u.s.-china relations. speakers include former a formeran and secretary of state. china's ambitions and the u.s. policy in the asia-pacific region. from the council on foreign relations, this is one hour. >> i know we have a lot of ground to cover, a of questions a lot of people want to ask. some of you have contacted me before to log your request. good afternoon and welcome to this council on foreign relations meeting on u.s.-china relations. i'm from the brookings institution. i'm thrilled to be joined by three of my favorite scholar practitioners. first, i want to commend them for agreeing to weigh in on one of the most complex and pressing questions, foreign-policy questions before us, and that is the question of whether beijing and washington can a vvert the pressure towards confrontation. the patterns of history that drive a willing power and rising power into confrontation. that we harder question will deal with is what can we do about it? a couple of housekeeping notes. please completely turn off your electronic devices. do not just put it on vibrate. if you have a reason to use your phone, you are welcome to go outside the room. our meeting today is off the record and we will talk for about 30 minutes and opened it up to questions. our distinguished panel begins to my right with my friend, anne stephenson. she is cofounder and research director at j. capital research. keeping an eye on macro economy. she has as much experience on the ground as anybody i know. eli, the senioris fellow at china's studies of a fellow. he was the national security adviser to vice president biden and had a special focus with china. our distinguished visitor from cambridge who is a friend, advisor and teacher. director of the belfort center. he is most relevant for today. author of the new book "destine d for war: can america and china escape the trap." the only people who have not heard about the book is an fun conten uncontacted tribe. if you want to know why it is trending on twitter, you have to credit graham for that. ere.re going to start th it has provoked intense interest and discussion on both sides of the pacific ever since graham started talking about it, even before the book was out. we will ask our panelists to give us a few words in the beginning on how they conceptualize u.s.-china relative from their vantage points. where the tensions and opportunities? and where is this headed? graham, the floor is years. ours. >> thank you for this opportunity. i think if we try -- if there's a concept to help us understand what is happening in the relations between china and the u.s. today, i think ithere iis. if we are trying to look through the news and noise of the day, whether it is about missile tests in north korea, potential confrontations in the south china sea, china becoming germany's number one trading partner. you look through that, the structural dynamic is a rising power that is threatening to disrupt the ruling power. i think that picture helps us but the rest of the things in place. is not my idea. if you don't know about it, i d on't if you tell you about it but you should at least google. you can download his book for free. you can read the first 100whered opportunities? pages. you will learn more than you have learned from everanything . he wrote famously it was the rise and fear this instilled in sparta that made war inevitable. he is choosing inevitable as hyperbole. in the book, i look at the last 500 years. i find 16 cases when a rising power threatened to displace a ruling power. in 12 other cases, the outcome was war. in four of the cases, the out come -- as i argue in the book, business as usual. i believe it will create history as usual. and history in usual in this case if it ends in a war between u.s. and china would be catastrophic. us inses help remind instances in which states or nobody wants war, that does not mean war cannot occur. in cases where war could us in instances in which states be catastrophic, that is where war cannot occur. the case i want people to think about most is 1914. i don't think you can study world war i too much. it is still dazzling. indeed, one of the principal actors in it was asked after the war, how did this happen? >> he said famously, ah, if we only knew. how in the world can an assassination of an art student by a serbian terrorist become a match that produces a fire that burns out a hole in europe? by the end of the war, every leader of the principal actors had lost what they cared about most. his empire has dissolved and he is gone. the russian czar is trying to back up the serbs. in germany is trying to back up his buddy in vienna, he is gone. relationship. never recovers as a society. into --turns at the end of the war, if there was a chance for a do over, but war came. the lesson i draw from this, the y're interesting lessons, each of them have important nuances. the proposition that people know that war is catastrophic is helpful, and particularly in cases like today. that'sstructural stress reflected in what the book because of the rising power syndrome. my interest deserves more weight, more say, more sway. the current arrangements were set in place before i became bigger and stronger. the ruling power becomes anxious, even careful -- fearful , paranoid. enhances -- people and externalnacing event would be otherwise consequential. the world war i case is a perfect example. that is the case of athens and sparta as well. a conflict is the reason for us to have a great war at the end of which we are both destroyed? that is a terrible idea. which theresy actions is an action which has the reaction and at the end of the which you are somewhere where nobody wanted to go. >> you have been an agent of the ruling power. what do you make of the patterns of history and how much does it inform the way you think about it today? >> it is great to see so many friends here today. i thought i would start by making a point is spending years debating the rise in china in academia, the white house. the firm believe that almost every argument over u.s. policy as it relates to china is what i would call a proxy war over underlying assumptions about the rising china. where you land on these assumptions, in many ways determines where you will come out in policy issues, which i think are very important. otherwise, they will lurk behind. the first is the inevitability of china's rise. i was reading graham's op-ed about china's unstoppable rise. anne described china's economy as the world largest year amid scheme,-- pyramid that it will not be important to the world economy in a short amount of time. the trajectory is fundamental. other question is is china's rise good for you the united states and the world? some believe the effects will not be much different. or they will want what they want but it will not affect us all that much. there is a different school that would suggest not that china's rise is a bad thing but there are elements other question is t challenges to the vital interest of the united states. where you come down on that question, the nature and character of china's rise is fundamental. it's worth bringing those out in the discussion at the top. as it relates to the trap itself, having been a participant in u.s. policy and strategy, i would say the following -- i couldn't agree more that war between the united states and china would be devastating. it would be like nothing the world has seen. we talked about world war i and now we are talking about nuclear weapons, absolutely incredible effects. we should not be complacent about that and i don't think we are complacent. we have a deeply engaged relationship with china. we have a military relationship, confidence building measures. a major military crisis between the u.s. and china for the last several years. it is a testament to the fact that we are understanding our interests and keeping us away from the precipice of conflict. where i have concern and where my critique is is not in graham's argument but how it has been applied. i think this concern about avoiding confrontation with china, lowering tensions is taken too far in u.s. strategy. in the u.s.-china relationship, keeping it happy, healthy, good, lowering tensions, of avoiding conflict, avoiding confrontation has become an end in of itself in u.s. strategy. the result is what i would consider to be endemic risk aversion in the u.s. china relationship that it is created an environment for chinese assertiveness, liberalism. the biggest threat in asia today is not the fact we are in the brink of great power war, but chinese hegemony, sphere of influence. in asia id order which china will win by not fighting. i think this risk aversion, when we center our strategy about avoiding war is leading us down a dangerous path, and we ought not to avoid that potential outcome. the last thing i will say as it relates to tethering our strategic lens around this issue or avoidance is there are very important aspects of the u.s.-china relationship. an economic competition is getting fierce. ideological competition is getting fierce. institutional competition that is getting more fierce. that is where i think the china and u.s. competition lies. it with think of it as the military competition, and that is where we center our strategy around, we will miss other parts of the competition. i was reading an article by a leading chinese academic. said talk about the relationship between the united states said talk about the relationship between the united states and china, it but moress hot, profound and widespread. i think that is right. as we manage this critical issue of the challenge of avoiding but more profound andwar, we should not t result in risk aversion or distraction from these other elements. >> that is an interesting point. we are not sleepwalking towards this arrangement of history. an ann: i think the big question is why am i here. i focus on economics and finance. i think there is a good reason why i'm here and that it is that china's ambitions are not just strategic. i'm a big fan of looking at the evidence in front of your eyes and not what you imagine. the evidence is that they have no plan on designing to become a great world power strategically, but, what it does have designs on is economic -- extending its economic strength growth of the world, collecting tribute, building states along its borders that have relationships with economic dependence on it, and building its own private journals of economic and financial communication. as for dr. allison, this is above my pay grade, but although that is an interesting aspect, there are others that could be just as useful. i'm a big fan of carl vogel's work. what is his book called? >> [inaudible] anne: exactly. i think perhaps an interesting paradigm to use is the great multiethnic empires that have all perished except for china. egypt, mayan, persian, and even the romans. to some extent, the romans were expansionist it but mostly in economic terms because of their need to find -- to extend -- to find new sources of income. i think that is what we need to be focused on with china. the effort to build dedicated and less transparent channels. like the money transfer system that china has tried to build, the asian infrastructure bank, the belton road system to bypass the world bank and multilateral institutions, all of the trade arrangements with southeast asia. yes, they are extending military power into southeast asia but i , would say that is more about having military power that being interested in invasion or anything like that. i do think that the issue of taiwan and hong kong and their relationships to the mainlands are perhaps being underestimated for the risk. this strategy for china is -- i think china is quite determined to recapture taiwan in one way or another. but not militarily. that would not benefit china and any possible way. china is very dependent on the technological strength of taiwan, on its it industry. almost as dependent as it is on the financial industries in hong kong so i think, one should think more about shaman and shenzhen and the concept used in the past to extend one nation -- one country, two systems toward taiwan. perhaps trying to get provincial representation in the mainland on to taiwan as happened under the kmt. something along those lines, a co-op strategy rather than a military strategy. i think that is where we should be focused. more to say but i won't say it now. >> another example of war without bullets in that context. if i can, graham, i expect you want to respond to some of these things. i wonder if you would take us to this next question which is, what do we do about it? what are the policy implications? you have staked out, effectively, the stakes. you have given us a sense of what the risks are, of what history suggests, but then, the hard question is what do we do? how much should the united states accommodate china's rise and how much is it a check against eventual war, or does it hasten war? graham: let me make three points. partly responding, because i think the differences among us might the more clarifying and , going to the point, that's let me start with a point and i will come back to in the conclusion of the book, i say this book will be very unsatisfactory for washingtonians. in washington, you have to describe the solution in the same sentence as the problem. the doctor says don't just stand there, do something. i am supposed to, in the last chapter to unfold a new strategy having a snappy title. three to dues, take an aspirin and everything will be fine. [laughter] i say this is not the case. this is not a problem subject to washington fix. >> this also gives you the opportunity for volume two very -- volume two. graham: my hope is all you into is somebody that is by somebody in your generation. those whose minds are not as encumbered or even by the constraints, because i think our current discussion about strategy toward china has been basically mush. i participated in -- i was in the clinton administration, the obama administration, and hedge is a great moniker that excludes nothing and permits everything. it essentially goes with the flow. whatever happens, i can explain why i am either hedging or engaging and the defense department can pursue containment, treasury can pursue engagements or even concessions. i would think that this has been the absence of a strategy. this allows us to go with the flow of what ever happens. if i go back to the first point, this is now for both eli and , this is not about only a military competition. reading about athens versus sparta, the reason why a athens drove sparta crazy was there economy, culture, their invention of everything. we read what the corinthian ambassador tries to convince to the spartans in telling them why you cannot living with the athenians, they said, these people are out of their minds. if whatever they invent doesn't work, they have something new the next day. they are never happy within their own country, and they are not happy to let anybody else be happy in their own country. they are always doing things. i think the athens invented everything. they invented drama, they invented philosophy, they invented history, they invented professional navy, they invented architecture. these guys were zooming in all dimensions. i think in the chinese case, and we are seeing china in our face everywhere in every way in every domain. in my book the thing i give to my harvard classes 26 indicators on when will china become number one. the students say in 2040, maybe 2050. the second chart says, already. already biggest automobile producer, already biggest smartphone producer, already artificial intelligence biggest , economy. they say wow. , the proposition is that the impact on the ruling power is not just military, it is economic, cultural, everywhere that we see. secondly, on eli's point which is absolutely correct which i agree with, is that some people interpret the trap and proposition that the only problem is avoiding war and the only way to avoid war is to concede. before, the problem was trying to avoid the trap to avoid war basically going with the flow and letting things happen the way that they did. i think this proposition is not in terms of what to do, concede in every setting. in fact, if you look at the story, i wrote a piece for memorial day on what should be the big take away as we think about what we owe to people that gave their lives so that we can have our debate and decide what we want to decide. if you are taking it, it would be avoid unnecessary wars. most people think this is about iraq no. , unnecessary wars we should've avoided world war i, easy to , avoid, and world war ii. the authority for the claim of world war ii is none other than the greatest statesmen and world war ii, is winston churchill. he tells a story, at one point, fdr asked what should we call this war? he says, i told him immediately we should call this the unnecessary war. he was shocked. i told him, how is it unnecessary? advancedif when hitler militarily, we done what many people said including churchill, the u.s. france, and britain, the generals that thought this was a crazy idea, you wouldn't have had world war ii. you can't get where we are to either concede or either confront, and when i say in the conclusion of the book, i think what we need now is a discussion and debate among the whole strategic community that says, wait a minute. here is this problem, this issue, this diagnosis that i try to illuminate through lucidity's lands -- lens. we have had to think of something way outside the box of the current conversation >> are we on a trajectory toward an unnecessary war? i think we are on the way to a china led order if we remain other path we are on now. i think to answer your question, graham, about where we go from here, i think a few principles -- and this will draw contrasts with the current administration, but looking forward as well -- the elements of what u.s. policy should look like, u.s. government should look like get yourng forward, team in place. graham is right, will require a much higher level of expertise than we have had today. we cannot have senior officials coming in to the national security adviser who are going to learn about the south china sea for the first time or be traveling to japan for the first time at the level we need to take seriously that this is a central challenge, if not the central challenge in u.s. foreign policy. our personality will have to reflect that as was the institutions. they absolutely don't. there will have to be a reformation and the state department, defense department, to be much more focused. the second, it will be obvious to everyone in the room, u.s. strategy in asia has to be comprehensive. right now, the trump administration is talking about peace through strength, dual carrier operations in the east china sea. secretary mattis will be giving a big speech tomorrow. not going to cut it. no amount of u.s. power will resuscitate american leadership and revive american interest in the face of this challenge. there has to be an economic component, and institutional component. as long as countries in the region believe that china is the future economically, our military will not be able to bend that perception. whether there it is tpp or something else, there has to be a major economic trade initiated for u.s. policy in asia. my personal critique of the trump administration to date as it relates to asia has been the transactional nature of the way the president has at least talked about his approach to asia. very focused on north korea saying things like, what will i do, start a trade war? before i call the president of taiwan again, i will have to check with president xi. because of desires of lowering tensions with china with north korea, as someone who is worked on this issue for many years now, i think many who have would agree, this is exactly the wrong approach. with the united states should be doing is principled and firm across the board, rather than signaling the united states being for sale or owing to trade up its vital interests. the chinese will have roped the united states around that. i think the united states has to be willing to take more risk in asia. there is a perception, not to the point of tripping into war, but there's a perception of china being very firm. having core interests that would must not get near, save face, and that is the theory and practice. in almost every single incident, some are public, some are not, in which the united states has said to the chinese government stop what you are doing, you are violating our interests, we will take a principled stand here, and if you don't, there will be these consequences china has , backed down on every single situation. there's not a lot of evidence for this as colette torry or risk acceptance of china -- e scalatory or wrist -- or risk acceptance of china. some of their logical vulnerabilities inside actually make them the risk your player. we ought to think about that on how robustly if it's our own interests. >> anne, that is exactly what i wanted to talk to you about. before i do turn to questions, frame the scene politically and economically. how is it important to their behavior in the dynamic that graham and eli have described? to what degree is china feeling as if it wants to pursue a more risk tolerant approach in the world? what degree are we misreading china from abroad, do you think? anne: we know a lot about the chaos and strife in the trump administration, but we don't see that in the xi administration. we can assume it is the same, if not in many cases worse. you're dealing with such opacity, and sharp tactics will win. they are in the year where they are going into the 19th party congress where xi has been named , in essence a leader for life. he is trying to consolidate his position and remain in place to keep his position, and his life and liberty as always happens in east asia in these transitions. the stakes could hardly be higher. part of what -- everyone knows including every single human being that china is in a very risky economic position. the financial system has been pushed to the very brink. there are backup plans within the government in case the financial system goes or blows. there is a very high understanding of how much risk there is and there is very high risk. as part of the consequence of that is the central government wants to project to the chinese people this sense that you can't be as rich as they said you can be, and nobody can have a ferrari, we want you to drink tea leaves and have small apartments. we will be projecting our power internationally, and you will be able to fly to milan and buy nimby -- rem.8 rim nimbi to the dollar. you will be proud to be chinese. i think the messaging of the belton road program is important internally to showing up xi and giving him a sense or surrounding him with the clout of glory that he really does carry the mantle of the old communist party. and that he can carry it into the future. >> before he got to questions, the story we tell each other as china's economy slows it is more inclined to take more adventurous postures overseas. you think that is right or wrong? are we making false assumptions or is it basically true? anne: more adventurous posture? >> do they try to rally people around the flag? in the absence of delivering the , will we deliver the emotional satisfaction of being able to punch somebody in the nose? i think that will come. the issue right now is that the system has relied very high income streams to certain supporters. as income streams have to be maintained, and is growth clients and profit declines, it becomes more and more difficult to do so. you have to look out around the world for other income streams and reward people in different ways. i agree completely with eli's analysis. with pakistan you never find a , china talking about isis, i agree completely terrorists, and that is mainly because they close their own borders and keep their own muslims from leaving and creating overseas movements. they are really not interested in international terrorism. what they do do -- china does things like going to muslim schools and force children during ramadan to eat. it does things like force muslims to shave their beards. this cannot be very popular in pakistan. one does not hear this from pakistan, one does hear about the friction between the united states and pakistan. we need to be focusing on the economic imperialism rather than the ships going to be it's not. -- going into vietnam. >> we bring folks into the conversation here. there are microphones going around. if you raise your hand, we get you one. we remind you to stand and state your name, and affiliation, and because we have a lot of people wanting to speak, let's avoid comments and make sure you ask one question. graham: can i make one quick note eli? ,we have a china working group at harvard. been bearish on china for the past 10 years. i have been bullish. every year we make a bet. that is not forever but you never know how things are going to go. if i'm netting for next year, i would be happy for anybody's that's because i keep a better book, i think china will grow three times the rate of the u.s. three times the rate of the u.s. if you take two numbers and run 13 times, you go like this. conversation] graham: historically, when economies fail, if they falter, rarely do governments blame themselves. externalization of problems is quite common if you look at it as a historical pattern. therefore, if the only other leg to china's leadership stands on his nationalism, which it is, it -- you would expect a more assertive china under those circumstances. anne: i just want to give a quick answer to that and to your first point that you gave your first response because this is , my domain. let's do the thought experiment. imagine that the trump administration were successful in collecting a $10,000 tax from every person in the united states. thus, gathered 3 trillion? or 30 trillion? if you use that 3 trillion u.s. dollars to build a wall around all the borders, canada, mexico, and everybody else the u.s. gdp , would rise 25%, roughly, next year. from the spending of the $3 trillion and building materials, and all of that. would that be a good thing? would that be valuable? would it be something that would sustain our growth into the future? this is a way to look at china. your 20 points with the auto and steel industry, and studies show we would exceed their production in the u.s., but the chinese exceeded ours. nobody noticed that metric when it passed. it doesn't convey value to the chinese people. >> we go there in the back, please. taiwan.with cta tv of the panelists mentioned taiwan. for many years in washington, there were people who were saying that if the united states and china were ever going to war, it would probably be over taiwan. is that assertion still valid today? is the current stalemate in cross relations making u.s. china relations more difficult? thank you. >> eli, do you want to take that? eli: i guess there is a couple different ways to answer that. i don't think we are on the precipice of war with china over taiwan, but, of course, it is an area of potential conflict in part because xi himself seems dedicated to this issue and quite intolerant on any moves of independence. i think the domestic politics in taiwan and the way the united states has, in my view, a very good team, a very strong team , obama's national security council managing this issue to the point where it was not a central component of the u.s. china relationship. i think it is relatively well managed, and that could change in the event there was an unexpected turn in taiwanese politics. i don't think we are at a point where this is a defining issue in the u.s. china relationship. graham: in the book i have a chapter called, from here to war , and i have five scenarios about getting their, taiwan being a very viable one. i think the things about taiwan that washington doesn't like, china will fight over taiwan independence. i think that is a fact. the u.s. has accepted that fact and they're not likely to fight over taiwan's independence. that is a hard fact. >> charles, right here in the front. >> thank you. charles, former member of congress. i'm part of the u.s. china working group and capital counsel of asian research. i agreed as will play out in an economic sphere and as i watch , i won't comment on what trump is doing with the new negotiation strategy. it seems they are more process oriented as time went on. it became more and more difficult to have results and to get chinese to commit. given that a lot of this is going to play out in the institutional arena, and we have our institutions, do we need to rely on those and fight it there or propose new institutions to china? we missed an opportunity with ib, i believe we should have engaged. is there more we should do? what kind of institutions should we create to deal with this? if we are looking creatively at a new strategy. eli: it is a very good question. it is a big challenge. let me answer that in a couple ways. number one, i do think we should be looking to create institutions with china. at the same time, i think in this environment where we have a perception that we have on the economic front of inevitability toward a china land order, -- china led order, i think it is important the united states provides alternatives to a liberal futures in the region. china wasn't excluded from the transpacific partnership, but it wasn't ready to be a member because it wasn't ready to meet the high standards of governments, transparency, and other associated rights in that agreement. even as we look to find a way to reach on into the system in a peaceful way, prosperous way, i think it is important to continue to maintain what we consider high liberal standards. first, i think we ought to not compromise our own view of where we want the region to go as we go about doing this. just a comment on aib and nelson -- belton road. if you have been watching the chinese media over the last couple of weeks, the rhetoric has gotten, this is the savior of humanity, a century long project, this is going to be the defining issue around mankind will organize. belton road cooked your lunch today. [laughter] now it is going to be the belton road circle and it is encompassing the world. no, literally. now, they are adding the arctic. it is hard to know what to make of this, because, in a sense, it is grand and visionary, but with need to nothink we be little it. -- belittle it. we need to put it in perspective in terms of size and reality. they are doing some back of that contact lesions in my office today, because i had a chinese newspaper i brought back from a recent trip and it had a huge picture on the front saying aib filling the infrastructure gap in asia. they estimated the infrastructure gap is $26 trillion over the next decade. the aib, to date has loaned , about $2 million. here, thattle math is .00007% contribution to what is needed to fill that gap. needher words, you would 130,000 aibs to fill it. i think it will be the same thing with the belton road initiative. you have a lot of promises, big dollars, but, what is actually new, we have to put in perspective. the last thing i will say, it is important, even if the numbers themselves are not that large, even if the economic facts are not themselves determinative. they do two things. they give china authority. you see a number of leaders going to beijing and they will do it again. xi shinpinging -- will produce its message and that has been the convening authority being as important as the business done by the institution. china gets convening authority and they are shaping perception of the future of the order in asia. things like the belton road initiative, or aib, if everybody walks away thinking we better make nice with china, that's will spill over into every other element of the international politics in asia. just as an example of that, i was recently speaking to a southeast asia expert who i think the world of, and he said to me, i think we are at the point where there is no country in southeast asia that will be willing to entertain a new security issue because of the perception of the economic side. they're worried about economic retaliation. even as we assess the reality of the dollars in these institutions the profound effect , they are having on politics is important. graham: i agree mostly with what eli said but i would say, look , in the book and you will say, here's a question, in development aid today, compare the world bank to china's set of development banks and figure out in terms of loans this year and loans last year, and loans next capital, which is bigger. you would be surprised. >> the chinese banks are larger. graham: four times. anne: it makes you wonder, what is this belton road thing since the china development bank already has the three times the balance sheet of the world bank. what has china become, a glorious leader thereby? not really. >> right here. >> thank you. simon henderson, the washington institute for near east policy. i would like to ask the panel, which country does china look at as being its natural allies, and why? if there aren't natural allies, does it need them and, if not, why not? graham: i would get one shot. the general washington view is russia and china cannot have a good relationship because russia is weak and they have a long border, and siberia doesn't have people. over the long run, this is going to be a very troubled relationship. over the short run, xi jinping's best buddy is himself. together, and get what do they talk about? against the u.s. what are they talking about? the u.s. undermining both of us. are they correct? the answer is yes. [laughter] anne: my thoughts will be briefer as it is not my area. i would say china takes an instrumental and transactional approach to its alliances rather than having grand alliances. for example, you will find the u.k. very thrilled about its relationship with china rights -- right now, because china has promised to bundle the power plants that will disappear again if china does not or when the next round comes up. the same is true, i think china likes having north korea, very dependent on it because it gives them a bargaining chip. i think that is the relationship. china, i think still conceptualizes itself as a great ancient, ancient power with tributary states around it. it doesn't need alliances, but it needs the occasional relationship. eli: if you're thinking about military alliances, we're not quite at the point of china's signing up for mutual defense treaties with countries in the world. it is expanding its military footprint, its first military base in djibouti. it is shopping places in the world to add to that and, over time, we will see more people's army in terms of access agreements and moving around. that is on the military peace. -- piece. on the question, it is interesting, one thing that i think china will find out and starting to find out now is, it is easy to sit back and engage in a win-win economic relationship with the world. once it starts to get out into the nasty competitive world of international politics, it will be able to play the game anymore. from the middle eastern suit obviously, china has tried to , develop close relationships with iran saudi arabia, , palestinians, israelis. that will only work up to a point. at some point, they want to be a major player in that area, then they will have to make really hard decisions on what side they want to be on. that is not the nature of chinese politics now. the experience that i've seen over the past couple of years, too close to that they start to pull back. we see that in the belton road initiative. the economic corridor has touched on india's sovereignty concerns. all of a sudden, china's big diplomatic initiative is stepping on core sovereignties -- sovereignty concerns. indianndia, representation, not going to the belton road initiative. inping steps in, it will be much harder to conduct a win-win foreign policy and they will have to come down on some the things that they haven't been able to do today. in terms of the president being daring, i think it'll be really telling on the chinese policy debate on what point they take. graham: i want to thank anne for mentioning a book i read 57 years ago. i thought it was a great book. we are talking about the prospect of a clash, would any of you care to comment on some issues on which we cooperate with china. just to keep things and a little bit of perspective? >> if you were to send us out on a sunny day. >> >> there was an event in paris, if i can remember. [laughter] in which the two greatest emitters of greenhouse gases had come to a consensus and had managed to organize a good part of the world. i think it was a great success, maybe. i'm not sure. >> it is a legitimate question. in the absence of climate change as a basis on which to talk about positive elements of the relationship, is that all there is? do we have anything else at this point? can it be counter proliferation, isis, what are the areas or opportunities? it is the question at the moment that we need to be thinking about. graham: the economic arena in principle could be won. i agree with eli's analysis on the way that evolved. the reason why we opened relationship with china was not for china not for the , international order, not for all the reasons that are typically given today, but because we had one objective in mind. i was part of the process. i think that was the right idea. we built up china to that end. economically, militarily, and otherwise. into the cold war, 1991, we took a holiday, victory lap where we declared history as over we , don't need strategy anymore, everyone will be globalized and what's good for one is good for all. there is going to be democracy and a market economy, not quite recognizing that china was getting bigger and stronger. china was most likely to be like china when it became big and strong. it had been that way for a few thousand years and it was not likely that is was going to be washed out easily. i think what we are seeing a reemergence of china that looks a lot like china. nne'see strongly with a point, the chinese have a long time that hard time thinking about how to relate to some in the party. they say, there is nobody equal to me. the way i understand the relationship with me is that, the extent at which they give me respect. basically, in the hierarchal system, which is their concept firster, confucius injection is you have to know your place. your place is not my place. my places at the top of the pyramid and your place is somewhere adjusting to that. never, mostlyre wanting to take over anybody's territory. they did not want to convert people. they want other people to become chinese. we want everybody to become like americans. have democracy, human rights, this and that. the chinese say you're not worthy of becoming chinese. you can't become chinese. you can imitate us and to the extent you do it won't be too , close. the closer you come, the more i will give you a little bit. if you give me enough respect, i will give you a present. >> if we go to the question about the basis for potential meaningful cooperation, some sort of way out of the shoals, some way out of this historical peril, the trump administration is putting a lot of weight on the joint of the peninsula saying that korea may be the way in which we find a -- find something. to what degree do you believe there is a opportunity there for a meaningful breakthrough? let's confine it to the u.s. china relationship on the north korea question. >> let me just back up for a i second, think this is a good question. during the obama administration there was the climate deal to the iran deal, economic relationship and it's not been great. it seemed like it was heading in the wrong direction, so i think the question of the vacuum on the positive legislature and the small ball being put in that. obviously there is constraints on some of the scientific and space exploration issues. i think the fact that the economic relationship has on chinese industrial strategy is a very dangerous trajectory. the u.s. china economic relationship has been the ballast of the relationship. i think that is not only going away, but it is potentially becoming the center point of the competition. anne knows much more about that than i do. it will be hard to find our way back. on north korea, count me cynical, but i still think there is a gap between how far china is willing to go and the degree to which the demand of the united states in terms of applying enough pressure on north korea, either to cause kim kim jong-un to change his calculation or create dynamic north korea that lead to a different decision makings within the leadership there. i don't think it is going to be a natural place or a meeting of interest, i think it will be, ultimately, as xi jinping thinks he needs to do, trouble make a depending on what is getting on trade or signals otherwise on whether he has to push for more or whether that'll be enough. he is going to be willing to steer into some kind of negotiation strategy, but i don't think it will be because of a strategic overlap. it will be determined by other factors. anne: you are more diplomatic than i. i can't imagine a dumber strategy than the trump extent. >> tell us what you really think. [laughter] anne: i didn't wear my "not my president t-shirt." that would be what i really think. taiwan was a good idea if it had been supported by strategy. i think the relationship is all about investment in trade and that is where we need to use our lever. we are not using the leverage we have over audits, over data security, that is a very disadvantageous one to the united states, and we have nothing to say about it over currency to some extent. to the management of currency. i think the apparent deal between the feds, all the different feds and the china at the bretton woods meeting last year was dumb and a bad idea and negative for the united states. there are a lot of levers that we don't use and that we should be using. but it is all about investment and trade. it is not about -- on the margins, climate and military cooperation. we have excellent institutions, we just need leadership and we don't have that. weould argue actually haven't had good leadership on china since clinton. graham: on north korea, to make a north korea the defining issue in the relationship between the u.s. and china is strange. very strange. because this is a problem that no one else has been able to solve. we have put this hot potato -- i spent a couple of days with some of the folks doing postmortem and the notion was, the chinese survived. now we have left this problem, if we are unable to solve it, who is going to be right? i wrote a piece this week in the times about this is a virtual cuban missile crisis in slow motion. in the foreseeable future, next year, maybe even sooner, but not now, on itsrom current path, be able to attack san francisco with a nuclear weapon. on the other hand, president trump said this will never happen. , he went outet instantly and tweeted, never going to happen. trains going right toward a crash unless one of them die verts. i think the ways to tell the chinese, make sure this guy diver. divert. you didn't get them to divert when they were attacking japan with nuclear weapons, and now you're telling us, i have to solve this problem? i would say, this is the train wreck to watch for. >> right there. >> barry wood, hong kong. how does japan fit into this equation, both in terms of japan china relations and how it fits even with the united states. >> graham, you will get the last word. graham: one of the fascinating differences, everyone one of the 16 cases is interestingly different. one of china's problems if you compare it with the u.s., when we emerged a hundred years ago as the dominant power is that we didn't have any neighbors that were strong. japan is a strong neighbor. it is the third largest economy in the world. japan is a serious military ally. if there were conflict in the east china sea between just the chinese navy and the japanese navy it would be bad for the , chinese navy. the japanese will be a significant player. i think the question that eli made -- the point that eli made earlier, people see that it has changed drastically. i think you will see the security relationships that we have built up in the philippines in the first instance, which you can see already. south korea, i suspect will be an extremely stressful alliance, and ultimately, even japan. >> i think we will follow the rules and finish on time. i thank you all for coming and i hope you will join me in thanking our terrific panel. [applause] >> this year, c-span's studentcam competition asks what is the most urgent issue for the president and congress to address? we will show you the top winning votes ond get your facebook and twitter. tune in just after 1:00 p.m. on c-span. on sunday, author and journalist matt tidy be will be our guest on in-depth. >> if you grow up looking at thousands and thousands of faces until you see that one that you feel was put on earth just for you, you fall in love for that moment. for me, trump was like that except it was the opposite. when i first saw him on the campaign trail, i thought this is a person who is unique, horrible and amazing, terrible characteristics put on earth specifically for me to appreciate or not appreciate. because i have really been spending a lot of the last 10 to it,ears without knowing preparing for donald trump to happen. >> he is a contributor to rolling stone magazine and the author of several books, including "smells like dead elephants," "a deadly and his most recent book "insane clown president, dispatches from the 2016 circus." during our live, three-hour conversation we will take your calls, tweets, and facebook questions. watch in-depth with author and ibbi, noon ontt ta sunday. house, president trump signed two bills into law. one allows family members of officers killed in the line of duty to collect benefits faster. the bill signing ceremony is just under 10 minutes. >> thank you all. it is a great honor.