I. A Dangerous Tariff War
The US and China are heading for a clash if the Trump administration does not rapidly alter its “Peace through Strength” stance toward China―the administration should be talking more about “peace” and trade compromises rather than about building up US military “strength” and imposing an international wall of protective tariffs.
Much as he did in his first presidential term, Trump is once again trying to pressure China, but this time with much tougher “Liberation Day" tariffs. And China is once again reacting both economically and militarily―but this time with even greater determination.
In further exacerbating already high tensions with Beijing, Trump had threatened to impose new taxes of up to 145% on imports from China―with major high tech US companies like Nvidia and Tesla caught in the crossfire―but suddenly backtracked after markets panicked. His Treasury Secretary Scott Bessent tried to reassure investors that he expected a “de-escalation” in U.S.-China trade tensions in the near future―even if it would be a “slog” to rebalance their relationship―with China boosting consumption and the US boosting manufacturing. Yet Bessent was still not certain Beijing was ready to negotiate such a structural "rebalancing."
Trump is not only pressuring China, he is also using tariff negotiations to pressure the EU, Japan, South Korea and many other countries into imposing new barriers on trade with China. At the same time, rather than separating defense and economic concerns, he is demanding that European allies spend up to 5% of their GDP on defense, while concurrently expecting Japan and South Korea to pay the costs of stationing US troops as part of tariff negotiations. (Japan hosts about 50,000 U.S. troops and South Korea 28,500.)
On the one hand, Trump seeks to block closer China-Japanese trade; on the other, he wants Japan to import more liquefied natural gas, rice and wheat from the US, and make it easier to sell US cars in Japan by pressing Tokyo to alter auto standards. In bowing to Trump’s pressures, Tokyo has offered to engage in infrastructure investments in the US as well as engage in shipbuilding collaboration.
Trump hopes that his “reverse Nixon” strategy will draw Moscow as much as possible away from its “no limits” strategic embrace with China. Yet this prospect not only depends upon whether Trump can achieve a sustainable peace between Russia and Ukraine, in part, by way of establishing a formally neutral and non-nuclear Ukraine―but on whether Trump can also help establish a sustainable peace between Russia and the Europeans.
In addition to ending the conflict in Ukraine, and preventing the conflict from spreading, the US, NATO, the EU, Russia and China also need to address potentially dangerous disputes in the Arctic region, as well as in the Baltic region with respect to Kaliningrad and to the Suwalki corridor, for example.
Trump likewise hopes to use the threat of high tariffs to draw Europe away from China by forcing it to further “de-risk” or even “decouple” European trade from China. He wants the Europeans to buy more American shale gas, autos, and agricultural produce, plus invest more in the US―while demanding that they also boost their defense spending―but without clarifying the nature and degree of expected European burden and power sharing.
In fomenting a global tariff war, Trump now wants Xi to kowtow to him. Recall that during Trump's first term, in order to get Xi to agree to talk, Trump had to kowtow and agree to recognize the “one China” policy. Now Trump wants Xi, in his words, "to kiss his ass."
Yet Xi appears to be in no mood to appease Trump. China has opted to play hardball, citing Mao in 1953 during the Korean war, “No matter how long this war is going to last, we’ll never yield.” Beijing has subsequently threatened to impose a 125% tax on products from the US in addition to placing sanctions on some 60 U.S. companies and curbs on exports of rare earths.
On the one hand, Trump is, in effect, trying to force US allies to choose between the US and the People's Republic of China―much as George W. Bush threatened US allies and rivals: “You are either with us or with the terrorists!”
On the other hand, Beijing has been approaching U.S. allies in Europe, Japan and South Korea, for new trade accords―to counter the US. Beijing has consequently warned the EU, Japan, and other countries, that “China firmly opposes any party reaching a deal at the expense of China's interests. If this happens, China will never accept it and will resolutely take countermeasures.”
To prevent a polarization of the global system, it is essential that the US, EU, Japan, South Korea, among other states, begin a rational dialogue with Beijing on trade and regional security and defense issues on the basis of mutual respect. Reviving and revising Obama’s Trans-Pacific Partnership Initiative might be one way to build a stronger political economic relationship vis-à-vis China by working with, not against, US Allies.
“Beggar thy neighbor” trade tariffs that link trade and security/ defense issues are not the way to deal with the real problem―which is not the US trade deficit―but excessive US public expenditure. It is crucial that the US find viable ways to reduce its roughly 2 trillion dollar budget deficit that represents roughly 6 percent of U.S. national income. This can be accomplished, at least in part, by cutting excessive defense and national security expenditure by reaching peace and arms reduction/ elimination accords with Russia, Iran, North Korea, as well as with China.
In this perspective, the US and its Indo-Pacific Allies need to enter into a more productive dialogue with Beijing over issues such as over-dependence on China for critical raw materials, rare earth elements, supply chains, digital technologies and computer chips, as well as arms reduction/ elimination negotiations.
II. China’s Fears of US “Encirclement”
In effect, Beijing sees the Trump administration’s post-Cold War containment policy as tightening the geo-economic “encirclement” of China―a process that began during the Clinton administration and that was strengthened in the aftermath of Obama’s “rebalancing to Asia” followed by the Quadrilateral Security Dialogue (the “Quad”) that has engaged in closer political economic and security ties between the US, Japan, Australia and India. Biden’s AUKUS pact then strengthened defense ties between the US, UK and Australia versus China.
Given perceived Chinese, North Korean, if not Russian, military threats, Tokyo established a Permanent Joint Headquarters in March 2025 that will prepare Japan’s Ground, Maritime and Air Self-Defense Forces for any possible contingencies, including China’s threat to blockade or seize Taiwan―while seeking to better coordinate possible military operations with the US Indo-Pacific Command.
Then, in mid-April 2025, as part of the Bomber Task Force 25-2 initiative, the US deployed B-1B Lancer strategic bombers at Japan’s Misawa air base for a span of several weeks―in an effort to reaffirm the U.S. defense commitment to Japan and to US Indo-Pacific allies. As the US and Japan have strengthened defense ties, Tokyo has augmented purchases of US weaponry, including some 400 Tomahawk cruise missiles in 2023, among other weapons systems―given Japan’s new 2022 offensive national security strategy that plans to develop hypersonic and cruise missile preemptive strike capabilities. These actions represent a major step away from Japan’s “pacifist” constitution.
So far, despite US pressures, India has sought to carefully balance its relations between the US, Russia and China as a member of the BRICS+ and the Shanghai Cooperation Organization―so as not to alienate either Russia or China. Should, however, India shift too close to the US and the Quad and to AUKUS, Beijing will scream “encirclement.” Recall the China-India clash over Kashmir in 2020―in which Beijing intended to force India to concentrate on land defenses, rather than pursue a blue water navy that could rival that of China.
After signing the AUKUS defense pact in September 2021, the Biden administration promised to accelerate the deployment of 3 to 5 US nuclear powered Virginia-class attack submarines—which are to possess the latest in stealth, intelligence gathering, and weapons systems technology. These undersea behemoths can deploy advanced dual capable conventional/ nuclear Tomahawk cruise missiles with a range of at least 1,000 miles (as of 2023), as well as hypersonic weapons.
The Pentagon sees Australia as providing greater strategic depth than does Guam or Japan for US naval, marine, and air force deployments versus China. US military deployments are intended to counter China’s anti-access and area denial capabilities by means of the Pentagon’s still evolving, yet still risky, Air/Sea Battle plans that were absurdly renamed the Joint Concept for Access and Maneuver in the Global Commons or JAM-CC.
Here, however, there appears to be a clash in geo-strategy. The Pentagon perceives Australia as being reluctant to use such weaponry offensively against China in backing Taiwan―while Canberra sees these submarines as a necessary deterrent for Australian defense.
Under AUKUS, Australia is expected to pay the United States $3 billion over a 4-year period to boost the capacity of the U.S. submarine industry. Washington will then sell at least 3 Virginia-class nuclear-powered submarines to Australia, while Britain and Australia will later build a new AUKUS-class submarine. Now, however, the Trump administration fears that these costly US subs, which have been exempted from Pentagon budget cuts, will not by ready for deployment by the US Navy’s 2027 deadline. The Trump administration now wants the Australians to pay more to speed up production!
The dilemma is that the US Navy has been confronted with a significant shortfall in the number of its own operational nuclear submarines as older Los Angeles-class submarines have been retired faster than they can be replaced by the more advanced Virginia submarine class. Concurrently, supply chain issues since Covid, the need to improve shipbuilding facilities, in additional to cost overruns, in part related to Trump’s tariff hikes, have all slowed Virginia-class nuclear submarine production.
This situation will make it very difficult for the US to fulfill its promise to deliver 3 to 5 Virginia-class submarines to Australia. The US Congress will not permit the transfer of these advanced submarines if the sale is seen as degrading U.S. underseas capabilities.
At the same time, one might ask whether these provocative multi-billion dollar behemoths are even needed by Australia? And if China’s defense capabilities continue to improve, will these subs be able to defend themselves in actual war fighting conditions against much cheaper underwater drones and other weaponry, for example?
In implementing another land component to its revised Air/Sea Battle plans, the Trump administration has deployed Typhon launchers on Filippino bases that can fire multipurpose missiles, including Tomahawk Cruise missiles, thousands of kilometers from the Philippines. Trump has likewise deployed anti-ship missiles of the US Navy-Marine Expeditionary Ship Interdiction System during the April 2025 US-Filipino military exercises in the Luzon Strait that links the South China Sea to the Philippine Sea.
III. China’s Strategic Response
Over time, Beijing has tightened its “no limits” strategic partnership with Russia that was initiated in July 2001 and strengthened in February 2022 just before the Russian attack on Ukraine. In addition to engaging in joint air and naval military maneuvers, Beijing has sought Russian assistance in developing an early warning system and other defense projects, plus trade and Siberian energy deals―in an effort to make China less dependent upon overseas energy supplies.
While China has sold dual capable civilian/ military systems to Moscow that could assist Russia’s war in Ukraine, Moscow has sold the S-400 Triumph surface-to-air integrated air defense system that permits China to cover the whole of Taiwan’s airspace and the Senkaku/ Diaoyu Islands, from Shandong Province. In addition, to expanding its ICBM and Intermediate Range Missile capabilities, China may now possess more than 600 operational warheads supported by expanding plutonium production. Beijing has purportedly deployed DF-17 hypersonic missiles on China's southeast coast “in preparation for an escalation in the cross-Straits situation.”
In early April 2025, China once again engaged in military maneuvers that now appear to envision a blockade, if not a possible invasion, of Taiwan given China’s development of amphibious invasion barges. Later in April, Beijing sent a fleet of warships into the western Pacific most likely to observe the arrival of the US aircraft carrier Nimitz and the next-generation destroyer Michael Monsoor.
Beijing continues to warn the US and the world of the risk of Japanese militarization―given the fact that China and Japan did not sign a peace treaty to put an end to World War II. Beijing’s apparent goal is to break the “encirclement” of US military bases in Okinawa, and now Misawa, Japan, in addition to Guam, Perth, Australia, and Luzon Island, Philippines by unifying with Taiwan―by “peaceful” means if possible―or upon the threat of war, if deemed “necessary”.
IV. Toward a US-China-Japan-ASEAN Peace Initiative
Given the break down or suspension of US-China talks over issues such as illegal migration; fentanyl; China’s backing of North Korea; defense/ security issues in the Middle East and in South and East China Seas; Beijing’s relations with Moscow; the current US-China tariff war—as well as the regional conventional, unconventional and nuclear arms build-up, there is a real danger that Beijing’s fears of eventual US military superiority in the region could lead it to act against Taiwan sooner rather than later.
China’s defense deployments come amidst a situation in which the US has thus far overextended its military industrial capacity for missile production since it has given away more missiles than it is producing thanks to its backing of Ukraine vs. Russia and Israel vs. Iran (and the Houthis). Not only is the US far from prepared to deal with China’s nuclear and missile capabilities, Washington has also been promoting deployments of dual-capable missiles without publicly seeking a quid pro quo in which the US and China could jointly agree to withdraw or eliminate such weaponry in arms discussions―once Beijing agrees to arms talks.
Both the Biden and Trump administrations have downplayed Xi’s attempts to play “peacemaker”―Beijing offered to help mediate a peace deal between Russia and Ukraine, while concurrently assisting Saudi Arabia and Iran to re-establish diplomatic relations. Beijing also mediated between Palestinian factions in an effort to eventually implement some form of “two state” solution to resolve the horrific Israeli-Palestinian conflict.
Instead of interpreting China’s global peace initiatives as hostile to US interests, the US and Europeans should jointly engage with Xi Jinping in a new multilateral peace initiative by seeking to extend China’s peace proposals—but under the condition that all sides agree to seek substantial diplomatic compromises with respect to their interests where possible, including Ukraine and eastern Europe, the wider Middle East―as well as with respect to trade and tariff disputes, disputes between North and South Korea and between China, Russia and Japan―in addition to the China-Taiwan conflict.
Much as was the case at the end of the Cold War, an international Contact Group could be forged that would engage the US, China, Russia, the ASEAN states, Japan, India, and EU, among other actors—under a general UN Security Council mandate. Such a Contact Group could seek to negotiate new arms treaties, among other disputes, for the Indo-Pacific. If not carefully negotiated, Trump’s threats to pull US forces from Japan and South Korea―if the latter do not pay their bills―could lead both Tokyo and Seoul to militarize and deploy independent nuclear weaponry―particularly if Russia, China and North Korea do not likewise accept arms reductions/ eliminations.
Such a Contact Group would also help to mediate between China and Taiwan—before a war breaks out that would devastate the region, if not much of the world. In building upon Henry Kissinger’s concept of “constructive ambiguity,” a new diplomatic formula needs to be reached that provides sufficient intergovernmental China-Taiwan cooperation for Beijing to be able to claim Chinese “unity,” but for Taiwan to be able to claim that it is “independent”—with the backing of US and European security guarantees and with the ASEAN states as intermediaries.
In the effort to address the real security and economic concerns of China, Taiwan and its neighbors, the US and EU should facilitate discussions between Taipei and Beijing and work to revive some of the previous multilateral proposals of Taiwan’s Ma Ying-jeou government, such as the East China Sea Peace Initiative (ECSPI). The latter plan sought to promote dialogue; abide by international law; establish a code of conduct based on the November 2002 accord; and allow for joint exploration and development of resources in disputed areas. Here it would prove necessary to replace the “one country, two systems” and possibly the “1992 consensus” formulas—since both formulas are generally opposed by the Taiwanese population. China would not be permitted to place PLA forces on Taiwan, but could work with multilateral joint task forces for peaceful purposes
A Contact Group would enhance the possibility of dialogue between Taiwan and Beijing―in the effort to engage in multilateral peace initiatives for both the East and South China Seas. Joint development projects with respect to fishing and resources could be implemented, along with sustainable development projects.
Multilateral efforts to counter terrorism, and to deal with human trafficking and drug smuggling in the area, could be enacted in the common Indo-Pacific and global interest. Such a new internationalized approach to regional security could involve joint multinational naval and air patrols to protect energy transit routes, while the US, China, Russia and Japan seek to devolve the heavy military presence in the region through arms negotiations. It might also be possible to deploy international peacekeepers to prevent the dangerous civil war in Myanmar from possibly drawing in the US and ASEAN states versus China in yet another proxy war.
Implementing negotiations that would seek to bring Beijing out of its fears of “neo-containment” and “encirclement” and into positive relations with its neighbors, Japan, South Korea, and with Taiwan― by means of forging an internationalized China-Taiwan confederation and through regional arms reductions/ eliminations―would require that the Trump administration engage in a complete ‘about face.’ By engaging with China as a global peacemaker, the US and the world could turn toward peaceful conflict transformation that would significantly lessen the real threat of major power war with China, while at the same time helping to wind down both the Israeli-Palestinian-Iran confrontation and the Russia-Ukraine war.
Hall Gardner is professor emeritus of the History and Politics Department of the American University of Paris.
He is the author of “Toward an Alternative Transatlantic Strategy,” “IR Theory, Global Rivalry and Major Power War,” “World War Trump,” “Crimea, Global Rivalry and the Vengeance of History,” American Global Strategy and the ‘War on Terrorism’” and “Averting Global War.”
To learn more, please visit Dr. Gardner’s website: Hall | Hall Gardner