• Thu
  • Nov 20, 2014
  • Updated: 4:36am
CommentInsight & Opinion

Sino-US relations: a game of defensive play

Lanxin Xiang says China and the US - which have vastly different ideas of political legitimacy - are caught in a strategic framework that prioritises cutting losses over maximising gains

PUBLISHED : Wednesday, 23 July, 2014, 3:25pm
UPDATED : Thursday, 24 July, 2014, 3:56am

The Chinese saying, "playing music to an ox", describes the phenomenon of two people talking past each other. It's apt imagery for the recently held Sino-US Strategic and Economic Dialogue, which ended as expected, with no serious progress and hardly any improvement in bilateral understanding.

During the 6½ years of the Obama administration, bilateral relations have sunk to their lowest point since the Nixon- Kissinger period of the 1970s. Leaders in Beijing and Washington have not only disagreed about how to solve major problems in the international trading system, global governance and regional security, they have also consistently been talking past each other on the key issue of how to define their relationship.

This is the ultimate result of failing to overcome their fundamental difference about what constitutes legitimacy for a nation state. For Washington, legitimacy has only one element - the democratic procedure, which it considers a universal model applicable everywhere. For Beijing, no political system is universally valid, and the claim that decision-making procedures alone determine political legitimacy is a myth. On this issue, Washington seems to have occupied the moral high ground.

Similarly, whereas Washington claims its intense military and diplomatic alliance-building activities in the Asia-Pacific are "rebalancing" for the sake of regional stability, Beijing clearly sees it as a containment strategy. But more worrisome is the fact that the two leaders use quite different reference points to describe their bilateral ties: President Xi Jinping speaks of a "new type of major power relations", while President Barack Obama insists on a "new model" of relations.

In his opening speech at the dialogue, held in Beijing this month, Xi emphasised that this relationship has no historical precedent or ready-made model as guidance. Obama's opening statement at the dialogue implied, however, that his "model" is based on the idea that he would never compromise on the question of democratic legitimacy, but is willing to build a working relationship with China contingent upon what the US considers proper Chinese behaviour.

China's behaviour will be judged according to what Washington holds as the universal standard. Thus, Obama the lawyer deliberately stresses the term "model", which implies an example to follow or imitate.

Why do Beijing and Washington keep talking past each other? One plausible explanation is found in the Nobel Prize-winning "prospect theory" of behavioural economics, which posits that people are willing to take greater risks to avoid losses than they are to achieve gains. Instead of making decisions that maximise their overall expected gains, people tend to focus on a particular reference point and give more weight to losses than comparable gains.

That is to say, leaders usually exhibit a status-quo bias. For example, a superpower in decline often considers preventive war a good instrument to forestall the loss of its status and prestige, and is willing to double its effort in existing conflicts rather than withdrawing from them.

Thus, Washington considers Beijing willing to gamble either to enhance its influence at the expense of US interests in diplomatic negotiations, or to offset American influence with an aggressive agenda for territorial gains. With this mentality, Obama's original reference point was the status quo before the eruption of the territorial disputes over islands in the East and South China seas, when Washington had a pliable ally in Tokyo, willing to turn over the responsibility of national defence to the US-led alliance arrangement.

But after Japan suddenly changed the status quo in 2012 to "nationalise" the Diaoyus/Senkakus, the Obama administration began to see this as a strategic advantage for the US in the Asia-Pacific, and decided to abandon a neutral position and "renormalise" its reference point through open support of the Japanese move in the name of alliance solidarity. Therefore, it is not surprising that Beijing sees this American attitude as a major policy reversal.

On the other hand, Beijing also seems to have changed its posture and is willing to take more risks to compensate for losses in diplomacy in its immediate neighbourhood, despite the fact that its crowning foreign-policy objective is to maintain a peaceful international environment as long as possible. The proposal to establish a new type of major power relationship with Washington is aimed at avoiding a downward spiral of strategic relations and preventing what Henry Kissinger called "Anglo-German alienation" before the first world war.

Here, prospect theory can go further in explaining Beijing's assertive behaviour, which is alarming its neighbours, because its mentality, very much like that of Washington, may not be focused on maximising gains but cutting losses.

Thus, we are witnessing a classic security dilemma which has the potential to become a permanent state of confrontation. Taking current US-China relations as a normal state of affairs is self-deluding.

To understand the present crisis, we must recognise that people renormalise their reference point after making gains much faster than they do after incurring losses. In other words, if an international situation turns to the advantage of one state over another, the one who gains will change its reference point to the "new normal" and resist efforts by the loser to revert to the earlier reference point. Call it a new cold war if you will.

It must be pointed out that, so far, American leaders have "renormalised" their reference point much faster than their Chinese counterparts; the latter are on the defensive and ill-prepared for an effective regional policy. In comparison, the US "pivot" to Asia is well designed for re-establishing American influence in the region.

In sharp contrast, the reference point of Chinese leaders continues to be the pre-pivot status quo, as they seek to recover their lost influence. As a result, the US is focusing on rolling back Chinese "aggressiveness" in the western Pacific, while China believes that assertiveness works better to deter the US.

If US and Chinese leaders continue bringing totally contradictory perspectives to the negotiation table, as the prospect theory would predict, it is hard to envision a diplomatic resolution to any crisis in the region that would satisfy both sides.

Lanxin Xiang, a professor at the Graduate Institute of International and Development Studies, Geneva, is currently in Washington as a senior fellow of the Transatlantic Academy at the German Marshall Fund


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Obama was born in 1961. He lived in Indonesia from 1967-71. Therefore, your assertion that he lived in Indonesia as a teenager was categorically wrong.
Snake Obama learned his values as a teenager in Jakarta, Indonesia under the murderous corrupt Suharto regime. So his foreign policy is based on deceit, divide and rule, aggression, inciting conflicts. This is the continuation of the US cold war policy to dominate the world and to continue it's barbaric War on Muslims.
This is not a balanced article at all. Lanxin Xiang is intellectually dishonest. Japan is not acting, it is REACTING to China's aggression and arrogance because China feels it is on the rise and, characteristically, is affecting a hubris which forgets that its new found success is founded on foreign capital, know how and technology. China is acting out its essentially racist "middle kingdom" fantasy formed at a time when it was conceitedly satisfied that it was the centre of the world and everyone outside was subhuman.
China is pushing its luck too far. It is so obvious that this will lead to a war which it lose. Free thinking people will never succumb to racist tyrants.
How About
Well written Lanxin, but other than the prospect-psychology, surely there's latitude to accommodate a rising China's actions' when she's clearly declared her core-interests, and to re-normalize that wish if US' intentions of accepting China as she is are truly honorable. There's yet another re-normalisation you might care to examine otherwise- get over it whether US likes a rising China or not. This is existential.
@caractacus- 2012 nationalization of Diaoyu was "explained" as a tactic to avoid Diaoyu 'wrongly' falling into the hands of Shintaro, bullocks to this because both outcomes [to Shintaro or to the LDP] meant Diaoyu were nationalized by LDP (or their cronie). Second hand scrap-metal called Liaoning and ADIZ when Japan had administered the Liuqiu (Ryuku) chains since 1972 ['track-2' US foreign policy]. Look- this is clearly the most convoluted argument to say China was the aggressive-party, but we all know why that is don't we - to justify Japan's reneging of the WW2 Surrender and to reinterpret Article9. Heed all the war-mongering Japanese, because all of Japan shall pay dearly for this eventually!
A well balanced analysis of the present geopolitical situation between China and US.
"But after Japan suddenly changed the status quo in 2012 to "nationalise" the Diaoyus/Senkakus, the Obama administration began to see this as a strategic advantage .........through open support of the Japanese move in the name of alliance solidarity."
I have to agree with your assessment. If we have to point fingers here, I have to say it is the fault of Noda and Abe. IMO, it is unfortunate that both China and US (no fault of their own) played into the hands of Japan. The only solution that I can think of to ease tension between China and US is for Japan to roll back the nationalization of the islands, but that is easier said than done, especially with a nationalistic revisionist leader like Abe. Or when Abe is booted out of office when his "three arrows" badly missed their marks.
Excellent analysis. A China, connected to the rest of the world, with an open economy and humility is a China with potential. China as it increasingly is becoming - inward looking, corrupt, state-owned enterprise dominating, over confident about it's capabilities is a China heading to disaster.
Obama likes to portray himself as the product of a poor family. Actually he mostly raised by his grandmother, a bank Vice President and twice the banker of the year in Hawaii. Obama attended the most elite private school in Hawaii. His mother was quite irresponsible and his father was completely irresponsible. Obama's lies about his background scandalously go largely unchallenged by the U.S. news media. Vice President Joe Biden tells similar lies about a working class background in Scranton, Pennsylvania. Actually Biden is from Delaware where his father owned the most successful car dealership in the state.


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