Stephen Roach—
HISTORY IS LITTERED WITH FALSE NARRATIVES. From the flat earth theory and the Ptolemaic system of cosmology to tales of UFO sightings and the “Big Lie” of election fraud promulgated by former President Donald Trump and his supporters, twisting facts to tell a convincing story has long been central to the human condition. So it is with the false narratives about each other that China and America have embraced.
The distinction between a true and a false narrative is often tricky to make. Veracity is ultimately determined by time. Just as new discoveries correct bad science, “fake news” can be fact-checked, and political detours can avoid dead ends. Yet dislodging a false narrative can be exceedingly difficult. Fact-based counterarguments, as reactions to America’s post-Trump political adventures attest, may not be enough. Repetition of a lie often breeds conviction. And technology-enabled repetition takes on new meaning in an era dominated by online social networks. If left unchallenged, the false narrative can become self-fulfilling—at least until experience makes it untenable. Until that moment of reckoning, however, the false narrative can take on a life of its own, shaping the very history from which it has emerged.
For most in the United States there is nothing false about the profusion of negative stories on China. They resonate with a broad cross-section of the American public. In mid-2021, fully 76 percent of Americans had an unfavorable view of China, according to the Pew Research Center. This is a stunning increase of 29 percentage points since the United States launched a trade war with China in 2018, and it represents the most negative US public opinion toward China since the inception of this survey in 2005.
China suffers from a similar malady. While it has long sought to replicate the strength of the US economy and to rival America’s hegemonic global role, China sees the United States through its own biases. It fears that America wants to contain its growth and development. It extrapolates the trade war of 2018–21 into the future, convinced that it will remain in the crosshairs of a protectionist and increasingly nationalistic United States.
At the same time, many in China have embraced the narrative of America in decline—especially after nearly two decades of crises and instability. China’s ultimate false narrative of America—the ideological triumph of socialism over capitalism—underscores a very different aspect of conflict between the two nations. It pits one system against the other, leaving little room for compromise on deeply entrenched values. As long as the Communist Party controls China, it can’t afford to let go of this ideologically expedient narrative.
Dueling false narratives spell nothing but trouble for this deeply conflicted relationship. America’s fixation on the China threat is on a collision course with China’s focus on the American threat. In both cases, the fears underlying these false narratives may feel perfectly legitimate, providing justification for strong actions. The dueling false narratives of the United States and China have, indeed, led to very real conflict.
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The lens of codependency brings this contrast between the two nations’ economic value propositions into sharper focus. In the 1980s and 1990s, the needs of the Chinese and US economies dovetailed perfectly. Coming off two decades of instability, the battered Chinese economy desperately needed a new source of growth. America was struggling in the aftermath of a wrenching stagflation—the confluence of sluggish economic growth and rising inflation. Shifting its manufacturing to China allowed US companies to cut costs and boost profitability while keeping prices in check and thereby allowing American consumers to enjoy rising living standards. For a fleeting moment in the late 1990s and early 2000s, this marriage of convenience was a blissful outcome for both nations. Chinese economic growth surged as the United States offered a major source of demand for Chinese exporters. And American consumers enjoyed a great expansion of purchasing power that low-cost imports from China provided.
But that was then. Now we are seeing a classic clash of codependency. China has moved up the value chain, making more advanced products and developing new industries that the United States wants to claim as its own. The US public, gripped by economic angst and with its leaders unable or unwilling to promote change, clings to the politically expedient characterization of China as an existential threat to America’s future prosperity.
In the end, the world’s response to the transitional imperatives of the Next China may be decisive in resolving the battle of competing narratives. Getting its economy right is essential for China to hit its own development targets as well as to resolve its relationship conflicts with others. Its focus on artificial intelligence as the linchpin of indigenous innovation is key to its audacious goal of achieving great power status by 2049. This poses a special challenge: is China strong enough to pull off such a transformation without reforming its debt-intensive state-owned enterprises or developing a modern, open financial system, including a fully convertible currency?
Similar questions can be asked of the United States. Can it continue to grow without addressing its saving challenge? Lacking in saving and the investment and research that saving supports, can the United States maintain its edge on the frontier of innovation? America needs to strengthen its economy, not just recapture a modern version of an earlier magic. It has to anticipate a very different future, one that undoubtedly includes an important role for a rising China. The resolution of the US-China conflict will depend critically on how both nations address daunting growth challenges, separately and together.
Conflict resolution is all the more urgent in today’s anxious and uncertain climate. The concurrent challenges of post-pandemic global healing and renewed military conflict in Europe are complicated by the confluence of breakthrough technological change, political upheaval, periodic bouts of financial instability, and newfound fears over health and climate security. A profusion of false narratives can deflect attention away from tackling these tough problems.
But for both the United States and China, the greatest danger of false narratives lies in the dark recesses of political expedience. What plays well politically may be more of a raw power play than an ideal economic or geostrategic strategy. As the false narratives spawned by the seduction of political power become ever more deeply entrenched, the vicious cycle of accidental conflict becomes exceedingly difficult to break. The real risk is that the temptations of the false narrative may not be dislodged by any experience-based correction that follows. Conflict resolution is vital to preventing permanent damage from the clash of false narratives between America and China. A new approach is desperately needed.
From Accidental Conflict: America, China, and the Clash of False Narratives by Stephen Roach. Published by Yale University Press in 2022 (hardcover) and 2023 (paperback). Reproduced with permission.