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- [00:00]
A
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A
Welcome to the Cynical Podcast, the weekly discussion of current affairs in China. In this program we look at books, ideas, new research, intellectual currents and cultural trends that can help us better understand what's happening in China's politics, foreign relations, economics and society. China Join me each week for in depth conversations that shed more light and bring less heat to how we think and talk about China. I'm Kaiser Guo, coming to you this week from my home in Chapel Hill, North Carolina. Sinica is supported this year by the center for East Asian Studies at the University of Wisconsin Madison, a national resource center for the study of East Asia. The Sinica Podcast is and will remain free. But if you work for an organization that believes in what I'm doing with the show and and with the newsletter, please consider lending your support. I know that you all think of this as boilerplate by now, but seriously, seriously, I am looking for new institutional support. The lines are open. You can reach me@synecapodmail.com and listeners, please support my work by becoming a paying subscriber@senecapodcast.com seriously, help me out. I know there's a lot of substacks out there and they start to add up because but I think this one delivers serious value. You get not only my stuff, you get the China Global south podcast, the fantastic content from Trivium, including not only their excellent weekly podcast, but also their really, really useful weekly recap. On the weekend. You get James Carter's wonderful, wonderful this Week in China's History column in text and even audio. I narrate that every week. I'm really trying to deliver value for your hard earned dollars, so please sign up. Things are tough, I know, but consider helping me out because things are tough for me too. Today we are turning to the state of US China policy one year into Donald Trump's second term. Not through slogans or the daily headlines, but through a clear eyed assessment of what has actually changed, what hasn't, and where the strategy is running up against reality. My guest is Patricia Kim, a fellow at the Brookings Institution where she focuses on US Policy toward China and the broader Asia Pacific. Patty has served previously in policy roles spanning the executive branch in the think tank world, and she's widely respected for bringing analytical discipline and empirical rigor to debates that are often long on rhetoric and short on evidence. Last month, Patty co authored a Brookings assessment taking stock of Trump's China strategy at the one year mark, looking hard at the administration's own stated goals on RE industrialization, AI leadership, strategic dependence and global standing, and asking a simple but quite bracing question, are these policies actually delivering the results they promise? It's a piece that cuts through a lot of noise and it's one I've been eager to discuss, especially given how much has happened in the weeks since it was published on January 16. Joyce Yang was the co author of this as well. Patti, though, it is just such a pleasure to finally have you on Seneca, this conversation is long overdue. A warm welcome to the show.
- [04:44]
B
Thank you, Kaiser. It's great to be on your show.
- [04:47]
A
Patti, Let me start at a really high altitude because this is a criticism that you hear constantly. You heard it in the Biden administration as well, but that the Trump administration doesn't actually have a China strategy. There's been no major speech, there's no doctrine, no capstone document that lays it all out. You can sort of piece it together. Of course you have Trump acting, as your colleague Ryan said on the show recently, very much as his own China desk officer. And yet, as you point out in the paper, there is a surprising degree of consistency when it comes to the administration's stated objectives. Again, rebalancing the US Economic relationship through re industrialization that's been a big priority. Maintaining dominance in critical technologies, especially in AI, reducing dependence on China controlled supply chains and restoring, insofar as that's possible, American respect abroad. How should we reconcile these two things? Is this a case of relatively clear objectives paired with highly improvisational execution, or does the absence of an institutionalized strategy something you can point to and articulate clearly? Is that itself becoming a limiting factor when it comes to delivering results?
- [06:07]
B
Yeah, I mean, Kaiser, those are great questions. And real quick, before we get into the substance, I want to acknowledge my co author and thank you for pointing her out, Joyce Yang. Joyce is one of our top research assistants at the Brookings China center, and she was a wonderful intellectual partner and a driving force behind this report. So turning to your question about the Trump administration's framing of China policy, I think there's, you know, there's the reason why there's such a ongoing debate among China watchers about whether the administration actually has a coherent China strategy is because, you know, we haven't really seen a single major speech or a policy paper that lays out a comprehensive China framework. President Trump, he hasn't delegated China policy to a formal interagency process in the way that past administrations have. As you just mentioned, he's taken a very personalized approach to China. And in fact, Trump is indeed described often as his own China desk officer. And it's very clear that he places significant weight on his personal relationship with President Xi Jinping and this conviction that leader level diplomacy can succeed where bureaucratic processes fall short. That said, I think Trump has held fairly consistent views about China that long predate his second term. Those views are articulated quite clearly in the latest national security strategy, which says, you know, three decades of mistaken American assumptions about China and the decisions to overcome open US Markets to China, encourage American firms to invest in China and to offshore manufacturing helped create a rich and powerful competitor while hollowing out US Industry, weakening America's economic autonomy and creating serious national vulnerabilities. So this is sort of the core view that the administration holds. And what's interesting is that in this second term, they've been very deliberate about stepping away from the language of great power competition. And this is a shift from the first Trump term when this framework was officially sort of explicitly embraced. Yeah, exactly. By the administration. But again, even without this framing, we do see a fairly consistent set of objectives that Trump and his senior officials often emphasize. And these revolve around rebalancing the US China economic relationship and restoring American strength vis a vis China. By one re industrializing the US Maintaining US Dominance in critical technologies, reducing strategic dependencies on Chinese controlled supply chains, and restoring respect for the US Globally. And what I'd finally note is that many of these goals are not necessarily unique to this administration. In fact, there's broad bipartisan consensus that many of these objectives matter. The Biden administration pursued many of the same ends, though with a different set of policy tools and approaches. But in any case, these are the aims that we think the Trump administration has set out for judging its own China policy, and they're the ones that we look at in the report.
- [09:37]
A
Yeah. You've anticipated what I was going to ask you, which was about that sort of institutional inertia, despite the fact that he's just so personalistic about it, that so much of Trump's China policy comes down to his instincts, his impatience with process, his preference, as you say, for leader to leader dynamics, which he puts over institutionalized relationships, his fondness for the deal and the leverage and a spectacle, frankly. But I sense that, as you say, there's a lot of continuity from the Biden administration. There are a lot of the same goals articulated, maybe different and with very different tools available to them or that they prefer. But I mean, just candidly, if Trump were suddenly removed from the picture, how much of this trajectory do you think would actually change in substance as opposed to tone and execution? These would be sort of the American goals if Kamala Harris had won in November, right?
- [10:30]
B
Yeah. I mean, that's a great question. I think I agree with that. I think they would broadly stay consistent, but obviously the policy tools for achieving these ends would probably change.
- [10:44]
A
Yeah. And the style, of course, picking up on that. Let me take your answer as a given that there are strong structural continuities in American China policy. I certainly agree. These predate Trump. They would probably outlast him despite his personal style and his volatility. With that framing in mind, I want to lay out the terrain before we start walking through it. In your paper, you organize your assessment around those four stated objectives, just to reiterate, re industrialization, AI leadership, de risking in supply chains and global standing in the US before we take those in order, and maybe we could just as we enter each of them, keep in mind that take it as given that I've asked this question, think about how listeners should should think about what success would even look like across each of these domains. Are there signals that you're particularly attentive to? Signs that something is moving in the right direction or warning lights that A strategy maybe isn't doing what it was supposed to as we move from one area to the next. I guess just keep that in mind as we go through these. But let's just start with the first of those four goals with re industrialization of the US Economy. Patti, before we I actually ask you a question, let me flag something I've been struck with lately, which gets at a real tension in the administration's approach. There is this growing argument, and I think we've seen some concrete examples of this, that broad tariffs can actually work against reindustrialization by making it more expensive to build and operate factories in the United States. If you're taxing imported machinery and components and a whole bunch of the industrial inputs, which we don't have in America, you may be just raising the cost of domestic production rather than actually lowering it, and in some cases even just discouraging firms from citing new capacity in the US at all. With that in mind, how do you assess the administration's record so far in re industrialization? Because they've been using the blunt instrument of tariffs mainly to what extent do tariffs and some of the other trade tools meaningfully support the goal of rebuilding domestic manufacturing, which is something, again, that we have a lot of bipartisan support for. We have differences as to how difficult it is. But where do you see these goals colliding with the underlying economics of investment and supply chains and cost competitiveness?
- [13:17]
B
Yeah, before I get to that, just sort of a general note. What we try to do in this report is to look at the administration's record as objectively as possible by looking for concrete indicators, things like manufacturing data, industry sentiment surveys, analysis of recent trade and investment deals, as well as global polling. And we do this in order to try to fairly assess have we seen deliverable, measurable results on the administration's stated objectives? And to put the bottom line up front, I think across all four objectives we find a consistent pattern that while the administration has clearly elevated very important priorities and it's deployed a variety of policy tools, tariffs being the forefront of them, its ambition and rhetoric have outpaced tangible outcomes.
- [14:10]
A
What a surprise.
- [14:12]
B
And of course, you know, this doesn't mean that nothing is happening. It's true that a lot of these goals, like reindustrialization or supply, supply chain diversification, take time to materialize. But you know, even accounting for these lags, the progress to date has been constrained by factors like policy uncertainty and instability and tariff volatility and growing skepticism among US Partners. Now turning to the question of re industrialization which really is the centerpiece of the Trump administration's China strategy or really the make America great again framework. And this is, again, this is a diagnosis that resonates with a lot of Americans, that the United States really needs to rebuild its industrial base. So we look at have there been measurable results and is there a manufacturing revival underway in the United States? And what we find looking at core indicators of manufacturing activity like employment numbers, factory construction capacity utilization and industrial output, the story is that we're not really seeing a takeoff. Manufacturing employment has declined since President Trump returned to office. And while, you know, month to month fluctuations are normal, a sustained drop is difficult to square with claims of a manufacturing resurgence.
- [15:37]
A
Yeah, yeah, for sure.
- [15:39]
B
And construction spending. Manufacturing construction spending also remains elevated compared to the immediate post Covid period, but it's plateaued rather than accelerated since January 2025. And it remains below the peak that was reached at the end of the previous administration capacity utilization, which tells us how intensively firms are using their existing factories, hover around a range where it doesn't make sense for them to necessarily make major new investments or to build new factories. And so these and many other indicators that we look in the report are not pointing to a manufacturing revival. It's pointing to a sector that is holding steady at best.
- [16:24]
A
What do you think is behind this? I mean, is that thing that I suggested that tariffs are actually making it simply not economically sensible to increase investment or making it difficult to source the machine tools, the things that are necessary to manufacture in America? What is getting in the way of re industrialization?
- [16:49]
B
That is absolutely a big part of it. If you look at what the industry executives themselves are saying, if you look at surveys and anonymous interviews, there's a lot of hesitation to move forward with investment. In theory, tariffs are meant to encourage companies to produce more in the United States. But firms in reality are facing a combination of higher labor costs, higher prices for intermediate inputs, uncertainty about where trade and economic policies are headed, and manufacturing investment is. These are long term decisions. You don't just build a factory overnight. It takes three to five years, if not longer. And so it's very difficult for companies to make these kinds of important commitments when tariff rules keep shifting and future costs are hard to predict. And so instead of seeing a rush to rushore, many firms are waiting, they're scaling back plans or looking for alternatives outside of the United States. And so I think this dynamic helps explain the disconnect that we're seeing in the data. Like the strong rhetoric about jobs in factories roaring back, but actually fewer signs of broad based gains that are showing up on the ground so far.
- [18:07]
A
So I'm thinking out loud here, but I wonder what the role of tariffs in Trump's own mind actually is. I mean, your approach in this paper, I think very admirably is to take the administration at its word and evaluate tariffs as tools that are aimed at re industrialization. I have to admit I find it hard to believe that for Trump himself, tariffs are really just, or even just primarily about rebuilding domestic manufacturing. I mean, setting his long standing idiosyncratic mercantilist belief that trade deficits are inherently bad, setting that all aside, tariffs for him seem to function as a kind of all purpose bludgeon. It's a way to punish behavior he doesn't like, whether by rivals or even by allies. It's a source of leverage. It's also just a piece of political theater that energizes his base and reinforces his brand. I'm curious how you see this. To what extent do you think tariffs at this point are genuinely being deployed as an instrument of industrial strategy and to what extent they're just doing other kinds of political work or symbolic work that may be just very loosely connected or even disconnected entirely from re industrialization as an economic project?
- [19:29]
B
Yeah, I think it's all of the above. And as you say, I do think President Trump sees tariffs as the ultimate source of leverage and perhaps even a magic tool to right many wrongs that he sees. I mean, we've seen him use the threat of tariffs to bring countries around the world to the negotiating table. And as a result, we have seen the White House strike a bunch of foreign investment deals with countries and they've pointed to that as again, proof that countries are investing in the United States. This is going to lead to a re industrialization of the country. There's a webpage on the White House website that's devoted to listing these blockbuster deals. But again, what we do in the report is that we try to look at what do these deals actually say? Are they going to deliver measurable results? And what we find is that there are some very impressive headline numbers out there, but they're less solid than they appear on the foreign investment deal sides. We see that many of these deals rest on non binding frameworks or mouse or they have very long time horizons that go that are going to go well beyond the Trump administration. And in many cases, the US Government and its partners describe the same agreement in very different ways, which raises questions about implementation and durability. And of Course, for many US counterparts, especially allies, there's deep unease about their country's sovereignty financial expression exposer who ultimately controls these investment deals and the projects that are supposed to be part of them. And again, I think this political friction really matters because it can slow or dilute or even derail follow through in the future.
- [21:21]
A
For sure. For sure. So one last question on re industrialization before we move on. I mean it comes through very clearly in your analysis, even if it's not always stated explicitly. And you just talked about this in terms of the sort of arm twisted investment agreements that they're on very, very long time horizons. But it's this tension between the time horizons that are involved in re industrialization and the political exigencies of this administration that causes a lot of difficulty. Rebuilding manufacturing capacity is by definition a very long term project. It's going to require years of planning and actually stable expectations around costs and market access questions. Actually quite a high degree of confidence that the policy environment isn't going to shift abruptly. But it does in America. It does. It might after the midterms, it might after 2028. At the same time, the tool, as we've been saying that the administration has leaned on, which is these sweeping tariffs which are imposed and adjusted or threatened on super short notice at whim, that's inherently destabilizing and it introduces a ton of uncertainty into these investment decisions, whether by foreign countries into America or by American firms. How do you think about this mismatch? To what extent does this policy volatility itself become a big old constraint on re industrialization? Is there a way to reconcile the long horizon industrial goals with these high variance policy effects of this crazy tool of tariffs?
- [23:15]
B
Yeah, I think we're going to have to watch and see. That is a big question. And I think for many of the US allies, they've kind of stuck around despite being whipped around by this administration and threatened tariffs overnight because they value their partnership with the United States. Their security depends on the United States. And so we've seen. They haven't quite walked away yet. And so we'll have to see. We'll have to see. But I don't think the administration is doing itself any favors or the president by continually wielding new threats. For instance, the South Korea deal we look at in depth in the report and since we've written it, there is now a new development where President Trump publicly threatened to raise South Korea's tariff rates up to 25% from the 15% that it was negotiated to citing South Korea's slow ratification of the trade deal. The very reason why this deal was being scrutinized to begin with by South Korea's national assembly was because there was a lot of anxiety about, you know, is this the right thing for the, for the country to do? Should we be spending $350 billion in the United States if there's so much uncertainty, and especially uncertainty about the U.S. commitment? And you know that. So that's kind of the reality that we're looking at. And we'll see, we'll see how it pans out over the next three years and beyond. But I think it's very true that many US Counterparts have been caught off guard and they're just trying to navigate it as well.
- [24:54]
A
Putting those South Korean battery engineers in shackles and deporting them probably didn't build confidence. Exactly. That's fantastic. Patty, let's turn to the second pillar of your paper, which is maintaining US Leadership in AI. So before we frame this up as a question, let me briefly note a coincidence that struck me just last week. Yann Lecun, who's one of the field's true pioneers, he was profiled in the New York Times with a scathing critique arguing that the industry's overwhelming focus on large language models may actually be a dead end on the path toward more general capable AI systems. This fixation with artificial general intelligence that the United States has, we've gone all in on this. It's a gigantic bet. What caught my attention, beyond the critique itself, was that he explicitly praised Chinese companies for pursuing a wider range of approaches rather than betting everything on a single dominant paradigm of large language models are going to take us to AGI. Against that backdrop, I'm curious how you think about AI leadership in strategic terms. In your paper you point to real US Strengths are pretty undeniable. Frontier compute and chip design and leading platforms, but also to growing self constraints from export control, volatility, infrastructure bottlenecks, pressure on talent. How worried are you that US Policy and market incentives may actually just be narrowing the innovation space, even just as competition is really heating up? As it intensifies? When we talk about AI leadership, should we be thinking less about who is winning the current race to scale existing models and maybe more about who is best positioned to explore, to sustain, to absorb the next generation of approaches, whatever those end up being? Because I feel like all our eggs in one basket right now.
- [27:00]
B
Yeah, I mean, I think many experts in the field have pointed out that there isn't a singular AI race per se. There's going to be competition in the AI space. And there's, of course, different lanes and different aspects that the US and China will be competing over. And so we can't see this as a singular race. The Trump administration has been, I think, a bit more general in the way that it's framed the competition. It's just said generally that the US Needs to maintain a lead in AI and stay ahead of China. And as you pointed out, the US does retain real advantages at the moment. It has domination in the advanced chip design. It controls a large share of the global frontier compute. It remains home to many of the world's leading AI firms and platforms and research labs. And these are meaningful strengths and they shouldn't be understated. But what we point out in our report is that these advantages are increasingly under stress and they're not guaranteed to hold over time. And one source of strain is the administration's evolving approach to export controls. Yeah, over the past year, the Trump administration initially tightened, and then it loosened restrictions on advanced chips and most recently lifted restrictions on Nvidia's H200 chips, based on the logic that it's better for China to remain dependent on US Technology and for American firms to continue benefiting economically from access to the Chinese market. But there's been significant pushback as well across the policy community on this decision. And you know, the critics point out that the United States is essentially handing away its compute advantage at a time when China is racing to close the gap and it's doubling down on reducing its reliance on US Chips as quickly as possible possible. And so it remains to be seen whether the administration can successfully balance its two stated objectives of one, supporting US Firms commercial interests, while on the other hand, preserving long term US Technological leverage over China in the compute domain. But of course, AI leadership isn't just about compute. Physical infrastructure that enables compute at scale, Think data centers, electric grid capacity, a reliable energy generation. You know, all of this matters as well. And we've seen the administration take steps to try to accelerate AI infrastructure buildout. But many of the consequential decisions in this area sit outside of direct federal control. We've seen a lot of state and local objections to data centers, for instance, because of real concerns about water. Yeah, exactly. Environmental concerns and pushback from local communities. And so this is, you know, kind of where what the United States is dealing with. Whereas China, by contrast, you know, has a far more centralized approach to AI infrastructure, as it does in all facets of its economic policy. And this has allowed it to run much faster in areas like power generation. And so when you put the US and Chinese model side by side, you know, the challenge becomes clear. I think the decentralized nature of US infrastructure governance combined with real environmental constraints and energy bottlenecks creates obstacles to the rapid large scale build out that will be important for sustaining a leading edge in AI.
- [30:36]
A
I'm not going to try to pin you down on where you come down on the export controls debate, but I do want to. There's another thing that shows up when you lay down these policies side by side, the approaches of China and the United States. And I think this is something that we've talked about quite a bit on the show. But maybe it's not down to who has the most advanced models at the frontier, but how AI capabilities are actually diffusing into the economies of both of these countries. And there, I think there are a lot of people, I don't have my own position on this necessarily, but who see China as ahead in that regard with its AI plus strategy, with these real efforts to see their models diffusing into all the way down through the firm level to mom and pop shops. It's a pretty impressive idea. The other thing is that of China's AI capabilities are diffusing into the global south, into the rest of the world as well. And this is another deliberate part of China's AI approach. So I don't know if you feel like that is a significant piece of this contest and what the Trump administration has said or what it's doing about this. I noticed that in David Sacks AI strategy there's much more emphasis now on, on open weight or even open source models. And I think, I sense that they're sort of learning, maybe looking at China and maybe taking some ideas. Is that your sense?
- [32:14]
B
That's a great question. Honestly, I haven't Kaiser. I haven't looked at that close enough. And so maybe I could sort of answer your diffusion question without looking, talking about David Sacks and where he's going.
- [32:31]
A
One thing that we're seeing very clearly is that Chinese firms are competing not just with models, but with systems. They're embedding AI into logistics, into manufacturing, into healthcare, education, public administration. This is often bundled with hardware, with financing, with training, and of course, like I said, this increasingly open source approach that makes adoption both easier and cheaper. That AI strategy, relatively permissive attitude toward open source, it does seem to me at least to be really resonating even in Silicon Valley. From what I'm hearing, when you think about AI leadership in strategic terms, are we at risk of losing by focusing too much on frontier controls and denial strategies that were maybe losing sight of where influence, where standards, where dependency actually might be forming in real life through adoption, through integration, through everyday use rather than the cutting edge breakthroughs. That's my worry.
- [33:43]
B
Yeah. I mean there's definitely concerns that US companies are too focused on AGI versus practical applications of AI. And I think this has to do with the fact that the United States and China have fundamentally different ecosystems. If you think about China, it's a manufacturing powerhouse. It's thinking really hard about how do you take AI advancements and actually apply them to, as you say, healthcare tools or whatever it is that they're creating. And that's perhaps different from where the focus is when it comes to American companies. There's also an important question of diffusion, whether other countries adopt US Aligned or China aligned AI systems, infrastructure and standards. And we've seen the Trump administration indeed put an emphasis on accelerating exports of the American AI tech stack. But China has been in this game earlier and in a different way than the United States with a focus on packaging its AI systems with financing, infrastructure and long repayment timelines, particularly in the Global South. And for many governments, especially in emerging markets, that's very attractive.
- [35:01]
A
Yeah, yeah, yeah.
- [35:02]
B
The models or the products that they adopt don't have to be the absolute cutting edge in the world. They just need to be affordable and reliable and easy to deploy. And so this creates a real risk. The US perhaps might lead in AGI or really cutting edge stuff. But if China is gaining ground where AI is actually being used and embedded and normalized around the world, then it may be running ahead in the competition in other ways that matter.
- [35:32]
A
Let's move now to the third pillar of your analysis, Patty, about reducing strategic dependence on China, what's often described as de risking. One thing that struck me in reading this section of your paper is how different the problem looks once you move beyond the slogans. The Rare Earth episode that you discussed from October, it made very clear that the vulnerability that the US feels isn't just upstream extraction, but it's downstream. It's processing, it's manufacturing, it's China's ability to set prices and shape markets over time. It suggests that dependence isn't something you can just switch off. It's embedded deeply in industrial ecosystems that took us decades to build. I'm curious how you think about de risking in practice. I'm actually going to be talking to your colleague Kyle Chan tomorrow for a show for the week after this one. Runs. It'll be three Brookings people right in a row. Ryan, we'll be talking more about this as well. I'm curious how you think about it. What does meaningful progress actually look like here in De Risking as opposed to just the symbolic moves or the political signaling? How should we think about the trade offs that are involved between resilience and cost, between speed and sustainability, between national capacity and allied coordination? Especially given that many of these supply chains can't be realistically reconstituted on short political timelines. See our discussion about re industrialization.
- [37:09]
B
Absolutely. I think Kyle will be able to shed a lot more light on this question when you have him on. But in our report, we point out that, you know, that there was a wake up call.
- [37:20]
A
Yeah.
- [37:21]
B
When China's export restrictions on rare earths hit last year, you know, it really disrupted supply chains almost immediately. And it made very visible a vulnerability that had long existed, but it was easy to overlook as long as trade flows were uninterrupted. And to be fair, the administration has taken a number of steps in response. As our report details, they've increased US Government investments to support domestic rare earth production and a variety of initiatives to work with allies and partners to diversify sourcing. Just this week, the administration announced a new initiative to stockpile critical minerals.
- [38:04]
A
Yeah, critical mineral reserve, right.
- [38:06]
B
Yeah, right. And it's hosted dozens of countries for a critical mineral summit. And so there's no question that the vulnerability is being taken very seriously and they're trying to take concrete actions. Having said that, as you point out, structural realities don't change overnight. They're not going to put the United States in a different negotiating position vis a vis China in the next one, two or three years. And for a variety of structural reasons, China continues to dominate the rare earth supply chain, especially when it comes to processing and magnet manufacturing, where U.S. and allied capacity remains extremely limited despite the wake up call and the efforts that are being put into place at the moment. And of course, China has a advantage because of the scale and sustained state support. And so they're very much ahead in this. And, you know, some Trump administration officials have suggested that the United States might be able to reduce dependence on China when it comes to rare earth within two years. And this is, you know, all the experts point out that this is simply unrealistic. You can't do this overnight.
- [39:18]
A
Yeah, yeah.
- [39:19]
B
And supply chain resilience requires long horizon investments, predictable policy environments, sustained coordination with allies and partners.
- [39:30]
A
I'm detecting a theme here.
- [39:33]
B
Right, Exactly. And this is again challenging when many of Washington's relationships with its counterparts are strained because of the Trump administration's broader economic and security policies. And finally, while we look specifically at rare earths in the report, we point out that there are many other sectors where the United States is very dependent on China, whether it's foreign pharmaceuticals or EV batteries or mature semiconductors. And so while reducing exposure to Chinese strategic strangleholds might be achieved over a long horizon, I think it's unrealistic to think that the United States can fully insulate itself from all vulnerabilities even in the far future.
- [40:21]
A
Yeah, yeah. And even if they could, even if, you know, on a three, three to five year time horizon, they can liberate themselves from dependence on Chinese processed rare earths. What about in the meantime? There's a lot of political pressure to show progress immediately, but our tools, the ones that we've used, are very episodic, they're super reactive, and there's a gigantic mismatch. So I wonder what the Trump administration that certainly isn't believing its own rhetoric. They don't believe that 18 months from now we're going to be free of this vulnerability. What are they planning to do in the meantime? Do you get a sense of that? Is it just sort of let's make nice with China?
- [41:08]
B
I think so. I think in the meantime they've realized that we need to extend the trade truce with China. I think China is comfortable and happy with that as well. But just based on where we are, I just can't see the United States situation changing in a two or three or four year timeline.
- [41:31]
A
I feel like China must be thinking all we need to do is keep the pressure off. If we don't remind them of the urgency by actually imposing export restrictions, if we don't remind them of the urgency, they'll take their eye off the ball. That's the American style and things like that. The dependency is likely to continue. I think people will lose interest. What do you mean? We've got plenty of rare earths now coming from China. It's all better this way anyway, I guess. This brings us to the fourth and final pillar of your analysis, which is restoring American standing globally. What struck me in this section is that you treat standing not as a matter of just image or reputation in the abstract, but as something with real concrete consequences for investment decisions, for tech partnerships, for coordination in this whole de risking business that we've been talking about, even for whether allies are willing to absorb costs, to bear the Burden alongside the U.S. given everything we've discussed policy volatility, the short time horizons versus the longer time horizon realities, tariffs that are being used against not just rivals but also our partners, uncertainty about long term US Commitments. How do you look at the administration's claim that the US Is respected again? I mean, Trump says this again and again. I was in Switzerland during Davos, didn't feel that way to me somehow. More importantly, how does Davos diminished confidence among allies actually constrain America's ability to achieve these other goals on China, you know, re industrialization and removing supply chain dependency and you know, keeping ahead in.
- [43:21]
B
AI Yeah, well this is exactly where we find the biggest gap between rhetoric and evidence that the objectives have been achieved. And you know, when you look at the polling, it's very clear across a wide range of surveys we see a sharp decline in favorability towards the United States, including among some of the United States closest allies in Europe and Asia. And these are not marginal shifts. In many case they are double digit drops in a single year. Now this isn't to say that China is winning the popularity contest either. You know, views of China remain overwhelmingly negative across many of these countries. But in some places the year to year movement runs in the opposite direction of US Trends with modest improvements in some countries. And again, while many of these governments remain wary of Beijing, they are also increasingly questioning the United States ability to lead, its predictability and its staying power. And this has real implications for the United States ability to work with partners and get large and politically sensitive investments into the US or to get them to align up with export, US export controls or trade restrictions, or to bear real economic or political costs in the name of long term strategic alignment and cooperation. And I think this does create real headwinds for the administration's broader China policy and strategy.
- [45:02]
A
I can't remember exactly when it was that it came out, but the European Council on Foreign Relations put out just such a poll recently. It was 20 some odd countries. And this was led by Mark Leonard, who's ahead of the European Council, but also Timothy Garton Asch, who's a very well known historian emeritus at Oxford and Ivan Krostev, who's one of my favorite public intellectuals. He's just a fantastic writer, a Bulgarian guy who's co authored a book that I really like called the Light that Failed. But anyway, the three of them put out that a very, very striking poll. I mean it's really, it describes exactly what you see see sort of double digit drops across a single year. You know, I mean, obviously. Right. Your piece came out on January 16, which I believe was before the latest eruption over Greenland. Before, I think it was. Before Mark Carney's trip to China, I think it was. Well, it was certainly before Davos, with Carney's speech there. But beyond the bilateral relationship, there's been a lot of discussion, especially after Carney's Davos speech, about the rupture. And there's this assumption in some quarters that as the US retrenches, China is going to. To fill a global leadership vacuum. But your work suggests something very much more restrained, that China is expanding influence. Deliberately. It's expanding, sure, but it's trying to avoid, to shirk the burdens of leadership. Is that a fair characterization?
- [46:38]
B
That is, we clearly are in a moment of major reorientation of US foreign policy. And this naturally raises the question, what does this mean for China? And is Beijing going to try to fill what some describe as a U.S. vacuum? And what I've argued not in this report, but elsewhere, including in a book that'll be coming out with Princeton University Press in the fall. And I won't go into too much detail.
- [47:07]
A
Oh, come on, spill. Spell.
- [47:09]
B
Yeah. With the hope that you'll have me back.
- [47:12]
A
I will, absolutely.
- [47:14]
B
The shelves. But in any case, you know, China has certainly tried to capitalize on this moment. It's presenting itself as a responsible great power, a defender of global stability, in contrast to the United States. But the reality is I don't think Beijing is interested at all in replacing Washington as a global leader, at least not in the way that the United States has traditionally played that role. If you look at the way China has shaped its global strategy from the reform era forward, it's certainly expanded its global footprint in a very ambitious, deliberate, but ultimately limited way. It wants greater influence. It's made struck a lot of strategic partnerships across regions, but it's done this while avoiding deep entanglements and the broader responsibilities that come with global leadership. And so, to put it another way, I don't think China is seeking to create a wholly new alternate global order. And to lead certainly wants more global influence. It wants to revise the existing order that is more favorable to its interests. But it's also very focused on self strengthening in expanding its economic and technological capacities while reducing its vulnerabilities. And Beijing has shown little appetite for bearing many of the steep costs that are associated with genuine global stewardship, whether we're talking about security provision or conflict management or crisis response. And so this suggests that rather than witnessing a transition of global leadership from the US to China, we're more likely to see an international arena that remains adrift for the foreseeable future.
- [48:59]
A
Yeah. So we're entering a period of diminished global leadership overall with neither the US Or China willing to provide systemic order. I mean, I totally agree with you. I mean, China has been very selective in this, in where they want to play, where they want to contribute public goods for the world. And some of them are, I think, inarguably good. And it's good that we're not going to have a sort of vacuum like we had in the late 20s and the 30s, where after the collapse of Great Britain as sort of the provider of public goods, the US Kind of refused to step up. And it wasn't until after the Second World War that it really did the so called Kindleberger trap. Right. But I don't think that China is not interested in a global security architect. It doesn't want to play the global policeman. It doesn't want to, as you say, bear the really, really huge costs of conflict resolution and stuff like that.
- [49:58]
B
And it's very explicit about it.
- [50:00]
A
Yeah, yeah.
- [50:00]
B
It says it in those exact terms.
- [50:02]
A
Yeah, yeah, yeah. So listeners will have I hopefully recently heard me talk with your colleague Ryan, Ryan Hass, about his piece laying out these broad scenarios for the US China relationship over the remainder of Trump's term. You know, they're from managed competition to renewed escalation to something closer to prolonged instability marked by episodic deals and flare ups. What we're in right now, when you look at your own findings, Patty, especially the emphasis on policy volatility, on these structural constraints, on the difficulty of translating pressure into durable gains, which of his three scenarios, soft landing, hard brake or kind of bumping along because of mutual constraints and vulnerabilities, which strikes you as most likely most consistent with the trajectory that we seem to be on right now. And are there maybe inflection points you'd be watching for that would signal movement maybe from one path to another.
- [51:02]
B
So I agree with Ryan's analysis that we seem to be in a situation where both sides are trying to buy time to build insulation against each other. I think our report suggests that the United States isn't negotiating from its strongest hand right now. Having said that, it does seem like the President, President Trump is fairly comfortable with the current state of relations, judging from his characterization of his most recent call with President Xi. Yeah, it seems like he's quite satisfied. And I think both capitals are pretty satisfied with where things are. I think Beijing is particularly pleased with its own handling of the trade war with the United States, which Chinese analysts largely view as having played out, at least to this point, to China's advantage.
- [51:56]
A
Hard to argue otherwise, I think.
- [51:59]
B
Right. And some Chinese analysts have even talked about this as the top, as a turning point in the US China relationship. They argue that because China stood up against US Tariffs and it wielded its rare earths card, this forced the United States back to the negotiating table and ultimately produced the trade truce that we see in place today. And I think they believe that this fact, as well as the fact that there are multiple leader level engagements that are scheduled for this year, have bought China time and space from the most hawkish policies that could potentially come out of Washington. But, yeah, we'll have to see what happens in April.
- [52:42]
A
Right?
- [52:43]
B
We'll have to see. Yeah.
- [52:44]
A
So now it becomes a race to see who can extricate themselves from the vulnerabilities, who can take the other guy's hand off of their oxygen tube faster and, you know, may it last a long time, if you ask me. I mean, I hope neither of them is able to. I mean, I'll live with this world of mutual assured destruction. It's worked for us before. Let us hope nobody emerges quicker because I think that would be destabilizing. You know, Trump's talked about a lot of big numbers about, you know, purchases of soybeans, about Boeing sales, about, you know, semiconductors. Beijing seems much more focused on just the tariffs on extending the Busan truce, locking in maybe a statement of principles. There's a gap there. What are your expectations for the summitry that's going to happen this year beginning in April?
- [53:39]
B
Well, I agree with you. I think, as you said, President Trump is going to want those headline sales numbers that he could point to boosted purchases of American agricultural goods, of Boeing planes, and maybe highlighting the TikTok deal or fentanyl cooperation. Whereas Beijing, I think at a minimum wants to extend the truce, wants to lower tariffs by maybe not take away all the tariffs, I don't think it's possible, but bring them down to a more manageable point. There's speculation about is Beijing going to push President Trump to try to change, for instance, US Declaratory policy on Taiwan.
- [54:21]
A
Right.
- [54:22]
B
And my sense for now is that, you know, Taiwan always matters for Beijing. It's going to come up. And that was very clear in China's readout of the call.
- [54:30]
A
Yeah, yeah, that's all it was.
- [54:33]
B
Right. But I, I don't think getting new declaratory policy on Taiwan is Beijing's number one priority right now. Again, I think it's really about keeping the US China relationship stable so that it doesn't once again become the focal point of hardline US Policy.
- [54:54]
A
Beijing knows the art of the deal, too. They're going to have this sort of big aspirational ask and they'll settle for something less than changes in declaratory policy. I just saw before we started taping that you have a new piece out about the end of new strikes start and what that means for nuclear arms racing. Can you give us a quick preci on that? I mean, since I've got you here.
- [55:14]
B
Yeah. So thank you for, for pointing that out. It just published and you know what? I, the broader point I make in the piece is that we're really, we seem to be entering this phase of no restraints on great powers, whether we're talking about nuclear restraints or anything, where, you know, power is the currency that moves the world and nobody's going to try to live by any rules. And it's a dangerous world and it has real consequences for Asia. And when it comes to the nuclear realm, I think the fact that we no longer have any meaningful arms control and the fact that there are growing concerns about U.S. extended deterrence commitments in the region and the United States long spending traditional security role that it's played in the region is going to lead to different conversations. It already has led to very different conversations in Seoul, even in Tokyo, where the nuclear taboo runs deep. And we could see a nuclear cascade in the region as China rapidly expands its own nuclear arsenal, as North Korea continues to grow its illegal nuclear and missiles programs. And it's so it's, it's a more dangerous world and it's very concerning for sure.
- [56:37]
A
If anyone's interested in delving into Chinese nuclear strategy, I did a really fun interview with Jal Tong from the Carnegie Endowment.
- [56:46]
B
Yeah.
- [56:46]
A
National Peace, who is one of the, I think the top ranked experts in the United States on Chinese sort of nuclear strategy. I would ask that you listen to that show if you haven't already. But Patty, what a pleasure it has been talking to you. This is a fantastic piece that you can find on the Brookings. Can you remind me of the title of the piece again?
- [57:09]
B
Sure. The title is Making America Great Again, question mark. Evaluating Trump's China strategy at the one year mark.
- [57:17]
A
That's right. And co written by Patty and Joyce Yang. So thank you so much. Let's turn now to our Paying It Forward segment. I understand you've got something good for us.
- [57:30]
B
Yeah. So when it comes to scholars who are worth paying attention to rather than singling out one person today. I'd like to point your listeners to a place where you can consistently find a wide range of scholars who are engaging very seriously about how China on how China thinks about its strategy, its foreign and domestic policies. And this is the Lost in Translation series from the Brookings Global China Project.
- [57:57]
A
Amen. It's fantastic. It's so good. Yeah, yeah.
- [58:01]
B
Thank you. So this series brings together a range of voices, from rising scholars to very well established ones, to try to explain Chinese strategic concepts, concepts, debates and theories that are widely discussed inside China but often misunderstood or perhaps missing from conversations outside the country. And we make a very special point to try to publish pieces by scholars who are based in China and throughout Asia, not just American experts. And so we've recently featured writing by Dawei from Tsinghua University, good friend. Yeah, yeah, yeah. Who wrote a very insightful piece on Chinese expectations ahead of the Trump Xi meeting in Busan. There was also a piece recently by Sun Chenghao, also from Tsinghua, who wrote an excellent essay on how Chinese analysts are interpreting the latest U.S. national Security Strategy. And finally, there was another great piece recently by Margaret Pearson, who, of course, is a very respected skill scholar from the University of Maryland, and Kainan Gao, who is her PhD student who recently completed his studies at the university. And they examine how China and Russia use military parades to shape historical narratives and to challenge the existing international order. And so if listeners are looking for a place with scholars worth paying attention to, I'd really encourage them to check out the Lost in Translation series where you can really discover established and emerging voices and try to understand better how Chinese strategic debates and policy discussions actually look like from the inside.
- [59:44]
A
That's just fantastic. Thank you so much for that Lost in Translation series. This has been a hobby horse of mine for a very long time. Just that we don't have enough of a sense of what, for lack of a better word, we call sort of establishment intellectuals, members of the strategic class, what they are actually saying. This is a very valuable service that Brookings has provided. So thanks a lot. I mean, I realize that in recent years, we're kind of awash in some really good stuff. Tuma Garrett Geddes has this fantastic thing. I link to it often on my own substack, but his substack called Sinification, translates a lot of really, really good stuff from Chinese thinkers. Of course, the OG of this, more towards the theoretical end of it, was David Odinby's reading The Chinese Dream. But that's really kind of not publishing as frequently anymore. I mean, he's retired now and he's working on things, but that was a real inspiration to a lot of us. But it's really glad. Great that you guys are taking up the torch and continuing to do this very valuable work. What about recommendations just for the ordinary recommendation section? Do you have a good book or a film or some music that you want to recommend?
- [61:01]
B
So for my recommendation, I'd like to pivot away from China to the United States and recommend Michael Hanlon's newly published monograph, To Dare Mighty Things. So this book is a sweeping but very readable account of US defense strategy from the American Revolution to the present day. And it does a really excellent job of putting many of today's debates about military restraint, global commitments and America's role in the world into long historical perspective. And it's very useful if you want to understand how US strategy has evolved over time, what has and hasn't changed across different areas. And of course, Mike is one of the country's leading thinkers on US military strategy. He's a first rate scholar and he's a dear colleague and friend that I admire deeply. And so I highly recommend that you check out his book.
- [61:54]
A
Oh, that sounds fantastic. I will absolutely get that. My recommendation this week is Vasily Grossman's Stalingrad, which came out in English translation in, I think 2019. It's actually been recommended before on the show and right after it was. I went out and bought it, but I hadn't really cracked it open until just last week. This is the first part of what's really a diptych, a pair. The second volume was actually Life and Fate, which is way better known, way more famous. Grossman's Life and Fate. I think a lot of people have read it. But Stalingrad is absolutely essential for understanding the full arc of what Grossman had in mind, his whole vision. There you get the Soviet War and Peace. It very much echoes Tolstoy in its structure and in the kind of sweeping canvas of these individual lives, families, networks of friends caught up in the whole machinery of history and the same kind of moral seriousness and historical reflection about war. And Grossman was actually at the. The siege of Stalingrad. He was a correspondent for Red Star. This isn't like armchair strategizing. He actually witnessed the horrors of it very much firsthand. I think what makes it so devastating and so important is that he writes with this genuine love for the Soviet people, their sacrifice, while simultaneously, of course, he interrogates the system that they're fighting to preserve. And you can feel him just working through these contradictions in real time, something I think a lot of us who work on China might be familiar with. The book was published in the Soviet Union in 1952, but by the time he actually finished Life and Fate, the critique of him had gotten so bad that the KGB actually supposedly confiscated even the typewriter ribbons that were used to write the so if you read Stalingrad now, you can see the seeds of that moral reckoning that Grossman makes taking root. This is before life and fate. So it's really just high, high level literature and I'm completely engrossed. Man.
- [64:13]
B
Sounds fascinating.
- [64:14]
A
Yeah, it's great. It's great. So I can't even remember who it was that I think it was Twos that recommended it on the show before. It's been really, really fantastic. Patty, once again, thank you so much for taking all the time to join me and I hope everyone gets out and reads the piece and your new one, which just dropped on the day of taping, which is Thursday, February 5th on the end of New start in this dangerous world we're moving into. I really look forward to your book. Make sure to send me galleys and I will absolutely get you on to talk about it because that sounds like a topic that's just made for Seneca.
- [64:51]
B
Great. Well, thank you so much, Kaiser. It was a pleasure to be on your show.
- [64:56]
A
You've been listening to the Seneca Podcast. The show is produced, recorded, engineered, edited and mastered by me, Kaiser Guo. Support the show. I mean it. Support the show through substack@senecapodcast.com where there is a growing offering of terrific original China related writing and audio. Email me@cinecopodmail.com if you've got ideas on how I can, you know, what I can be doing better of? Guest suggestions, topic suggestions, anything you'd like. Don't forget to leave a review on Apple Podcasts. Enormous gratitude to the University of Wisconsin Madison's center for East Asian Studies for supporting the show this year. Huge, huge thanks to my guest Patty Kim of Brookings. Thank you for listening and we'll see you next week. Take care. Sa.