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Mainstream, Vol XLVII, No 52, December 12, 2009

Changing Perception of US Policy towards China under Obama

Saturday 12 December 2009, by Rajaram Panda

President Obama’s foreign policy orientation towards East Asia seems to be characterised by continuity rather than change. Amidst much hype, Obama’s East Asia policy is not much different from his predecessors. However, one possible negative fall-out of such a policy can be that while paying more and more attention on the hotspots of the so-called war on terror, continuity of policies towards East Asia will shade into complacency, leaving the Administration to constantly making efforts to catch up with the rapidly changing situation in the region.1

Presently, a multi-level approach in managing trilateral relationships between the US, China and Japan has been increasingly advocated. However, at a time when each of these countries is going through a transformative period, bilateral relationships will remain central to their interactions with one another. As the largest overseas purchaser of the US treasury, China will have considerable leverage while dealing with the superpower. Viewed differently, one cannot really underestimate the mutual hostage quality resulting from China being the largest holder of US bonds, which has a kind of economic Mutually Assured Destruction character attached to it.

However, the merits of a trilateral consultation among the US, Japan and China cannot be underestimated. The three should avoid institutionalising such a practice by making it a regular consultative mechanism, as it will make the South Koreans feel alienated. So far, the experience of regional institution building in the East Asian region has proved to be nebulous. The failure of the Six Party Talks (SPT) in obtaining a desirable solution towards North Korea’s denuclearisation is an example. That is why, at present, the Obama Administration has been suggested not to think about building new security architecture in East Asia. The dominant view within the strategic community of the US seems to be that “East Asia today needs an attentive US Government that engages with countries in the region flexibly and with imagination”.2

In recent years, a rising China has been attracting a great deal of attention in the US foreign policy. However, China’s need for a stable international environment to pursue its developmental goals cannot be overlooked. But US policy-makers are apprehensive of the fact that factors like US media criticism about human rights violations in China, the inherent fragility of an authoritarian political system lacking in sources of legitimacy over its ability to produce rapid economic growth, a reversal of positive trends in cross-Strait relations, division between the US and China on North Korea’s nuclearisation issue, and the possibility of growing protectionist pressures in the US leave no room for complacency for managing the future Sino-US relations. Therefore, the Obama Administration has been advised not to provoke the Chinese by attempting any of these harsh measures.

Obama and China

The frailty in Obama’s China policy came sharply in focus when Obama failed to wring any concessions from China in his maiden voyage to Beijing in November 2009. America’s conservative media viewed this as capitulation on the part of the US. In 1998, Bill Clinton in a public discussion with Jiang Zemin had talked about China’s poor human rights record, the Dalai Lama and the Tiananmen Square episode. Similarly in 2002, George W. Bush stressed liberty, the rule of law and faith in a speech to university students broadcast across China. In contrast, Obama’s November 2009 visit was distinctly different. Not only did Obama in Washington defer indefinitely a meeting with the Dalai Lama to mollify the Chinese,3 in Beijing he assured his audience that “we recognise that Tibet is a part of the People’s Republic of China” and only then added that “the United States supports the early resumption of dialogue between the Chinese Government and the representatives of the Dalai Lama”.4

Not offending China was Obama’s higher priority, at least on Tibet. The Dalai Lama has met with the sitting US Presidents a dozen times. Although Beijing complained about these meetings, there were no serious costs to the US-China relationship. George W. Bush met with the Dalai Lama in May 2001, in advance of his first trip to China, and thereafter made clear that meetings with him were non-negotiable. These presidential meetings are important because they affirm the religious and democratic freedoms America stands for, while setting a global precedent. China routinely assails countries whose leaders meet with the Dalai Lama, targeting France and Germany in recent years by cutting off diplomatic exchanges, cancelling conferences and the like. Does Obama expect a return favour from Beijing for snubbing the man Chinese leaders label a “splittist” and a “wolf in sheep’s clothing”? But Obama should be careful that rewarding China’s bullying only encourages such tactics.

However, where Obama floundered more was that he failed to bring up matters of human rights and the subject of China’s currency, the renminbi, being kept undervalued to promote China’s exports, which are issues of major concern to the US and other industrialised nations. China in fact snubbed Obama by putting a long-time US resident and leader of the Tiananmen Square protestors, Zhao Yongjun, on trial the day after Obama left Beijing. That Obama steered clear of public meetings with Chinese liberals, free press advocates and even the average Chinese, showing a deference to the Chinese leadership’s aversions to such interactions that is unusual for a visiting American President, showed how much had changed in the perceptions of each other and the evolving equations between the two countries.

When Obama visited Moscow in July 2009, he met with opposition political activists and journalists, and he publicly questioned the prosecution of an anti-Kremlin businessman. In China, by contrast, Obama, in nuanced references to human rights, shied away from citing China’s spotty record. For its part, the Chinese Government made sure that Obama did not bump into protestors by placing well-known activists under tight security. Some of those who were vocal—20 of them—were detained, placed under house arrest or prohibited from travelling before Obama’s visit.

As the New York Times wistfully put it,

This is no longer the United States-China relationship of old but an encounter between a weakened giant and a comer with a bit of its own swagger. Washington’s comparative advantage in past meetings is now diminished, a fact clearly not lost on the Chinese.5

Conservative media and numerous Right-wing bloggers in the US are upset at Obama’s bending over backwards to make peace with China. It is possible that Obama has emerged as the scapegoat for all the ills that have developed over the past in Sino-US relations, leaving Obama with little choice. For decades, the US has bought more goods from China than it has sold. This has led to a mounting American debt and explains China’s staggering foreign exchange reserves of over $ 2000 billion. To get a sense of how large this is one simply needs to know that the second highest reserve-dollar holder, Japan, has less than half this amount.

If China offloads a substantial amount of these dollar reserves, it can bring the dollar crashing down with devastating consequences. Such an action, of course, will hurt China itself as its reserves will dwindle but the impact will be disastrous to the US economy. Obama’s disappointing visit is a symptom of his administration’s dysfunctional and poorly conceived China policy. Obama’s China’s policy is dubbed as “strategic reassurance” as it envisions a tacit bargain whereby the US mollifies Chinese fears of containment, while assuages US concerns about its global intentions and shoulders more international responsibilities.

The concept of “strategic reassurance” may be an attractive concept as it aims to encourage a rising China to be a status quoist, rather than a revisionist, power as Washington cannot do without China to tackle more serious issues such as curbing greenhouse emissions and checking North Korea and Iran from pursuing their nuclear ambitions. But bending over backwards to reassure China, as Obama did, risks undermining America’s own objectives, losing its leverage with Beijing and eroding its standing in the world.6 The Taiwan portion of the US-China joint statement also seemed to concede too much to Beijing by suggesting that “respect for … sovereignty and territorial integrity” represents the “core” of the various documents leading to Sino-American rapprochement. Washington has always sought to balance its recognition that Taiwan is a part of China with guaranteeing Taiwanese security under the Taiwan Relations Act (TRA).7 If the Obama Administration gives concessions to China on this, it not only reduces the US leverage but feeds Beijing’s sense of its growing power and decreases its incentive to reform.

Is China Ready to be a Responsible Stakeholder?

It transpires that howsoever much Obama would like to reassure Beijing by bending over back-wards, China would be reluctant to be a responsible stakeholder. In September 2005, Deputy Secretary of State Robert B. Zoellick, in his address to the National Committee on US-China relations, had urged China to become a responsible stakeholder in the international system. He further argued that China has a responsibility to strengthen the international system that has enabled its success.8 Between then and now, China has shown little hope to become a responsible stakeholder in the inter-national system. All nations conduct diplomacy to promote their national interests but responsible stakeholders go further: they recognise that the international system sustains their peaceful prosperity, so they work to sustain that system. In its foreign policy, China has many opportunities to be a responsible stakeholder but China does not seem to want to do so.

According to Brad Glosserman, the Director of the Pacific Forum CSIS, because China tends to attribute problems like North Korea, Iran and Afghanistan-Pakistan to these countries’ desire to reshape their bilateral relationships with the United States, it feels that Washington should bear the burden of resolving them. According to him, China’s reluctance to shoulder more international responsibilities have several roots.9 The first is Deng Xiaoping’s admonition that China “should adopt a low profile and never take the lead”. He argues that despite China’s meteoric rise to become the third largest economy and threatening Japan to emerge as the second largest economy in the world by 2010, that mentality prevails. The Chinese ambassador to the UK, Fu Ying, feels that for China to reach the level of a world power will be an incremental process and that it cannot play a role in the world beyond its capacity. It seems that China is confronted with daunting domestic challenges which might be more serious when viewed from Beijing than as seen from outside.

Glosserman cites a CSIS survey of Chinese elites from a range of institutions that revealed that few felt any sense of global responsibility for China or for global leadership. Almost of all of them believe that China should be active internationally, but when asked what role their country could play, over 70 per cent thought China’s greatest contribution would simply flow from securing China’s own stability and development. A whopping 90 per cent rejected an international leadership role, and two-thirds rejected the idea that China should take a special role in resolving international disputes.

The recent Chinese conduct confirms this. China’s economic stimulus efforts have focused on domestic stability. Beijing complains about the dollar’s status as a reserve currency, but is unwilling to loosen its grip on the renminbi, fearing that that would weaken its policy-making tools and undermine the value of its dollar holdings. China is unwilling to use the word “sanction” in relations with Iran or fully implement a UNSC resolution on North Korea. China’s own interests in regional stability remain a higher priority than denuclearisation, despite the global interest in stopping nuclear proliferation. When Chinese Premier Wen Jiabao visited North Korea in October 2009, it was seen as a move to bring Pyongyang to the negotiating table but his promise of economic package was not in-consistent with the UN resolution.

Its choice of increasing trade with Iran also goes against the popular opinion.10 Oil exports account for nearly half of Iran’s revenues and that because of economic sanctions imposed by the West, Iran exports most of its oil to Asian countries, with a large percentage of that going to China. In return, China is investing billions in Iran’s gas and oil fields. Even on issues where China’s interests align with the US, Beijing is loath to invest the necessary capital in pursuit of these public goods, preferring that Washington and other developed nations pick up the tab.


Obama emerged from the trip with no big breakthroughs on important issues, such as Iran’s nuclear programme or China’s currency. In stark contrast with the past, Obama’s trip was largely conciliatory. In a joint appearance with President Hu Jintao, Obama hailed China as an economic partner that has “proved critical in our effort to pull ourselves out of the worst recession in generations”. Speaking to the students, he described China’s rising prosperity as “an accomplishment unparalleled in human history”. On a visit to the Great Wall, he described the ancient structure “spectacular” and “majestic” and expressed “great admiration for Chinese civilisation”.11 It is not that past US Presidents did not laud the Great Wall since Richard Nixon visited the country in 1972 but Obama’s trip stood in sharp contrast to the journeys of his predecessors. It was not a policy shift as such but what was more dramatic was in the power dynamic, particularly in economics over the past decade.

In 1998 when President Clinton visited China, the US was still basking in its position as the Cold War victor and the world’s sole superpower. It sought China’s help on only a narrow range of international issues, such as the spread of missile technology and North Korea. China was trying to recover from the stigma of the 1989 crackdown. It was the seventh biggest holder of US Treasury securities. Today, China is the nation’s biggest creditor and its trade with the US has grown sevenfold. Whether as a creditor, an emitter of greenhouse gases or a neighbour of Afghanistan, China has a clout that the US now desperately needs.12 The US seems to be struggling to come to terms with Asia’s increasingly assertive superpower.

Obama’s China policy is thus neither strategic not reassuring. China is producing long range missiles, radars, sensors, and torpedoes. Beijing is also moving ahead with a ballistic missile that could deter US aircraft carrier strike groups critical to the defence of Taiwan and the security of Washington’s friends. Friends of the US in Asia urge the US for a robust and extended regional presence, irrespective of what Japanese Prime Minister Hatoyama might be saying to opt for an equal partnership with the US. The Australian White Paper of 2009 paints a grim picture of China contesting the American primacy in Asia. Similarly, Singapore’s patriarch Lee Kuan Yew chides Washington for “giving China a free run in Asia”.13

It was astounding when Obama suggested that Beijing and Washington “together can help to create international norms”. How Obama wants to craft global rules with a country that coddles dictators from Pyongyang to Myanmar to Harare, and tramples on the freedom of expression and minority rights domestically not only defies logic but also undermines the American legitimacy to remain the sole superpower. A flawed strategy on the part of Obama will embolden Beijing, a rising power bent on pursuing its own interests. Parameswaran observes:

Instead of “strategic reassurance”, Washington should aim for a realistic China policy, working with Beijing where it can, pressuring Beijing when it should, and balancing China’s influence where it must.14

Obama’s narrative helped catapult him into the Oval office as a leader who could bridge racial and regional divides. He has successfully used that message to greatest effect abroad—talking about his African roots in Ghana and infusing remarks about race relations in Latin America. He is breaking down the sense that America and America’s leaders do not have any understanding of or identification with the rest of the world.

Despite having a Kenyan father, a Kansan mother, a sister who is half-Indonesian and married to a Chinese Canadian, Asia provides far less fertile ground for Obama’s multiethnic biographical message than America, which is a melting pot for immigrants. As a continent, Asia is hugely diverse, but its individual countries tend to be far more ethnically homogeneous, and often wary of diversity.

That apart, beyond avoiding problems that are linked to North Korean and Chinese issues in bilateral allied relations, Obama has an opportunity to boost the alliance triangle to a level never before reached. To do this, Obama has to maintain careful relations with both Japan and South Korea. Engaging China is another challenge for Obama. As regards Japan, Obama needs to seek out ways to enhance their alliance by strengthening the mutually complementary roles of the two nations, focusing on areas in which the two nations are skilled or influential. The Japan-US alliance will only be stable through smart management of military bases. The challenge before Japan is to develop trust with its Asian neighbours and to create a strong and multilateral framework for peace.

North Korea will be a real challenge for Obama. North Korea has repeatedly used negotiations over ending its nuclear weapons programme as a way of extracting aid and diplomatic concessions from other countries. North Korea has so far received $ 2.2 billion under failed international deals aimed at persuading it to dismantle its nuclear facilities. While the economic assistance China promised may elevate its leverage over North Korea, it may also deprive the US and South Korea of their sapping the strength of sanctions. Beijing’s diplomacy is a combination of sanctions and engagement arising out of a concern that isolation and pressure alone would drive North Korea only to strengthen its nuclear weapons programmes. Though there is an opinion that says that China’s influence over North Korea is overstated, the fact remains that China’s trade and aid ($ 2.79 billion in 2007 that slipped to $ 1.6 billion in 2009) is crucial to North Korea’s survival. Though the US has expressed that it was open to direct negotiations with the North, bilateral discussions should not be a substitute for the SPT.

The challenges that confront Obama are huge and it requires extraordinary maturity to handle the sensitive and critical issues that are unfolding in the Asian theatre. Obama as the head of a declining power has to deal with an assertive China and a Japan clamouring for more independence in foreign policy; he has a tough task ahead of him. Posterity will judge if Obama has failed or succeeded and it is too early to predict his success or failure.


1. Gerald Curtis, “Obama in East Asia: No Room for Complacency”, East Asia Forum, August 30, 2009, at (accessed on November 18, 2009).

2. Ibid.

3. “No Time for the Dalai Lama”, The Wall Street Journal, October 6, 2009, at

4. Kaushik Basu, “Yuan for the buck”, The Hindustan Times, November 21, 2009

5. Michael Wines and Sharon Lafraniere, “During Visit, Obama Skirts Chinese Political Sensitivities”, The New York Times, November 18, 2009, at =print

6. Prashanth Parameswaran, “Obama’s China Policy: Neither Strategic nor Reassuring”, November 25, 2009, at aspx?ID=4698

7. Rajaram Panda, “Sino-US Accord on Taiwan”, China Report, vol. 19, no.1, January-February 1983, pp. 3-6.

8. “Whither China: From Membership to Responsibility?”, Remarks to National Committee on US-China Relations, Promoting Constructive Engagement, by Robert B. Zoellick, Deputy Secretary of State, on September 21, 2005, at

9. Brad Glosserman and Scott Snyder, “Not Too Fast with China”, PacNet No. 74, Pacific Forum CSIS, Honolulu, November 13, 2009.

10. Warren Mass, “China to Strengthen Trade Ties with Iran”, October 15, 2009, at China-to-strengthen-trade-ties-with-iran?tmpl=component&print=1&layout=default&page

11. Andrew Higgins and Anne E. Kornblut, “In Obama’s China trip, a stark contrast with the past”, The Washington Post, November 18, 2009, at

12. Ibid.

13. Quoted in “Can US take China as an Equal?”, November 23, 2009, at

14. Paramesswaran, n. 6.

Dr Rajaram Panda is Senior Fellow at the Institute for Defence Studies and Analyses, New Delhi. His e-mail is:

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