Transcripts For CSPAN3 CSIS Discussion On U.S. And China Relations 20170718

We split the panels up so that this panel will address the papers on u. S. And chinese strategy and interests in the asiapacific region. And also u. S. China military issues. And the next panel will cover economics, global issues and politics. Scott kennedy will chair that session. We had a number of participants who helped write the papers or who joined us in study groups to review the papers. So this is a representative group, its clearly not everyone who was involved, but some of the key authors in each of the papers were going to address in the panels, body glazer, my colleague at css, senior director of the China Project will talk about the asiapacific papers. Were going to ask the panelists not to summarize the papers but to identify between the american and chinese papers the issues of convergence, divergence and some recommendations. My friend will present on the asiapacific strategy after bonnie. Then well shift to the military relationship, David Finkelstein and the member from the Chinese International Security Studies will address the areas of convergence and implications of what we identified and analyzed in military spheres. As dr. Henry said, we endeavored to make these papers that would be based on the u. S. National interest and u. S. Strategy on our side and on the Chinese National interest and chinese strategy on the chinese side. We did these in consultation with each other, meaning that for example on the asiapacific paper, bonnie and i and colleagues talked about structuring the themes and what key issues to address. But we were very clear on several things, no veto on the other side of this paper. It had to be an honest and forthright explanation of interest and strategy from that countrys perspective. We informed and talked to our governments but the u. S. Government and the Chinese Government did not review or approve these papers. Theyre independent. We are all independent scholars. And so what weapon presented is not u. S. Or china government policy, but we think it represents a pretty good consensus point about how these issues are viewed in each country. Of course, there are multiple views about military affairs, global issues, north korea, in both china and the United States. But we have for each of these papers three authors on the american side, three authors on the chinese side, and a group of somewhere between 6 and 15 other experts who weighed in. And on the asiapacific paper, for example, and i think this is true for the military paperwork tlrve , there was an awful lot of consensus from experts hailing from thinktanks across the ideological spectrum. Its quite interesting, between the u. S. And china papers, there were some common themes. One was that we should strive to avoid becoming adversaries. That was consistent for both sides. There was a theme in all the papers that we should seek out and try to build patterns of cooperation between the u. S. And china where we can on every area, military, asiapacific issues and so forth. And many of the papers concluded that the United States and china need a substantive, honest and farreaching Strategic Dialogue where each side doesnt coverup its fundamental interest and concerns and presents those and goes from there to see what can be done. There are obvious strategic and structural differences to come out of these papers. These are not differences that can be involved with a different theyre historic. We spent a lot of time on the history of these issues for our countries. For example, there are between the two papers on the asiapacific some different assumptions about the future orientation of the Korean Peninsula. Its not just disagreement over tactics in north korea, but how the u. S. And china each view the Korean Peninsula and where it is going in the longer term. There are some fundamental differences in terms of the South China Sea or the first island chain that encompasses japan and taiwan and the philippines and the eastern and South China Seas about what it means to have influence control denial. This is not a small issue. There were differences about how strong american alliances should be. Very basic differences. Not so much about the validity of alliances but how strong should the alliances be in asia. There were differences about what china should be doing to a sort of sovereignty. Not channels over sovereignty per se, but what china should be able to do to a certain sovereignty and what is destabilizing and what is not. There were big differences on both sides, i think, dave will say more about what constitutes a reasonable and acceptable level of defense capabilities. I dont think either side drew that yardstick exactly the same, via the other side. And there are with differences in how we think about the future structure or order of east asia. There was more enthusiasm on the chinese side about the bipolar u. S. china relationship to manage asia. There was much less enthusiasm on the u. S. Side. But even within the two sides there was debate and disagreement. Im going to let my colleagues go into more detail on these areas. And just conclude for now by saying, i think when you read the papers, youll find that these are papers that sort of stand the test of time. That are not based on today or tomorrows news about the g20 or the north korea problem, although we can talk about that. And in some ways, they may be a useful model for what a Strategic Dialogue would look like and how to address the fundamental issues and find ways to minimize the cooperation. But be realistic about the fundamental differences we have unearthed. So with that ill turn it over to bonnie to address the first asiapacific paper. Let me quickly add, we printed out as many papers as we thought we would have audience, this being fourth of july week. We were about 50 short. So this is online as well. So you can get it online and check it out in chinese and in english, i think. So with that, bonnie, thank you. Thanks, mike. And this is a very interesting project. I would urge you all to read these papers very carefully. And its a privilege to be part of this. We have a very short period of time, each speaker, so im just going to hit on the highlights and if theres time for q a we can go into greater detail. For some of the convergences and divergences, both of these on the asiapacific security say that there is a need for a rulesbased order. So thats a good start. We should have rules. There are differences over not only what those rules should be, but whether or not the International Communities that allow welcome from chinas participation in the process of shaping the rules. So the u. S. Papers are quite clear on that score saying america is not calling on china to simply sign onto the rules written in the past but understands that the International Community will draw these rules up together and china will draw in the process. The chinese paper is very skeptical of the u. S. Willingness to do that. It says whose rules are these . How can these rules be defined in light of the changing situation, et cetera. So a lot of suspicion. And i think you find throughout the chinese paper and the asiapacific security that there is a lot of skepticism about u. S. Willingness to include china. Even though i would underscore that i think the current administration, prior administrations have welcomed china to be a responsible stake holder in this rulesbased order. And that goes far back as far as the george w. Bush administration who coined that phrase. Secondly is Regional Security and architectural alliances. And the chinese paper very much contends that the u. S. Alliance system is increasingly targeting china. And it calls for the United States to give up that attempt to build this sort of antichina coalition. And it states that those who try to open a rather secure system rather than the Alliance System. But says china can tolerate the alliances as long as they are not targeted at china. So a little bit of ambiguity there ultimately whether alliances can be part of the system, but it does the bottom line is that the u. S. Led Alliance System can coexist with an increasingly influential china in the region if the u. S. Gives up the effort. Now, for the u. S. , this paper doesnt portray in any way the alliances as aimed at china. And it talks about the allies as the basis of our regional position. It lists several threats that are alliances that were trying to deal with. Such as north koreas emerging missile and Nuclear Capabilities and maritime conflicts. Very different discussion of alliances. When i was at the rollout in may in china, the chinese version of this, madam fuying talked about the concern in the Regional Security architecture. So i think that this really is a difference that the u. S. And the chinese have about whether or not the alliances should be part of this rulesbased order going forward. Third, both identify areas of concern. Pretty much the same, as you would expect. North korea, taiwan, mare thyme issues. On north korea, the u. S. Paper claims that china doesnt recognize the new level of threat posed by the kim jongun regime. Events that have transpired in the last couple of days and months really provide evidence of that. The United States is, i think, incredibly concerned about the launch of an icbm by north korea. Very upset about how u. S. Citizens are being treated. Of course, the most recent being, the very tragic death of otto warmbier. So i think that the chinese paper in some ways recognizes the danger, but insists that the problems just cant be addressed through sanctions alone and diplomacy is necessary. But i do sense a real gap between the two countries in terms of their assessment of the urgen urgency. The u. S. Paper has some interesting policy recommendations in this regard, calling for not only more dialogue but for specifically on noncombative operations, weapons proliferation, closing loopholes in usca sanctions. The chinese paper doesnt have any of these very specific areas of potential cooperation. And i would underscore the need for Crisis Response in the event of instability in north korea and something that the u. S. Has tried to do with china for several administrations as well. There are solutions put fwarmd by both sides and i want to highlight some of the divergences and comment on them. Both avoid disputes of military content. Though the paper focuses much more on this than the chinese newspaper to manage differences. Of course, we would know that he does talk monoabout our finances. And then the chinese purse officers a u. S. Led Alliance System. This is interesting and we should consider theres been recall in the back of a trilateral music dialogue that was supposed to take place back in 2009 and for various reasons did not. It should be considered once again. Ways that we can offer trying to reassure citizens about our alliances engaged in the trilateral goals. So as mike mentioned, the chinese authors do not rule out a g2. They say a either a g2 or through other forms of security cooperation, china and the u. S. Need to establish a joint vision for the region that is inclusive and based on mutual consensus. I think that would be a very, very different thing to do. I dont know if we can establish a joint vision, but certainly the u. S. Paper and reflecting the mainstream views in the u. S. Rule out such a g2 arrangement. The u. S. Paper says that washingtons not interested in the condominium that would apply a greater relationship. And finally, the chinese newspaper calls to adhere for the components of the new type of power relationships. It says we should adhere to the principles, no confrontation, Mutual Respect and win win cooperation. And i think accurate ly we ae looking at where the Trump Administration has come to after the first several months in power, that americans, in general, dont like a Bumper Sticker phrase. And there continues to be enormous discomfort with new models of the power relations including the co points. So again, the u. S. Shares the goal of avoiding conflict. But we worry interest on corp issue xwou i corporation issues thank you for your leadership. So you impressed me and encourage me. In the past oneandahalf years, we have been working together and thinking together. So, of course, when talent up no matter how wages are honored differently, share the vision and divergence and convergence is some sort of reality. So we need to get through some sort of very accurate reality checking. Finally, we have to get back to the history to use the history as some sort of very interesting studying point. You have a very positive security anchor here in the region. No matter how china, the china will benefit a lot from the americans very steady and constructive on the chinese side. Second, of course, if we had to look at some sort of a potential ri risk, we are causing a collision between the two powers. Then the element will create or drive back the divergence. Then well have to say, its not a status, its an issue. So theres a lot of speculation across middle east asia for the moment where we have to transition. I have to say its the fallacy. You read some sort of recently published book. Its call ed everything that china inhabits. Its very simply from a historical special circumstancetive. Its a tributary, but most welleducated scholars, that kind of system subpoena not necessary for this. So where 20 years ago, 30 years ago, they faced some sort of disparity. It is significantly diminished but the u. S. Remains where dump in the power week this is the biggest trade in u. S. Foreign relations now because a lot of the interest is now in a condition where we are competing off the past taking solutions and methodologies, but the promise if we get back to some sort of centerpiece to be behind the strategy, then well prefer to see and its also veried a cat and reasonable. And then well see this in the asiapacific. Of course, this place is a very important tasting ground as i mentioned to have a serious examination of chinas Foreign Policy interaction or the strate strategy where we see people suffering for days. But i consider the china methodology in the region. And the region remains largely as some sort of a china power position. I consider chinas policy has been very consistent and smart. Now, why . Its very hard for china just to have a tvery successful transfom to power. China remains vulnerable at large. So in the region, were going to consider some sort of ways to compete a place then the point is we consider no matter how we diverge, but the strategy and policy should be oriented where the future oriented is not just in our history, we are oriented that ends a lot of speshlation. But we are overpaid and that will be getting us into a conflict. So the harvard professor is set to be a sensationalist. We consider u. S. And china to jointly create a new moldening of the new power relations. Conclusively, i have to say that this presents a very interesting challenge for us. So, on the one hand, we have to balance the points to set up a tradition in inspiring points. It is not an easy job. So from the chinese side, its not how we can just envision some sort of power stories between the u. S. China in the region, but how china cant overcome some sort of adherence. This happened before china became a real popular part in the region. Let me stop there. Thank you very much. You contrasted the papers well in eight minutes and fit in three book reviews. So well done. I appreciate it. Thank you. Over to the military side of this panel to david. Okay, thank you to john for participating. And thank you to michael and scott kennedy. Three of us comprise the military and defense writing team, myself, Armitage Associates and fill saunders from National Defense university. All three engaged in this in our personal and private capacities and id be remiss if i didnt state anything i said today reflects the views of cna or any sponsors. I think if they were on the dais with me, im sure they would provide the same caveats. So as you heard were not supposed to summarize our papers. Ours is 25, 26 pages long. You can take a look at it. But i feel a need to at least provide you a sense of our overall assessment. And the reason i feel a need to do that, our assessment of the state and trends in u. S. China Military and defense relations, is because this is a major area where the u. S. And chinese side did have some convergence. Recognizing some of the positives and recognizing some of the negatives. So let me give you a gisting of the u. S. Assessment of the state of being. And it goes like this. At the moment, the relations between the u. S. And chinese militaries are more stable than they have been in decades. The two militaries are engaged in a widerange and unprecedented number of interactions from the strategic level down to the tactical level that theyve never done since relations were established in 1980. Both militaries are working together at Risk Reduction to ensure that highly contentious issues do not result in miscalculation. And the u. S. Team assesses that neither military seeks a conflict nor sees it in their nations interest to resolve differences between us by military means. However, all is not necessarily well in the military and defense dimensions of the u. S. china relationship. The u. S. Writing team adjudged that the competitive aspects of the military and defense relationship are growing and intensifying. Both sides have deepening rp i concerns about the others defense. As well as the uncertainty over each others future intentions. The competitive dimensions are most intense in the Asia Pacific Region where traditional u. S. Predominance in the maritime and Aerospace Military domains and chinas expanding offshore reach and increasing military capabilities are intersecting. Strategically, the u. S. Is determined to sustain its longstanding military predominance in the region through forward military presence and its system of alliances and partnerships. Whereas for its part, we assess that china, from a u. S. Perspective, is purposely developing military capabilities to challenge u. S. Military advantages as well as military, political and economic means to weaken the u. S. Alliance structure in some instances. Operationally, this competition is being characterized by the development of weapons and technologies aimed at accruing operational advantage by doctrinal adjustments. And by shifting force postures and deployments. Beyond asia and other parts of the world, there are and will be more opportunities for u. S. China Military cooperation. And we look forward to that. But, and we also recognize as chinas militarys footprint around the world steadily increases, the potential for new misunderstandings beyond the Asia Pacific Region cannot be discounted. Because of this intensifying competition, carefully managing the military dimensions of the u. S. china relationship has to be a top priority for american and chinese civilian and military officials to reduce the chances of confrontation and assure that military tensions do not overtake over areas in the relationship that are cooperative in nature. So those are the u. S. Sides bottom lines. I think if you read the two papers, you wont see a lot of daylight between them. Now, on convergence and divergence, both sides agree the relationship between the two militaries is stable. A disturbing context in which i laid out. In which the u. S. And china militaries are increasingly wary and suspicious. And both militaries are, in fact, hedging against each other operationally. The chinese paper was a bit starker. Maybe than the u. S. Paper. Where the u. S. Paper, my paper, talks about intensifying competition, the chinese paper talked about concerns that, quote, the potential for clashes over security interests between the two countries has grown rapidly. So both writing teams did laud the efforts of the pentagon and the pla to introduce confidence Building Measures into the relationship. And both sides agreed that a military conflict would derail both countries, larger, domestic and strategic objectives. Each side is presenting significant security challenges to the other. Both are exacerbating each others securitys situation in the Asia Pacific Region. On divergence, the two papers of course converge in identifying the common set of problems. But they do diverge in many ways in explaining motivations, ca e causality and impact. Differences in respective views on the motivations behind the u. S. Alliance system or on the chineses part, motivations behind Chinese Military modernization. Very different views between the two sides on what those are all about. Overall, though, i think that the two papers, if you read them, will provide readers a very sound appreciate for the strategic Perception Gap that exists between the two countries on a wide range of military defense and security issues. And readers should also come away with an appreciate that the military tensions are a reflection of competing National Interests and fundamental policy decisions of civilian leaders in beijing and washington and not just the decisions of military officials. Its much broader than just military issues. On future cooperation, if you take a look at the paper, we found many ways we can be cooperating in nontraditional security. Some folks have mentioned that already. I think the most important thing to zero in on is what both teams did zero in on and that is cooperation on the very difficult issue of north korea. I think if you read the papers, both the u. S. And chinese teams cited the need to engage in Crisis Management activities as regards the peninsula. And i think thats an important potential opening that we need to pursue either at a track 1 or track 2 level. Final points. Going forward, Development Since january 2017. I think the events of the past week have underscored that the u. S. china relationship remains a tangled and messy web of issues which impell the two countries on one hand to cooperate but another set of issues that produce contention and competition and great tension between the two. And the military dimensions of the relationship are no different. Though some of us are concerned that the competitive dimensions are in the ascendancy. But it is clear i think that leaders in both capitals today recognize this competitive problem and are attempting to manage the two sides of this relationship to include on the defense and military side one of the recommendations in our paper was to conduct an assessment of the efficacy of the military and security dialogues that have proliferated over the past few years to determine whether or not they were serving a good purpose. Now, clearly, leaders in washington and beijing have already voted on that account, having dismantled the sned and creating the new comb prehebs e ive comprehensive dialogue. And with its diplomat and security dialogue. Which had its first meeting two weeks ago. Defense secretary mattis commented that the idea of the new venue is to, quote, elevate and focus the discussions. And i think on defense and military relations, elevating the discussion and focussing the discussion is a pretty good idea. So theres a new start to these discussions. Whether theyll be new solutions remains an open question. And ill stop at that point. Thank you. Im glad to have a chance to participate in todays great event. I will be focusing on two points. First, about my viewpoints about the two reports. I think they are a lot of consensus. Similar observations in the two reports. For example, both sides believe the relations is very complicated with booth cooperation and competition. But this is very, very different from that. Another example is both sides believe although in recent years, the frictions and the suspicions has been increasing. Especially in the west pacific region. However, neither military seeks conflict and it tries to resolve differences by force. For this, both sides have achieved a lot. And Crisis Management. Regime. Another example is both reports believe in recent years the military relationship is a highlight of the whole bilateral relationship. And the most stable it has been in decades. This is not only reflected in the enhancement of the differences and the Crisis Management, but also in the keeping and upgrading talks, exchanges and more cooperation on nontraditional security and Global Governance. It said both sides proposal partisan proposal has a lot of convergence. However, both sides reports also have a lot of differences. Here there are two more striking ones. First, americans report believe asia pacific strategy and operationalization of the rebalance by dod is inevitable and very positive. Its in the interest of the United States, its allies and the defense partners. However, chinas report believe the rebbs, especially the military element in the rebalance policy, mainly aimed at china. And china is one of the major challenges, security challenges. In result, it has intensified military and security friction between china and the u. S. And increase the tension in the region. Secondly, chinese believe the maritime frictions increasing. One of the reasons for this is americans invitation and the u. S. Take sides. However, preliminary reports believe it is Chinese Military capabilities, expansion, es especially the maritime capabilities expansion and chinas assertive policy and activities which are the root of maritime tension. Both sides, both reports pointed out a lot of differences. Which refer to taiwan, Korean Peninsula, regional architecture, Security Architecture, cyber and space, nuclear relationship. Now we ask this question. Why we cant have this kind of relationings. Answer is the economic independence. The common global challenges we are facing. The common desire of no conflict, no confrontation. All these decided that both sides must cooperation. Including the passive security cooperation. On the other side, because we have different political systems. We have different values. And we have some different National Interests. It has decided that we must have some differences. And especially in the new background of the changing of the balance of power. Chinas a rising power. U. S. Is resiexisting power. So because of this, all this has led to aggregation of military fricti frictions and competition. Then how can both militaries close their differences or manage them while also exploiting the potential areas for cooperation . Both reports have raised a lot of proposals. In summary, mainly three points. The first is we must always keep and expand dialogues and exchange the military dialogues and exchanges. Especially we should have new talks in the new domains. Just like the nuclear talk. Cyber talk and space talk. In this way, then we can increase the understanding of both countrys intentions. Decrease misunderstanding. Secondly, we must put reduction of risks, operational safety, Crisis Management at the center of our effort to stabilize military relationship and avoid military conflict. The third is that we must strengthen nontraditional security cooperation. In this area, we are still in the same boat. Now, i will talk my second point is about bilateral military relations in the first half of this year. And its prospect. I think in the first half of this year, generally speaking, relationship is stable. We keep talks and expand new talks. And especially early this year when the two president s meet each other, they reach consensus to strengthen cooperation, nuclearization in the Korean Peninsula. And also because of the activity in the South China Sea. So all these beneficial for the stability of the bilateral military relation. However, in recent months, there are some inactive elements. U. S. Has took twice the socalled freedom in the china sea and declared military arm sale to taiwan again. So this has bring about impact on the relationship. Now the two leaders at the g20 conference. Both leaders will meet each other. And very soon we will have first the talks between the two joint staffs. And trump, President Trump, will visit china in the second half of the year, this year. I hope these efforts include stabilize the relationship and stabilize the overall relationship of our two countries. It will be beneficial for the Regional Peace and the civility. I will stop here. Thank you. Thank you tuosheng. Of course all the military and defense issues and different do mains. Let me focus first on one area which is in the news very much right now and thats north korea. Of all the issues we looked at in the paper, including cyber, including aaib, of all the issues weve looked at, the Korean Peninsulas the one where the United States and china could, because of our interactions, on the north korea problem, in a few years become much more trusting of each other across every issue or truly sensing that were adversaries as we were when the korean pa numbe peninsula was at bar. It seems to me thats the one issue you could have the biggest impact on the overall sense of whether were adversaries or we can Work Together on hard problems and affect our security. And were not in a good place right now in north korea. You mentioned its very hard in the area politically. The president announced his disappointment. The chinese side couldnt do anything. And yet probably xi jinping is doing more than it was done before but its clearly not enough to convince the u. S. Side. Let me start with bonnie and ask you all, are there concrete things we can do . And the Security Council on the north korean launch. The u. S. Has imposed or announced it will impose secondary sanctions against the bank because the chinese side hasnt cracked down on those sanction violators themselves. Are we stuck on this is a very specific set of issues right now, but it has very broad g geopolitical issues. Ill start with you, bonnie. Well, i think that when xi jinping and President Trump met at mar a lago and agreed in principipl principle. Tried to identify what it really was the u. S. Wanted. Firps the chinese interpretation was compliance with existing u. N. Sanctions. Chinas always opposed any unilaterally or secondary sanctions. China has banned of course coal imports from north korea after reaching the cap under the u. N. Security Council Resolution that was passed. In terms of border inspections. But i think that theres been a maybe a failure on the chinese side to identify what it was that would really satisfy the United States. Not meet all of our expectations because that wasnt in the cards anyway. And it really goes to this issue of banks operate in northeast china are facilitating norths being an to the International Financial system and enabling north korea to engage in these illicit activities. Theres been activity from the Trump Administration. And the reaction, as i understand it, from china, was not sufficient. And thats why we saw this 311 action last week. But there can be a way forward. China can take action against these banks. If not, i suspect what well see is the tip of the iceberg. Weve only seen one bank cited. And there are more. But it would be better if china does this, rather than the United States does it. In particular, because some of these small banks and Front Companies do business in currency other than u. S. Dollars. And they really are beyond the reach of sanctions like those that we impose 311. So i think there is a potential way forward. Maybe when President Trump called xi jinping on sunday, maybe articulated some of the things were looki ing for. If xi jinping can deliver some of these things in hamburg, maybe there is a positive pathway. I think neither government really wants the relationship to sour over this issue. The best outcome for the United States is more cooperation from china on north korea. And i think the best outcome for sxi jinping as he heads towards the annual meetings, the 19th Party Congress and of course President Trumps visit to china later this year. He wants the china relationship to be heading into a positive trajectory also. So i think that there is a way forward. Well see whether we get there. Okay. You raised a very important question. I think of course china and the u. S. Could do a lot more to cooperate. The key is how to measure, how to define, chinas cooperation. For example, i know how frustrated over policy over pkrp. Chinas some sort of help to reel in the drpk. But for beijing, we will not overwhelmingly cut off trade relations. Because trade relations with dprk in some sort of normal turn is chinas leverage, is chinas some sort of political preemption. On the other hand, see such a no normal trade relations is chinas way to domestically keep some ideological, lets say, some sort of calculation. So its not easy for china to cut off all the trade relations with dprk overnight. But the party it is their issu has become sm sort of leading points where how strategically readjust the relations between washington and beijing could be significantly and exactly crystalized. Just imagine back to the korean war. North core mekorea means a plac. Now there will be second korean war. Chinese. Overwhelming majority of chinese say no. It would be crazy. If u. S. Went in military, china will reach out a helping hand. No. Totally gone. Its a big strategic change. Now were also getting close to some sort of judgment of what the dprk is. Its a threat , not to the u. S. Its a threat to china. So we need to figure out some sort of joint contingency plan to relegate the dprk. But where is the starting point. How we can move very firmly but very notably going beyond some sort of historic inheritance. For example, for chinese, plus the dprk. Dprks ideology. Dprks chinas security state. Dprk is also some sort of entangled some sort of personal emotional, you know, connections. Its not easy, but is very positive. I really hope two things could be serving as very decisive criteria. If there is one more nuclear test, i really, really hope Chinese Government could give them a big punch. Even just decide the suspension for provision. Second, if jongun really wants to turn the back to International Appeal to deescalate tension and stopping missile tests. We also need to give them pinch. Get them hurt. Economically and commercially. So i really put a lot of hope on up and coming trump and xi jinpings meeting. If some sort of new summit, momentum, could build. Then well see both sides heading to more significant specified and immeasurable cooperation. Thank you. I personally think that chinas not what it was a year ago and not what it was 20 years ago. But the changes are incremental compared to the growth of the threat itself. Certainly the view in washington. And for our chinese friends, i can tell you if the Chinese Security services turned over several containers of centrifuges or precursors for reprocessing or shut down in very specific ways Bank Accounts in about a dozen banks, having worked this issue in the white house for five years, boy, would that have a huge impact, huge impact on how the administration, any administration, thought about how trustworthy china is on this problem. Im going to come back. But i want to give the audience a chance for one or two questions. Raise your hand. We have microphones. Very briefly, who you are and your question. So i have the gentlemen in the blue shirt right here. Thank you. From the university of washington, chinese student. I have a question about current north korea situation. We have all been talking for a long time about what we should do, which is putting plans to solve this crisis. But i wanted to put forward one scenario for the panelists to respond. Can it be a very brief scenario . Very brief. How about having china to have the kind of dominant control over north Korea Nuclear scenario and having the United States internationally recognize north korea so we can solve the problem. Thank you. Well take a couple. One more. Yes, maam. Up in the front. Hi, my name is jamie. A couple of a little bit louder. Hi, my name is jamie. And a couple days ago, north korea Just Launched a missile and landed in japan sea. I was wondering how far will let it go for securitywise in building that momentum for figuring something out with what actually should be done in letting north korea keep testing the missile . Youre asking about what is chinas line of tolerance or the u. S. . Both. Okay, internationally. Maybe one more. Yes, sir. Were making our hello, my name is cameron. Im an International Relations student at miami university. My question is regarding the idea that he came up with mutually assured restraint and whether or not thats a viable option. Given the two papers viewpoints. Especially from diplomatic as well as military channels. Thank you. Thanks. Lets start with tuosheng and then david. Our talk about something about how to deal with north Korean Nuclear issue. So i think chinas position is very clear. That in the interest of china, not just try to satisfy the u. S. Demand. Because we think if north korea became a de facto Nuclear State, it would be also a disaster for china. For example, north koreas withdrawal. Finally became a Nuclear State. It will set a very bad example to the other countries. Then the mtp will collapse. So many people will follow suit. Then so many Nuclear States follow china. Its not in the interest of china. The risk of this is very high. Now, though, any country really try to solve the issues by military means. But if theres conflict, if theres misjudgment, there could be a military conflict. Even war, nuclear war. Just at the border of china. Even without war. Because of the tensions to asia, u. S. Will increase the military. Strengthen the military alliances. So its also not in the interest of china. So i think china are determined to realize due nuclearization. But we must have cooperation with United States. Without it, coordination and cooperation, we cant achieve anything. But on that side, u. S. And north korea will make some compromise between yourselves. Otherwise, we can only achieve anything. So in the future i think chinas policys very clear. First, the denuclearization and freeze the Nuclear Program should be the first step. And in the long run, denuclearization is the goal. And secondly, we should prepare for the worst case scenario. If north korea refused to go back to the negotiating table. If they made a sixth nuclear test. So we should put more pressure on them. But now there is still a chance. A little chance for resumed talks. And we should have a try. Anyway, we should also not just put pressure on them, we should also also extend a carrot to them. Anyway, just depends on the pressure. But if they refuse to go back to negotiating table, we must prepare for the worst case scenario. So their time, especially after six nuclear test it is, maybe china and the u. S. And south korea should have a talk of how to deal with contingency. Its in the interest of all the countries. Its also a kind of signal to north korea. You cant go further. So anyway. We should strive for the best. We should prepare for the worst. This is the only way to deal with this crisis. Tuosheng can i follow up. How much the International Community should tolerate. Ive been working on this north corekorea problem for 20 years. Every time i hear someone says we have to give north korea one more chance. It reminds me of bars where i used to live in japan. Inside a door there was a sign saying starting tomorrow no drinking. So everybody felt good about themselves while they drank. And, you know, when at one point do we just decide or realize north koreas just not serious about negotiating away its Nuclear Program. I think thats what basically gr youre asking. Is it your view this is the last chance . I mean, how much more do we have to try this thing which has not worked for 20some years . You see now north korea havent totally realized weaponization, Nuclear Weaponization. Theyre still maybe in two or three years, they will go across, totally go across nuclear threshold. Becoming de facto Nuclear State like india, pakistan, israel. At that time, theres no way to force them to go back. But before that, theyre still a chance we can do something. If the International Community can unite it. And we can have more coordination and cooperation. Just like our daily life. Some people make decision. We have to do something. But it must be successful. The objective of condition is very important. So if we can unite it, we can persuade them to change their wrong idea. We can force them to change their idea. So theyre still a chance. But if we cant resume talks in two or three years, i think the situation will be very pessimist pessimistic. And finally we must be prepared for the worst case scenario. The military conflict and even more war. So thats very bad situation. But anyway, we still should have a try. Thats my point. Im going to go to jufong next. Im a little bit pessimistic. I dont think they like to negotiate in exchange for any bad off by dismissing their Nuclear Weapon. Because they consider in the minds of pyongyang, Nuclear Weapon is only last resort to secure the regions security or secure regimes safety, National Security. The second is nuclear bomb is the only way for kim jongun to magnify how holy, how admirable he is to be top leader of the dprk. By all means negotiation. Yes, we should leave this option there. Unless two conditions happen. Theres no way dprk will abanden their Nuclear Weapons through negotiation. One, to my understanding, to be honest, one is u. S. Is serious ly seeing the military strike. And second condition is china is unbelievably clear in signaling pyongyang were going to abandon you. So then yes, i consider negotiation is always operable. History also is very telling. In the past three decades. So then we need to be more serious. Second question is about, for example, its about this mutually assured restraint. Consider most important we should have some sort of bottom line mentality. If both sides have such a bottom line mentality and somehow very smartly and very constructively accommodating each other, i mut outcome. The visual of president putin and president xi jinping calling for the dual suspension approach to korea does not give me a lot of confidence that the gentlemans prospect or idea of china taking the lead in dealing with north korea has any legs. So that i think thats a nonstarter and does not give me a lot of confidence. The second thing i would say is ever any a country deserved an award for straw edtegic patienct should be china with north korea. If you look at the last 70 years, were it not for north korea and kim ilsung. You can ask professor cohen. If it were not for north korea and their missiles, japan probably wouldnt have signed the revised guidelines for defense cooperation back in 1998. Because i was in the pentagon at that time involved in that. Had it not been for those missiles, north korean missiles, you wouldnt have had japan providing billions of dollars for the very Ballistic Missile defense that china sees as a threat to itself and there would be no rational for approximately 30,000 troops, u. S. American Forces in chinas neighborhood, which is definitely viewed by china as a not a good thing. So how much is enough . Well leave that to friends in china to deal with. The third thing i would point out is that dealing with north korea is a trip to the land of bad policy options. But not just for the United States. Also for china too. And i know that chinese decisionmakers and policymakers and leaders must be struggling with the monumental implications of what theyre being faced with at the moment because of north korea. To wit up until now china has not had to choose between north korea and south korea. China has been able to have it both ways to a certain degree. Sooner or later, chinas going to have to lean to one side on this issue. And how it leans to one side on this issue will say a lot about its aspirations for world leadership. So this is not just tough decision for the u. S. These are tough policy decisions for leaders and friends in china as well. And im honest to god glad i dont have to make a decision on this because there are no good options at the moment. And if you had the time, i could give you 15 minutes on why as the general says a conflict in korea would be the most disastrous departure that weve had in this century. Very short since we are just about out of time. The question that the gentleman in the middle asked suggests somehow what we, china, the United States, are willing to do, will satisfy north korea. Maybe a useful conversation between the u. S. And china is what does north korea really want. You say u. S. Recognized north korea. Is that really what north korea really wants. North korea wants to be recognized as a Nuclear State. I dont think china really wants to take over the north korea problem. But i can certainly be confidence north korea doesnt want china to take over the problem. If china offered north korea today a nuclear umbrella, the North Koreans would say thanks but no thanks, we have our own. I think maybe that would have worked before 2006 when the North Koreans tested their first Nuclear Weapon. But i think its clear to me what the North Koreans want is a Nuclear Weapons capability. I think its far too optimistic in terms of his time frame. The u. S. And china and russia are going to have to work out what we classify this recent test as. I think from the u. S. Point of view, it were a standard trajectory. It would have traveled approxima approximately, what, 6,000 miles. That is icbm range. So i think the North Koreans have already miniaturized a nuclear warhead. I think most people believe that. It may have remastered reentry capability without the warhead burning up. We are probably far closer to this goal. Not to a Nuclear Deterrent which is really Something Else but having a deliverable Nuclear Weapons capability. Im just going to end on one very specific point that goes back to the issue of north korea using chinese banks and why this is so important to address. Between 2009 and 2016, approximately 300 million was laundered through these banks in the u. S. Financial system. This money is going to support the wmd programs in north korea. And so this is a place to start. We can also cut down the north korean laborers because of a portion of their salary is going to north koreas elite. And i think we should take a look at issues like crude oil. Why do we have to wait until north korea does its six Nuclear Tests to cut back on crude oil . This is an area where china has enormous leverage. So theres more that we can do. China conducts n 88 of nort koreas trade with the International Community is with china. It will be discussed too. So i hope that our two countries can have a more serious discussion about what really doable and not just talk about suspension for suspension or things that frankly are not workable at this point because weve really reached a very critical turning point i think with this icbm test. I want to thank the panel and all your fellow authors and working Group Members who are not on the stage. David thanked his cowriters. D i did the asia pacific paper. But with a lot of participation from bonnie and doug paul and other experts around town. And this is a good discussion. And now for the really hard part. Im going to invite the next panel to come up. We will give you room now. Thank you very much. [ applause ] good afternoon. The first panel really did a stellar job of staying within the time limits and in staying within the guidelines of not simply summarizing their papers but actually looking for area, of convergence and divergence between the views of the two sides. And particularly those with policy significance. Our panel will be dealing with a different set of issues. But ones that are actually also fundamentally important to the bilateral u. S. china relationship. Economics. This was the area which during our Election Campaign seemed to be the most controversial issue between china and the United States. Unlike the exciting north korean issue which gets a lot of the attention, the problem with the north korean problem. The administration thinks it has options for dealing with a trade imbalance with china. And how the United States handles Economic Issues has a potentially major impact on the bilateral relationship. This has to do with is china really out to undo the liberal world order the United States set up after world war ii . Does it want to push us out of asia . How are the governance issues playing what role is it playing in the relationship between the United States and china . And politics is fundamentally important. Attitudes in both countries, Public Attitudes, often do not support the declared policies of the government. Polling shows the attitude towards the United States and china are more hostile than attitudes in United States toward china. But when you think about it, you realize of course, because from chinas standpoint, the United States is supporting countries who are making territorial claims against china or were supporting taiwan in ways that china sees as interfering on an important territorial issues to them. And we dont have any territorial issues with china in the same way the chinese see the issue. So its not surprising if one side has a territorial issue, thats going to affect public attitude. So Public Attitudes are very important. And our panelists will get into the subject. I encourage them to be equally diligent in sticking with the time limits. We have one additional member of the panel so the pressures on us will be even greater. There was a chinese participant who was supposed to be commenting. Unfortunately, he could not be present. The economic issue is one where the United States will be dominating the presentation. Although im sure if we say anything that the chinese feel will have to be rebutted, they will not be hesitant in doing so. Scott, why dont you lead off . Thank you very much. Its an honor to be a project on everyone with the first panel and this one as well with all the other contributors. I want to talk about the economic relation sheriff. The paper that you have and the report we present that we publish today was written jointly by myself and the council on foreign relations. We had several other people who acted as advisers. Who helped gud us along. But were jointly responsible for what you like in the paper as well as of course all of the mistakes and challenges as well. We also want to commend hufon from peking University School of business who cant be here today because of a family illness, but he and his team, the other three authors on his team and the rest of their group, really should be commended for a very thoughtful analysis. Serious discussion, presentation of evidence in their paper as well which is on the csis website which you can read. Let me say a little bit about sort of the differences similarities and differences in our analysis on Economic Issues. And then similarities and differences where we come down in terms of policy prescriptions as well. Particularly since hufon is not here, i want to try to be as balanced as possible. Even though i probably cant, you know, fully meet that idea. I think in terms of our analysis, both sides agree that the u. S. China Commercial relationship is mutually has been largely mutually beneficial. That it has benefited both sides. That despite the fact there is this large trade deficit bilaterally, that number shouldnt be the measure by which we judge whether the relationship is beneficial or not. I think also we agreed on both sides that the United States economy faces a variety of challenges and not all those challenges emanate from beijing or from anywhere in china but emanate domestically, and there are things the United States needs to do to address those that dont involve china. We also agree that chinas economy is changing, evolving the role of government, manages the economy is changing. China is still trying to integrate itself into the Global Economy. I think we all agree to that, those sets of analysis. But we differed in a variety of other ways that are very important i think. I think the u. S. Paper youll find if you look at it, we focus heavily on what we see is the growing centrality of Chinese Industrial policy and protectionism in managing its economy, in making life more difficult for those that want to export to china and those that do business in china. And this is not a question of just whether how much it contributes to u. S. Trade deficit or not or how much jobs it affects. But first the question of basic unfairness and the difference between this behavior and chinese commitments. As well as the effect on companies that are competing with china in the u. S. And elsewhere. But even beyond that, because of chinas size, its unique size, Chinese Industrial policy is having a huge Global Effect on b business modeled, not just in china but globally. So its really important we address this issue not because were trying to support one Company Winning over another, but because of chinas size and it has a special responsibility. Thats something we focused on. I think hufon and his group on the chinese side did focus primarily on the benefits that both sides gain from the relationship. The need to continue that. And to avoid any path which would lead to growing protectionism on either side. Our sense was, again, from our report, is that these chinese declarations of continued reform and opening, although repeated consistently in the by chinese leaders, officials in the press, are inconsistent with the reality on the ground in china. In addition, we dont see a consistent or equivalency between the challenges that Foreign Companies face in the chinese market. And some of the things the United States has already done with regard to Market Access in the United States. Or things were thinking of. For example, including revising sifious. I dont think theres much on the table as a possibility that would come close to what are ongoing obstacles to access in the chinese market. And i think you see this difference in approach in analysis in the current rhetorical fight between the United States and china, where china says its opposed to protectionism and the United States, most recently at the g7 in italy, and i expect well see this weekend at the g20 in germany, its opposition to trade distorting measures. The visions of whats going on. Now, as the ambassador alluded to when we got under way, we expected that after President Trump came into office, that the u. S. China Economic relationship would be very contentious. Right away based on everything that we saw in the campaign. And also there was concerns in the Obama Administration and i thinkgrowing consensus about the need for a more tougher approach on china. But thats not what we saw. Thats what weve seen essentially in the first several months of the Obama Administration. We described the american path policy so far as sort of a pursuing general cooperation and openness. And we expected the u. S. To move towards what we call conditional cooperation and openness. Which is essentially much more like the idea of reciprocity that is now circulating around and that we hear about every day. So now theres a chance weve seen over the last few weeks that the u. S. May be shifting. That it may be moving away from this effort to seek cooperation and deliverables toward putting more pressure on china to try and get outcomes that address these questions of Chinese Industrial policy. And considering penalties and pressure. So we cant be sure. Because were not clear what american policy toward china is overall or what our clear policy is on trade. But we will see, you know, over this coming weekend a discussion of the global forum and whats going on with chinese subsidies with steel and aluminum. I think well have a better sense next week of whether were seeing just some, you know, Media Coverage on trying to push things in a new way or whether this is really a substantial term. In terms of policy recommendations in our report, and this is where ill conclude, we had actually a lot of common agreement about the relationship in terms of policy. I think we agreed that the u. S. Should not engage in wholesale protectionism. And just using any convenient tool sitting around. Above board or below board. To just whack, to use juofengs term, to punch the United States, for example. We, again, agreed that the u. S. Needs to do a lot to improve its domestic economy that isnt related domestic economy that isnt related and dependent on china. I think we also agreed in both reports that china needs to continue to reform and open up. In the u. S. Report, we say china needs to resume that. Chinese say continue. But nevertheless, the direction i think is the same on both sides. Where we differed, as i think, again, the u. S. Believes in our report that china isnt living up to its commitments and that much more needs to be done to bring china back into compliance and restart liberalization, and there are a variety of things the u. S. Can do bilaterally, multilaterally, both carrots and sticks, and be proactive in pushing for that outcome. So, we, to begin with, is simply just rigorously enforcing u. S. Trade laws, bilaterally and in the wto. Were not advocating discouraging Chinese Investment in the United States because it strengthens the economy, but we do think that its reasonable to strengthen the process for considerable whether individual investments, particularly in hightech, may have concerns for National Security. Within our group, there was no consensus about the principle or this term reciprocity, but we do think u. S. Investment policy should be somewhat affected by how china treats american investment. Finally, the u. S. Side thinks that the u. S. china Bilateral Dialogue is extremely important, but addressing solving all the problems in this economic relationship isnt just about the bilateral track. The u. S. And china need to engage in multilateral forum, in regional forum, and the u. S. Needs to further engage its allies. You cant pick a fight with everyone at the same time on every issue if addressing these type of core strategic challenge is a real important goal. So, the United States needs to pick its priorities, pick those its going to cooperate with, so it can engage china more effectively on these issues and achieve what we hope would be a more genuine winwin outcome. Thank you. We will now move on to Global Governance, and professor gewirtz will lead off. Thank you, ambassador roy. Its been a privilege, as others have said, to participate in this project, and i think its important to say that because this project demonstrates how much goodwill there is in each country to work hard to try to get this complex u. S. china relationship on the best possible path. And its been good to participate in that and to continue to participate in that. The topic of Global Governance is one that has been particularly disoriented, i think is the word, by Donald Trumps election as u. S. President , and i will get to that in a few minutes, but i want to begin with the reports, because the reports, i think, reflect and demonstrate a rather surprising amount of agreement on this large topic of global govern yarnsion andance and i w six quick examples, also noting along the way some of the disagreements. But in the current climate, i think its important to emphasize those agreements. We agree that global challenges, of which there are many, require Global Solutions and that no single country is going to be able to address them effectively in isolation, that cooperation is the path that produces the most shared benefits, and that rulesbased approaches are usually better than ad hoc responses. Second area of agreement the main institutions of Global Governance established after world war ii remain essential institutions in the system of Global Governance. The chinese paper probably puts more emphasis on the United Nations and criticizes the u. S. For sometimes departing from u. N. Processes and norms, but the truth is, the u. S. Remains strongly committed to the United Nations, and truthfully, no country has a perfect record regarding the United Nations. Third, we agree that the established institutions of Global Governance need some reforms, taking account of new power relations, taking account of new realities. Yes, there are differences on what those reforms might be, but there is a shared agreement that we should be talking about what those reforms are. Fourth, we want each other, both the u. S. And china wants each other to be active players in Global Governance. There is some difference in the nuance that the United States has wanted china to be a full stakeholder. And china, by calling itself a developing country, has sometimes seemed to the u. S. To want it both ways. But recently by both ways, i mean being a partial stakeholder, but i dont think thats really a concern very much anymore. Its very clear that china has been stepping up and changing has changed both its selfunderstanding and its ambitions in playing a fullthroated, global role. Indeed, that may be creating some problems for the United States that are more substantial than china being a partial stakeholder. Fifth, we agree that the established institutions of Global Governance can be and already are in good ways being supplemented by various multinational mechanisms of governance. Now, not surprisingly, this is an area where i think a number of more substantial differences have surfaced in the two reports and in the discussions around those reports. The chinese has as has already been noted, has criticized the Alliance System, and the u. S. Considers that the Alliance System, especially in asia, or at least certainly in asia, has contributed to the stability of the whole region, which has allowed china itself to prosper, and we i think recognize in the u. S. That alliances come in a rather Broad Spectrum of different kinds of partnership and commitment. Another difference the u. S. Applauds chinas ambitions to make greater contributions to Global Development but has also expressed some concerns about whether these chineseled institutions will develop norms of adequate transparency and governance, and those concerns, among others, led the u. S. To decline to join aaib. But i think as we indicate in the u. S. Report that theres been a change of views on the u. S. Side, and the report recommends that the u. S. Consider ways of cooperating in aaib, and as you probably mostly know, a highlevel government u. S. Representative was recently sent to the belton forum, belton road forum, in beijing. The most complicated and difficult difference that has emerged i think in this area concerns the phrase liberal International Order and what that implies. That phrase, which is certainly widely used in the west to characterize the institutions after world war ii and after the fall of the soviet union, has elements of emphasizing markets, individual freedoms, rule of law, democracy. And china in its paper so indicates, indicates that thats a western ideological mindset, and it has been invoking, and this paper invokes, a different concept, in the paper called inclusiveness, and elsewhere ive seen the phrase diversity, in which Global Governance institutions are not guided by a liberal mindset, but welcomed as equals, illiberal political systems and are not about the business of changing those illiberal institutions. Its obviously a very hard, complicated topic that we dont have time to discuss, but its clearly an emerging one of great significance. The papers lastly agree on the areas where Global Governance is really needed, and you know those, and thats part why there is agreement economic architecture that addresses current realities and problems in globalization, addressing issues of cyberspace, terrorism, and Serious Problems of Climate Change. And that last example is the pivot to my sort of closing observations, which Climate Change as an example crystallizes the point i began with, which is that a central problem in the moment currently in the field of Global Governance is that our american president has already taken a sharp turn away from the decadeslong path of American Leadership in the global order. His slogan is America First. Hes begun a process of withdrawing from the paris climate accord. He scrapped tpp. Hes criticized nato. And hes given no sign yet of nurturing and focuses on the strengthening and building of institutions of global governments. So, its fair to wonder what is the fate of this project in the upcoming period, and i want to close by simply mentioning reasons why i think this current moment is not one that should prevent the efforts of People Like Us be developing and working hard on thinking through these ideas. And let me just mention quickly three factors. One, its early in the Trump Administration. We dont really know where this administration is going to go on these issues. Secondly, the United States of america is not just the period after Donald Trumps election until the next election. We will have a long future, and the issue of Global Governance is not a madeup issue. Its a response to realities that require international cooperation, and the United States will have a future after donald trump, which i believe will focus more, again, on issues of Global Governance. And lastly, in the present, right now, the United States of america is not just the National Government, and there are enormous numbers of actors who are working, in spite of what the National Government may be doing, to sustain and develop and be active in issues of Global Governance. And ill mention three. States. Under the american system, yeah, states cant sign international treaties, but they have sovereign powers, and they are standing up, and particularly after the announced withdrawal from the paris climate agreement. Take jerry brown, governor of california, 40 million people. He has organized other governors to take collective action to try to jointly meet the paris climate guidelines. He met with xi jinping in beijing. Xinhua news service had a headline that said president xi eyes bigger role for california in u. S. china relations. Interesting. And he invited california to join the belton road initiative. So, states. [ laughter ] states. Dont forget about them. Two, companies. Businesses are active in the enterprise of global guidelines, global judgments. And lastly, ngos, which play a distinctively strong role in the United States in galvanizing public opinion, helping on implementation of rules and sometimes even sitting at the table at Global Governance institutions. So, theres work to be done in the present, regardless of what the National Government is doing, and i consider this project, even in this Small Working Group on Global Governance, to be part of that. Thanks. Thank you, paul. Dr. Li . Thanks, chair, and the panel. Good presentation. And i also working on the Global Governance part of china side report. Id like to say that both sides of report is very positive and constructive. Please be sure youre close enough to the microphone. Okay. So that everybody can hear you. Okay. The china and u. S. Both believe that during the past eight years, both countries have made great contribution to the Global Governance issue, such as the protection of the environment and the cooperation of Global Economy and the long proliferation of the weapons of mass destruction, et cetera. And thats why in u. S. Report, it welcomes china to play a more active role in the future, and china also attach great importance to the bilateral cooperation on this area. The u. S. And china also reached comments on whats the future challenges facing by both sides. That is, we all called it a kind of uncertainty about the continuation of such a good cooperation. Both sides provide the observations and conclusions. Some conclusions are similar, such as we are concerned about trumps policy focus transfer from the global to the domestic, domestic will bring some negative effect on the future cooperation. And some conclusions are very different. For example, what impressed me most is that in the u. S. Report, when theyre talking about the future china maybe bring some kind of uncertainty to the Global Governance cooperation is that this in china want to change the Current System just because they think the Current System is developed by developed countries and particularly led by the u. S. Actually, its not true. Thats why in the chinas report, our Team Provides the basic attitude of china side to understand how to understand the whole system reform. I think we have two key points in this area. The first thing is china always think that reform, when its necessary, indeed, in the practical level, we all know that there are some specific mechanism have some problems that many of them cannot cope with new emerging challenges. So, thats why sometimes we need to take some reform measures to improve its efficiency. And the other key point is that reforms based on the consensus. That means no one country, no one stakeholder can do all the reforms on its own. It needs cooperate and it needs the worldwide consensus. So i think maybe there are some differences between china and the u. S. And on the basis of analyze of the future challenges, both sides also keep focus on how to get the differences and how to enhance our cooperation on the Global Governance issues. Both sides provide some basic suggestions or devices. Id like to conclude then with four key words, two from the u. S. Side and two from the china side. I think the most valuable key word from the u. S. Side, one is the mutual trust. That means both sides should judge one anothers Global Governance initiative based on its targets objectives but not simply on its ideological state. And the second one from the u. S. Side is that consensus, it means whatever happens in the governance system reform, we should cooperate and consult and make some consensus, just focus on the same consensus. We can make some reform measures, and i think the two words from china side, one is the practical. That means we should need more practical common actions to do some things, not just on the stage of keep arguing or keep plan i planning which we all know the process of governance, Global Governance, is actually a way of practice, which has been proved is the most efficient way to enhance communication and improve the cooperation. And the final key word from china side i think it should be the focus. That means that we know not only for china, but for the United States, the resources, the governments resources are always limited, and there are so many different Global Governance areas, we should allocate these resources effectively in different governance issues and keep the balance between the Global Governance and domestic governance at the same time so we should do something really efficient in this area. Id like to end up with another, how to say maybe a little bit of pity from the u. S. Side, you know. When were talking about this area of issues, our team really look forward to figure out how the u. S. Colleagues what kind of specific or practical actions of the projects and the different Global Governance issues. Thats why we spent a lot of time to discuss these kinds of questions. But comparing with the china side, i think the u. S. Colleagues make a very general conclusion on these specific areas, so i really look forward to hearing more specific details, about detailed information about the different governance issues this area. Id like to stop here. Thank you. Thank you. Well now move on to politics. Evan, would you like to lead off . Thank you, ambassador roy. Id like to begin by thanking csis and my chinese colleagues. When we embarked on this project, we werent sure exactly how it was going to go. Ive worked on collaborative projects between american and chinese scholars, many times before, and its a challenge for the obvious reasons. And as a result, they gave me the hardest topic of them all, politics. And it was the hardest because its so sensitive. Its, of course, sensitive in america, but its even more sensitive in china. Yet, the two teams worked together, persevered, and i think were able to generate very credible products. So, what id like to do is make three points about how i think politics impacts the u. S. china relationship and weave into that those comments, some thoughts about the differences, where views converge and diverge. And hopefully, make it policyrelevant. My first point is that when one looks at the u. S. china relationship, and i look at it from a very practical perspective. I was very fortunate enough to serve in the obama administrati administration, in the white house for six years, and i had six years at the control panel of the u. S. china relationship and see all the lights flash and the buttons whirl and figure out how this big relationship operates, and it was fascinating. And one of the lessons i took away from that, and there are many lessons and im still digesting them years later, is that this is a deeply, deeply mature relationship. And what i mean is, as of 2017, this is a 38yearold relationship, right . This is not a young kid. This is not an adolescent. Its not even a 20yearold. 38yearold relationship, which means america knows china and china knows america. Now, that doesnt mean we still dont have a lot to learn from one another. Were constantly changing and evolving as societies, as countries, but nonetheless, there is a big and rich data set that both sides can draw from in understanding the, sort of the pace, the scope, the tenor of the u. S. china relationship. And i think that the scope, the depth, and the quality of the papers in this particular project reflect that underlying maturity in the u. S. china relationship. I mean, look no further than the current period of the u. S. china relationsh relationship. The u. S. Arguably took four major actions against china last week taiwan, north korea, South China Sea, you know, all the sensitive areas. Did the bottom fall out of the relationship . No. Is the relationship in a rapid spiral downward . No, not really. Both president s talked a few days afterwards. Theyre going to meet on saturday. So, in other words, there are boundaries around this relationship that are shaped by politics, but nonetheless, i think its important to keep in mind maturity of the relationship. And that was point number one. Point number two, as we try and understand what these boundaries are and how we get things done and in the case of the work that myself and mr. Dink ao and others did on politics, when we look at how policies affect the u. S. china relationship, i think there is one distinction thats critical to understanding how to assess this relationship, and its a distinction that i have used before. Some of you have heard me refer to, which is distinguishing between the the structural features of the relationship, in other words, those features of the relationship that are enduring and probably arent going to change and will have a deep and profound effect on the ability to stabilize the relationship and to shape it so a distinction between the structural features of the relationship and the cyclical features, in other words, sort of the issues that come up on a daytoday basis. And weve talked a lot about a lot of them today north korea, taiwan, South China Sea. And certainly in the think Tank Community in washington, its fun and exciting and engaging to talk about those cyclical issues but dont have a longterm effect on the trajectory of the relationship, and in particular, what does the shape of that curve look like . And so, i think this is an important distinction because when one thinks about these issues of politics in the u. S. china relationship, that is deep structure. Thats something that probably isnt going to change any time soon. And its important that we not always get caught up in the daytoday debates about china, north korea, the South China Sea, thibaut, taiwan, et cetera, and instead focus on the structural features. There are two structural features that i think came out of our analysis of how politics impacts the relationship, and the first is that its clear that competition and the competitive aspects of the u. S. china relationship are coming to the floor, and thats not meant to be a dark or negative statement, but rather, a statement about sort of the balance of issues facing the u. S. china relationship. And Dave Finkelstein began to go down this pathway in the discussion of the militarytomilitary relationship, but these are not issues this is not a statement about issues that we should shy away from. We need to embrace the competitive aspect of the relationship, because thats the only way were going to manage them. And in fact, one of xi jinpings attributes is the fact that hes been relatively frank and open about the fact that there are disagreements, we have to talk about them, theyre going to generate competition. The question is not can we avoid competition, the question is what kind of competition is it . Is it competition that leads us both to improve our game and raise our capabilities, or is it destructive competition, militarized competition that runs the risk of instability and militarized conflict . So, competition is one structural aspect. The second is sort of what i refer to as resilience and stability in the relationship, because from my perspective, theres a big difference. And while i find that the u. S. china relationship is not always the most stable relationship theres lots of disagreements, we disagree regularly but its a relationship that is actually quite resilient. In other words, even though there is disagreement, even though there is competition, there is a sort of core of stability at the center of it that has, you know, bounded these disagreements in this competition from leading to, you know, a free fall. Now, thats something that could change, but its something that i noticed evolve over the the Obama Administration, and its one of these cyclical features that could become structural, depending on how the politics play out. So what does that mean for my assessment of the papers . Well, i would say these papers are an excellent compliment. They do two different things. They highlight different aspects of the relationship. The chinese paper was very focused on history, ideology and the way in which those issues affect chinese perceptions of the u. S. china relationship. I think the papers a very good description of how china bees ideology, and in particular this feeling that china is the victim, china has been wronged by the United States, and how that affects chinese perceptions of the u. S. And the u. S. china relationship. And its clear from the paper that china really holds on to these, and that even in 2017, that these issues affect chinese perceptions of u. S. Strategic intentions and the quality of cooperation that can be gained in the u. S. china relationship. I have to admit, i was surprised by the fact that there was so much discussion in the paper about the u. S. Trying to change chinas political system. And that that is a continues to be a core fear at the heart of the u. S. china relationship. And i say that because as somebody that spent six years in the white house, i was not in a single conversation with the president , the Vice President , the National Security adviser, where anybody said chinas political system is a threat to american National Security and we have to do Everything Possible to change it. Never once, never even remotely close. Now, that said, of course we have questions and concerns about human rights in china, the clampdown on political freedoms, because thats who we are and that is a structural feature of the u. S. china relationship, but that is very, very different than the kind of claims addressed in the paper. The u. S. Paper took a different approach. When mike and i were working on it, we focused less on history and ideology and more on institutions, actors, and changing american perceptions, and how the changing set of institutions, the fact that the executive branch appears to be playing a much more consistently active role in both formulating and implementing china policy, the fact that there is a broader set of actors in the United States influencing the u. S. china relationship the business community, we talked about ngos, and pauls great presentation reminded me of the importance of subnational act s actors, states in the United States, governor brown, for example, and the Important Role they can play in bounding competition, expandi ining cooperation. Now, does that mean ideology and history doesnt play a role in american perceptions of china . And i would say no. I would just say that in the u. S. , we dont really call it ideology. What we call it is International Relations theory. And what i mean by that is that there are different schools of thought in the United States about chinas strategic intentions. You have the and ill use two sort of stylized schools of thought to make my point. The spectrum is obviously far more diverse. On the one hand, you have the sort of offensive realist, john mersheimer, china wants this tributary system and will do Everything Possible to become the hedge month in east asia. On the other hand, you have a group of china specialists. I would maybe point to somebody like michael swains work. Excellent work, who tries to point out that china has a much more nuanced approach to the region. Its not trying to recreate a sino centric system, but rather, its trying to find greater space for its rise in east asia as it tries to protect its selfdefined economic and security interests. But my point is, in the United States we have our own competing schools of thought, and those have different influence on u. S. Policy over time. So, the chinese paper would benefit from a greater attention to actors, institutions, processes, and how those affect perceptions, and i think the u. S. Paper would have benefited from a little bit more discussion of sort of the range of schools of thought in the United States, because we have our own manifestation of ideological and theoretical lenses that inform our approach. Let me end with this point, which is, what does this all mean for the trajectory of the u. S. china relationship . And i am very much of the view that the evolution of the u. S. china relationship is one that is going to be determined by a series of ad hoc decisions by both sides. To put it differently, the future of the u. S. china relationship is a constant search for a stable, strategic Modus Vivendi between washington and beijing, but unfortunately, the search for that stable strategic Modus Vivendi is not going to occur at a potsdam or a yaltatype negotiation. I think many people in this room wish it were, that you could just have two leaders sit down, hash it out and move on. But rather, its going to be a series of ad hoc decisions. And the question is, will the Political Institutions in both countries, institutions, actors perceptions filtered through ideology and history allow that sort of series of actions to be one that takes the u. S. And china down a pathway toward a gradual convergence of interests, where theres both cooperation and competition, or one where the pathway looks darker . Thank you. Thank you, evan. And now mr. Diao daming. It is hard, even dangerous for sneaky people to talk about politics, but i will try my best. I am honored to have been part in the writing of the chinese part and to attend the so great panel here today. Actually, my research is focusing on u. S. Politics, so the process of writing for me is a very good chance to reconsider about chinese politics, about the u. S. china relations. I have to say that i have read the u. S. Report very carefully and especially the wonderful analysis about u. S. Congressional role in the u. S. china Foreign Policy making. I totally agree with the idea of ups and downs of congressional power. Comparably, the two reports, we have a lot of consensus. We all agree that domestic politics is one of the most factors shaping the u. S. china relations. Most importantly, we all believe that when the two countries Political Goals are consistent, the relations will make significant process. I think this is a very important consensus. Of course, we have some difference. Personally, i think the most maybe the biggest difference between the two reports is that the two sides seems think about the word politics in different ways. For the chinese report, we talk about politics as a very big issue, such as political system, ideology, or even the political stability, but the u. S. Report give me some impression about the decisionmaking process, especially the key players during this process. I think just because of this differen difference, the chinese report gives us a bigger political background and the filter of u. S. china relations and that the u. S. Report talks about how more discussion about the key details, such as congress, such as business community, ngo, even personal factor of the leadership. Personally, i think for a lot of issues, if you talk about if you focus more on the details, its very easy for people to find out some problem, even some not problem, but when you pay more attention on the overall history, the whole trend, maybe we may see a better filter. So, for why there is some difference . The reason for the difference maybe is the deficit of the mutual trust. It is that china and the United States still have doubts on how to look at each other, how to deal with each other. Of course, to some distance, china is still worried about some socalled political involvement of United States. And for the u. S. Part, maybe because of the diversity of the partisanship, so there are more and more different, even conflicting views on china or on chinese politics. Though for a long time, as evan mentioned, there is a long history of u. S. china relations, so we have a long time to try to resolve the difference gradually. But as both of us i mean, both of these reports mentioned that the subnational level relations, i think that is a personal choice now for us. It is a better choice for us to strengthen the u. S. The subnational relation between u. S. And china, such as the state to province, the citytocity, the countytocounty, or the local level. The subnational relation exchange cannot only bypass the socalled high politics disputes and maybe can improve a lot of peopletopeople exchange, such as economy trade, technology science, education and so on, and maybe it will be consolidated, the basis of the political relations. In addition, i think that as the chinese report mentioned that there is a situation that the u. S. And china confronting some kinds of the same challenges, the same problems, but the solution may be not the same. As we know, china is continuing the economy reform and they improve the welfare. And as we know, the Trump Administration proposed America First slogan and concerned more about the economy, the jobs, the immigration and other domestic issues, so maybe there is some more room for some kind of a mutual learning, mutual cooperation, for Mutual Benefit between our two countries. For new development of the political factors, since trump took place, i think on the chinese side, theres no big change. On the u. S. Side, maybe theres some new points should we talk about. One of them is that the unified socalled politics of Trumps White House brings more uncertainty to u. S. Foreign policymaking. Outside world totally have no idea about who at what time, how much influence on which issue. So, its a big uncertainty even for United States. Another point i want to raise is that in case of trumps unclear policy, u. S. Congress seems to once more dominate some foreign policies. For example, the taiwan policy. So, we can see the sales. We can see various bill named, titled taiwan trouble act, sponsored by marco rubio in the senate and Steven Thibault in the house. I dont think this trend is conducive to the Stable Development of u. S. china relations. My times up. Ill stop here. Thank you. We have run over our time. The panelists raised some fascinating issues that we could usefully explore for the next hour or two, but rather than eating into the time of the professor who will make concluding remarks, i will thank my panelists. And if you have questions, maybe you can call our members of the panel after the conclusion of our conference this afternoon. [ applause ] i want to thank the panel, especially ambassador stapleton roy. He is part of the senior group on behalf of senior china hands and veterans of foreign and defense policy who provided overall guidance and worked with john hamre to produce an overview paper. The chinese side also had a Steering Group with very distinguished scholars, diplomats, defense experts, and also produced an overview paper. And the principal author was our closing speaker, professor wang jisi. So its now over to you to sum up and tell us, what do we do next . What do we do here . Professor wang. Im not going to summarize, and im not going to tell you what to do. But i will have to say something. First of all, on behalf of ambassador fu ying and all the members on the Chinese Research group, we want to express our heartfelt congratulations on the release of your very comprehensive report, that is the u. S. Side, the report on the u. S. Side, and we also want to express our sincerest appreciation to csis for its collaboration with us and support to our joint effort. So, actually, well have two sets of reports, parallel reports. The beginning of this joint effort was the spring of 2016, and the able stewardship of ambassador fu ying, we initiated the Research Work on the future of u. S. china relations. The initiative has been endorsed and financed by the Chinese Academy of social sciences, a Global Think Tank is what it i dont remember the exact name of that. It is called Something Like global strategic studies think tank. And we have been in touch with Chinese Foreign ministry and other Government Agencies, senior diplomats, u. S. Embassy in beijing, and various u. S. Counterparts, individuals and institutio institutions. Its actually csis. We are very much indebted to their advice and support. The Research Team on the chinese side was composed of about 20 to 30 researchers, scholars, and policy analysts from numerous leading think tanks in china, actually, not simply from bej beiji beijing, but from shanghai and nanjing and elsewhere t. They included the academy of sciences, National Strategic studies, National Defense university, the pla academy of military science. Of course, my university, peking university, and chief university, shanghai institute, Shanghai Academy of social sciences, nanjing university, and many others. We held dozens of closeddoor debates and discussions. Some were smallgroup meetings. And we also held many meetings with our american counterparts in beijing, washington, d. C. , or new york city. The end result is the attorneys report publicized in both chinese and english, and we also want to thank csis for publicizing the chinese report, and the chinese report in both english and chinese are already edited in the volume, which will be published by the Chinese Academy of social sciences, published inhouse. I hope it will come out pretty soon. And in may of this year, we launched a rollout event in beijing similar to the one we are holding today in washington, d. C. We have people from csis and other think tanks from the United States. This is simply my story, the chinese side of the story. Equally important, or even more important, is the is that after a few rounds of consultations, csis made the decision to help us and to coordinate american think tanks to write a joint report write a report. Instead, the first idea is to write something called the joint report, like a publicity of teamwork collaborated by both sides. But because of the lack of communication, i mean, the means we are separated so widely, and we cannot reach consensus on every single issue, so we decided to do Something Like the shanghai communique. That is, we express our views and they express their views, and you can compare notes. We compared notes in the first place. So, the end result is two separate and parallel reports reflecting our views of several dimensions, like trade and economics, asiapacific, Global Governance, the impact of domestic politics, our bilateral relationship, and militarytomilitary relations. And also, of course, an overview. And we have frequent exchanges of views between the United States and chinese teams. When we have two premiums in washington, d. C. , and another in beijing respectively, we compared notes and we improved the quality of the papers. Substantively, we debated on the chinese side more than we publicized them. I mean, honestly, we have different views among the chinese on some issues. We dont have identical views on issues like north korea or, you know, sensitive issues in chinese Foreign Policy. Of course, generally, we have a consensus, but on specific issues, we dont have everything in such a group of, such a large group of 20 to 30 people, we cannot agree on everything. But what is available is generally the consensus on the chinese side. But the consensus is not necessarily the Government Point of view, and this is our think tank still in effort. We consulted the government, but we did not seek endorsement from Government Agencies. In our cooperation, im talking about a strategicoriented think tank cooperation, two things are striking to myself, to me. Im speaking for myself in this regard. First, the frequent, substantive, and the sustained dialogue and when we constructed the report, i cannot help but thinking about some earlier episode of the u. S. china relationship. In the early 1990s, the economic and cultural exchanges were influenced by the political storm in beijing, and then in the mid1990s, our Bilateral Dialogue was suspended by lee dong hwas visit. And then there was the Embassy Bombing incident in the late 1990s. So, the academic and scholarly exchanges between universities and think tanks of the two countries was often, very often interrupted by political events. But nowadays, especially since the beginning of this century, we have very intensified and extensive changes of views between think tanks. And i think personally speaking, i think the intensity and extensiveness of the sustained dialogue between the two sides, it sees what i know as the exchanges of views between china and other countries will have very strong ties with countries like russia and europe and many other countries. But i dont think, you know, the intensive our extensive dialogues are less frequent than our changes of views with the countries we have friendly relationship with, like russia. And to be very honest, if i compare this relationship with our relationships with south korea or japan, in recent years, unfortunately, sometimes the exchanges of views have been interrupted by unhappy events or happening. So, what does this tell us . This tells us we have reached a new level of maturity. And in the words of evan medeir medeiros, this reflects the resiliency of the relationship. The Second Striking thing to me is, of course, how much we are familiar with each others views and how much we know each other personally and individually. That includes some youngergeneration scholars and think tank people. In fact, because of the deepening understanding of u. S. Think tank like csis, a great number of chinese think tanks have been established in china in recent years. When we have specific issues to discuss or to debate, we know who we are going to talk to to seek advice from. And i would like to mention a paper i did with my friend, ken lieberthal, five years ago, and we coauthored the report on china u. S. Distrust. And this distrust was reflected in Evan Medeiros discussion on whether the United States wants to change chinas political system. That is what we see as a very deepened distrust. In thedistrust has been dispelled or reduced. My answer is no. I think the Strategic Trust has deepened and its become more extensive. But at the same time, have the two countries moving move closer to confrontation. Again, my answer is no. But why is that . Why the contrast between the two things . I can give some reasons that reflect, you know, the joint report, the parallel report. First, we increase mutual understanding. We share our more balanced views, the think tank views with larger with our separate respective domestic audiences. And we are much less influenced by, for instance, conspiracy theories. With conspiracy we can think about among the audience here if they dont have conspiracy, i dont know where we can have those conspiracies. And you know as well, and you know Chinese People and Chinese Government officials much better than before. So it is very difficult to believe in those conspiracy theories. Im not saying that theres no conspiracy, but conspiracies are not widespread. And second, we have more institutional languages, which are cushioning against possible conflicts between the two sides. We are helping Government Agencies to construct crisis prevention and Crisis Management skills and devices. This is what china is very good at. And also my friend also has talked as well. And third, despite this, the two countries enhanced their bilateral cooperation, and multilateral cooperation, reflected in the global governors and reflected on the papers on economics and trade relations. And what is not talked too much about is the booming tourism between the two countries. And the United States is more interested in one belt, one road initiative. And chinas best interest, best students continue to come to the United States for advanced studies. Im not extremely happy about that because im losing some of my best students who i want them to attend our graduate schools. But instead they go to the best universities in the United States. But at the same time, we have many very Good Students from the United States studying in china. So this give me somewhat more reason to be cautiously optimistic. I dont want to neglect the differences and the pitfalls and difficulties ahead. What i see as a new normal of the bilateral relationship, featured by increased cooperation and increased competition. And i do know competition is greater than cooperation is greater. Rising simultaneously. And another feature i see in the bilateral relationship is the increased degree of influence from domestic parties on both sides. And what should we do next . I dont have any good advice, but i think about more substantive and more collaborative projects. For instance, we can be somewhat more specific in discussing relations. One aspect is investment, trade, and we can talk also about more extensively security multilateral Security Architecture in the Asia Pacific Region. There are already proposals in that regard. So we can launch some joint programs on a great number of projects. And we should also try to bring countries like japan, south kore korea, india and russia into our collaboration. And we can even think of our joint effort to analyze situations in the middle east. This morning, i read very carefully a publication by your Vice President john ottman on china and the far east. In any sense, the joint effort has set up a think thank for cooperation in the future. Well continue to rely on csis as our partner. We are also trying very hard to reach out to other u. S. Think tanks and we also want to reach out to other universities in china to bring them together to cooperate with you. Thank you very much. [ applause ] on behalf of the american participants, i want to thing professor wong and ambassador fu ying who brought this idea to us. Everyone was interested, a dozen think tanks or universities at least heard her idea. We werent sure how it worked and i think it worked quite well. One, the good will and the candor of all the participants. Number two, we structured it in a way where each side had to think hard about how they thought about the others relationship. Third, because of Maria Sinclair and sun ying. An example of an American University graduate going to work for you, professor wang. The two of them herded these cats and we owe them special thanks and thank you for joining us. House republicans unveiled the 2018 budget plan today that includes 622 billion in pentagon spending, and 511 billion in nondefense spending. It calls for an overhaul of the u. S. Tax code. Cuts to medicare, medicaid and social security. But the budget doesnt detail the specifics of the tax changes and budget cuts. Tomorrow, the House Budget Committee will mark up the House Republicans budget blueprint for 2018. Live coverage starts at 10 00 a. M. Eastern on cspan 3. Earlier today Vice President mike pence spoke at the gathering of the National Retail federation to talk about healthcare. Heres a short highlight on what the gop and congress should do now. We are grateful for the efforts of Mitch Mcconnell and the vast majority of republicans who have worked so hard in the house and senate to keep their promise to repeal and replace obamacare. As the president said just earlier today, most republicans were loyal, terrific, and worked really hard. And there are no truer words. But last night, we learned that the senate still doesnt have consensus on a bil