Jilted. That’s how policy makers here in America feel now that British Prime Minister David Cameron has dubbed his country’s relation with the People’s Republic of China as “a very special relationship”, trumping the merely “special relationship”, the term used by Winston Churchill in 1946 to describe Britain and America’s close security and cultural ties. Britain also trumped the state dinner accorded Xi here in Washington by providing the iron-fisted leader of the People’s Republic of China bed and board in Buckingham Palace as a guest of the more benign head of state of the United Kingdom. So we enter what the chancellor of the Exchequer George Osborne dubs a new “golden era” in relations between China and Britain – not a silver era, but a golden one, as in the stuff of which the Midas legend is made. For some reason, Britain, the world’s fifth largest economy, feels a need to woo Xi so that he will pour capital into Britain’s needy infrastructure, finance the nuclear plants Britain believes it must have if it is to keep its lights on, and do it the favor of using the deep, liquid capital markets of London – Beijing has none such -- to help the People’s Republic trade its yuan and flog its financial paper.
The administration has been leaking to the press its unhappiness at what one unnamed official calls Britain’s “constant accommodation” of China. That is understandable, but comes with ill grace. For one thing, Obama has its European allies on notice that America is “pivoting” to Asia, and away from Europe. One nation’s pivot is another nation’s abandonment. And the 21st Century circumstances that justify our pivot surely equally justify Britain’s pivot from an America shrinking its international footprint to a China expanding its global each.
For another, President Obama’s reputation as an ally a nation wants to “have its back” has been tarnished by his refusal to provide Jordan with drones, Ukraine and the Kurds with weapons, Israel with unambiguous support, and Syrians fighting Assad and Isis with cover from Russian bombs. So Britain certainly has reason to reduce the value of America’s special relationship to second rank by adding “very” to its description of its special relationship with China.
But that does not mean that the administration has no justification for its concerns. As part of its seeking after accommodation with China, Britain was the first Western country to join China’s Asian Infrastructure Investment Bank (AIIB), the regime’s competitor to the Washington-based World Bank, over the Obama administration’s objections. Of course, if the British government thought joining the AIIB was in its economic interest, it quite properly treated US objections as irrelevant. But it might worry about the long-term consequences of transferring power from a democratic market-based economy to an authoritarian centrally managed one.
Then there is the deal Rolls Royce has signed with China’s SNPTC to develop civilian nuclear products. State-owned SNPTC has been accused by America of cybertheft and cyberespionage of nuclear power technology, which the company denies. Expanding SNPTC’s reach into an important British manufacturing company is a reason for concern by the U.S., and perhaps should be by Britain. As should turning over an important future part of the nation’s energy infrastructure to China by involving it in financing and eventually designing and constructing nuclear power plants. If those plants are economically viable, which long experience with the economics of nuclear power suggests to me it is not, markets would make capital available to finance their construction. If not, and China leaps into the breach, it must be expecting a non-financial quid pro quo in addition to the return on and of its cash. “China would gain access to information that would give it more insight into the vulnerabilities in the U.K.’s critical infrastructure. As much as possible, your critical infrastructure should be national,” Caroline Baylon, a specialist on online security at Chatham House, a London research institute, told the New York Times. One vulnerability is exposure to induced power outages, another might be to the safety of the plant.
Most important from the American point of view is concern about the loss of support from the UK should one of the possible flash points spark and ignite a conflagration. China demonstrated a few years ago that if Britain makes it cross, it will retaliate. When the prime minister made it cross in May of 2012 by meeting with the Dalai Lama, China imposed an 18-month diplomatic freeze. Imagine how really cranky Mr. Xi would be if Britain sided with the US in the event of a serious confrontation with China, something that is certainly not beyond the realm of possibility.
Some 30 percent of maritime trade goes through the South China Sea, and it has been the historic responsibility of the U.S. to keep those sea lanes open to all. Now China has created military bases out of bits of land known as the Spratly Islands, and announced that it has developed missiles capable of sinking an aircraft carrier. The ideological Xi seems less likely to favor unimpeded movement of goods, regardless of their source and destination, than America has been. Bad news, and not only for the U.S.
Then there is the problem of China’s theft of intellectual property, both by cybertheft and by coercing foreign companies to turn over IP in return for access to China’s market. These companies, hoist with their own greed, may not merit our sympathy. But nothing can justify plain old-fashioned theft. And if Obama does lay on the sanctions he has threatened, British support risks bringing the just-dawned “golden era” to a premature close. As it will if the UK joins America’s complaints about China’s manipulation of its currency.
Then there is the not small matter of the role of the dollar as the world’s reserve currency. China has long pressed for its replacement by a basket of currencies that would include its yuan. Backing by Britain for that position would be a major triumph for Xi’s war to reduce the role of America in the world economy and increase that of China.
Finally, American policymakers have raised the issue of human rights publicly when the opportunity presents itself. Secretary of State John Kerry, in his department’s public Report on Human Rights Practices, cited China as a country that “continued to stifle free and open media and the development of civil society through the imprisonment of journalists, bloggers, and non-violent critics.” Cameron promises to continue pressing China to adopt human rights policies consistent with British values, but henceforth will do so in private, eschewing what the Chinese and Osborne call “megaphone diplomacy”. There is no reason to doubt the prime minister’s word, or believe he will abandon his advocacy merely to extend the new golden era Britain so values. Whether private criticism will be as effective as a public roasting remains to be seen. China’s oft-stated objections to megaphone diplomacy – a phrase I believe its diplomats coined – suggests that they prefer the privacy of a conference room to the blare of publicity.
One of Barack Obama’s first acts when entering the White House was to return the bust of Winston Churchill that had been presented by Britain as a gift to America. He has little standing to complain about Britain’s very special relationship with its new best friend.