- This week's presidential debate and Trump's Covid-19 diagnosis and hospitalization contribute both to the perception and reality of Beijing's historic gains.
- Chinese officials are unlikely to use this moment of unanticipated U.S. distraction for any sort of dramatic move that might provoke Washington.
- At a minimum, however, Chinese officials will embrace this period as additional, welcome "breathing space" to escalate their ongoing efforts across a range of fronts to build upon their momentum.
As our new era of U.S.-Chinese major power competition accelerates, this week's train wreck of an American presidential debate, followed more dramatically on Friday by President Trump's positive Covid test and hospitalization, contribute both to the perception and reality of Beijing's historic gains.
Chinese officials are unlikely to use this moment of unanticipated U.S. distraction for any sort of dramatic move that might provoke Washington, such as a military move on Taiwan's independence to complement its recent actions to more fully control Hong Kong.
At a minimum, however, Chinese officials will embrace this period as additional, welcome "breathing space" to escalate their ongoing efforts across a range of fronts to build upon their momentum – from tightening party control on the Chinese private sector, to the accelerated development of a digital currency, to closing remaining technology gaps with the United States.
Recent events have also contributed to Chinese confidence that their single-party, autocratic system – for all its failings and inefficiencies – is better designed to provide public needs and political stability than the disorder of American and Western democracy.
Though Chinese officials have been cautious this week in their reactions to both the U.S. debates and President Trump's illness, commentators that typically reflect official views left little doubt that President Xi Jinping regards this past week as a powerfully positive one for the Chinese team.
"Such a chaos at the top of U.S. politics reflects division, anxiety of U.S. society and the accelerating loss of advantages of the U.S. political system," wrote Hu Xijin, editor of the English-language Communist party mouthpiece, the Global Times.
Commenting later in the week on the positive Covid tests in the White House, Hu Xijin underscored a message that's been sent consistently by Chinese officialdom to their global partners that U.S. institutions and leaders have failed badly in handling this year's crisis in comparison to their Chinese counterparts.
"President Trump and the first lady have paid the price for his gamble to play down the Covid-19," tweeted Hu Xijin.
Chinese leaders began more actively to question the durability of the American model, and the dangers in their dependence upon it, during the global financial crisis of 2008 and 2009. Chinese leaders now see 2020, burnished by their role as the first major economy to return to growth after Covid-19, as a chance to accelerate the global shift of power and influence in their direction.
Two Congressional reports released this week in Washington – one from the House Intelligence Committee and the other from House Republicans on a China Task Force -- underscored bipartisan consensus that the United States could be falling behind China in a multidimensional contest for the future.
In any other news week, both would have gained more attention for their findings and recommendations.
"What we found was unsettling," wrote Adam Schiff, the Democrat House Intelligence Committee chairman, in Foreign Affairs on the findings of a two-year study that concluded that U.S. intelligence agencies "are not ready – not by a long shot" to tackle the Chinese challenge.
"China itself views competition with the United States unfolding in ideological and zero-sum terms," wrote Schiff. He called for intelligence agency recruitment of a whole new set of individuals to develop skill sets to take on China's focus on "new domains, such as space and cyber, that would redefine existing conceptions of how a twenty-first century war would unfold, extending the battlefield to our political discourse, mobile devices, and the very infrastructure that modern digital communications and communities rely upon."
House Republicans Kevin McCarthy and Michael McCaul, writing in National Review on their task force's findings, warned, "…the United States stands to lose the future to today's Communist superpower." Their plan calls for a doubling of federal research and development funding for artificial intelligence and quantum computing over the next two years, ensuring that America leads both in setting international 5G standards and the fabrication of advanced semiconductor chips.
For its part, China is accelerating comprehensive efforts across political, technological and economic domains to ensure that they translate 2020's disruptions into historic gains.
President Xi has been nationalizing and taking measures to ensure party control over the actions of private enterprises, which provide 60% of the country's economic output and 80% of its employment. He's at the same time considering blacklisting foreign enterprises, and he jailed a prominent, uncooperative Chinese CEO, designed to send a message to all others.
The Chinese Communist party continues to bet big on internationalizing the RMB, where it still has had marginal success, and in winning the race for an internationalized digital currency, where international experts believe it may be leading. It is beta testing its digital currency in four cities, supported by the country's vast implementation of digital payments systems.
On the technology front, Chinese officials have been using U.S. lists of embargoed and controlled technologies as a crib sheet from which they are sharpening their own focus. Top of their priority list are semiconductor chips and computer software, electromagnetic technology, artificial intelligence, quantum computing, 5G, pharma, biotech, aerospace, robotics and automation, green technologies and the internet of things.
There's a tendency in today's Washington to underestimate Chinese weaknesses: It's lack of consumption as the economy recovers, its increasing debt issues, a graying population, international pushback against its bullying diplomacy, and its risky economic bets on its ambitious Belt and Road Initiative.
Yet a lot of weakness can be forgiven when your competitor keeps kicking what soccer fans refer to as "own goals." Chinese officials see President Trump's Covid contraction as a self-inflicted wound, given President Xi's elaborate and painstaking efforts to avoid infection and wean his country from Covid.
Irrespective of how and when President Trump recovers and who wins November's U.S. elections, President Xi is focused on how this period can serve China's long game and his historic legacy.
Frederick Kempe is a best-selling author, prize-winning journalist and president & CEO of the Atlantic Council, one of the United States' most influential think tanks on global affairs. He worked at The Wall Street Journal for more than 25 years as a foreign correspondent, assistant managing editor and as the longest-serving editor of the paper's European edition. His latest book – "Berlin 1961: Kennedy, Khrushchev, and the Most Dangerous Place on Earth" – was a New York Times best-seller and has been published in more than a dozen languages. Follow him on Twitter @FredKempe and subscribe here to Inflection Points, his look each Saturday at the past week's top stories and trends.
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