By Eric Vandenbroeck and co-workers

Why Competition With China Is Here to Stay

In the United States, bipartisan consensus is painfully hard to achieve—except on the issue of China. Even as American political polarization has intensified over the last eight years, both Republicans and Democrats have agreed that an increasingly powerful Beijing poses an economic, technological, and security threat to Washington and its close allies.

This consensus is, in part, Donald Trump’s achievement. During the president’s first term in office, his officials raised alarms about Beijing’s growing technological prowess, its military buildup, and its dominance over the critical minerals industry. They slapped sanctions on Chinese entities, imposed tariffs on U.S. imports of Chinese goods, placed some restrictions on the country’s access to semiconductors, and even labeled Beijing’s actions in Xinjiang a genocide against the Uyghur people. Upon taking office, the Biden administration kept and, in many cases, expanded on these policies and positions. It took the Trump team’s diagnosis and built a government-wide strategy to comprehensively address the China challenge through domestic investment, cooperation with allies, and hard-nosed diplomacy. When Trump returned to office four years later, China was one of the only areas in which analysts expected continuity.

Yet Trump has dashed these expectations. In fact, since starting his second term, the president and his closest advisers appear determined to build a commercially based détente with Beijing. The president imposed crippling tariffs on China in April but then quickly lowered them. He has loosened multiple export restrictions at the behest of Beijing. And he has sought a leader-level meeting with Chinese President Xi Jinping in hopes of moving the two countries closer to a trade deal and overall rapprochement. The two are now set to talk this week, on the sidelines of the Asia Pacific Economic Cooperation conference in South Korea.

But those hoping for a major shift in U.S.-Chinese relations may be disappointed. Despite his attempt to court Xi, and Xi’s own desire to take maximum advantage of Trump’s overtures, any truce will probably be temporary. China is highly unlikely to adjust its global aims, and there are many ways an attempted détente could unravel. Trump and Xi may want to calm the waters in the short term. But structural realities mean that U.S.-Chinese competition is here to stay.

 

Decade In the Making

Presidents before Trump worried about growing Chinese influence. Barack Obama, for example, began a pivot to Asia in part to address concerns about China’s assertiveness in the Indo-Pacific region. But it wasn’t until the first Trump administration that Washington’s long-standing effort to shape China’s behavior through engagement was replaced with an effort to check Chinese assertiveness where it impinged on American interests. After more than 15 years of American preoccupation with counterterrorism and the Middle East, Trump’s National Security Strategy and National Defense Strategy refocused U.S. policy on great-power competition. His officials at the time, including Secretary of Defense James Mattis, Secretary of State Mike Pompeo, and Deputy National Security Adviser Matt Pottinger, made Beijing their main priority. They called attention to China’s unfair trade practices, its use of economic and diplomatic coercion, its growing desire to dominate the Indo-Pacific militarily, and its troubling efforts to gain international leverage through foreign investment, theft of intellectual property, and state-directed technology strategies. Congress embraced this approach on a bicameral, bipartisan basis.

But although Trump gave his stamp to these China policies, his personal instincts lay elsewhere. The president valorized autocratic strongmen, including Russian President Vladimir Putin, North Korean leader Kim Jong Un, and Xi. After China’s president dismantled term limits in 2018, for instance, he praised the move as “great.” In fact, Trump’s gripes with Beijing were mostly limited to the amount of goods China purchased from the United States, and so much of his attention was spent on direct negotiations with Xi that tried to address the trade deficit. Beijing, meanwhile, gained control of Hong Kong.

In January 2020, Trump and Xi made a seeming breakthrough, striking their “phase one” trade deal. In this pact, China agreed to make large agricultural and energy purchases and strengthen commitments to protect intellectual property and technology. In exchange, the United States lowered some of its tariffs. But the Chinese side lagged on targets for the purchase of American goods and services. The president’s diplomatic efforts were further derailed by the outbreak of the COVID-19 pandemic, which Trump labeled the “China virus.” Tough-minded American policies toward China thus intensified over the course of 2020.

When Biden took office, he largely accepted the Trump administration’s geopolitical diagnosis, and his team built much of its foreign policy around the China challenge. The Biden National Defense Strategy and National Security Strategy were animated by competition with Beijing, and its Indo-Pacific Strategy laid out a blueprint for a more robust U.S. role in Asia. The White House also redoubled American attention on Indo-Pacific partnerships and alliances, such as the Quad (also known as the Quadrilateral Security Dialogue), the AUKUS alliance with Australia and the United Kingdom, and the U.S.-Japanese-Korean trilateral partnership. And it sharpened Washington’s ability to go toe to toe with China through a stronger military posture, targeted technology controls, and tough diplomacy. Congress supported all these measures and tried to boost the United States’ competitiveness through legislation such as the CHIPS and Science Act, which poured federal money into strategically significant industries. By the time Biden left office, the China consensus seemed so strong that it resembled something of a ratchet. With Xi’s China continuing to press its advantage around the world, the pressure for the United States to compete could only increase.

 

Commerce First

When Trump returned to office, he seemed destined to take an even tougher stance. On April 2, the president announced an initial tariff rate on China of 34 percent, which ballooned in subsequent days to 125 percent. China, in turn, imposed new strangling restrictions on the export of seven rare-earth minerals.

But by the beginning of May, in part because of Beijing’s critical minerals leverage, the Trump administration paused many of these tariffs. It then pivoted to negotiations, quickly declaring that it was interested in a trade deal with Beijing. As the spring wore on, it became clear that the Trump team was pursuing a narrow deal that would lower tariffs in exchange for large Chinese purchases of U.S. goods and, potentially, new investment in the American economy. The United States, in turn, would make major concessions on critical technologies and, perhaps, geopolitics. Trump’s aims, in other words, were commercial and appeared to forsake many of his first administration’s highest priorities.

To many analysts, this shift might have seemed baffling. Why, after all, would Trump turn his back on the system he helped build? The answer, in part, is that there are now far fewer constraints on Trump’s instincts. Before 2025, U.S. policy toward China was made through a whole-of-government approach, with officials across different agencies drawing up plans for managing Beijing. The process was coordinated by a White House National Security Council staffed by experts who were increasingly concerned about the way Beijing used its power and were intent on counterbalancing it where they could. But in May, Trump emptied the NSC and vested power in a small number of officials, most of whom supported his drive for short-term economic agreements and reducing trade deficits. As global bond markets heated up in April, for example, Treasury Secretary Scott Bessent began to call for de-escalation in order to stabilize them, even as Beijing indicated its willingness to stand firm. Trump then tapped Bessent to serve as his primary channel to Beijing and to lead negotiations. The White House technology adviser David Sacks also wields significant influence, and he has criticized prior administrations for their “overzealous” technology controls and argued in favor of selling high-end chips to China.

There are still some officials in Trump’s orbit who, historically, have had more traditional beliefs, including Secretary of State Marco Rubio. But when Trump returned to power, Beijing was substantially better prepared to push back against confrontational policies than it was in 2017. During Trump’s first term, the president’s unpredictability and willingness to embrace seemingly inconsistent approaches appeared to baffle China. This time, Beijing had a strategy for using its leverage and was resolved to follow it. Nowhere was this more apparent than in April, when China decided to restrict sales of critical minerals (of which it processes most of the world’s share)—a key chokepoint it had never wielded so decisively. In exchange for allowing rare earths to begin to flow again, Beijing then sought and received an assurance from the Trump administration that Washington would not apply any new technology export controls, such as those the Trump and Biden administrations had previously applied on semiconductors, while Trump and Xi were negotiating over trade. Beijing, in other words, got Washington to forswear one of its best economic tools just as China was wielding its own leverage.

As negotiations have dragged on, moreover, Beijing’s appetite has grown. Its aims have expanded from the economic sphere to the geopolitical one, again with little resistance from Washington. Most notably, Beijing has pushed for the United States to reduce its support for Taiwan. Trump, it seems, may be listening. The administration has withheld routine forms of assistance from Taiwan—including by downgrading a defense dialogue with the island, denying Taiwanese President Lai Ching-te the ability to briefly visit the United States while traveling elsewhere, and blocking a major arms sales package. Trump may hope these choices will create a climate in which Xi wants to strike a deal. Chinese negotiators, in turn, are probably working to persuade Trump that he should withdraw even more support from Taiwan. Beijing might then demoralize Taipei, making it easier for Xi to eventually seize control of the island.

In the short term, Trump will probably maintain his charm offensive toward Beijing. When the American president and Xi meet, they will likely announce progress toward a trade deal. China could pledge new investments in the American economy, despite years of U.S. restrictions, and new efforts to halt the export of fentanyl precursors, ingredients that have helped fuel the U.S. opioid epidemic. The two sides will probably commit to continuing their dialogue and to stabilizing relations. Given that he believes he is seizing a moment of opportunity, Xi has every reason to keep Trump talking.

Yet there is reason to be skeptical that Trump and Xi will ever truly reset ties. Republicans in Congress have been remarkably quiet as Trump takes a business-first approach to China, but both the House and the Senate are full of lawmakers who have been instrumental in constructing the economic, technology, and defense policies designed to help Washington compete against Beijing. If Trump ultimately welcomes new Chinese investment or lifts more chip controls, they will face pressure to respond. And although Trump may have sidelined many of the bureaucracy’s China hands, agencies such as the Department of Commerce have prepared new lists of export controls to implement should Trump come away disappointed. And there is a good chance that he will: Trump has already wavered on détente. This month, after China introduced sweeping new critical minerals restrictions, he threatened new tariffs and export controls and, briefly, canceled his meeting with Xi.

Beijing’s behavior is likely to keep disappointing Trump, just as it did during his first term. Xi will not stop China’s use of widespread economic subsidies or alter the other policies that have flooded American and allied markets with its goods. In fact, China’s president will not make any concessions that cut against his existing strategic plans—he will make deals only to advance them. Xi will likely continue using Beijing’s stranglehold on critical minerals to coerce the United States and others. He will press Trump to back away from Washington’s long-standing commitment to Taiwan. He will direct the People’s Liberation Army to continue harassing U.S. treaty allies, such as Japan and the Philippines. And he will ensure that China does not become dependent on critical American technology, even as he pushes Trump to further loosen export restrictions on cutting-edge chips.

Because of these conflicts, it is possible that Trump and Xi will never conclude any kind of formal U.S.-Chinese trade deal. If they do, it may go only partially filled. Xi, for instance, could agree to invest more in the American economy in exchange for reduced tariffs and rhetorical gains over Taiwan. But he could then overreach elsewhere, such as by taking new measures on critical minerals, causing Trump to respond. The two sides, now locked into competitive postures, might also simply grow exasperated with each another and announce new trade restrictions out of the blue.

This is not to say that there is no space for a good deal. If Beijing and Washington reach an agreement to meaningfully lower tariffs, for example, Americans will experience less economic pain. If the Chinese truly agree to keep the supply of critical minerals flowing on an ongoing basis, the world will win. Both outcomes might also blunt the risk of further great-power escalation in this deeply chaotic geopolitical time. No one should wish for competition for its own sake.

But Trump should not make unrequited concessions in pursuit of narrow, short-term wins, because such concessions come with significant opportunity costs and could foster long-term instability. If Trump reverses U.S. semiconductor export controls and investment restrictions, for instance, future administrations will struggle to reconstruct them. The damage to American technological and economic prowess might also be significant. Washington should not want China to get access to the American semiconductors it needs to create more sophisticated, domestic artificial intelligence systems. Likewise, if China ends up blockading Taiwan because it believes that Washington won’t interfere, officials the world over will wish the United States had maintained a strong deterrent posture instead. Preventing a blockade or attack, after all, is far easier than stopping one once it is underway.

Trump has had his best intentions thwarted by a strongman counterpart before. His efforts could go the way of his outreach to Putin. Since launching his 2024 presidential campaign, Trump promised to repair relations with Russia and end the war in Ukraine. But despite his entreaties, including meeting with Putin in Alaska, floating sanctions relief, and threatening to cut off aid to Kyiv, the Russian president has refused to be charmed into giving up on his invasion. As a result, the two sides remain far apart, and Moscow remains heavily sanctioned.

The United States and China have singular leaders who each see reasons to negotiate. But the laws of international relations are ruthless. No matter what happens at their meeting, China’s ambitions will still pose the same long-term risks to American interests, American allies, and American power. The question is whether the bipartisan architects of Washington’s China consensus will act swiftly enough to protect the system they helped create.

 

 

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