Interpreting the crisis behind the Taiwan-related bill

By Digby Wren

The assurance that the United States would not alter its position about the status quo over Taiwan is the most crucial and volatile issue in China-US relations. The importance of the “one-China Principle”, the “Three Communiques” and the “Taiwan Relations Act” on China-US related interests has never been a more complicated and less happy story than during the current Trump Administration. For the first time since George Walker Bush’s Presidency, China has been labelled a “strategic competitor” and for the very first time, an “economic security threat”. The Taiwan Travel Act, recently rubberstamped by the US senate and congress and signed into law by US President Donald Trump, encourages visits between the United States and Taiwan at all levels. For China, the relevant clauses of the act, though not legally binding, severely violate the one-China principle and the three joint communiqués and send very strong signals of support to separatist forces in Taiwan. 

An Fengshan, spokesperson for the State Council Taiwan Affairs Office, gestures at a regular press conference in Beijing, capital of China, Feb. 22, 2017.[Photo: Xinhua]

Deeply conflicting assessments of trends in China-US relative power abound in foreign policy circle. But for the Trump Administration, there is a significant strand of thinking that holds that the US has been on a steep and irreversible decline, at any rate relative to China. Moreover, there is a long list of internal and external pressures that successive administrations, at least since the time of President Reagan, have either ignored or were incapable of addressing. Internally, the most vocal critics point to the administration’s apparent failure to formulate, plan and communicate a comprehensive strategy for American domestic renewal to the electorate and lawmakers. The ballooning national debt, which now stands at over USD$21 Trillion, a hugely inflated defence spending habit that is basically a form of ‘Quantitative Easing’ (or QE4; a way to inject more liquidity into the economy through military expenditure, which creates manufacturing jobs and therefore more spending) while appearing to maintain a global dominance in security, is firmly in the hands of the military-industrial complex President Eisenhower warned the country about. And, the insatiable desire of Americans for foreign imports while having one of the lowest savings per capita of any large economy has caused the US trade deficit with China – China has been open to negotiations - and its erstwhile allies Japan, Germany and South Korea, amongst others, to expand to record levels. 

Externally, the Trump Administration’s record is filled with failures. CGTN commentator, Einar Tangen has pointed to “the politically tone-deaf visits to South America and Africa, chaos in the Middle East including US sanctions on Russia, failed military strategies in Afghanistan, an alienated Pakistan, uncertain NAFTA, the threat of US sanctions against the Nordstream Project (with its 5 EU backers), the partition of Syria, a failing Iraq and the President’s tariffs against China” Altogether says Tangen, “and you have a gradual consensus of countries who increasingly see the US as an unreliable troublemaker.” 

As if that were not enough, China’s global lead on climate change and structural improvements to enhance the use and development of industry based on renewable energy and electric vehicle manufacture including battery technology is advancing quickly. Deepening connections along the Belt and Road economies across Eurasia and into Africa, which may be able to replace US commodity exports in the near future, the successful launch of the AIIB to support it and the gradual acceptance of the Renminbi as a currency of international settlement have unsettled the dollar, bond markets and US stock exchanges, which is, by most accounts, overvalued. Other factors too, weigh heavily for the Trump Administration. China’s rapidly accelerating advances in AI, cyber and military capability, the digital and mobile economy and, perhaps most importantly, the success of the current Chinese leadership to maintain and communicate a peaceful global development plan, based on the above, that was recently renewed and reinforced during the 2017 19th Party Congress and the recently concluded Two Sessions. Combine this with the ever eastward drifting wealth line and the preeminence of eastern markets in India, China and ASEAN said Tangen, “and you have a threat to dollar dominance which could reshape the world as we know it.” 

For the Trump Administration, increased political, military and trade exchanges between US and Taiwan officials is seen to deliver six strategic advantages: (1) It will lead to increased arms sales and short term domestic economic gains (2) It increases the pressure on Beijing to help ‘resolve’ the North Korea issue in the lead-up to the Kim-Trump summit; (3) It appeases the ‘hawks’ of the conservative US establishment and the Taiwan lobbyists in Washington; (4) It buys time for the US military establishment to respond to the growing strength and sophistication of the Chinese military, cyber and space capabilities; (5) If Taiwan were to declare independence, Beijing’s response may lead to war and negative global consequences (America, nor any other nation, can afford a war); (6) It shores up Trump support within the US electorate, distracting them from domestic political turmoil and in particular, a polarized Washington and a White House in disarray.

The signs are everywhere says Einar Tangen, “India has suddenly turned quite warm, with Modi sending an immediate warm congrats to Xi and posting on Weibo, and Japan has just stated its interest in the Belt and Road Initiative. This is hardly a preamble to a united front containment strategy”“Trump's administration uses slogans rather than strategies and they are about to come home to roost. Investments and diplomacy are based on trust and reliability, I am not sure any of those things apply to Trump.”

The Taiwan Travel Act directly challenges the One-China Principle and Three Communiques while it reinforces both the [Peace] Treaty of San Francisco and the Taiwan Relations Act. While not seemingly dangerous in the very short term, the signing of the Act by President Trump, demonstrates the US Administration’s thinking on how to gain control not only over the internal political, structural and social turmoil being experienced in the United States, but also its increasingly expensive and difficult problem of how to maintain a global power balance that is progressively edging towards a truly global market economy and multi-lateral institutions not beholden to Washington’s declining economic influence and interventionist policies. Under the present administration, Washington and Taipei are capable of provoking a new crisis or multiple crises at any moment.

(Digby Wren is a visiting international relations scholar at Sichuan Normal University)