Lessons for Trump from Nixon-Mao summit

R. N. PRASHER

When US President Richard Nixon visited China in 1972, the US economy had been effectively decoupled from that country since the establishment of the Communist rule in 1949. A Chinese trade leader recalled in 2022 that in the pre-Nixon era if an American citizen was caught bringing more than $100 in Chinese goods, he would be arrested. In addition to opening China for trade, Nixon was aiming to take advantage of the Sino-Soviet split due to a deep ideological and personal schism between China’s Mao Zedong and Soviet leaders Nikita Khrushchev and his successor Leonid Brezhnev. Two years after this “historic” visit, faced with impeachment due to the Watergate scandal, Nixon had resigned.

More than 50 years later, a twice-impeached US President Donald Trump has landed in China amid much talk of decoupling and delinking – from that country that has emerged as a formidable economic and geopolitical challenge. Russia and China may claim to be “friends forever, never enemies”, but now it is Russia that Trump wants to wean away from China.

In spite of the cliché, history never repeats itself. It moves like the wheels of a vehicle, going around the same axis but moving forward with each rotation. Trump is facing a different China than the one encountered by Nixon; in 1972, a vast majority of its population were poor farmers, recovering from the Great Famine. Today’s China is the world’s second-largest economy by nominal GDP and the largest by purchasing power parity. It has a huge army, the largest navy and is an exporter of sophisticated military equipment.

Nixon sought to open China. Trump, accompanied by leading business leaders including Tesla and SpaceX chief Elon Musk and Apple’s Tim Cook, has said he “will be asking President Xi, a leader of extraordinary distinction, to ‘open up’ China so that these brilliant people can work their magic”. Beijing responded that China is ready to “expand cooperation, manage differences and inject more stability and certainty into the turbulent world.”

At the end of Nixon’s visit, the Shanghai communiqué promised efforts to normalise relations and expand trade. The document papered over differences on issues such as the Vietnam war and the status of Taiwan, agreeing to disagree. Today, both the US and China have come a long way from the turbulent 2021 encounter in Anchorage where China’s Yang Jiechi and Wang Yi delivered a 17-minute harangue against the United States. China was at the peak of its pompous wolf-warrior approach to diplomacy and the then-US president had repeatedly called Xi Jinping a dictator.

Engagement with China and enriching it by trade has not created even a semblance of democracy in that country.

Subsequent developments have shown that neither the US nor China is all powerful by itself in this interdependent world. China’s arrogance displayed during the Covid pandemic about its monopoly of supply chains has resulted in active steps by the US, Canada, European Union, Japan, Australia, India and other countries to create alternatives. In China, the shock created by real-estate collapse and its effects on related major industries such as cement, steel and glass is adding to unemployment. The persistent low domestic consumption means increased export dependence.

The US, for its part, has seen the futility of sanctions on Russia, and China has successfully retaliated against Trump’s tariffs. The Iran war has shown that even a country facing a civil war-like situation because of economic collapse can create trouble for powerful countries.

Trump and Xi, both known for arrogance, are meeting as somewhat chastised leaders of powerful economies. The best outcome the rest of the world expects is that they do not engage in Cold War II, dividing the world into their zones of influence, expecting everyone else to choose sides. More importantly, the US should not repeat Nixon’s misconception – feeding the dragon makes it a bigger threat, not a friendlier partner.

Engagement with China –enriching it by trade – has not created even a semblance of democracy, and has not prevented the likes of the Tienanmen massacre, the Covid lockdowns and the mass deaths that followed their abrupt end. The US will tumble into the same pit again if the industry leaders accompanying Trump once more opt to enhance investment in China, with all its coercive conditions that entails, including forced technology transfer.

Democracies represent a more stable investment environment, unlike China’s lurch with policy flip-flops from Mao to Deng Xiaoping to Xi. The US needs to tilt more towards democracies and away from totalitarian regimes, even when the latter are deemed to be necessary evils.

The article appeared in the lowyinstitute