Authors: Dean Cheng and James Carafano

China as the most persistent and consequential foreign policy challenge that will confront the U.S. for the next several decades.

It compounds other threats to the U.S. like those posed by Russia and Iran.

The U.S. doesn't need simply a game plan for “managing competition” with China—it needs a strategy for winning.

The Communist regime in China—its global ambition, growing power, and values that are diametrically opposed to America’s own—is the greatest international danger facing the United States. Not just in its own right: It compounds other threats to the U.S. like those posed by Russia and Iran. The U.S. must have robust, practical solutions that vouchsafe Americans against the threats posed by China in every sphere, from security at home and national interest abroad to the values that infuse America’s role in the world. These responses must be comprehensive and encompass both foreign and domestic policies and every level of government.

In 2020, The Heritage Foundation launched the China Transparency Project, a collaboration with dozens of world-class data-oriented private research efforts.REF Our intention was to bring to light the full range of China’s impact on the world, identify gaps in knowledge, and create avenues for interdisciplinary exchanges. In conjunction with this effort, Heritage also released “Assessing Beijing’s Power: A Blueprint for the U.S. Response to China over the Next Decades.”REF That report was based on what we already know about China.

As that first Blueprint established, the worldview of the People’s Republic of China (PRC) is shaped by a history that is different from those of past American rivals. China’s millennia-long evolution, occurring in an Asian geopolitical context, has produced a nation that is far less accustomed to the concept of balancing powers. It also fundamentally rejects the rule-of-law approach to governance, both at home and abroad. Rather, it uses dominance—what has been called rule by law. Abroad, this is often called “legal warfare.” The ideology of the Chinese Communist Party (CCP) only intensifies this tendency.

This combination of authoritarian sources of behavior puts China directly at odds with U.S. domestic security and international interests, the protection of which should be the principal occupation of all American officials.

Although the U.S. government acted on a majority of the first Blueprint’s 59 recommendations, the competition between the United States and the PRC has only sharpened. Aggressive Chinese military activity around Taiwan, intrusions into the Japanese air defense identification zone (ADIZ), and open militarization of the artificial islands of the South China Sea have increased regional tensions. Nor has the focus on Russia’s attack on Ukraine ameliorated these conflicts. On the contrary, China’s growing influence has been felt all the more as Washington has urged Beijing not to support Russian aggression.

The other Chinese list, a “List of Key Individual Cases that China Has Concerns With,” includes allegations involving the rejection of Chinese student visa applications, unfair treatment of Chinese citizens by Americans, harassment of and attacks on Chinese diplomatic and consular missions, growing anti-Asian and anti-Chinese sentiment, and attacks on Chinese citizens.REF

In combination, these two lists are said by the Chinese to constitute a “tutorial on treating other countries equally.” From Beijing’s perspective, it is merely asking the United States not to “challenge, smear, or seek to subvert the Chinese path and system [i.e., CCP rule]”; “seek to interrupt or disrupt China’s development [including denying it access to technology it wishes to acquire]”; and “not violate China’s national sovereignty or territorial integrity [by supporting Taiwan or criticizing Chinese treatment of Uyghurs and citizens of Hong Kong].”REF

In reality, however, the Chinese are demanding that the United States compromise its sovereignty in order to show respect to the PRC. The United States should not prevent China from influencing its own students (via Confucius institutes); should allow Chinese media free rein in the United States (while limiting foreign media in China); and should defer to Beijing with respect to what China can purchase and how its companies behave. The high-handedness of China’s diplomacy reflects the extent to which U.S.–China relations have deteriorated.

Global rivalry with the PRC has become the primary concern for America. No other nation poses such a multifaceted threat to the United States—a far more comprehensive challenge than the Soviet Union ever was. We need to understand it, and we need solutions on a scale that can meet the challenge.

Economic. Comparisons are often made between the adversary the U.S. faces in China and the adversary it faced in the Soviet Union during the Cold War. Except for the centrality of the strategic challenge it poses, however, China is much different, and no aspect of the China threat differentiates it from the former Soviet threat as much as economic power does. Where the Soviet Union was largely autarkic, choosing to limit its trade with other nations, the PRC is the world’s largest trading stateREF and in 2021 was the leading destination for foreign direct investment.REF It is integrated into global supply chains, from car parts, pharmaceuticals, and information and computer technologies to “green energy” products like solar panels and batteries, as well as mineral mining and processing.

China’s nodes in some of these value chains, as in semiconductors, are far less advanced than those of the United States, South Korea, and Taiwan (which manufactures the world’s most advanced microchips).REF But by having an outsize role in areas from rare earths to the glass bottles for vaccines, China nonetheless occupies a central node in many global supply chains.

China is also increasingly a provider of foreign direct investment. Since 2000, China’s “go global” strategy has seen more and more Chinese investment abroad. Non-bond investment has included billions invested in the U.S., the U.K., Australia, Brazil, and Russia.REF These investments are distinct from the Belt and Road Initiative (BRI) spending that has dominated headlines and attention.

All of this, in one way or another, can be put at the disposal of the state, whether through Xi Jinping’s “Common Prosperity” program of civil–military fusion, which seeks to leverage advances in civilian technology to benefit the development of the Chinese military, or through the many other ambitious government programs that are directed at the “great rejuvenation of the Chinese nation.”

This makes for a complex operating environment for the U.S. Despite Beijing’s access to economic levers in pursuit of the CCP’s ends, much of the world emphasizes China’s importance as an economic opportunity rather than fearing it as a threat. China’s military is leading not with a military stick but with the carrots of economic investment and financing. The further from China’s immediate borders, the fewer sticks and more carrots it proffers. Even as the U.S. moves decisively to insulate its own economy from Chinese influence, it must acknowledge the Chinese economy’s attraction for others and find alternative ways to meet the economic needs of the countries it hopes to enlist to support it in the U.S.–China competition.

Political–Diplomatic. Beijing has employed its growing economic power to build ties to a variety of states. The Belt and Road Initiative has led to major Chinese influence around the world, using subsidized Chinese labor and materials to build infrastructure projects in a variety of countries. These projects, often built by Chinese state-owned enterprises (SOEs) employing a wholly Chinese work force, create both political and financial debts that Beijing exploits to expand its international footprint.REF The BRI has also helped to insulate China from criticism of its domestic policies, especially the genocidal policies toward the Uyghurs and repressive policies toward Hong Kong.

Technological. China’s economic prowess is paired with an active effort to foster the indigenous development of modern technologies. It is no accident that the PRC has invested massive amounts in its aerospace, commercial aviation, and information and communications technology fields. While centralized planning and direction are less efficient than free markets (and generate enormous waste and corruption and general resource and credit dislocations), they can nonetheless create short-term benefits, and Beijing has sought to exploit this in key areas of advanced technologies that will support them in the Information Age. This is complemented by an active espionage program that seeks to steal foreign technology and intellectual property through a range of measures that include both human and cyber espionage efforts.

Military. Nor has the PRC neglected its military. The recent National People’s Congress officially increased China’s defense budget by more than 7 percent for 2022, but the national economy was forecast to rise by 5.5 percent.REF Only rarely has the budget of the People’s Liberation Army (PLA) grown faster than the overall national economy. The PLA’s modernization efforts have included a range of advanced systems, including two stealth fighter programs, anti-satellite weapons, and an array of modern naval combatants. It has also included improved training and a steadily updated set of doctrines. The PLA remains on course to becoming fully mechanized, informationized, and “intelligence-ized” by 2027 when its current iteration of modernization efforts is expected to be completed.

The Russia–Ukraine war will only increase the challenge posed by the PRC. When this war concludes, Russia’s military will have largely expended its best munitions, lost much of its most advanced equipment, and suffered debilitating losses in manpower, especially among its officers. Consequently, Russia’s military will have to be extensively rebuilt, imposing a grave burden upon an economy that is the size of Belgium’s or Italy’s and will have been badly damaged by global sanctions imposed in response to Putin’s attack. For some time to come, Russia’s conventional threat will be relatively limited.

By contrast, China’s conventional forces (as well as its nuclear forces) are continuing to modernize. For the next several years, American decision-makers are therefore likely to be confronted by a Sino–Russian alignment that links Russian resources with Chinese technological and financial initiatives and proficiency. This adds a critical facet to and significantly augments the challenge that the PRC already poses to U.S. national interests.

For the United States, given the breadth of concerns about the PRC, it is essential to shape an equally comprehensive approach that is not only about military or trade, but also directly addresses threats to America’s interests and values in this complex environment.

Trade and Finance. Nothing is more urgent than ensuring that the United States economy is positioned for the long struggle that is shaping up between the PRC and the U.S. China’s leaders clearly understand that without a strong economy (including a firm foundation in advanced science and technology), they cannot hope to compete successfully with the U.S. Ironically, American leaders appear to be not only less confident in the ultimate success of our own approach, but also intent upon undermining American economic competitiveness by incorporating big-government and “woke” attitudes into the teaching of everything from engineering to mathematics.

It is not so much that America needs a more centralized planning system, whether in the guise of industrial policy or employment of subsidies, to pick winners and losers. Instead, for the United States to compete economically with the PRC, the government needs to get out of the way. This means doing everything necessary to raise the country from its disappointing place in the rankings of the world’s freest economies,REF from getting government spending under control to removing costly regulations to freeing trade. Education reform to enable greater focus on STEM (science, technology, engineering, mathematics) fields is also needed.

Massive deficit spending, on the other hand, especially spending on politically motivated social programs, only leads to the crowding out of capital for investment and other discretionary purposes, which in turn leads to higher interest rates and slower economic growth. Additionally, hampering trade prevents the most efficient deployment of capital and undermines the living standards of American workers.

The American economy also must become more resistant to Chinese power and manipulation. Areas ripe for exploitation by Beijing, in addition to supply chain nodes, include American telecommunication networks and the next frontiers of technology in areas like quantum computing and machine learning. It is not simply that China’s domination of these sectors makes it stronger and therefore a more capable adversary. The problem is the amply demonstrated integration of technology advancements into China’s military, espionage, and domestic security apparatus. The first threatens the U.S. abroad, and the second threatens it at home, in addition to which China’s authoritarian capabilities have become an ever more important part of its foreign policy.

Military. While the main focus of China’s competition with the United States is not military forces, the steady modernization of the PLA, including its expanding nuclear capabilities, cannot be ignored. The growth in PLA Rocket Force numbers, for example, will inevitably weigh on the minds of China’s neighbors as well as the United States.

China’s growing ability to engage in counter-space operations, as well as maritime and network operations, will complicate both regional efforts to safeguard national security and America’s ability to support allies in the event of confrontation. This, in turn, will require significant American investments not only in maintaining current force readiness, but also in improving current capabilities such as missile defense, air defense, and mine countermeasures while also exploring such new technologies as directed energy weapons, hypersonic vehicles, and various types of unmanned vehicles.

Supply Chains. As the COVID-19 pandemic and the Russia–Ukraine war have demonstrated, supply chains are extraordinarily complex, entangled systems. For example, while many assumed that China had the superior position in information and communications technology supply chains, the Trump Administration’s restrictions on American sales of microprocessors and software to China and its enlisting of allies to do the same exposed Chinese vulnerabilities.REF Similarly, the Russia–Ukraine war has led to trade disruptions that range from reduced microchip production due to lack of Ukrainian neon to higher food prices due to disruptions in Russian and Ukrainian wheat sales and shortages in fertilizer.REF Limiting China’s role in American supply chains has the potential to affect a wide array of industries, in many cases unintentionally.

Moreover, it is essential to recognize that government cannot create supply chains. They grow organically out of the interaction of thousands of companies and millions of individuals. More often than not, when Washington tries to dictate the shape of supply chains, it succeeds only in imposing competitive disadvantages on American companies and costs on citizens.

What government can and should do is ensure the security of the supply chains on which its businesses and citizens depend. For example, no one would countenance relying on Russia or China for the supply of fighter aircraft for the U.S. Force or satellites for anti-missile early warning purposes. Huawei should not be the supplier of National Security Council cell phones. Conversely, purchases of Russian timber or Chinese drywall are not likely to have a national security implication. It is items like Chinese rare earths and telecommunications equipment that pose the real challenge to decision-makers.

This has real security implications, for example, if the United States is really going to try to transition toward a carbon-neutral energy picture.REF Shifting away from fossil fuels, whether coal, oil, or natural gas, in favor of renewable energy sources such as solar and wind will lead to an increase in dependence on China, which dominates battery manufacturing and has a commanding position in certain parts of the rare earth supply chain. Similarly, the PRC is one of the world’s largest producers of solar panels and windmills.

Consequently, rather than reverting back to a situation of foreign reliance, the United States needs to be thinking about how it can better exploit domestic energy sources while also establishing commercial and diplomatic ties to non-Chinese sources of key materials.

Taiwan. Russia’s attack on Ukraine has brought the issue of Taiwan to the forefront. Many analysts have questioned whether the Russian invasion of Ukraine might see an Asian counterpart in a Chinese invasion of Taiwan. While the Chinese likely prefer to win without fighting and have many tools at their disposal to do this, the valiant defense waged by the Ukrainian people likely gives them further reason for pause. Nevertheless, Beijing has never renounced the option of using force to reunify the country.

The successful employment of such weapons as Javelins, Switchblades, and Next Generation Light Anti-Tank Weapons (NLAWs) suggests that a successful amphibious invasion of Taiwan is hardly a foregone conclusion. Clearly, with the right mix of weapons, Taiwan might well be able to stall a Chinese amphibious-led assault, one of the most difficult of military tasks. Ensuring that Taiwan has both military and political support, however, will remain a major task for the United States in the coming years. So will ensuring that Taiwan can withstand peaceful coercion into unification with the mainland. This will involve giving Taiwan the confidence that the U.S. has the capability to help defend it if required to do so, helping it to maintain its active and independent international engagement, and providing it with the means to contribute to its own defense.

Human Rights. The CCP clearly feels entitled to criticize other nations, including the U.S., for their human rights situation, as reflected by various statement from China’s “wolf warrior” diplomats. This only reinforces the need to keep the spotlight on China’s human rights abuses. Whether it is ethnic minorities such as Tibetans and Uyghurs, the citizens of Hong Kong, or human rights lawyers and other advocates for civil society, the list of abused citizens in China is long.

U.S. commitment to principle is a strength in its international engagements, not a weakness. It helps Washington to build connections with other democracies as represented by our treaty allies and arrangements like the Quadrilateral Security Dialogue (the Quad).

Countering Chinese Espionage. One particular area that the Administration has chosen to neglect is countering Chinese espionage. The abrupt ending of the Department of Justice (DOJ) China Initiative gives the appearance of choosing to accede to Chinese demands to “stop harassing” Chinese businessmen and scholars. The reality is that investigating alleged instances of Chinese espionage is a way to safeguard American intellectual property, not to mention economic and security well-being, rather than a sign of racial bias.

If Beijing did not specifically target overseas Chinese, the instances of Chinese espionage would likely be far lower. Similarly, CCP pressure on Chinese citizens from all walks to engage in intelligence collection places the onus for bad behavior on the CCP, not on the law enforcement agencies that try to counter them.

Because of the span of China’s challenge, the United States must respond comprehensively. Economic, military, and diplomatic measures alone will not counter the PRC unless they are undertaken in a coordinated fashion. Consequently, a wide range of recommendations should be considered in concert rather than simply within a particular category.

Strengthening America’s Economic Competitiveness

Nothing is more important than getting the American economy back on track. Without the economic sinews, no other efforts can be sustained. Not only does revitalizing the American economy provide the U.S. with the means to counter China, but it also provides clear evidence of the viability of the American approach to other countries, reassuring friends and allies and deterring other potential adversaries. To achieve this goal, it is essential to:

Promote domestic production through economic reform at home. It is vital both that the American economy become more efficient and productive and that it attract more investment from domestic and foreign sources. This means reviewing many of the regulations that now strangle small business and frustrate efforts at innovation.

One of the strengths of the American economy has been its participation in the global trading system. This not only generates economic benefits, but also creates segments of foreign interests and populations that support the United States for economic as well as strategic reasons. This approach has been so successful that the PRC has deliberately chosen to make itself a trading power as well. The United States needs to support trade and investment while addressing China’s efforts to undermine the very system it also exploits. At the same time, it is hardly in America’s interest to strengthen China’s military–industrial complex. China’s opaque nature, however, makes it harder at times to discern where the PLA is an active, much less passive, player.

It is in America’s interest to limit the ability of China’s military and security services to exploit American financial systems or companies. This must be done in full recognition of the fact that, while there are distinct differences in governance between state-owned and private companies in China, no China-headquartered enterprise is immune to CCP dictates.

Refrain from helping China in areas that directly threaten U.S. interests. Americans should not, however unwittingly, support Chinese ambitions in areas that could adversely affect U.S. national interests

Prevent the diversion of U.S. government resources to China. The value of government support, beyond what the private sector and universities would provide on their own, is itself open to question. Taxpayer-funded activity would merely add to the problem.

Insulate the U.S. economy from Chinese abuses. China protects its own economy and national interests while cheating and gaming the international trading regimes and the laws of its trade partners.

Limiting China’s Access to and Influence on American Educational Institutions

One of the most pernicious aspects of China’s policies has been the undermining of freedom of inquiry and thought at American universities. The use of student tuitions, Confucius Institutes, and grants as leverage to gain access to American research and suppress “unfriendly” points of view is a reminder of how China sees foreign universities as part of the battleground.

Increase scrutiny of collaboration between American universities and the Chinese state. Although universities, often under pressure from the federal government—particularly the Department of Defense (DOD)—have pulled back on cooperation with Chinese authorities on the establishment of Confucius Institutes, China has adopted new models to gain the same effect.

Require U.S. schools and universities to disclose financial ties to Confucius Institutes. Congress should require universities and K–12 schools to disclose their financial ties to Confucius Institutes —nationwide propaganda organizations masked as cultural institutions and sponsored by the Chinese government. Shortly after taking office, the Biden Administration withdrew a rule proposed late in the Trump Administration that would have done this. Congress should require that the rule be reinstated. As for the Institutes’ purported purpose of encouraging the study of Mandarin, there are other ways to ensure that a sufficient pool of Mandarin speakers is available for U.S. government service.

Extend CFIUS authorityREF to include review of education grants. Chinese money comes with strings. Congress, under the Higher Education Act of 1965, should extend CFIUS authority to evaluate whether foreign malign influence or espionage activities against American institutions of higher education are being directed or directly assisted by the Chinese government and to review certain foreign gifts to and contracts with American institutions of higher education.

Require universities to disclose all grants or be denied further U.S. government funding. As the DOJ’s now-suspended China Initiative indicated, China is actively trying to recruit American professors and gain access to American university research programs. This is a violation of U.S. laws regarding the acceptance of foreign funding by individuals and organizations that are receiving money from the U.S. government. It is essential that universities exercise oversight of their professors even as they receive U.S. government funding.

If a university department accepts U.S. government funding, then any researcher who accepts foreign funding or grants in violation of the law should be prosecuted, and all funding to the department should be suspended. Similar policy should also be enacted by state legislatures to apply to institutions that receive state funding.

Amend the National Defense Authorization Act, which prohibits DOD funding of institutions with Confucius Institutes, to cover other Chinese organizations with a similar purpose as well. As outlined in a June 2022 National Association of Scholars report, After Confucius Institutes: China’s Enduring Influence on American Higher Education, China’s government “has persuaded American colleges and universities to reopen and rebrand Confucius Institute programs [that have been shut down, often due to this restriction on funding] under new names.”REF

Look at additional steps. NAS made several other recommendations, including:

Establish the principle of information and education reciprocity in U.S.–China relations. Even controlling for current restrictions, Chinese educational organizations like Confucius Institutes and their successor programs have broad access to the United States.

The U.S. should insist that American non-governmental organizations (NGOs) be granted the same level of access to China that Confucius Institutes and their successor programs enjoy in accessing the United States and that American NGOs in China be accorded the same treatment that is granted to PRC organizations. Otherwise, comparable Chinese organizations should be prohibited from operating in the U.S.

Protect against espionage. American research universities engage in sensitive research on behalf of both the private and public sectors. They are therefore ripe targets for espionage.

Countering the Influence of Chinese Agents and Entities Operating in the U.S.

Standing up for American Values

The United States must remain true to its principles, one of which is the worth of the individual—a position diametrically opposed to that of the CCP. The United States must continue to speak out about a range of issues, including China’s treatment of ethnic groups such as Uyghurs and Tibetans, its treatment of the residents of Hong Kong, and its suppression of freedom of religion and expression among its entire population.

Designate Uyghurs and Hong Kongers as groups of special humanitarian concern by extending Priority-2 (P-2) refugee status. If granted P-2 status, Uyghurs and Hong Kongers can bypass U.N. High Commissioner for Refugees (UNHCR), embassy, and NGO referral by applying directly to the U.S. for refugee designation and resettlement. Applicants are subject to the same vetting that applies to all other refugee categories. Such a process recognizes the severity of the crisis they face by facilitating their application process for resettlement.REF

Create and appoint a Special Coordinator for Xinjiang. Similar to the Special Coordinator for Tibet, the Special Coordinator for Xinjiang would be tasked with coordinating the policy and response of the U.S. government on a day-to-day basis and would signify the priority the U.S. places on responding to the crisis in Xinjiang.

Increase the Customs and Border Protection (CBP) Forced Labor Division’s funding and expertise of the. Even before passage of the Uyghur Forced Labor Prevention Act, CBP’s Forced Labor Division was understaffed and inadequately resourced. In mid-2020, for example, the division had only 13 employees. Before Congress passed the UFLPA, in an April 2021 letter to the House Appropriations Committee, House Democrats called for $25 million in additional resources to combat forced labor. While funding alone will not counter China’s use of forced labor, it is arguably a prerequisite.

To meet the need for expertise, the U.S. government should also consider collaborating through detail programs from the U.S. Departments of State, Labor, the Treasury, and any other relevant agencies to ensure interagency coordination of the UFLPA and to burden-share expertise within CBP’s Forced Labor Division. Job priorities could include identifying individuals to be sanctioned, determining how to respond to China’s rapid exportation of surveillance technology, prioritizing resettlement of Uyghur refugees, pressing for the release of Uyghur and Uyghur-American family members currently held as political prisoners in China, and ensuring that the issue of Xinjiang is raised at key diplomatic moments with China. This coordinator could also be responsible for pressing China for access to and eventual closure of the PRC’s political reeducation camps, among other tasks.

Chinese agents and China’s intelligence agencies are actively supporting other PRC activities in the United States that range from intimidating and even trying to remove dissidents to engaging in espionage against economic, political, and military targets. The FBI opens a counterintelligence investigation related to China about every 12 hours, and there are more than 2,000 active investigations in all 56 field offices.REF Simultaneously, nation-state–sponsored cyberattacks and threats, many of them emanating from China, continue to threaten American critical infrastructure and small businesses.REF American intelligence and law enforcement agencies need resources to counter these Chinese activities.

Improve publicly available information. The first line of defense against Chinese designs on the homeland is a well-informed citizenry.

Prioritize countering Chinese espionage and intelligence activities. Chinese espionage is a major CCP tool, as it generates benefits for the PRC’s economic, military, intelligence, and political initiatives. Countering Chinese espionage efforts in the United States is essential, if only to stanch the bleeding of intellectual property and various secrets.

The DOJ’s China Initiative played a key role by not only dedicating resources to countering China’s varied efforts, but also by signaling within the DOJ the priority accorded this effort. It is vital that the DOJ revive the China Initiative against an adversary that is mounting so extensive a campaign that the head of the FBI once said that he started a new investigation every 12 hours.

Support a vigorous interagency effort. Professionals in government agencies see the threats and often know what to do, but they are stretched thin and need resources.

The United States cannot counter China on its own. It does not have the preponderance of resources, nor does it have the absolute support of the region’s leaders and populations. Countering the PRC will require a reinvigorated diplomatic effort, including more substantial outreach to various nations in Asia. As important, the United States should not court these nations alone. Long-standing allies have important resources and ties that can be leveraged to help counter China’s influence and pressure. This includes efforts to work with NATO, other European partners, and America’s Quad partners: Japan, India, and Australia.

Give development assistance a clear strategic focus. When it was proposed, the Development Finance Corporation (DFC) was billed as a new tool to advance U.S. strategic interests and enable countries to seek infrastructure investments that are free of the strategic baggage that accompanies China’s BRI. Unfortunately, this goal was not explicitly included in the legislation, and project selection has not reflected this priority.

Congress should reform the Better Utilization of Investments Leading to Development (BUILD) Act of 2018,REF the legislation that created the DFC, to make countering Chinese influence explicit in the DFC’s statement of policy and purpose. The DFC should be required to report to Congress on how it has incorporated this goal into its project selection process and assess its impact in meeting this objective, especially in energy, transportation, infrastructure, mining, and other sectors that are the targets of BRI efforts.

Countering China in International Organizations

For too long, the United States and the West in general have ignored China’s inroads into various international organizations—inroads that too often have enabled China to achieve easy wins, helping it to expand Beijing’s influence, shut out Taiwan, and limit any Western reaction. China has managed to install allies in key international organizations, many of which play an outsized role in setting international norms and standards.

Rebuilding America’s Defenses and Strengthening Its Posture in the Pacific

While there is a need to implement changes in American trade, diplomacy, and intelligence policies to counter China, there is also a continuing need to rebuild American defense capabilities. During the past two decades, the U.S. military has focused on counterinsurgency rather than on preparing for war with a peer competitor that is able to operate in force on the land, in the air, at sea, and in outer space. America’s armed forces need to restore their focus on preparing for a conflict with a nation like Russia and China rather than countering insurgents in Afghanistan and Iraq.

The United States is not looking for a war with China. At the same time, however, it must make clear that further Chinese aggression and expansion will incur a heavy price.

Confront Chinese expansion in the South China Sea. China’s island-building in the Spratlys was a preamble to militarizing those same islands. It may make another move in the east on land features that include Scarborough Shoal and Macclesfield Bank. If China is allowed to succeed in this, it will have locked up the South China Sea, through which some $5 trillion in trade moves every year and through which the U.S. Navy must move to meet any contingency to the north.

Taiwan remains the most dangerous flashpoint between the United States and the PRC. China has never relinquished its right to use force to compel the island of 23 million to rejoin the mainland. The United States has long stated its interest in a peaceful resolution of the Taiwan Strait situation. Those two perspectives appear ever less compatible. Under the Taiwan Relations Act,REF the United States is committed to helping Taiwan defend itself, but we should be careful to avoid the assumption that we necessarily know how best to do that.

The Heritage Foundation’s first China Blueprint identified China as the most persistent and consequential foreign policy challenge that will confront the U.S. for the next several decades. Nothing has happened in the two years since then to change that judgment.

Cold War analogies to the current confrontation with China are imperfect, but when Ronald Reagan summarized his strategy for the Soviet Union as “We win; they lose,” he captured something enduring about the way Americans approach competition. What the U.S. needs today is a game plan not for “managing competition” with China, but for winning.

Dean Cheng is a Senior Research Fellow in the Asian Studies Center at The Heritage Foundation. James Jay Carafano, PhD, is Vice President for the Kathryn and Shelby Cullom Davis Institute for National Security and Foreign Policy and E. W. Richardson Fellow at The Heritage Foundation.

Former Senior Research Fellow, Asian Studies Center

Vice President, Kathryn and Shelby Cullom Davis Institute