China’s Hyper-Realism and the Global Order: a 30-year Retrospect

George Yean, Harvard University, 7/2022

During the G20 meeting in November 2022, Chinese President Xi Jinping complained to his Canadian counterpart Justin Trudeau about media leaks, saying, “we can cooperate if you are honest, otherwise, the consequences would not be good to say.” I watched the clip five times. The otherwise solemn face of Xi smiled halfheartedly like a threatening boss. He tried to remain calm. It was, after all, in the international spotlight.

While this may not surprise many familiar with the party, others are puzzled as to what type of China we are dealing with. The distinction between “revisionist” and “status quo” is too simplistic. For decades, scholars have imagined China's assimilation into the global system, and even a China-led future order. If international relations are understood as the socialization of states based on identities and interests, a proper type identification is required. Identification itself will not lead to the trap of fierce confrontation or naive appeasement. Rather, it is the first step toward realistic policies. It also helps to understand China's often mythical behavior. Why does China contribute to the IMF and World Bank while building the AIIB and BRI? Why Shanghai Cooperation Organization (SCO)? What is the purpose of its hyper-mercantilist trade policy? How likely will China use TikTok to its advantage?

Scholars generally accept that the Chinese Communist Party (CCP) has a Leninist organizational structure that has been more centralized under Xi. This explains the ruthless repression and intolerance of dissent at home. Though literature argues that domestic politics often extend to the foreign realm, competing views exist for China's foreign behavior: reactive, defensive, offensive, revisionist, revolutionary, etc. There are too many theories about international relations. Even realism has many variants. The challenge is to identify the best theories, logically coherent and empirically accurate. This is important because theories, as parsimonious generalizations, not only explain, but also predict.

Many scholars regard China as a realist. Many Chinese international relations scholars also believe in realism, according to a survey. Nevertheless, realism is a continuum whose degree and micro-foundations matter. Although scholars can trace China's realism back to the "Warring States" times, the last 30 years provide us with a valuable lens. Mao's era was ideological, while his successors were quite rationalist and pragmatic. Regardless, the U.S. was brought in to counter the Soviet Union. After Mao’s death, the leaders’ reformist gestures shaped people's perceptions and led to decades of engagement. Village elections, market-oriented reforms, and the semi-functioning of the National People’s Congress, to name a few. For reformists, the 1980s were the "golden decade."

THE GREAT REBALANCE

Things began to change around 1990. Several events such as the Tiananmen movement and the fall of the Soviet states reconstructed threat perception. As Deng chided that “the students were supported by the West to topple the socialist regime,” he realized that the existential threat now came from the West. As authoritarians, the CCP leaders naturally resisted political liberalization and viewed liberal ideas as threatening. In fact, Jiang Zemin soon purged student leaders and began censoring the internet, which evolved into the sophisticated Great Firewall we see today.

But China was weak. In 1990, China’s GDP was only one-twentieth of that of the United States. It had a backward military and an unstable political system. Realists see the world as more abysmal than liberals. At that time, the CCP by no means saw the world as benign, after witnessing so many communist states collapse. The world (a U.S.-led hierarchy), though not anarchic, was self-help: the surrounding U.S. military bases, the sanctions, the fear that liberal ideas might change the regime, and no de facto allies. Canada, by contrast, would view the world much more cooperatively. The party felt threatened existentially. This sense of insecurity cannot be wished away, however much the U.S. may promise.

The only choice left was to increase capability, or balance of power internally as realists predict. That's what happened. Among China's strategic shifts was the rapid development of asymmetric weapons (assassin's mace, as it is officially known) such as ballistic missiles and submarines, rather than expensive projects like aircraft carriers. The purpose of the strategy is to counter the high-tech military superiority of the U.S. by an asymmetric advantage.

The second pillar was, of course, the economy. China had to rely on American market, capital, and technology. Since the accession into the WTO, investments, technical know-how, and management experience have poured into China, creating millions of jobs and thousands of research and production facilities. As with oil for energy-exporting countries, exports largely helped China finance technology imports, provide public goods, and later fund its global influence. The global markets incentivize firms, local- and foreign-owned, to invest, innovate and compete, particularly in manufacturing and technology.

Throughout nearly two decades, Deng's overarching strategy was "hide capacity and bide time"; “Never hegemony,” to use Deng’s words. Unlike today, China deliberately avoided displaying ambition. Archives indicate that the rationale was based on a clear assessment of international power comparison, a typical realist mentality. Liberals may argue that it was economic (inter)dependence that prevented high-profile behavior. However, this account ignores the fact that CCP leaders have repeatedly stressed the importance of "strategic opportunity period" and that “China will be invincible if it seizes this opportunity to grow (Deng’s speech in 1990, also in Jiang and Hu’s similar speeches).” This is a clear reflection of power calculation, balancing, and strategic delay. China had no choice but "soft bandwagon."

From 1990 to 2002, Jiang Zemin largely followed this guide, displaying reformist and modest characteristics. Despite incidents such as the jet crash in the South China Sea and the embassy bombing, Jiang tried to cool it down. Nonetheless, Jiang brutally cracked down on the then-popular Falungong and political dissidents before starting the Great Firewall, a much tighter restriction than in the 1980s. Jiang's successor Hu Jintao wasn't as strong per se, but the collective leadership nevertheless remained vigilant. "peaceful subversion" and "color revolution" were phrases often used by the government. Domestic crackdowns and controls continued. Despite this, Hu sought to portray China as "peaceful rise." He responded to external concerns regarding human rights and hosted the North Korea nuclear talks.

RISE TO TOP

China’s economy surpassed Japan during Hu's second term, after the global financial crisis. Leaders’ speeches indicate the party’s emerging perception of the West’s decline. For realists, international structure, as well as capability, are of particular relevance. Not surprisingly, China moved beyond the low-profile posture. Hu's "going out" strategy was a mercantilist approach aimed at securing energy supply and expanding influence. In addition, Hu stressed the importance of multilateralism and multipolarity. As I will show, promoting multipolarity wasn't just about democratizing global governance, but a reflection of “power rebalance.”

Xi’s era took it to a new level. After becoming President in 2012, Xi emphasized numerous times the importance of fighting Western liberalism. The U.S. image was corrupt and chaotic, as often portrayed by Chinese official and social media. Now a personalistic strongman, Xi believes he possesses "red blood." He started campaigns such as personality cults and anticorruption to consolidate power and eliminate opponents, and stepped up the crackdown on human rights protestors and lawyers, labor unions, activists, media, religious groups, Xinjiang and Hong Kong. With A.I. and surveillance technologies, digital authoritarianism in China reached an unprecedented level. While pursuing "national rejuvenation" to restore China’s historical status, he pushes for "Inner Circulation" and "Made in China 2025," with the goal to make global supply chains more concentrated in China, strengthening the economy and security. It’s getting clear China’s pursues self-suffciency while making others dependent.

In 2017, China’s GDP hit $12 trillion and its military dwarfed that of the U.S. and allies in East Asia. In Feburary, Xi claimed “great changes unseen in a century”, and later “East's rise and West's fall.” This demonstrates a realist view of power distribution and a desire for change. Xi’s foreign policy became more assertive. China has built up a global military power and escalated territorial disputes, with increased jets flying over the others’ ADIZs for a decade. Unlike Jiang and Hu, Xi's not afraid to use statecraft to achieve concessions, not to mention a long list of smaller offenses, including interference in foreign elections and cyber attacks. Xi sought to forge its own AIIB, BRI, RCEP, CIPS (Cross-Border Interbank Payment System), and SCO, building China-led economic and security organizations, perhaps as part of his call for “a new fair global order.” Even the dovish diplomat Fu Ying maintained that “China is offering its own ideas to improve the international system.” Blueprinting the “Common Destiny of All Humankind” notwithstanding, China stood firm with Russia, though it later shift to neutrality. Nonetheless, China’s export of authoritarianism boosts dictators around the world.

HYPER-REALISM EXPLAINED

I have shown the trajectory of China's realist behavior over the past 30 years. Why did all these happen? Power distribution and capability changes are obviously two driving forces; China has emerged as the only superpower aside from the United States. Power and wealth are expected to be pursued by realists. As a popular saying in China goes, "Mao made China stand up, Deng made China rich, and Xi made China strong." Such remarks represent the normative desire that China ought to be wealthy and powerful. Realists’ pursuit of national interest is stated numerous times in party archives that China needs to fight resolutely.

But national interest alone is insufficient to explain the degree of China’s realism. The story doesn't end there. Security, argued by realists, is the most important concern for states. Even the more liberal figure Adam Smith argued that "defense is more important than opulence." To be clear, for the CCP, security relates more to the regime than the state. Nobody would invade China. As Deng once said, “stability dominates all else,” security always comes first when making domestic policies. At the recent 20th Party Congress, security has been given a historic level of importance, surpassing the economy.

Realists don't emphasize ideology. But Leninism and authoritarianism are the very micro-foundations of beliefs and preferences that enable the party to view a liberal world as threatening. Because ideas can spread, Chinese citizens may demand liberal norms one day, as they did three decades ago. This insecurity cannot be wished away and anyone who feels threatened must take action. Xi’s frequent calls for "Three Confidences" well imply a lack of confidence. The zealous resistance to losing power is manifold: the party elites have amassed enormous wealth and power; the natural power desire of authoritarians; path dependency or mechanistic rigidity in dealing with threats; and, some may argue, the fear of political purge due to millions of abnormal deaths after 1949. Consequently, as with its home rule, the CCP's philosophy becomes “nipping danger in the bud whenever possible.” A possible loss of power would be extremely fearful. Even free elections in Hong Kong and allowing independent labor unions are seen as too risky.

I call this “hyper-insecurity.” Hyper-insecurity leads to hyper-realism. Realists argue that insecurity motivates states to seek more power, preservation at least and domination at most. The CCP's seeking absolute dominance of domestic society and suspicion of a liberal world as extremely threatening sets it apart from other realist states like India, Vietnam, or even Putin's Russia before the war, where non-abiding media and foreign internet access were allowed. In fact, the building of China’s own economic and security spheres despite being engaged and gaining hugely, combined with a superpower capacity, is hardly a predictor of a defensive or preserving strategy. If the CCP leaders are still rationalist, it then depends on which approach works best toward maximizing the goal. Realists also admit states are egoistic, as evidenced by the fact that China even uses climate change as a bargaining chip. China's massive subsidies for electronic vehicles are driven more by industry advantage than climate change, while it increases coal production.

Liberal theories suggest China has greatly benefited from economic cooperation which in turn will have a major influence on its policies. Realists do not reject cooperation. Yet, they believe cooperation subordinates security or strategic goals, especially for great powers. Certainly, China's continuing push for globalization despite the U.S. retreat can be explained by economic gains, though globalization seems to only mean exports, rather than the free flow of information and migration, or a level playing field. However, economics alone cannot explain why organizations such as the BRI and RCEP were created despite the existence of the WTO and IMF that China benefits from. An important explanatory variable is power. States can gain leverage and influence from investments, trade and market power, as numerous research shows. China’s economic leverage has made periphery states carefully navigate between the U.S. and China. We also see a similar pattern at home: China prioritizes the party's objectives over the market by prohibiting foreign firms like Google and Wikipedia, and restricting financial, educational, and real estate commercial activities.

Liberals also point out that China has contributed to international organizations (IO) such as the IMF and the UN, and China is willing to uphold IOs. It's true that China benefits from IOs for economic gains and cooperation, but it is more than that. For instance, China politicizes IOs such as soliciting the UN votes to block human rights resolutions and disappearing the chair of the Interpol during a trip. Despite knowing mercantilism undermines the WTO, China pursues the policy regardless (for power). Moreover, the Shanghai Cooperation Organization as a regional security regime with an “anti-terrorism” theme ensures liberal norms does not gain ground, resembling what happens in Xinjiang. Clearly, the establishment of China-dominated institutions is for leverage, as well as getting rid of constraints it dislikes.

One question may arise – do leaders matter? The regime resembles a civilian structure, but it's indeed a mixture of civilian and military, since the CCP firmly controls the PLA. Deng, Jiang, and Hu were to some degree constrained by the institutions they designed (such as party disciplines) and domestic audience (such as factions). Xi, however, is not subject to them. This explains why Xi’s policy was much harsher. Personal characteristics of the CCP leaders vary. Xi’s family background as well as his education during the Cultural Revolution may have shaped his resolute and relentless nature. Nonetheless, all leaders’ policies are, to varying degrees, coherent and persistent. All four administrations view the West and liberal values as threats; the gradual efforts to challenge the status quo are consistent with realist theories.

Ultimately, the U.S.-China relation boils down to security dilemma and value competition. Because of the intrinsically opposing domestic politics and ideology, especially among the ruling elites, trust can never be fully constructed. As a Leninist party, the CCP runs the country like a corporation where everyone is subject to the party's objectives. In contrast, the U.S. believes in a more free and democratic system. Consequently, one can never be certain of another’s intentions, regardless of promises. The U.S. won’t trust China due to its dictatorial nature and low historical credibility. China suspects liberal values and the U.S. wants “peaceful subversion.” Therefore, the U.S. may indeed pose an existential threat, unlike many may argue. Jiang Zemin even claimed in a public speech that the U.S. allowing China to join the WTO was to weaken China domestically.

A MINIMALIST ORDER?

To be clear, all this is not to say China should never seek power and wealth. But if China led by the Leninist CCP is hyper-realist, with an increasing superpower capacity and an assertive life-time leader, the world needs to watch for the potential offensive for domination. The U.S. did that, too. In theory, ultra-security is possible if the CCP were able to establish a China-led order that suppresses liberal norms globally, just as it does at home. Otherwise, it is always possible that an unstable structure of power and ideas may threaten security again. However, offensive does not necessarily mean military action. There are more realistic ways: economic (inter)dependence can make others, states or non-state actors, obedient (even Germany must carefully balance the economic and security impacts). The gigantic size of China's economy and its mercantilist policy, through a global trade system, can de facto deindustrialize and weaken others, externally and internally, without war or subversion. This is already happening.

When China again doubles its GDP, as it continues to concentrate the global value chain and remains innovative, integrating regional economies such as in Southeast and Central Asia’s, the world political structure will be fundamentally altered. More regional states will have no choice but to join the bandwagon. Some may gradually change regimes, as happened in Cambodia and Myanmar. Yet, it is likely that a CCP-led order will be illiberal, especially for ordinary citizens. In Hong Kong, the leaders are already CCP puppets, and a fair and free election remains remote. Based on hegemonic stability theory, this order will ensure general peace. It also needs to rely on global institutions for governance. However, the Xi-Trudeau drama illustrates that the institutions will be less transparent (thus more covert) and more coercive. The interests of authoritarians may be prioritized. Today, global dictators already feel more emboldened than ever since the end of the Cold Wapur.

The current rule-based liberal international order (LIO), according to some, is a set of political and economic institutions, norms, and rules, based on liberal principles such as mutual respect, democracy, human rights, and rule of law. Nonetheless, some scholars criticize the LIO as too Western centric, not inclusive (especially for those who reject liberal values) and subject to conflicts. In their opinion, the LIO is not supported by economic and political reality, and we need a minimalist order that is accepted by everyone. This certainly makes sense. We live in a world of diverse interests, cultures and norms. Admittedly, the LIO needs more reforms and inclusion, in the similar way as the well-negotiated international rules that have escape clauses, or embedded liberalism as some scholars have described. Global firms and capital that disproportionately gain from unfettered globalization and often disrupt financial stability should be regulated. There is no need for the LIO to reflect U.S. interests or impose liberal norms coercively through interventionism.

However, the hypothetical minimalist order with minimal liberal principles, is problematic. First, as compared to the early years of the post-Cold War period, the political and economic deterioration of industrial democracies is partly due to China's unfair trade practices and its growing dominance in global production, which also suppress the industrial development of developing countries. China has been undermining the order in the long run. The trend is far from reversed. industrial democracies, however, have begun to act, and if they can correct the issue, they might be able to regain competitiveness and appeal. Second, liberal and autocratic states might have trouble getting along within the same order however leaders may try (imagine not criticizing human rights abuses or comfortably integrating economies). Perhaps it is simply unrealistic. Regime type matters and like-minded states may eventually form regional blocs, as a result of deep distrust. Third, even if there are agreements signed or institutions built for an order, autocratic states are less likely to honor them as they always are (e.g., no infiltration, fair trade, and transparency). IOs are usually hard to monitor compliance and lack effective enforcement mechanisms.

Fourth, an order with weaker liberal principles and norms may gradually result in fewer liberal states. Having more illiberal states may make the world look more Hobbesian. Consequently, the level of trust among members will decrease rather than increase. Fifth, an authoritarian bloc is already emerging for the first time since the end of the Cold War, from Russia to Iran, from China to Vietnam, and from Afghanistan to Saudi Arabia. Autocrats cooperate and may build their order regardless; the more compromises made by liberal states, the more encroachment they advance because they perceive it as weakness. North Korea starts to launch more rockets. China's regional order building and Russia's military intervention in Central Asia are real, and their long history of strategic partnership did not just happen after Biden united democracies. There has never been a time in the past 30 years when dictators have been so relentless in their crackdowns and overthrows. In the future, nothing may be able to constrain China, if its economy is larger than the U.S. and EU combined, with everyone dependent on it. Last but not least, and often ignored, while leaders of illiberal states may resist liberal norms, people may nevertheless demand them, as is taking place in Iran, Russia, Myanmar, Afghanistan, and part of China.

Therefore, this hypothetical order to replace the LIO outright may be fragile and wishful thinking; the counterfactual may even be more conflictual and dangerous. Power politics will inevitably once again become a tragedy for states. Under the LIO, there was stability, prosperity, and humanity, including and until China's rise. In a world where an order is needed to maintain stability and no feasible alternative exists in human history, the LIO held up by democratic states is still worth supporting. As stabilizing forces, the world needs more liberal states standing up for principles, not fewer. After all, its liberal norms and principles deserve to be the pursuit of human beings. Of course, pessimists may predict a world divided into regional orders, with limited interorder cooperation and guard rails to prevent conflicts. But as with the waves of democratization during and after the Cold War, more states may join the liberal order over time.

Yet, there is no doubt that the United States must cooperate with China as much as possible, within either the existing or new apparatuses. According to IO theories, even distrusted and egoistic states can cooperate on common interests, on the basis of reciprocity or tit-for-tat. As well, the U.S. need not escalate tensions or become another China, nor should it appease for the sake of engaging – a hyper-realist China has its agenda. Despite a long list of issues, ranging from technology transfer to chip competition to Taiwan support, trade remains perhaps the most critical and biggest one. A strong economy is essential. For China, the global market is the incentive for distorted policies creating structural advantages in a wide range of sectors, be it subsidies, currency rates, labor standards, or state-sponsored expansion. For the U.S., China’s unfair practices continue to undermine grand objectives: economic prosperity, national security, and geopolitical influence. In no trade theory is “unilateral free trade” economically beneficial, not to mention security and geostrategic implications. But once addressed, the U.S. will rebuild domestic shape, minimize security externality, thwart China’s global influence while regaining its own, and better support the order. A $3 trillion import market is the biggest leverage one could ever hope for. Nevertheless, the solution must include allies and friends who also suffer.

In sum, most realist assumptions and expectations hold true for China. In spite of some constructivist, liberal, and psychological accounts for China's behavior, realism dominates. The authoritarian and Leninist nature of the CCP is the very micro-foundation of its hyper-insecurity, which leads to hyper-realism. As a result, China's behavior follows decades of pattern, at home and abroad, and to a greater extent than other realists such as India or even Putin's Russia, though less militaristic. If there seems to be little that can stop a hyper-realist China from advancing its agenda, however derailed or delayed it may be, a minimalist international order that discards liberal principles will likely be futile, as well as dangerous.