Let China win. It’s good for America.


When Chinese officials announced in 2013 that they would open an Asian Infrastructure Investment Bank to primarily fund big construction projects across the Pacific, they launched a slow-motion freak-out in Washington. As they went around the world inviting governments to join, Obama administration officials pressured their allies in Asia, Europe and elsewhere not to. The AIIB, headquartered in Beijing, would allow China to expand its influence throughout Asia, the White House fretted. “We are wary about a trend toward constant accommodation of China,” one Obama aide complained to the Financial Times after Britain joined 56 other nations in signing up to fund power plants, roads, telecommunications infrastructure and other ventures. It was a rare public critique of a U.S. ally.

The campaign against China’s bank is hardly unique. Since the Obama administration came into office, its Asia strategy has been to fear and combat nearly every move by China to flex its muscles, which Beijing has done through aid grants, trade deals, energy exploration, new diplomatic initiatives and military relations with other nations. This anti-China strategy might be one of the only areas of agreement between the president and Republicans. Donald Trump, for instance, says he wants to battle China at every opportunity and promises to slap 45 percent tariffs on Chinese imports.

In some places, such as the South China Sea, the nation’s expanding power poses a real threat. And it is frightening to see a xenophobic autocracy — one that cracks down ferociously on domestic critics and fosters a growing cult of personality around President Xi Jinping — gaining influence.

But wariness toward China has morphed into a muddled, obsessive and often mindless U.S. policy. It holds that any new Chinese action must be stopped; any new Chinese ally must be won over; any new Chinese ambition must be contained. The administration has become so fixated on countering Beijing that it fails to realize that some of the Chinese actions it is fighting do not imperil the United States’ interests. Meanwhile, the (largely futile) battle doesn’t just alienate allies. It also takes U.S. diplomats, money and arms away from places that truly matter to the United States. In some places, America would do best to let China win.

Since at least 1989, the year of the Tiananmen Square massacre and the end of a honeymoon in U.S.-China relations, Washington has regarded Beijing’s growing power with suspicion. But during the Clinton administration, China was still recovering economically and militarily from that debacle; it posed no real military or diplomatic threat to the United States or most U.S. partners in Asia. Then George W. Bush spent his presidency focused on the war on terrorism and largely put China issues to the side. By the time Barack Obama took office, however, China had become much more influential. And the promise to end Middle Eastern wars gave the White House the bandwidth to focus on opposing it, often counterproductively.

The Asian Infrastructure Investment Bank — a relatively modest institution with an initial capitalization of about $100 billion, much of which China plans to provide — is one place where the United States should have simply stepped aside. In asking other nations not to join as founding members, U.S. officials sometimes argued that the institution would duplicate the older Asian Development Bank, a multilateral bank dominated by Japan and headquartered in the Philippines, a U.S. treaty ally, according to Obama administration Asia specialists. Other times, they argued that the new bank would undermine international financial and environmental standards for aid projects.

Yet the Asian Development Bank itself estimates that infrastructure in the continent’s poorer nations needs about $8 trillion in upgrades by 2020 if those countries want to remain globally competitive. The idea of the AIIB is genuinely popular with these countries — as well as with some donor nations in Europe — and doesn’t threaten U.S. strategic interests.

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