U.S.–China Week: Clinton on China at DNC, Uber’s China exit, U.S. supporting SCS talks, Susan Rice trip (2016.08.01)

Welcome to issue 62 of U.S.–China Week. Continuing my occasional series on other useful resources for those interested in U.S.–China relations, this week I would like to congratulate China Politics Weekly by Trey McArver for reaching its 100th issue last month. Trey consistently provides a useful summary of the activities of top Chinese officials and often adds sharp analysis of likely policy trajectories. (He also kindly shared with me some of his experiences with CPW as I got going on this project.) Read the most recent issue here, and send him an e-mail to subscribe.

Beginning with this issue, I will also be experimenting with re-publishing U.S.–China Week through Medium. This issue should be available on a new Medium channel a few minutes after it goes out by e-mail.

As always: Please encourage friends and colleagues to subscribe to U.S.–China Week. Here is the web version of this issue, ideal for sharing on social media. You can also find U.S.–China Week on Medium and on Facebook, and you can follow me on Twitter at @gwbstr. And please send your comments, quibbles, and suggestions to[email protected].

CAMPAIGN 2016
In passing reference, Clinton implies she will ‘stand up to China’; Clinton and Trump advisers speak on Asia policy

In her speech at the Democratic National Convention, former Secretary of State Hillary Clinton mentioned China twice. The first quote: “If you believe that we should say no to unfair trade deals; that we should stand up to China; that we should support our steelworkers and autoworkers and homegrown manufacturers, then join us.” The second: “[Trump] also talks a big game about putting America first. Well, please explain what part of ‘America First’ leads him to make Trump ties in China, not Colorado…” Meanwhile, the BBC spoke with Laura Rosenberger, a Clinton foreign policy adviser, about Asia policy. Parts of that interview can be viewed here, and I’ve transcribed her comments, which addressed TPP, the South China Sea, North Korea, and the “pivot to Asia.” The BBC’s earlier but little-circulated interviewwith Peter Navarro, identified as a Trump policy adviser, is a bit more juicy, talking about what a “Trump regime” would work toward. / Since I discussed the attention-grabbing statements on China in the Republican platform, it is worth noting that the Democratic platform was much more typical: saying “China and other countries are using unfair trade practices”; identifying “managing China’s rise” as a challenge for the next president; and promising to “press China to restrain North Korea,” “protect freedom of the seas in the South China Sea,” and “press China to play by the rules.”

ANALYSIS: “Standing up” to China has a history in Clinton campaign rhetoric that stretches at least back to 2007, when she said, “I went to Beijing in 1995 and stood up to the Chinese government on human rights, women’s rights.” At the time, I andothers questioned whether that 1995 speech really counted as standing up to Chinese officials, but it was a move that many Chinese still remember. Perhaps the most striking thing here is that Rosenberger and Navarro’s remarks to the BBC aren’t all that far apart, with the important exception of the Trump campaign’s case for making allies pay for protection. While the U.S. election provides plenty of volatility, Chinese observers should note that both candidates are unhappy with China’s economic behavior, and both at least formally back a rules-based solution in the South China Sea.

INVESTMENT
Uber China and Didi in enormous China deal, ending Uber’s costly efforts in the market

Days after the Chinese government announced rules that would legalize and regulate ride hailing services like U.S.-based Uber and Chinese giant Didi Chuxing, the two announced a deal to combine forces in the China market. As Eva Dou noted on Twitter, there was some rhetorical tension between Didi’s announcement that it is “to acquire Uber China” and Uber CEO Travis Kalanick’s framing of “the merger of UberChina and Didi.” As Dou explains, “It was likely no coincidence that [Kalanick’s] decision came on the heels of China’s new ride-hailing regulations, which were announced last week but had been in the works for two years and were known to companies in the industry in advance. … The rules forbid companies to operate ride-hailing services below cost, putting an end to ruinous subsidy wars but making it difficult for UberChina, with its smaller scale, to match Didi on price.” / Meanwhile, the U.S.-China Economic and Security Review Commission released a new report on “Policy Consideration for Negotiating a U.S.-China Bilateral Investment Treaty.” And Chinese tech company LeEco will reportedly acquire Vizio.

ANALYSIS: It’s hard to avoid the conclusion that Uber got beat, its reported $1 billion annual spending in a contest for market share amounting to nothing. But Uber may yet make money through its “nearly 20% stake in Didi,” according to WSJ—far better for the U.S. company than a full withdrawal. Still, the company’s public hubris in the face of a challenging market and regulatory environment makes a potentially smart business outcome look like a big defeat.

EMISSARIES
Susan Rice, in China, explains ‘Why I’m Here: The Importance of the U.S.–China Relationship’

In a post on the White House’s Medium channel, National Security Adviser Susan Rice described the purpose and context of her then-ongoing trip to China. The contents are mostly White House boilerplate, but I note the administration’s continued assertion that crisis-avoidance mechanisms between militaries are working: “Since 2014, I worked with our Chinese counterparts to agree to a series of confidence-building measures between our militaries that have reduced the risk of unintentional escalation and confrontation on land and at sea. Our men and women in uniform are safer as a result, and our militaries are better prepared to take on shared challenges.” Meanwhile, the U.S. Embassy in Beijing published a background briefing on the trip and Rice’s opening remarks when meeting President Xi Jinping, State Councilor Yang Jiechi, and Gen. Fan Changlong.

ANALYSIS: The Rice piece is notable mostly for its unusual form—as a Medium post and not on the White House website, and in using the first person. It seems unconventional for a presidential adviser to personalize achievements while still serving, for example in saying “my meetings with Chinese counterparts were instrumental in achieving the public commitment from President Xi and President Obama in 2015 not to conduct or knowingly support cyber-enabled theft of intellectual property for economic gain.” No doubt Rice is an important player in U.S.–China relations (and rightfully so), but the piece comes off as an effort to convince us that is the case. Even if, as the background briefer says, Rice and Secretary Meng Jianzhu “together played the central role” in reaching that agreement, it seems a break from the norm to point that out.

SOUTH CHINA SEA
Kerry lends support to talks between China and Philippines, after Wang asks him to, while also backing tribunal

Reuters reports: “U.S. Secretary of State John Kerry said on Tuesday he supported the resumption of talks between China and the Philippines over the South China Sea… China’s Foreign Minister Wang Yi had asked Kerry to lend his support for bilateral talks to restart between Manila and Beijing in a meeting between the two in the Laos capital of Vientiane on Monday. ‘The foreign minister said the time has come to move away from public tensions and turn the page,’ Kerry told a news conference. ‘And we agree with that … no claimant should be acting in a way that is provocative, no claimant should take steps that wind up raising tensions.'” / Speaking alongside Philippine Foreign Affairs Secretary Perfecto Yasay, Kerryreportedly also backed the UNCLOS tribunal’s decision, saying “It’s impossible for it to be irrelevant. It’s legally binding.” / The United States, Japan, and Australia released a joint statement on strategic issues, including the South China Sea. / And China and Russia will reportedly hold joint military exercises in the South China Sea in September.

#USChinaWeek1966 <— follow this hashtag on Twitter for more
‘China Says Japan, Soviet And U.S. Form Alliance’

“TOKYO, July 31[, 1966] — Communist China charged today that the United States, Japan and the Soviet Union had formed an anti-revolutionary ‘sacred alliance,’ Jenmin Jih Pao, the official newspaper of the Chinese Communist Party, said the visit just made to Japan by the Soviet Foreign Minister, Andrei A. Gromyko, had brought the alliance into being.”

(Source: The New York TimesThis entry is part of an ongoing feature of U.S.–China Week that follows U.S.–China relations as they developed in another era of change and uncertainty, 50 years ago.)

ABOUT U.S.–CHINA WEEK

U.S.–China Week is a weekly news and analysis brief that covers important developments in U.S.–China relations and features especially insightful or influential new policy analysis.

Graham Webster is a senior research scholar, lecturer, and senior fellow of the Paul Tsai China Center at Yale Law School, where he specializes in U.S.–China diplomatic, security, and economic relations through research and Track II dialogues. His website is gwbstr.com.

Disclaimer: Opinions expressed here are my own (and I reserve the right to change my mind).

Subscription to U.S.–China Week by clicking here or e-mailing me is free and open to all, and an archive of past editions appears at my long-running website on East Asia and the United States, Transpacifica.

Contact: Follow me on Twitter at @gwbstr. Send e-mail to [email protected].

1 thought on “U.S.–China Week: Clinton on China at DNC, Uber’s China exit, U.S. supporting SCS talks, Susan Rice trip (2016.08.01)

  1. Pingback: U.S.–China Week: Diplomacy and deployments at sea; Trump and Clinton’s shared economic tune on China; China’s quantum satellite (2016.08.15) – Transpacifica

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