Competition With China Can Save the Planet
Pressure, Not Partnership, Will Spur Progress on Climate Change
Every so often in the history of the United States, there are moments of political realignment—times when the consensus that defined an era collapses and a new paradigm emerges. The liberal era ushered in by President Franklin Roosevelt defined U.S. politics for a generation. So did the neoliberal wave that followed in the 1980s. Today, that era, too, is coming to a close, its demise hastened by the election of President Donald Trump and the chaos of the coronavirus pandemic.
The coming era will be one of health crises, climate shocks, cyberattacks, and geoeconomic competition among great powers. What unites those seemingly disparate threats is that each is not so much a battle to be won as a challenge to be weathered. This year, a pandemic is forcing hundreds of millions of Americans to stay at home. Next year, it might be a 1,000-year drought that devastates agriculture and food production. The year after that, a cyberattack could take out the power grid or cut off critical supply chains. If the current pandemic is any indication, the United States is woefully underprepared for handling such disruptions. What it needs is an economy, a society, and a democracy that can prevent these challenges when possible and endure, bounce back, and adapt when necessary—and do so without suffering thousands of deaths and seeing millions unemployed. What the United States needs is a grand strategy of resilience.
For psychologists who research child development, resilience is what enables some children to endure traumatic events and emerge stronger and better able to navigate future stresses. For ecologists, resilience is an ecosystem’s ability to resist, recover, and adapt to fires, floods, or invasive species. For emergency, disaster relief, and homeland security experts, a resilient system is flexible, adaptable, and can withstand an impact. The writer Maria Konnikova has summed up the concept with a single question: “Do you succumb or do you surmount?”
The highest goal for American policymakers should be to preserve and defend the country’s constitutional democracy while enabling Americans to thrive regardless of their race, gender, location, or origin. A society that achieves that goal will be better prepared to face the next crisis. A more equal and more just nation is a more resilient one.
Although Americans tend to think of grand strategy as an overarching foreign policy vision, any true grand strategy requires a solid domestic foundation. The United States’ Cold War policy of containment, for instance, had a domestic analog, although it is less emphasized in the foreign policy community. For a generation after World War II, Democrats and Republicans alike embraced a model of regulated capitalism, with high taxes, financial regulations, strong unions, and social safety net programs, and thus charted a path between the totalitarian control of the Soviet Union and the laissez-faire approach that had plunged the United States into the Great Depression. Regulated capitalism and containment together were the grand strategy that defined the post–World War II era. A grand strategy of resilience, likewise, will not meet with success unless the United States addresses the many forms of inequality, fragility, and weakness that undermine the country’s preparedness from within.
“Grand strategy” is a slippery term, with perhaps as many definitions as authors who invoke it. It can describe a framework that guides and focuses leaders and societies on their aims and priorities. Critics of the notion believe this is impossible: no paradigm, they say, can help navigate a chaotic, uncertain future, and in any case, U.S. society is too polarized to identify a consensus paradigm today. But the skeptics have it backward. Grand strategy is won, not found. It emerges from argument and debate. And it is useful precisely because it offers guidance in a complex world.
Start with pandemics. For hundreds of years, quarantines have been essential to preventing the spread of infectious diseases. But today’s stay-at-home orders have exacted a devastating social, economic, and psychological toll on individuals and communities. Small businesses that are closed may never reopen. Tens of millions of people are out of work. Families are struggling to juggle childcare, homeschooling, and working from home. The government’s goal should be to minimize those disruptions—to build a system that can prevent economic disaster, secure supply chains for essential materials, and massively scale up production and testing when needed.
The United States needs a democracy, an economy, and a society that can endure, bounce back, and adapt.
Climate change could pose an even bigger threat. A sustained drought, akin to the one that created the Dust Bowl during the Great Depression, could threaten the global food supply. Rising sea levels, especially when coupled with storms, could flood low-lying cities. Fires already disrupt life in California every year. Climate-induced crises will also lead to population migrations globally and, with them, social unrest and violence. Part of the answer is aggressive action to limit increases in temperature. But in addition, the United States must be able to endure climate shocks when they arise.
Consider also the country’s dependence on technology and the vulnerabilities it entails. Cyberattacks have already targeted U.S. election systems, banks, the Pentagon, and even local governments. The city of Riviera Beach, Florida, was forced to pay a ransom to cybercriminals who had taken over its computer systems; big cities, such as Atlanta and Baltimore, have faced similar attacks. Cyberattacks on the U.S. power grid, akin to the one that led to blackouts in Ukraine in December 2015, could “deny large regions of the country access to bulk system power for weeks or even months,” according to the National Academy of Sciences.
All these challenges will play out at a time of growing rivalry—and especially geoeconomic competition—among great powers. Over the last half century, the United States has been the world’s most powerful economy and has thus been relatively safe from outside economic pressures. But as China’s economic strength grows, that is likely to change. The United States and other democracies have become dependent on China for essential and nonessential goods. China’s ability to exploit that dependence in a future crisis or conflict should be extremely worrisome. A strategy based on resilience would help deter such coercion and minimize the disruption if it does occur.
One foundational weakness is that American democracy is beset by broken processes and vulnerable to outside meddling. Four years after Russia interfered in the 2016 presidential election, the United States has yet to take serious steps to protect its voting systems from hostile foreign governments and cybercriminals. Comprehensive reforms would include voter-verified paper ballots and the auditing of voting results. A new agency charged with election security could develop standards and conduct mandatory training for election officials, as Senator Elizabeth Warren, Democrat of Massachusetts, has proposed. And as the pandemic has made clear, voting should not require a trip to the ballot box on Election Day. Nationwide vote-by-mail and early voting policies would provide resilience during a crisis—and make voting easier and safer in ordinary times, too.
Democracy is not resilient if people do not believe in it. Yet Americans’ trust in the government has been stuck near historic lows for years, and surveys show that startling numbers of citizens do not think democracy is important. It is no accident that this loss of faith has coincided with decades of widening economic inequality and a rising consensus that the government is corrupt. Study after study has shown that the U.S. government is far more responsive to the wealthy and big corporations than to ordinary citizens. Only sweeping changes to the rules regulating lobbying, government ethics, corruption, and revolving-door hiring from the private sector can restore public trust.
Generations of racist policies—redlining, militant policing, and the failure to regulate predatory lending, to name just three examples—have done much to undermine U.S. resilience, too. A country will have trouble bouncing back when entire communities are disproportionately vulnerable in a crisis and when leaders use divide-and-conquer ideas to stir division and prevent solidarity across races. Fighting for justice is the morally right thing to do—and it makes American society stronger.
When it comes to economic policy, an entire generation of American leaders embraced deregulation, privatization, liberalization, and austerity. The result has been staggering inequality, stagnant wages, rising debt loads, an intolerable racial wealth gap, shrinking opportunity, and rising anxiety. Low wages, limited social benefits, and an unaffordable and inefficient health insurance system have weakened the country’s resilience by turning any economic shock into a potentially existential threat for many citizens. “Deaths of despair,” such as suicides and overdoses, plague rural areas. Meanwhile, the wealthy and powerful continue to push for and win lower tax rates, which increase their wealth and power and create artificial political pressure to oppose social infrastructure spending. The damage to American resilience, in ordinary times and especially in a crisis such as the current one, has been considerable, as has the resulting loss of economic opportunity and innovation that could boost the United States’ power.
Resilience demands reversing these trends: expanding health care and childcare to all Americans, restructuring the economy so that people gain higher wages, restoring the power of unions, making early education universal, and ensuring that students can graduate from college debt free. All these goals are eminently achievable.
Officials must also provide the basic infrastructure necessary to operate in the modern world. The United States has a long tradition of public investment in infrastructure—from the post office to rural electrification to the national highway system. In recent decades, however, that legacy has been abandoned. The pandemic has revealed that, whether for telemedicine, remote work, or education, high-speed Internet is an essential utility, just like water and electricity. But nearly a quarter of rural Americans do not have adequate access to it, in part because Internet provision has been left to the marketplace. The country’s financial infrastructure also needs to be updated. Millions of unbanked Americans are dependent on check cashers to access their hard-earned dollars, which eats into their wages and their time. Both in normal times and during a crisis, the Federal Reserve’s policies are less effective than they could be and favor financial institutions because the Fed uses banks as intermediaries rather than interfacing directly with consumers. If every person or business instead had access to a no-fee, no-frills account at the Federal Reserve, it could reduce the unbanked population and ensure that everyone could get stimulus payments instantaneously in a crisis.
Decades of neoliberal capitalism have not made markets more resilient, either. Competition is suffering, and fewer companies are being founded, as monopolists and megacorporations come to dominate one sector after another. The “shareholder primacy” philosophy and growing pressure from financialization have turned some corporate leaders into short-term tacticians who use buybacks, leverage, tax strategies, and lobbying to increase their stock prices, even if doing so means greater fragility, volatility, and boom-and-bust economic cycles that lead to big taxpayer bailouts. As some sectors come to depend on just a few firms, prices rise, innovation suffers, and supply chains become fragile. Meanwhile, some companies amass so much power that they distort the democratic process by throwing their weight around in Washington.
Combating these trends will require reforms designed to deconcentrate wealth and power: robust financial regulations (including a new Glass-Steagall Act, to separate investment banking from retail banking), a more progressive tax structure, stronger unions, and aggressive antitrust enforcement to prevent anticompetitive mergers and to divorce platforms from the commercial activity that traffics across them. Such reforms, especially when applied to the financial, telecommunications, and technology sectors, would discourage business models that increase systemic risk and make individual companies “too big to fail.” These reforms would also make it harder for wealthy individuals and well-funded special interest groups to capture the government.
For decades, economic-policy makers also failed to think seriously about a deliberate, national-level industrial policy, deeming it impermissible even as they allowed it in the form of a host of sector-specific tax benefits and regulatory policies. A coherent industrial strategy would enable leadership and innovation in areas critical to the challenges of the future, including clean energy and technologies such as artificial intelligence and robotics. It would also decrease the risk of supply chain disruptions, which can lead to public health and economic disasters, as the shortages of ventilators and personal protective equipment during the pandemic have shown.
The failure to pursue sound industrial policy points to a broader oversight. Whether the next crisis is another pandemic, a cyberattack, a climate shock, or a geoeconomic conflict, the United States lacks a comprehensive strategy to ensure its economic resilience. The government does not even have an office equipped to develop such a plan. Yet there is so much planning and coordinating to do: research and development keeps the country on the cutting edge of the technology needed to prevent and respond to threats. Supply chain analysis and planning ensures that critical materials can be produced even after a systemic shock. Production and mobilization planning ensures that supplies can be delivered quickly and exported to help countries in need. This is difficult, detailed, and technical work, and it must be ongoing because markets are constantly evolving. A new U.S. Department of Economic Resilience, consolidating resources currently spread across many agencies, could lead the charge and draw up a comprehensive road map, akin to the National Security Strategy and the National Defense Strategy. In it, the government could set goals for R & D, identify supply chain threats, coordinate its response to trade-induced inequality, develop a plan for competitiveness in artificial intelligence and other frontier sectors, and lay out a range of industrial policy programs, from small-business lending to export incentives.
The full array of ills that beset U.S. economic resilience is on display in the defense sector. Debates over U.S. military spending attract considerable attention but often overlook how concentrated the country’s defense industrial base has become. A 2019 government report found that of 183 major weapons systems contracts, two-thirds had been awarded with no competition and half had gone to just five firms. In such a top-heavy sector, small businesses and entrepreneurs have a hard time breaking in—many, according to news reports, have simply given up. The Pentagon is left to partner with the same companies over and over, even those that charge excessive prices or, worse still, have previously been accused of fraud. All of this adds up to lower quality, higher costs, and less innovation. The United States’ ability to endure and bounce back is strengthened when it has innovative, competitive markets that can anticipate a crisis or adapt when one takes place—and weakened when it does not.
Offshoring, too, has made the U.S. military less resilient. A recent report from the Department of Defense revealed that the United States no longer has the capacity to produce many of the essential materials used for military hardware or the technical know-how to scale up domestic production in the event of a major crisis. “China is the single or sole supplier for a number of specialty chemicals used in munitions and missiles,” the report notes. When it comes to one critical material, carbon fibers, “a sudden and catastrophic loss of supply would disrupt [Department of Defense] missile, satellite, space launch, and other defense manufacturing programs. In many cases, there are no substitutes readily available.”
To build a foundation of domestic strength is not to withdraw from the world—far from it. Most countries, including the United States, cannot be completely resilient on their own. Not all critical supplies and manufacturing capacities will be available domestically, and not all countries will have enough economic power to withstand political and economic pressure from great-power competitors. The solution is to deepen the ties and alliances that bind the like-minded liberal democracies of North America, western Europe, and Northeast Asia. A single country might not control the entire supply chains needed to respond to a public health emergency, for instance, but an alliance likely could. An alliance composed of resilient liberal democracies would also have the collective countervailing power to deter geoeconomic threats or cyberattacks from great-power competitors such as China and Russia. Critically, the purpose of such collective resilience is not to expand and engulf the world; it is to preserve the states within the alliance.
When it comes to economic issues, collective resilience will require a major change in outlook. The recent history of international economic policy is one of trade liberalization, often in ways that have benefited capital and with little regard for the regime types of the countries involved or the potential ramifications for domestic resilience. To continue down this path is risky. International trade policies that increase inequality and weaken domestic production capacity make the United States less resilient and more susceptible to geoeconomic threats and leverage. Liberal democracies’ agenda for international cooperation should focus on strengthening their own social infrastructure and making markets resilient, not on marginal gains in efficiency that come at the expense of domestic resilience.
Decades of neoliberal capitalism have not made markets more resilient.
Even as the United States deepens its relationships with close allies, resilience will require attending to the rest of the world, as well. Diseases travel with ease, so any country far or near that cannot get a handle on an epidemic poses a danger to the United States and the world. Famines and other climate shocks might lead to massive refugee flows or set off violence that spills over into peaceful areas. Another critical part of U.S. foreign policy should therefore be to advocate, and assist with, a development agenda based on resilience. That means, for example, helping foreign countries build up their public health capacities and foster sturdy and diversified economies. Most developing countries must currently choose between a neoliberal approach that benefits global capital and a Chinese-led path that brings with it a risk of dependence and debt traps. The United States and international institutions such as the World Bank and the International Monetary Fund should aim to provide a new path focused on domestic flexibility and capacity.
More broadly, an international system that depends on a single country to accomplish collective goals is not a resilient one. For decades, some foreign policy experts have celebrated the United States’ role as “the indispensable nation.” Today, Washington should instead use its influence to ensure that its allies and partners can accomplish shared goals even when the United States is not involved—call it “resilient multilateralism.” The African Union’s creation, in 2016, of the Africa Centers for Disease Control is a good example of what such institution building can look like.
When it comes to great-power rivals, a U.S. grand strategy of resilience will require healthy working relationships and frequent cooperation. Working together is necessary for managing climate change and pandemics. Economic ties are inevitable and desirable, and the vast majority of goods and services do not require fully independent supply chains. Functional relationships with China and Russia will make open conflict less likely by reducing the risk of misperceptions and misunderstandings. Ultimately, cooperation and communication do not require affection or a shared ideology, nor do they prevent countries from acknowledging their differences or seeking greater economic independence from one another.
A resilient United States needs to retain a powerful, cutting-edge military to deter and defend against threats from abroad. But it would not—and should not—go abroad in search of monsters to destroy. As the last two decades have shown, wars of choice designed to transform foreign societies make the United States less resilient, not more. They cost an enormous amount of money, diverting dollars that could have been spent at home. They redirect the attention of policymakers, who then cannot focus on challenges that arrive without warning, such as pandemics, or arrive gradually, such as climate change. And the dream of turning war-torn countries into Denmark is just that: a dream. Its failure contributes to the loss of faith in U.S. leaders and institutions, in the United States and elsewhere.
Any grand strategy has tradeoffs, and a resilience-based approach is no exception. It would require the United States to abandon democracy promotion by force and deprioritize policies that focus on economic efficiency and benefit global capital. But these are tradeoffs worth making. Even well-intentioned wars can weaken the country and destabilize entire regions, and the era of go-go trade liberalization has contributed to extreme economic inequality.
Washington is at a pivotal moment. Ideas that dominated for decades have been exhausted, and the need for a new approach coincides today with a crisis of massive proportions. The precise challenges ahead are not yet known, but they are coming, and they are certain to require planning, adaptation, and durability. In this new era, a grand strategy of resilience can act as a North Star for policymakers. It will make the United States stronger, freer, and more equal, and it will preserve, protect, and strengthen democracy for the next generation.
The Age of Contagion Demands More Internationalism, Not Less