US-China relations will not be flushed down the toilet

One can be forgiven for assuming that US President Joe Biden’s administration ratcheting up the anti-China narrative was meant to escalate US-China tensions, flushing the world’s most important and complicated relationship down the toilet.

One example is Biden’s decision to investigate the conspiracy theory that the coronavirus that causes Covid-19 was manufactured in a lab in Wuhan, China, ordering his intelligence community to come up with an answer in 90 days.

Kurt Campbell, Biden’s China policy chief, lamented in a recent Stanford University speech that engagement with China was over, and that US policy on the Asian nation going forward would be confrontation.

A replay of Bush’s WMD investigation

Biden’s decision to investigate the origin of Covid-19, in some ways, was a replay of George W Bush’s justification for invading Iraq. Bush’s intelligence communities were ordered to find “evidence” that Iraqi president Saddam Hussein possessed “weapons of mass destruction” (WMD). But the “evidence” was manufactured, giving the US president an excuse to invade Iraq in 2003.

Similarly, it would not be a surprise if the US intelligence community found “credible” evidence that the SARS‑CoV‑2 virus was produced in the Wuhan Institute of Virology (WIV) and accidentally leaked, going on to infect more than 165 million and killing 3.5 million people across the globe.

Whether the conclusion will be based on new intelligence or a reiteration of reports that three WIV researchers fell ill and an unusual number of cars parked in a hospital’s parking lot in the autumn of 2019 remains to be seen. But Biden will have achieved his aim: claiming China is responsible for the pandemic and the huge losses of human lives and economic activities associated with the virus.

Surprise surprise, Biden, like Bush, also has an ally in the British intelligence service. Its spies now find the lab theory “plausible,” according to a May 30 Business Insider report. According to the same article, British intelligence is said to be recruiting sources to investigate the allegation.

The world, of course, has seen this movie before, when British prime minister Tony Blair testified that his intelligence community had credible evidence that Saddam Hussein possessed WMD. With that information, Blair joined Bush in attacking Iraq, but neither had a happy ending, losing credibility and damaging their legacies.

Impact of Covid origin probe

A similar outcome will likely be in store for Biden’s investigation into the lab-leak theory. It will do nothing to bring the pandemic under control, but will exacerbate anti-Asian hate crimes at home and sink the US-China relationship further.

Cooperation between the US and China on anything will likely be halted, putting Biden’s economic recovery plans, climate policies, etc at risk. For example, climate change cannot be addressed without cooperation between the two largest emitters of greenhouse gases. Not repealing Trump’s tariffs on Chinese goods will exacerbate their negative effects on US economic competitiveness, increasing production costs and consumer prices.

‘Conspiracy theories’ have legs

China will also demand that the investigation into the virus’ origin be extended to the US and other countries. Some scientists have reported that the coronavirus has three or more strains, and that the one that emerged in China was the second strain while the US had the first, suggesting that the virus found in China might have been imported from America.

That “conspiracy theory” gained traction when a number of American athletes participating in the World Military Games in October 2019 in Wuhan succumbed to a flu-like illness and had to return home.

One or more of those athletes were said to have lived near Fort Detrick in Frederick, Maryland, home to a major biological-weapons research facility. It was shut down temporarily in 2019 for poor safety-management issues, suggesting the coronavirus might have leaked from that lab.

Yet that “conspiracy theory,” which was first advanced by an American reporter and kept alive by China, that Covid-19 might have originated from the US or elsewhere is no more absurd than of the WIV-lab-leak one.

Covid-19 cases were said to have been detected in the US, Italy and Spain long before the Wuhan cases emerged. For example, postmortem analysis conducted by the US Centers for Disease Control and Prevention (CDC) indicated that Covid-19 infections and related deaths were found in the US in the summer and autumn of 2019.

Against this backdrop, China will demand that any “independent” investigation into the origin of the coronavirus be extended to the US and other countries. China will also demand a science-based determination of the origin of the virus. Both Chinese demands will likely have the the support of the scientific community.

The US, of course, will not allow any investigation on the origin of the virus on its soil, dismissing the Chinese demands as a “conspiracy theory.” US media will likely accuse China of attempting to shift blame for the pandemic to the US.

It will be interesting to see what Biden will do with the findings of the intelligence community. He might find himself between a rock and hard place. Conspiracy theorists in the US will likely push him to be more “tough” on China, but how tough Biden can be is another story.

Why Biden might want better US-China relations

Biden might want to reset the US-China relationship, because being “tough” has gone nowhere, as Trump’s anti-China policies attested. And there is no reason to believe that China will cave to “tough” US policies.

It must also be pointed out that China is not Iraq – it has the means to inflict unthinkable losses on the US if it is attacked. Second, it is not possible to decouple from China without significant costs to the US, because the two economies are deeply entwined. Simply put, Biden flushing the US-China relationship down the toilet would be akin to cutting off the US nose to spite its face.

All about politics?

So trying to pin the pandemic on China is all smoke and no fire, an attempt to garner support for Biden’s anti-China policies. But it is a big risk, putting America’s economic recovery and security at risk. From this perspective, Biden’s decision to investigate the virus’ origin might be nothing more than catering to the domestic audience.

Probable effects of confrontation

As for Kurt Campbell’s speech regarding confrontation against China as the way going forward, does he really know what he is talking about? Unless US allies such as Japan are willing to forgo their own national interests, there is no way that they will join America in an economic or military war against China.

It is well documented that such allies are highly dependent on China for their socio-economic well-being, the country being a major trading partner, as well as a source of international students and tourists. Equally noteworthy is that any US-China war will be fought on their soil, potentially costing many Japanese, Australian, Indian or Korean lives.

Furthermore, not all Americans hate China, and indeed, those who understand China and its importance to the US are urging Biden to tone down his anti-China rhetoric, and for good reasons. China is a major source of revenue for many US enterprises, including Boeing, General Motors, Apple and a host of others.

Chinese imports save the average American family around $1,000 per year, have stabilized inflation and kept interest rates low. Put another way, trading with and investing in China have in some ways promoted and sustained US economic growth.

Even if the US does not want to do business with China, other countries do. According to the United Nations Conference on Trade and Development (UNCTAD), China became the world’s largest destination of direct foreign investment in 2020, estimated at around $163 billion. This is because the world, including close US allies, sees China in a different light from America.

China, too, is not sitting idly by to allow the US to stifle its rise. Senior Chinese officials are traveling around the world to offer investment, trade and aid to countries hit hard by Covid-19. Judging from news reports, it is succeeding in Africa, Latin America, Eurasia and other parts of the world.

Indeed, many countries and international organizations, including the World Trade Organization and International Monetary Fund, are welcoming China’s pro-globalization stance.

So China is not isolated as some Western pundits would like the world to believe. And with a population of 1.4 billion and billions more in the developing world, not doing business with China may slow down its economic growth, but will not stifle it.

But the same cannot be said for the US. First, after decoupling from China, US production costs and consumer prices will skyrocket. Second, Biden’s policies on climate change will go nowhere. Third, sidelining China will make the world, including the US, a more dangerous place.

All this explains why Biden is reaching out to China while demonizing it at the same time. Cases in point are his defense secretary, Lloyd Austin, reviving US-Chinese military dialogue and his trade representative negotiating trade issues. Both would suggest Biden wants to reset the relationship rather than sink it.

Ken Moak taught economic theory, public policy and globalization at university level for 33 years. He co-authored a book titled China’s Economic Rise and Its Global Impact in 2015. His second book, Developed Nations and the Economic Impact of Globalization, was published by Palgrave McMillan Springer.