economic power, remains a formidable military power, but also has been, as it were, coalesced into a wider strategic condominium between Moscow and Beijing, a raid against the United States. Japan, the Chinese regard as a formidable economic and military force on their doorstep and with a long and difficult history with China going back to earlier Japanese invasions of China's sovereign territory. But certainly numero uno from Beijing's point of view

is the United States of America, the world's largest economy still, the world's largest military still, the world's most formidable technological power still. But as we said before, with China, from their own perspective, closing on all three. What evidence does Xi Jinping and other senior Chinese leaders see that supports their view that the U.S. is acting in a hostile way? The Chinese lens on America is a long historical lens, beginning with their own analysis of the Monroe Doctrine and America's strategy over many decades to secure for itself a dominant position in what Americans call the Western Hemisphere, to the exclusion of other great powers from Europe. And China, in many respects, in my judgment, has taken some learnings from that in terms of how they perceive their own future in East Asia

and the West Pacific, and their own longer term interest in dominating what they perhaps refer to internally as the Eastern Hemisphere. I think secondly, they've looked at the pattern history of American alliances in East Asia. Remember, America has already fought against Chinese troops in Korea, came close to it over Taiwan. China was backing militarily the North Vietnamese against US forces in the Vietnam War. And so for these sorts of reasons, China sees a lot of historical pattern. And in the contemporary framework, what they identify is the formation of new geopolitical entities such as the Quad, the quadrilateral security dialogue between India, Japan, Australia and the United United States as fundamentally seeking to balance against

China's rising power in Asia. They would also point to bans on Huawei in terms of its ability to supply telecommunications infrastructure for American allies and partners in the world. And they look at a range of unfolding bans on certain critical technology exports from the United States, particularly in semiconductors and microprocessors to China. have nonetheless reached a conclusion themselves that they must increasingly resort to national economic self-sufficiency, a more assertive security policy, and forging ties with their own perceived natural economic and security partners around the world, including the Russian Federation. How important is Taiwan to Xi Jinping? Taiwan's a matter of high religion, if you like, to an atheist party. It is a galvanizing, unrealized national ambition. It's seen as the incomplete component of the Chinese Revolution of 1949,

when Chiang Kai-shek and nationalist forces fled to the island of Taiwan after they lost the military battle against the Communist Party in Mao on the mainland. So for Xi Jinping, who sees himself a little like Vladimir Putin as, quote, a man of history, that is someone who seeks to readjust the historical map to deal with leftover questions from history, it is a particularly urgent political and foreign policy challenge. It doesn't mean that Xi Jinping will move tomorrow because, as some have written timetable, towards looking at ways and means to coerce Taiwan back into Chinese sovereignty sometime in the late 20s, early 2030s, and back on the basis of the changing balance of power scenario that I referred to before with the United States and China. How do you think the Russia-Ukraine war has impacted that? I don't think it's adjusted Xi Jinping's timetable at all. There'll be lessons learned and lessons drawn from Russia's military and financial economic experience in Ukraine. But in many respects, China's innate strategic

conservatism has caused them to double down much earlier on in their pursuit of military preponderance over Taiwan and the United States in this particular theatre, because it's a conservative military culture in China, one not predisposed to taking unnecessary risks. So they will look at Putin's foolhardiness in embarking upon this land-based invasion. Although they would have believed, I presume, Putin's military briefings to the Chinese leadership that this will all be over in a week, whereas the reality has proven to be anything but. Remember, in China's case, this is not the relative ease of a land-based invasion. It would be the largest amphibious operation since the D-Day landings,

across 180 kilometers of open waters, where Chinese vessels are massively vulnerable. On the financial and economic side, they'll look carefully at the operationalization of US dollar-denominated sanctions, financial sanctions, and particularly those removing the Russian Federation from SWIFT, that is the US dollar denominated international settlement system. And China, I think, will seek to build up its own resilience against those possibilities by the late 20s and the early 30s. So yes, there'll be lessons learned and drawn, but the Chinese will have concluded themselves, I think internally, that these were lessons they

were already working on anyway, hence their extended timetable for working out the Taiwan question to their satisfaction. Do you think that Xi Jinping has used nationalism and anti-American media to strengthen his position and has it worked? How do you think the average Chinese, if there is such a thing, sees the US? I don't think there is such a thing anymore as, quote, an average Chinese, unquote. What I can look at is what the official propaganda apparatus has done under Xi Jinping on nationalism and make some judgment broadly about how effective it may have been with particular groups. On the first question, you don't have to be a Rhodes Scholar to line up the change in the tonality

and content of Chinese official domestic propaganda against the United States and its Western allies in recent years. A clear insight in this is through a marvellous leaked document from the Chinese system called Document Number Nine, which was basically a verbatim transcript of Xi Jinping unvarnished at a national ideology and propaganda work conference in 2013, very early on in his period. It's a no-holds-barred representation of the ideological evils of the West, the ideological virtues of the Chinese Communist Party and Marxism-Leninism, and the need, therefore, to fully embrace the positive forces of what he described then as Chinese patriotism to advance China's interests at home and abroad. So nationalism and moving China's nationalist center of gravity further to the right in order to underpin a more assertive Chinese foreign

and security policy in the world has been at least half of Xi Jinping's overall ideological enterprise. Secondly, on the question of its effectiveness, it's hard to judge. I'm not sure we have reliable opinion poll data from China itself in terms of popular and public attitudes. And also the control of China's social media space, while not complete, is difficult to get a handle on in terms of what constitutes real public sentiment. But I will say this, and I've written recently on this elsewhere, when you have senior Chinese academics writing publicly about the new nationalist temperament on the part of Chinese millennials, that is those who have grown up purely in the Xi Jinping period and come to adulthood in the last 10 years. And when these academics reflect on their experience of these 20 and 22 year olds in their university classrooms today, what these Chinese academics are saying is that this is a world apart from the kids they were teaching 10 and 20 years ago. Let's switch and talk about the U.S.

perspective on China. Many Americans believe that China would become more tolerant, more open, more liberal, and more of a democratic state. But that attitude and perspective has changed dramatically. How do you think that most US leaders, government leaders see China now? And what evidence supports their current perspective? I've always had a view that the idea that open and more liberal economic policies would produce in China automatically varying degrees of political liberalisation and or even the emergence of democratic forms of governance was a little misplaced. It may have been an unconscious organising principle

on the part of various US political leaders over time, but if we had eyes to see and ears to hear what happened in Tiananmen in 1989, 30 years ago, this is not really the case then. And it hasn't really been the case since, because we have a Leninist party in China, which is determined to remain the ruling party in China for the very long term future, and not to yield political space. If I was to summarise Xi Jinping's worldview, it would be along the lines of a guy who sees him having moved the ideology of his country to the left,

the centre of gravity of Chinese politics to the left with the party's reassertion of its power over the rest of public policy, the professional apparatus of the Chinese state, economic professionals, quite apart from business professionals and even people's personal lives, and reassertion of Xi's individual leadership, as opposed to the collective leadership of the rest of the Communist Party put together. Similarly, we've seen a move to the left in the center of gravity of Chinese economic policy, with a new emphasis on state-owned enterprises, Chinese industrial policy, Chinese state planning, a more restrictive environment for the private sector, either in the tech sector or in the property sector or more broadly, and a new common prosperity agenda, which is a neo-socialist, neo-communist agenda to maximize economic assumptions compared with the past. So why do I make these points is that whereas under previous pre-Xi Jinping administrations of Deng Xiaoping, of Jiang Zemin, of Hu Jintao, China was never trending towards becoming a liberal democracy.

There were greater freedoms, both politically and economically, as of 2012 than there are today. And Xi Jinping has dialed all of these back and taken it in the reverse direction. So therefore, for those who conclude that we now have a more, shall we say, assertive Marxist-Leninist state at home and a more nationalist Chinese state abroad, analytically, that is correct. And I think that is a view reflected across the United States Congress and across democracies around the world. Of course, the $6,000 question is, what's an effective

strategy for responding, as opposed to just pulling out a bullhorn and screaming at China and thinking that using a megaphone every Tuesday morning actually equals a strategy, which it does not. What do you think a good strategy toward China would be? And what strategy would avoid a war? How do you think a war could start? There are multiple scenarios in terms of how crisis, conflict and war could emerge between China and the United States. Over Taiwan, in fact, I traced five sets of scenarios there. The South China Sea, the East China Sea, we've got so much metal flying around in terms of ships and aircraft. Korean Peninsula also presents some challenging scenarios for the future,

particularly Kim Jong-un's predisposition to go fully nuclear. And then, of course, there's this rolling roll of the dice in terms of random attacks in cyber and space. So there are plenty of tripwires out there. Secondly, one of the reasons I argue in this book for what I call a doctrine of managed strategic competition is to try and reduce the risk of any of these tripwires producing accidental crisis, conflict and war, for which there are many, many possibilities right now. And by managed strategic competition, I refer to the need for each side to identify its core strategic red lines in these five areas, communicate them through private diplomatic channels to the

other side, rather than the current game of what I describe as strategic push and shove, in the hope that somehow operationally we deduce where in fact red lines may lie but it's a pretty dangerous way to go about doing it. It's a form of Russian roulette and I'm not all that happy about that as being a form of enhancing strategic stability. I think a further element of what I describe as a potential joint strategic narrative between China and the United States within this umbrella of managed strategic competition. If you can deal with the red lines and the core strategically sensitive areas, you can embrace non-lethal, full-blooded strategic

competition and everything else. The rest of national security policy, the enhancement of deterrent capabilities on both sides of the equation, the rest of national security policy, the enhancement of deterrent capabilities on both sides of the equation, the rest of foreign policy and the pursuit for foreign policy influence in the world, economic policy, trade, investment, capital markets, technology markets, talent markets, etc. As well as ideology and the great contest for the world of ideas underpinning the next international system, if there is to be a next international system. And finally, to construct at the same time sufficient political and diplomatic space in the bilateral relationship, as would still enable strategic collaboration in critical

areas of mutual national interest, like climate change, like the next pandemic, given how much we screwed up the last one, all of us, that is, and furthermore, maintain global financial stability, given that these are the two largest economies and financial systems in the world. So I think that's a credible way ahead. And for the US to use that period, through what I call the decade of living dangerously, the 2020s, to continue to invest in effective military deterrence together with their friends and partners in Taiwan, across the Taiwan Straits, to ultimately cause the Chinese military to think twice about whether Xi Jinping's political timetable is militarily capable of execution. Last time when we talked for Three Takeaways,

you talked about the importance of allies and that the U.S. is ally rich with over 40 allies compared to China, which only has North Korea. How important are allies now and how can they be leveraged? Allies, as China and the United States understand implicitly, are force multipliers. And you don't have any good ones, which the Chinese privately concede they don't. And the United States starts with this enormous advantage of 46 treaty allies around the world, in Asia, and in Europe and elsewhere. So the question for the United States, however, is not to just regard these as passive military partners, but also to

affect a much broader, shall I say, strategic and economic relationship with their allies. And one of the challenges for the United States Congress, which has become overwhelmingly protectionist, is to regard their friends, allies and partners as natural participants in wider free trade zones with the United States for the long term, both in Asia through what was once called the Trans-Pacific Partnership, but also with Europe with what began as a concept of TTIP. And the United States with the NAFTA economies of North America, with its partners and allies in Asia and in Europe were to expand the tent, the economic tent in trade and investment flows and technology flows.

This is such an important leverage point for America and its ultimate strategic competition with the People's Republic of China. The fact that the United States Congress is heading in exactly the reverse direction is a case, in my view, of pulling out a very long double-barrel shotgun and aiming it at both feet and blowing a hole in it. And that's what very much the United States is up to now. Kevin, before I ask for the three takeaways you'd like to leave the audience with today, is there anything else you'd like to mention that you haven't already touched upon? I'm very happy with what I've said so far, Lynn. That's fine. Thank you for your questions.

And the three takeaways? Three takeaways, I think, are as follows. One, that it's critical for the United States to stabilize the US-China strategic relationship in the 2020s, this decade of living dangerously, by embracing with Beijing a concept like managed strategic competition, as I've outlined in our discussion today. Number two, the United States, if they do so, should use this critical decade to rebuild its capacity both for military deterrence, but also economic growth and development in order to continue to strengthen the position of the United States and its allies in the region and the world. And the third takeaway is this, and we haven't discussed this one, but to look carefully at the long-term economic trajectory

of Xi Jinping's move of Chinese economic policy to the left, the impact which that has in turn on China's long-term economic growth rates as the private sector in China starts to go on a business investment strike, together with demographic trends through an aging population, a shrinking population, and a shrinking workforce and declining productivity growth, to conclude that maybe by the time we get to the 2030s, China's economy ultimately doesn't become bigger than the US economy, or if it does, maybe only a little bit bigger, rather than the projections of the past, more of a linear nature, that it ends up being

twice, thrice, or four times the size of the United States and perhaps twice the size of the United States and Europe combined. Put those three things together, I think they are reasonable takeouts for a long-term analysis of where this relationship can go. Thank you, Kevin. This has been great. And I really enjoyed The Avoidable War. It is a wonderful book. So thank you. Thanks so much, Lynn. And I appreciate your having me on this podcast to discuss it and with all the folk who subscribe to it. If you enjoyed today's episode and would like to receive the show notes or get new fresh weekly episodes, be sure to sign up for our newsletter at 3takeaways.com or follow us on Instagram, Twitter, and Facebook. Note that 3takeaways.com is with the number three. Three is not spelled out. See you soon at 3takeaways.com.