A Fight Over Taiwan Could Go Nuclear
War-Gaming Reveals How a U.S.-Chinese Conflict Might Escalate
Since the end of the Cold War, most U.S. policymakers have been beguiled by a set of illusions about the world order. On critical issues, they have seen the world as they wish it were and not how it really is. President Donald Trump, who is not a product of the American foreign policy community, does not labor under these illusions. Trump has been a disrupter, and his policies, informed by his heterodox perspective, have set in motion a series of long-overdue corrections. Many of these necessary adjustments have been misrepresented or misunderstood in today’s vitriolic, partisan debates. But the changes Trump has initiated will help ensure that the international order remains favorable to U.S. interests and values and to those of other free and open societies.
As the administration’s first term draws to a close, Washington should take stock of the crumbling post–Cold War order and chart a path toward a more equitable and secure future. No matter who is U.S. president come January, American policymakers will need to adopt new ideas about the country’s role in the world and new thinking about rivals such as China and Russia—states that have long manipulated the rules of the liberal international order to their own benefit.
A new set of assumptions should underpin U.S. foreign policy. Contrary to the optimistic predictions made in the wake of the Soviet Union’s collapse, widespread political liberalization and the growth of transnational organizations have not tempered rivalries among countries. Likewise, globalization and economic interdependence have not been unalloyed goods; often, they have generated unanticipated inequalities and vulnerabilities. And although the proliferation of digital technologies has increased productivity and brought other benefits, it has also eroded the U.S. military’s advantages and posed challenges to democratic societies.
Given these new realities, Washington cannot simply return to the comfortable assumptions of the past. The world has moved beyond the “unipolar moment” of the post–Cold War period and into an age of interdependence and competition that calls for different policies and tools. To properly navigate this new era, Washington must let go of old illusions, move past the myths of liberal internationalism, and reconsider its views about the nature of the world order.
As the twentieth century drew to a close, the increasing number of countries that were embracing democratic ideals inspired pride in the West and high hopes for the future. A consensus formed that a convergence on liberal democracy would lead to a stable international political order. As the Soviet Union withered and the Cold War ended, U.S. President George H. W. Bush called for a “new world order,” a “Pax Universalis” founded on liberal values, democratic governance, and free markets. Several years later, President Bill Clinton’s 1996 National Security Strategy articulated a policy of engagement and democratic enlargement that would improve “the prospects for political stability, peaceful conflict resolution, and greater dignity and hope for the people of the world.”
This presumption of liberal convergence motivated the decision to allow China to join the World Trade Organization (WTO) in 2001. As Clinton said at the time, such an opening would have “a profound impact on human rights and political liberty.” The rest of the world would get access to Chinese markets and cheap imports, and China would get the chance to bring prosperity to hundreds of millions—which, many in Washington believed, would improve the prospects for democratization. It was a win-win.
But China had no intention of converging with the West. The Chinese Communist Party never intended to play by the West’s rules; it was determined to control markets rather than open them, and it did so by keeping its exchange rate artificially low, providing unfair advantages to state-owned enterprises, and erecting regulatory barriers against non-Chinese companies. Officials in both the George W. Bush and the Obama administrations worried about China’s intentions. But fundamentally, they remained convinced that the United States needed to engage with China to strengthen the rules-based international system and that China’s economic liberalization would ultimately lead to political liberalization. Instead, China has continued to take advantage of economic interdependence to grow its economy and enhance its military, thereby ensuring the long-term strength of the CCP.
China never had any intention of converging with the West.
While China and other actors subverted the liberal convergence overseas, economic globalization was failing to meet expectations at home. Proponents of globalization claimed that in an economy lubricated by free trade, consumers would benefit from access to cheaper goods, lost manufacturing jobs would be replaced by better jobs in the growing service industry, foreign direct investment would flow to every sector, and companies everywhere would become more efficient and innovative. Organizations such as the WTO, meanwhile, would help manage this freer and more integrated world (never mind its 22,000 pages of regulations).
But the promise that globalization’s rising tide would lift all boats went unfulfilled: some rose to extreme heights, some stagnated, and others simply sank. It turned out that liberal convergence was not a win-win: there were, in fact, winners and losers.
A populist backlash against this reality caught elites off-guard. This reaction intensified as malfeasance on Wall Street and the U.S. Federal Reserve’s misguided monetary policies helped bring about the 2008 global financial crisis. The generous bailouts that banks and financial firms received in its wake convinced many Americans that corporate and political elites were gaming the system—a theme that Trump seized on in his 2016 campaign. Years before Trump’s victory, however, many ordinary Americans had already come to see that globalization was hurting them. Working people directly experienced how free trade could hollow out communities as jobs and capital investments fled overseas. Even the chief economist of the International Monetary Fund, Gita Gopinath, acknowledged in 2019 that international trade had been very costly for manufacturing workers in the United States. Between 2000 and 2016, the country lost some five million manufacturing jobs.
A second illusion that has entranced U.S. policymakers is the idea that Washington could depend on international organizations to help it confront major challenges and that “global governance” would emerge with the help of American leadership. Since countries were supposedly converging on political and economic liberalization, it was natural to think that transnational challenges such as nuclear proliferation, terrorism, and climate change would replace interstate competition as the principal focal point for U.S. leaders. The conventional wisdom held that such threats could best be managed by international institutions.
That view presumed that since other countries were progressing inexorably toward liberal democracy, they would share many of Washington’s goals and would play by Washington’s rules. That belief tended to minimize the importance of national sovereignty and the fact that countries differ in how they organize their own communities. Even among democracies, there exists a high degree of variation when it comes to cultural, institutional, and political values.
Nevertheless, international institutions grew more expansive and ambitious. In 1992, UN Secretary-General Boutros Boutros-Ghali’s Agenda for Peace envisioned a world in which the UN would maintain world peace, protect human rights, and promote social progress through expanding peacekeeping missions. Between 1989 and 1994, the organization authorized 20 peacekeeping missions—more than the total number of missions it had carried out during the previous four decades.
Mission creep extended to individual UN agencies, as well. The World Health Organization—created in 1948 to prevent the spread of infectious diseases—pioneered a number of the UN's greatest accomplishments, including the eradication of smallpox and the near eradication of polio. But over the years, its scope grew dramatically. By 2000, it had begun to issue warnings on everything from food safety to cellular phone usage to air quality. This spread staff and resources too thin, crippling the organization’s ability to respond to genuine crises, such as the ongoing COVID-19 pandemic. During the initial outbreak, the WHO was relegated to the sidelines as national governments raced to secure medical equipment. The institution’s robust defense of China’s response to the pandemic demonstrated that the CCP had used its clout to co-opt the WHO rather than support its missions.
The trouble at the UN went far beyond the WHO, however. In 2016, Anthony Banbury, a career UN official who had recently served as assistant secretary-general for field support, wrote that the organization’s bureaucracy had become so complex that it was incapable of delivering results, creating a black hole into which disappeared “countless tax dollars,” as well as a long list of “human aspirations, never to be seen again.” Such lost opportunities have led to cynicism and have weakened the liberal international order from within.
Although liberal internationalism encouraged interdependence and multilateralism, it also rested on a faith in Washington’s ability to indefinitely maintain the uncontested military superiority it enjoyed in the immediate aftermath of the Cold War. In reality, U.S. military dominance is now challenged in virtually every domain. The United States is no longer able to operate freely in the traditional spheres of land, sea, and air, nor in newer ones such as outer space and cyberspace. The spread of new technologies and weapon systems and the pursuit of asymmetric strategies by adversaries have limited the U.S. military’s ability to find and strike targets, supply and safeguard its forces abroad, freely navigate the seas, control sea lines of communication, and protect the homeland. Nothing is likely to reverse these trends.
Since the 1990s, the United States has become more dependent on space for its national security, because so many military and intelligence functions depend on assets, such as satellites, that are based there. But China, Russia, and other states now have the ability to field antisatellite weapons systems. Meanwhile, private commercial activities in space have increased exponentially, as well. Since 2014, a majority of satellite launches have been conducted by countries other than the United States—primarily China, India, Japan, and members of the EU, further eroding the United States’ ability to maneuver freely in space and increasing the amount of debris orbiting the earth, which threatens all space assets.
U.S. military dominance is now challenged in virtually every domain.
In cyberspace, hardware and software vulnerabilities have emerged across military supply chains, potentially reducing the effectiveness of important platforms. In 2018, David Goldfein, the U.S. Air Force’s chief of staff, described the F-35 Joint Strike Fighter as “a computer that happens to fly”—and thus, like all computers, it is vulnerable to cyberattacks. That same year, the Defense Science Board warned that since so many weapons systems were connected, a vulnerability in one could affect others, too.
At the same time, bureaucratic requirements have made it harder for the military to innovate. More than 20 years passed from when the Joint Strike Fighter program was envisioned to when the first combat squadron of F-35s was declared operational. The military demands unrealistically high levels of performance, which companies, hungry for contracts, promise to deliver. Former U.S. Defense Secretary Robert Gates has bemoaned the armed forces’ unwillingness to settle for an “80 percent” solution that could actually be built and fielded in a reasonable time frame. Given how quickly countervailing technologies develop, these frictions in the U.S. defense industry pose serious questions about the country’s ability to fight and win wars, especially against near-peer competitors.
Meanwhile, Beijing and Moscow have developed so-called anti-access/area-denial weapons systems, which reduce Washington’s ability to project power in East Asia and Europe. China has developed and modernized its strategic and tactical nuclear weapons and has invested heavily in technologies to improve its conventional forces. Russia has built an array of exotic “doomsday weapons” and low-yield tactical nuclear weapons, despite arms control agreements with the United States. And both countries are also pouring resources into hypersonic weapons whose speed and maneuverability render conventional missile defense systems ineffective.
In addition, smaller rivals such as Iran and North Korea have continued to develop and refine their nuclear programs. Despite visions of a world in which no one could challenge American force, the era of U.S. military dominance proved to be relatively short.
Misplaced faith in the advantages of new technologies has not been confined to military affairs. As the digital revolution began, policymakers and business leaders were optimistic that these technologies would accelerate the spread of liberal democratic values—that “the age of information can become the age of liberation,” as President George H. W. Bush put it in 1991. A few years later, Clinton predicted that “liberty [would] spread by cell phone and cable modem.”
Over time, however, it has become clear that the same technologies that connect and empower people can also imperil freedom and openness and limit the right to be left alone—all elements of a flourishing democracy. Authoritarian countries have deployed digital technologies to control their citizens, with the (sometimes unwitting) assistance of Western companies. The CCP has developed the most sophisticated surveillance system in the world, for example, using facial and voice recognition technologies and DNA sequencing to create a “social credit” system that monitors China’s 1.4 billion people and rewards or punishes them based on their perceived loyalty to the party-state.
These practices are not limited to authoritarian governments—partly because Huawei, the Chinese telecommunications giant, has exported surveillance tools to 49 countries, including tools that employ artificial intelligence (AI). According to the Carnegie Endowment’s AI Global Surveillance Index, virtually all the countries in the G-20 have deployed AI-enabled surveillance technology, including facial recognition programs. Meanwhile, even as the CCP banned Twitter in its own country, Beijing and other governments have used it and other platforms to carry out disinformation campaigns abroad aimed at weakening democracies from within.
Trump, in his campaign and presidency, has offered some correctives to the illusions of the past—often bluntly and sometimes inconsistently. His departures from traditional ways of talking about and conducting foreign policy stem from an embrace of the uncomfortable truth that visions of benevolent globalization and peace-building liberal internationalism have failed to materialize, leaving in their place a world that is increasingly hostile to American values and interests.
Trump emphasizes the role of states in the international order, challenging an American tendency since the end of the Cold War to transfer power to international organizations. This has not meant unilaterally reducing the U.S. role in the world; rather, it has meant signaling respect for the sovereignty of others. Consider, for example, the administration’s strategy for a free and open Indo-Pacific region, which involves countering China’s excessive and illegal territorial claims in the South China Sea and bolstering the maritime security of other countries in the region, such as Vietnam, by providing them with equipment. Such measures draw a contrast with Beijing’s efforts to create subservient relationships in the region and establish spheres of influence.
More broadly, the Trump administration has applied the principle of reciprocity to various international institutions and norms. This has meant urging other powers to take more responsibility for their own security and contribute more to the strength of the Western-led order. Trump’s attention to burden sharing has “made NATO stronger,” according to NATO Secretary-General Jens Stoltenberg. Between 2016 and 2018, defense spending by NATO members other than the United States increased by $43 billion, and Stoltenberg has predicted that by 2024, such spending will increase by another $400 billion.
Trump has offered some correctives to the illusions of the past.
In trade and commerce, reciprocity has meant raising the alarm, louder than in the past, about China’s unwillingness to open its market to U.S. products and services and Beijing’s unfair practices, such as forced technology transfers and intellectual property theft. Experts estimate that since 2013, the United States has suffered over $1.2 trillion in economic damage as a result of China’s egregious abuses.
Trump’s use of tariffs as a trade tactic has underscored his willingness to take risks. Critics have decried the tariffs as radical departures from orthodoxy. In reality, the use of retaliatory tariffs to demand reciprocity is an American tradition that dates back to the presidency of George Washington. They are also used by countries around the world to enforce WTO decisions or counteract unfair subsidies provided by other states. Trump’s tariffs helped yield an initial agreement with China that, unlike any previous bilateral U.S.-Chinese agreement, includes meaningful commitments from Beijing to limit the theft of trade secrets, reduce forced technology transfers, and open Chinese markets to U.S. financial services and agricultural goods.
The ongoing negotiations with China are part of the Trump administration’s broader effort to mitigate the downsides of globalization, such as the vulnerabilities created by “just in time” supply chains and the deindustrialization of the U.S. heartland. In the words of Robert Lighthizer, the U.S. trade representative, in these pages, the goal is to support “the kind of society [Americans] want to live in” by acknowledging the dignity of work and always keeping American workers and U.S. national security in mind when crafting economic policy. Along those lines, one important measure was the administration’s strengthening of the Committee on Foreign Investment in the United States, which reviews major investments in U.S. companies by foreign entities and has helped to block Chinese companies from using investments to access key technologies developed by U.S. firms.
In accordance with the goal of enhancing American power, Trump has fulfilled his campaign promise to reverse the decline of the U.S. military—and has increased defense spending by almost 20 percent since 2017. Funding for nuclear modernization and missile defense has returned after years of neglect, and the Trump administration has established the Space Force. The Department of Defense has prioritized the pursuit of advanced technologies, such as hypersonic missiles and AI, as part of an overall focus on competing with other great powers. The Pentagon and U.S. intelligence organizations have also advanced the important operational concept of “defend forward” in cyberspace, which guides the United States to more proactively identify threats, preempt attacks, and impose costs in order to deter and defeat malicious cyber-campaigns.
No administration’s policies are without flaws or inconsistencies. The Trump administration has exhibited a tendency, shared by many of its predecessors, to rely too heavily on regional partners that are not always up to the job. One example is the confusion about the extent to which Washington could withdraw its forces from Iraq and Syria following the U.S.-led victory over the Islamic State (also known as ISIS). Consolidating U.S. gains there required understanding the limited capabilities of Washington’s partners in Syria, the mixed motivations of leaders in Iraq and Turkey, and the danger of leaving the field open to the Assad regime, Iran, and Russia. Ultimately, protecting U.S. interests has required a direct if modest American role.
The president and members of his administration have also been brash to the point of counterproductively alienating allies, especially in Europe. And tariffs have not always been applied in a strategic manner. It would have been better to seek unity in the contest against China rather than pick fights with allies and partners by imposing steel and aluminum tariffs on them in 2018.
No matter who is elected president in November, returning to a set of strategic assumptions designed for the unipolar moment would harm U.S. interests. Competition is and will remain a core feature of the international environment, and interdependence does not obviate that. If a Democrat wins the White House, he will likely require convincing that rivalry is an unalterable feature of the international system and that it would be a grave mistake to return to the premises of a bygone era.
If Trump wins a second term, his administration must focus on better implementing the policy shifts it has initiated, sending more consistent messages, and building stronger coalitions both at home and abroad. Whoever occupies the White House in January will need to understand that today’s multidimensional rivalries will not end in conventional victories. More broadly, policymakers and strategists need to move past their emphasis on achieving particular end states, since that springs from a mechanistic and ahistorical view of how politics works. In reality, as the historian Michael Howard argued, human acts create new sets of circumstances that, in turn, require new judgments and decisions.
Geopolitics is eternal. That is why competition persists no matter how much idealists might wish otherwise. A main objective of U.S. strategy, therefore, should be to prevent the accumulation of activities and trends that harm U.S. interests and values, rather than to pursue grand projects such as trying to determine how China or other countries should govern themselves. To do this, the United States must craft policies that aim to maintain regional balances of power and deter aggression by revisionist powers.
Geopolitics is eternal. Competition persists no matter how much idealists might wish otherwise.
Many on the right who favor restraint or retrenchment will be reluctant to embrace the idea of constant competition because they tend to discount the aspirations of other powers. If the United States is restrained, their argument goes, others will follow suit. History suggests otherwise. Many on the left will be reluctant to accept the idea of a rolling end state because they tend to believe that the arc of history is progressing toward a liberal convergence and view the push and pull of a competitive world as overly aggressive and likely to lead to war.
But recognizing the centrality of competition does not mean favoring the militarization of U.S. foreign policy, nor does it mean a drive to war. A wider acceptance of the competitive nature of geopolitics does indeed require a foundation of military power, but it also accentuates the need for diplomatic and economic tools of statecraft. Precisely because so much of today’s international competition happens below the threshold of military conflict, civilian agencies need to take the lead in maintaining order and shaping a landscape favorable to U.S. interests and values. But that will occur only once the mindset and culture of U.S. government agencies change to allow for a broader recognition of the competition now underway.
Going forward, U.S. foreign policy success will hinge on a clear-eyed approach to cooperation. Rather than seeing cooperation with other countries as an end in itself, policymakers should recognize it as a means to crafting a stronger competitive strategy. They must also grasp that genuine cooperation requires reciprocity. Margrethe Vestager, the EU's competition commissioner, perhaps put it best when she expressed the essence of this policy: “Where I come from—I grew up in the western part of Denmark—if you keep inviting people and they don’t invite you back, you stop inviting them.”
In addition, Washington needs to accept that global problems are not necessarily best solved by global institutions, which are accountable primarily to internal bureaucracies rather than to external constituencies. Such institutions can play useful roles as conveners and centers for information sharing, but they lack the operational capacity to act at scale; bureaucratic complexity prevents them from accomplishing broader missions.
Reconsidering global governance does not require rejecting liberal principles or abandoning an order based on them. But because only a handful of countries are committed to those principles, the goal should be to foster what the scholar Paul Miller has described as a “smaller, deeper liberal order” of industrialized democracies that would defend liberal values and serve strategic and economic purposes. The focus might be on creating mission-driven coalitions that could construct redundant supply chains, fund research in emerging technologies, promote fair and reciprocal trade, and cooperate on security issues. Such coalitions would be open to new members provided they shared U.S. interests and values and could bring capabilities to bear on key problems. The Cold War–era rules-based order began much the same way: as a U.S.-led group of like-minded states seeking to win a strategic and ideological competition against a common adversary.
Washington also needs to refresh its thinking about political economy and improve the capacity of U.S. government agencies to address the interplay of politics and economics. The United States will never be able to integrate its economic policies and political strategies as China does by putting its command economy directly in the service of the CCP's goals. But Washington should invest more in economic intelligence and make it easier to share such information across departments and agencies by establishing a national center for economic intelligence, perhaps modeled on the National Counterterrorism Center, as the scholar Anthony Vinci has advocated.
Moreover, the U.S. government must counter China’s massive investments in research and development in emerging technologies. Congress must fund public- and private-sector research in AI, high-performance computing, synthetic biology, and other strategically important technology sectors. And the State Department should also put economics front and center by giving economic officers more responsibility at embassies and by opening more consulates around the world, to better foster business and commercial relationships.
Finally, U.S. policymakers must accept that in the contemporary world, speed is a vital component of power. The ability to respond quickly to threats and seize opportunities enhances a country’s influence. Slow responses undermine democratic governance, since they reduce citizens’ confidence that their government can meet needs within a reasonable amount of time. This truth has been underscored by the current pandemic, at the beginning of which, owing in large part to China’s initial cover-up, governments around the world acted too slowly. U.S. government agencies need to introduce a new calculation: time to outcome. Armed with this measure, a policymaker might have a hope of identifying obstacles that need to be removed to get things done.
The goals of the liberal international order were laudable—and, in many cases, they were achieved against daunting odds. The world is safer, more prosperous, and more just than it once was. But the unexpected consequences of globalization and the unfulfilled promises of global governance cannot be overlooked.
In a world of great-power competition, economic inequality, and dazzling technological capabilities, where ideologies as well as pathogens spread with viral ferocity, the stakes are too high and the consequences too dire to simply stick with what worked in the past and hope for the best. Trump recognized this reality earlier than many in the U.S. foreign policy community. Whoever follows him—be it in 2021 or 2025—will need to recognize it, as well.
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