U.S. - China: “Power Transition” and the Outlines of “Conflict Bipolarity”

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This article focuses on the phenomenon of global rivalry between China and the United States in terms of power transition theory, which is scientifically new and relevant due to the increased attention to the so-called “Thucydides trap”, in which, as some experts claim, both states have fallen. This paper presents a different vision of the global rivalry for leadership in the shaping of a new world order, which has already taken the form of overt non-violent confrontation and manifests itself in technological and trade wars as well as scientific and cultural rivalries. Nevertheless, despite the non-violent nature of the rivalry, this process is followed by an increase in the military capabilities of states, mainly projected in the basins of the Pacific and Indian Oceans (Indo-Pacific region). The methodological basis of the paper is ‘power transition’ theory, which has been developed over the past 60 years by A.F. Organsky, J. Kugler, D. Lemke, R. Tammen and other researchers, united in the TransResearch Consortium. The authors argue that the analytical prism of this theory is more relevant to the analysis of current global rivalry than the classical neorealist balance of power approach. Through the prism of the theory the issues of rebalancing the global system of economic governance are analyzed. Also, a comparative analysis of the US-Japanese and US-Chinese trade and technological wars is carried out. Both the military and aggregate capabilities of two countries on a global scale and in the Indo-Pacific region are examined. The conclusion contains findings and comments on the impact of U.S. - China rivalry on the system of international relations.

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The growing competition between the United States and China is attracting more attention of both Russian and foreign scholars. However, it is mostly about the curtailment of cooperation in certain areas or the so called decoupling, which does not fully allow to find deep causes for the growing contradictions and the transition to a new U.S. — China bipolarity [Degterev 2019]. In the medium term, relations between two states will be confrontational, apparently, until the transition to a “new détente” [Bogaturov 2003].

Among Russian researchers, the full depth of the American-Chinese contradictions is perhaps revealed only by A.V. Lomanov, who describes the macro-historical nature of the issue [Lomanov 2021]. By inertia, the modern international system is perceived in terms of the previous bipolarity [Shakleina 2018], in the hope of a new “reset”.1 Meanwhile, the U.S. has already withdrawn from all major Cold War agreements,2 dismantling the skeleton of the previous system of strategic stability. Moreover, a comprehensive comparison of indicators suggests that the U.S. — China duumvirate leads in most spheres, except, perhaps, military, diplomatic and soft power [Degterev 2020]. The analysis of geopolitical changes in the context of the Russia — U.S. — China strategic triangle, which has become especially popular in recent years [Badrutdinova, Degterev, Stepanova 2017; Voskressenski 2021: 231—250; Morozov 2020; Khudaykulova 2020] only partially helps to overcome the problem of relevance of the analytical tools.

Research Methodology

The scale of the ongoing changes requires a more active use of the entire arsenal of theories of international relations. It is no coincidence that three landmark monographs on the balance of power in the world arena were published in Russia in 2021 [Voskressenski 2021; Degterev, Nikulin, Ramich 2021; Trenin 2021]. This demonstrates a serious surge of interest in the issue after the publication back in 1993 of E.A. Pozdnyakov’s monograph [Pozdnyakov 1993]. Despite the overwhelming dominance of the realist discourse for the analysis of the U.S. — China competition in Russian science, as well as its prevalence in the United States, the authors of this article believe that the power transition theory is the more relevant analytical framework for studying the topic.

Formed more than half a century ago by A.F.K. Organski [1958] and continued as a scientific tradition by a group of authors (J. Kugler, D. Lemke, R. Tammen and others), united in “TransResearch Consortium”,3 the theory explains the mechanisms of changing global leadership (in our case — from the USA to the PRC) and related processes.

Figure 1. Visual Interpretation of Power Transition Theory
Source: compiled by the authors based on: [Thompson 2018].

An indicator of the start of the power transit period is considered to be the achievement by a contender for world leadership of about 80 % of the power of the dominant nation [Organski, Kugler 1980: 44]. There are different approaches to assessing power (more on this below), but, for example, in terms of the absolute size of GDP at purchasing power parity (PPP), the PRC surpassed the United States back in 2014 [Voskressenski 2021: 173]. According to the ideologue of Chinese triumphalism, Hu Angan, back in 2013 China also overtook the United States in terms of aggregate power [Lukin 2019]. Obviously, the latter statement is clearly speculative, since the U.S. leadership, at least in the technological and military spheres, is still preserved, but in any case in 2010—2020 a period of power transit started, which will end after the power of the PRC reaches 120 % of the American one (Figure 1).

The 4:5 or 5:6 power ratio between the revisionist and the dominant nation represents the most dangerous moment for the outbreak of war between them [Tammen 2000: 31]. At the same time, according to empirical studies of the theory’s founders (based on the analysis of 32 cases), with a parity of power between the two strongest nations war occurs only in 18.8 % of cases, and peace remains in 81.3 % of cases [Organski, Kugler 1980: 50]. The probability of conflict increases if the rising power is heavily dissatisfied with the status quo. The dominant nation can start a preventive war without waiting for the rising power to overtake it in power. However, the “Phoenix factor” should be taken into account — even a country lying in ruins can almost completely recover in 20 years, after which it would be difficult to keep it from revenge [Organski, Kugler 1980: 142—144].

In 2017, G. Allison in his book “Destined for War: Can America and China Escape Thucydides’s Trap?” absolutized the power transit theory, transforming it from probabilistic to deterministic. He managed to put the provisions of the theory into a simpler form, clear for both decision-makers and ordinary people. Using the example of the analysis of 16 bilateral (dyadic) confrontations in the process of power transit, he concludes that the “Thucydides trap,” the historical analogy of the Peloponnesian War between the growing Athens (Delos Union) and Sparta (Peloponnesian Union), described by the ancient Greek historian Thucydides, is inevitable [Allison 2017].

The almost complete absence of the respective discourse in Russian science can be explained by the continuing inertia of bipolar thinking of the Cold War period, as well as by the selective borrowing of the modern Western theories of international relations. In the most well-founded Russian-language monograph [Istomin 2021: 103—104], which describes the logic of international behavior of states, only a few paragraphs are devoted to the power transit.7 The static version of the theory — the hierarchy of the world system, headed by the US and China (superpowers) competing for leadership, followed by the great powers (Russia, Great Britain, France, Germany and Japan) and the rest of the world — breaks the stereotypes of superpower that flatter the Russians’ self-esteem. The dynamic version of the theory — the inevitable transition of leadership to China — questions the validity of Russia’s “Euro-Atlantic turn” in the early 1990s. Meanwhile, illusions in foreign policy perception lead to incorrect assessments (misperceptions) of strategic alternatives, the cost of which can be extremely high [Jervis 1976].

In the PRC, the discourse of power transit and the “Thucydides trap” is levelled as much as possible in the hope of a continuation of the peaceful rise [Lomanov 2020]. The issue of the lesser influence of the intellectual tradition of the TransResearch Consortium (US West Coast) in comparison with the balance of power, the approach of the “holy trinity” of realists (G. Morgenthau, K. Waltz, J. Mearsheimer, two of whom belong to the Chicago School), requires a separate study and, apparently, is associated with the peculiarities of lobbying the interests of various groups in the political-academic community of the United States, leading to the so-called “vocation crisis” in foreign policy expertise [Sushentsov, Pavlov 2021].

The authors of the study do not believe that the power transit theory is flawless. Moreover, it is inherently probabilistic rather than deterministic. Its main shortcomings are covered in great detail by the most famous critic of the theory S. Chan, which saves us from the necessity to repeat the brilliant arguments of the master of his craft.

Most of the international academic (and, under the influence of G. Allison’s article, the political-academic) community exists in the semantic field of power transit and “Thucydides trap”.8 At the same time, some researchers express solidarity with these approaches, believing that the conflict between the United States and China is inevitable or has already begun [Tellis 2013; Bergsten 2018; Johnston 2019; Han, Paul 2020; Wang 2019; Wyne 2020; Mastro 2019; Yoder 2019; Goldstein 2020] and the world may become even more anarchic [Xuetong 2020; Wang, Sun 2020; Layne 2020]. Others are confident that the new bipolarity will not lead to open confrontation [Xuetong, Qi 2012; Wu 2020]. Whether or not this theory is true (we are inclined to the first point of view), but it firmly holds the minds of decision-makers and therefore has the character of a “self-fulfilling prophecy.”

Transit of Global Governance through Accommodation

The key factor of the power transit is the discontent of a significant part of the great, medium and small powers with the current status quo, as the dominant nation and its allies (majority coalition) are structuring the international system in their own interests
(Figure 2).

The system of global governance headed by the United States and some other Western states was formed after World War II. In terms of its structure it includes the Bretton Woods institutions — the International Monetary Fund (IMF), the World Bank Group, the regional development banks, as well as the World Trade Organization (WTO), the Organization for Economic Cooperation and Development (OECD) and the International Energy Agency (IEA) [Degterev 2016]. Each of these organizations was originally created according to the “sketches” of the United States and its allies, and therefore their dominance in these structures is quite natural. This is a clear manifestation of the so-called structural power, which was fully presented by the founder of international political economy S. Strange. This kind of power includes control over security mechanisms, credit and finance, economic production, as well as the creation and dissemination of knowledge [Strange 1988].

Figure 2. Satisfaction by Status-Quo in World Hierarchy
Source: compiled by the authors based on: [Thompson 2018].

As part of the accommodation strategy and peaceful rise, China joined the Bretton Woods structures in 1980, the Asian Development Bank (ADB) — in 1986, and the European Bank for Reconstruction and Development (EBRD) — in 2016 [Voskressenski 2021: 172—173]. In 2001 after 15 years of negotiations China became member of the WTO, opening its economy to the world MNCs. The PRC also integrated into the Western system of dissemination of knowledge (Scopus, WoS), although it is developing its own (CNKI).9 It seemed that China was one of the great powers quite satisfied with the status quo. In a little while, “socialism in China would turn into a decorative sign over the grand building of the market economy,” and “the Chinese middle class, raised in the era of reforms, would lower the dilapidated red banner, rejecting the one-party rule of the Communist Party of China in favor of a liberal system” [Lomanov 2021].

A number of analysts even expressed a timid hope for the possibility of socializing the PRC. Under the influence of the constructivist turn this discourse touched on supporters of the power transit theory in the mid-1990s. Socialization was understood as influencing the minds of the population of a rising power, so that it sincerely considered maintaining the status quo in the system exclusively as part of its own interests. Extensive U.S.-Chinese humanitarian ties (exchanges of students, tourists, businessmen) seemed to contribute to this as much as possible [Badrutdinova, Degterev, Stepanova 2017: 98—101]. However, in the context of China’s course of strictly ensuring information sovereignty, these reflections look quite naive.

Within the framework of the strategy of engagement the B. Obama’s administration made an attempt to form the G2 format for closer cooperation with China. One of the proponents of this approach, American economist C.F. Bergsten, stressed the need to create a dialogue format between the United States as a leader of the developed world, and China as a leader of developing countries, for more effective management of world economic processes.10

In 2015, the IMF Executive Board decided to include the yuan in the basket of special drawing rights (SDR) currencies. Sometime later the US Congress finally ratified the 14th revision of the IMF quotas [Degterev 2016: 83]. It was planned that these measures would keep the coalition of discontented developing countries from trying to revise the whole system, creating opportunities for Beijing to strengthen its leadership in the realities of the new world order [Bergsten, Freeman, Lardy, Mitchell 2008: 25].

Already in 2018, after the failure to create the G2 and the trade war that soon began, Bergsten acknowledged the reality of the “Thucydides trap” and put forward new scenarios for the world order: first — G0: a world where the U.S. had already lost its leadership and China was unable or unwilling to take on the role of global leader; second — G1: a world where sooner or later China will be the sole leader; third — G2: a world where the U.S. and China have agreed to cooperate or have temporarily suspended competition to prolong the period of power transit [Bergsten 2018]. In fact, this was the starting point of the power transit period.

On China’s part, recognizing the G2 format would become an open claim to world leadership, which contradicts one of the basic principles of Chinese foreign policy that was laid down under Deng Xiaoping: China will not claim hegemony and seek to take the place of the leader.11

As a response to the idea of creating the G2, Xi Jinping proposed the concept of “mutually beneficial relations between the great powers of a new type” to promote the cooperation and avoid conflict situations.12 At the same time, China was not fully satisfied with the existing world order. So, on the one hand, it put forward mutually beneficial cooperation formats, such as “One Belt, One Road,” and, on the other, it pursued a tough policy in the South China Sea regarding the disputed territories [Mastro 2019: 32].

From a country that uncomplainingly accepts all international norms (rule-taker), by 2010 China turned into a country that already influences the content of these norms (rule-changer) and, moreover, by 2020 has gradually become a country that shapes international norms (rule-maker), especially in the IT sphere. If earlier, within the framework of its soft power and the concept of Wang Huning, China promoted exclusively culture and education, then in recent years it has switched to broadcasting its discursive power, that is, new meanings, norms and standards [Denisov 2020].

China’s interest in changing world order is confirmed by the increase in scientific research on this topic. Since 2010, the number of scientific publications containing the phrase “world/global order” in the Chinese science metric database CNKI has been growing, with the highest number of articles published in 2016 [Chen, Zhang 2020: 3—4]. These articles explored the nature of understanding of the world order in the West (mainly in the United States) and in the PRC, offering specific options for the development of Chinese foreign policy, diplomacy, and approaches to global governance [Chen, Zhang 2020].

The Chinese leadership and foreign policy theorists faced the need to provide a theoretical basis for new concepts, such as China’s peaceful rise, harmonious peace, etc., which entered political discourse along with the rise of China [Grachikov 2021: 73] and the concept of a common future of mankind as a new world order model [Semenov, Tsvyk 2019: 72].

In terms of global governance the PRC promotes China-centric international institutions and rules. Thus, in global economic governance it is fully demonstrated by creating in 2013 of the Asian Infrastructure Investment Bank (AIIB) with a share of China in the authorized capital of 30.8 %, and during voting — 26.6 %, and headquarters in Beijing [Voskressenski 2021: 181—189]. In fact, the AIIB is becoming an Asian-centric alternative to the Bretton Woods institutions, because the regional members of the bank account for about 75 % of the capital, in contrast to the dominance of the United States and its European allies in the IMF. The AIIB was joined by five of the seven G7 members, 15 of the 19 G20 members (South Africa is a potential member), 26 of the 37 OECD members, and 41 of the 60 Bank for International Settlements members (Figure 3). That is, the countries that form the core of the world economy have already joined the China-centered international institution. It is expected that in the near future the total number of members of the organization will exceed 100, as another 17 potential members will join existing 86.13

Figure 3. US-led and China-led Institutions of Global Economic Governance
Source: compiled by the authors based on: [Degterev 2016: 91].

So far, the PRC has managed to ensure the smoothest possible transit of power in the global economic governance. In the future, regional investment project management competencies (along with key personnel) may “flow” from the Bretton Woods system to the AIIB “matrix” as the bank’s share of joint infrastructure projects with the Bretton Woods institutions gradually increases. This process will accelerate after the implementation of a number of practical steps to internationalize the digital yuan.

The point of no return in the erosion of American-centric structural power was the refusal of the U.S. itself, represented by the Trump administration, to maintain the liberal world order, which has been the basis of American leadership since the end of World War II.

It Worked with Japan,  Will It Work with China?

While monitoring potential candidates for the role of a future revisionist superpower, the power transit school initially gave preference to economic and demographic indicators such as population, GDP, and GDP per capita [Organski, Kugler 1980; Kugler, Organski 1989: 191]. School representatives explain the emphasis on GDP by the fact that, having the necessary income, the leaders of the countries themselves can choose the optimal structure of its distribution (for defense and security, social spending, economic and infrastructure development, and other items) depending on the challenges and threats that face in front of the country.

According to Figure 4a and Figure 4b over the past 50 years only Japan among the great powers has come as close as possible to the US GDP figures, both in absolute values and in per capita income. Japan’s per capita GDP peaked in the mid-1990s, when the world was in a unipolar moment and no one assumed the possibility of power transition. However, when Japan’s per capita GDP reached a critical 80 % in 1985, a trade war broke out between Japan and the United States.

As a result of a series of events, including the Plaza Hotel agreement of 1985, which led to the revaluation of the yen, and a trade war against the Japanese semiconductor industry,14 there was a “soft landing” of the Japanese economy, which resulted in several lost decades.15 One of the direct participants of those events, economist P. Navarro, wrote a book about the “Chinese threat” back in 2006, which was already published in Russia in 2007 under the title “China’s Coming Wars” [Navarro 2007]. However, P. Navarro’s alarmist calls to restrain the growing power of China were heard only 10 years later. In 2016, in the administration of U.S. President D. Trump, he became an ideologue of the trade war with China, headed the National Trade Council, which in 2017 was transformed into the Office of Trade and Industrial Policy.

Similarly, by 2010 the PRC has already reached 81% of U.S. GDP in PPP terms (Figure 4d). The first timid attempts to decoupling in U.S.-Chinese relations began. As American researcher E. Tellis admits, that during this period the U.S. was forced to act subtly and carefully, so that measures to counterbalance the PRC would not affect the strategic partnership between the countries [Tellis 2013: 111]. In fact, it was the Obama administration (2009—2017) that lost the time to deliver a preventive non-military strike against the PRC in the economic and technological spheres, closing eyes to all the contradictions of the “cozy symbiosis” of the capitalist West
and socialism with Chinese characteristics [Lomanov 2021]. In other words, China turned out to be closer in spirit to the United States than Japan, the preventive trade war with which was launched just in time16 in accordance with the provisions of the power transit.

Figure 4a. Share of U.S. nominal GDP  in current U.S. dollars, %
Source: World Development Indicators // World Bank. URL: https://databank.worldbank.org/source/world-development-indicators (accessed: 02.02.2021).

Fig4b. Share of U.S. nominal GDP per capita in current U.S. dollars, %
Source: World Development Indicators // World Bank. URL: https://databank.worldbank.org/source/world-development-indicators (accessed: 02.02.2021).

Fig. 4c. Share of U.S. GDP at PPP per capita  in current international dollars, %
Source: World Development Indicators // World Bank. URL: https://databank.worldbank.org/source/world-development-indicators (accessed: 02.02.2021).

Fig. 4d. Share of U.S. GDP at PPP in current U.S. dollars, %
Source: World Development Indicators // World Bank. URL: https://databank.worldbank.org/source/world-development-indicators (accessed: 02.02.2021).

It was only after 2017 (three years after China’s PPP GDP had already exceeded the U.S. GDP) that the Trump administration began to actively oppose Chinese expansion by imposing higher tariffs on Chinese imports, and also hit the Chinese IT sector by tightening requirements for the purchase of Chinese equipment for government and commercial use, as well as limiting investment in Chinese technology companies [Friedberg, Boustany 2020: 25].

Although with a delay (which makes it impossible to classify this action as a preventive war), the U.S. attempted to actively counteract its main competitor in the economic sphere, previously successfully tested in a trade war with Japan. However, not bound to the U.S. by the “strong bonds” of the Treaty on Mutual Cooperation and Security Assurances,17 as well as the almost 40 thousand U.S. military contingent [Degterev 2020: 96], the PRC suddenly began to respond.

Trade War: China Responds

Hundreds of articles have already been written on the U.S. — China trade war (2018—2021); there is no point in repeating their main assumptions. Interesting is the idea of such drastic, albeit belated, U.S. actions, previously disclosed in the materials of this issue [Vinogradov, Salitsky, Semenova 2019; Suisheng, Guo 2019], in the articles of the French researcher L. Estachy [2020], and Russian scholar A.V. Lomanov [2021]. All of them emphasize that this is not a simple trade dispute, but essentially a “non-conventional” trade war conducted contrary to all WTO rules [Vinogradov, Salitsky, Semenova 2019: 43], which has strategic importance and is designed to stop the further expansion of China as a trade superpower, to undermine the very source of “dragon” power [Estachy 2020: 96]. It is also noted that this war is extremely difficult to wage under conditions of complex interdependence [Istomin 2018; Suisheng, Guo 2019].

Next, we will focus on only one aspect of the trade confrontation, showing that every US action was followed by a reaction from the PRC, which makes this case starkly different from the U.S. — Japan trade war.

At the beginning of the trade war, the bulk of China’s exports to the United States were high-tech products — electronics (25 %) and various equipment (21.5 %). Imports from the U.S. of these categories of goods accounted for 12.7 and 11.8 % of total imports, respectively. In absolute terms, Chinese exports of electronics and equipment significantly exceeded those of the United States: electronics — 119 billion USD versus 19.7 billion USD, equipment — 103 billion USD against 11.8 billion USD.18

A similar situation occurred at the end of the 20th century in the U.S. — Japan dyad. In addition to these categories of goods Japan was actively exporting cars to the United States. Therefore, cars were the main category of goods for which higher tariffs were announced in the 1980s. In the case of China, the first tariff restrictions were announced against solar panels and washing machines (Figure 5). The trade war in both cases was triggered by allegations of infringement of intellectual property rights.

The U.S. trade wars with Japan and China were caused by similar trends in bilateral trade, and also started according to a single scenario, but developed differently. In the 1980s Japan chose the path of accommodation to the U.S. requirements without taking retaliatory measures (to some extent suppressing the self-preservation instinct), and began to develop its production in the United States and South America [Chong, Li 2019: 192]. In  turn,  China responded to the outbreak of the trade war by imposing reciprocal sanctions on U.S. goods, both agricultural and metallurgical (see Figure 5).

Fig. 5. A brief timeline of the U.S. — China Trade War in 2018—2021
Source: compiled by the authors based on: The US — China Trade War: A Timeline // China Briefing. August 25, 2020. URL: https://www.china-briefing.com/news/the-us-china-trade-war-a-timeline/ (accessed: 02.02.2021).
Note: events relevant to the technology sphere are shaded.

The different approaches of Japan and China were due to several factors (in addition to those already indicated). In the 1980s, Japan was already a leader in several high-tech industries, while most of China’s exports today are low-value-added goods.

Japan has been and remains the main ally of the United States in East Asia, and the PRC has become the ideological rival [Chong, Li 2019]. Therefore, the D. Trump administration acted rather toughly to maintain its dominant position in the high value-added goods market and force China to continue to specialize in the export of low-value-added goods [Yu, Zhang 2019]. But China  generally  managed  to  avoid negative consequences by switching to the “double circulation” model [Lomanov 2021].

Fig. 6a. U.S.-China trade in 2010—2020, billions USD
Source: U.S. Census Bureau. URL: https://www.census.gov/foreign-trade/balance/c5700.html (accessed: 02.02.2021).

Fig. 6b. U.S. — China trade balance in 2010—2020, billions USD
Source: U.S. Census Bureau. URL: https://www.census.gov/foreign-trade/balance/c5700.html (accessed: 02.02.2021).

An important outcome of the U.S. — China trade war has been a gradual decrease in interdependence through an apparent reduction in trade turnover between the two countries. First of all, this was due to a decrease in the share of imports of goods from the PRC, since the export of American goods has been approximately at the same level for 10 years (Figure 6a). Similarly, the US trade deficit has begun to decline due to the reduction in dependence on Chinese goods (Figure 6b).

In addition to the reduction in Chinese exports to the United States, the share of China’s investments in US government bonds is also decreasing. In 2008, China became the main holder of United States government bonds; by 2015, the Chinese package amounted to more than 1.24 trillion USD, and by 2020 it dropped to 1.06 trillion USD.19

The decline in trade turnover and interdependence indicates that the PRC is becoming less vulnerable to US sanctions pressure, which has fewer leverage for non-military deterrence of the new superpower. Moreover, in recent years, as the economic potential of the PRC has increased, the skills of Chinese sanctions diplomacy have also actively developed [Voskressenski 2021: 205—222].

In Figure 5 it is no coincidence that the US sanctions are separately highlighted in the technological sphere — one of the few remaining pillars of American leadership, which in recent years the PRC has been actively undermining. In this area, market competition has long been out of the question. The leading Russian expert in innovations I.N. Danilin characterizes this confrontation as a technological war not by chance [Voskressenski 2021: 275—293].

Chinese researchers also speak of the beginning of the Cold War in cyberspace [Xu 2021]. The most fierce battles are unfolding for control over the production of semiconductors and element base, and for what equipment the 5G network will be deployed around the world — European (Nokia, Ericsson) or Chinese (Huawei, ZTE).

It should be noted that in the technological war the PRC “holds the blow,” and the “heat of the fight” even causes unprecedented enthusiasm in both Chinese companies and Chinese society. In particular, after the ban on the sale of American components by Huawei, the company was able to find alternatives rather quickly, presenting in December 2019 a phone that did not contain a single American-made part.20 After the ban on the installation of the Android operating system (OS) from Google, Huawei presented its own Harmony OS within months.21

Continuing this trend, the Chinese government has ordered to replace by 2022 all foreign computer equipment in government and public institutions [Wyne 2020: 46], and the transition to alternative Linux-based systems (Ubuntu, UOS, Kylin, etc.) instead of Windows, primarily for government agencies, has accelerated.22

All this is rapidly leading to technological decoupling, that is, the gradual formation of two closed IT loops — another sign of Cold
War 2.0.

Military Power and the Indo-Pacific Region as a Future Theater of War

Military power is a very important component, which shouldn’t be overestimated. According to the most influential and at the same time mysterious23 index of military power Global Firepower Index, compiled on the basis of an expanded range of indicators, the top three countries in the world remain unchanged — the United States, Russia and China. The gap between them is relatively small (the U.S. — 0.0721, the Russian Federation — 0.0796, the PRC — 0.0858).24

The attempt to combine economic, demographic and military indicators in a single index was successfully undertaken by D. Singer, who developed the Composite Index of National Capabilities  (CINC)  for   the   War   Correlates

Fig. 7a. TOP 5 countries by CINC1970—2018
Source: prepared by the authors based on the data from: 1970—2012. — NMC 5.0. URL: https://correlatesofwar.org/
data-sets/national-material-capabilities/nmc-v5-1 (accessed: 02.02.2021); 2018 — [Degterev, Nikulin, Ramich 2021: 313—319].

Fig. 7b. CINC 2018 components
Source: prepared by the authors based on the data from: 1970—2012. — NMC 5.0. URL: https://correlatesofwar.org/
data-sets/national-material-capabilities/nmc-v5-1 (accessed: 02.02.2021); 2018 — [Degterev, Nikulin, Ramich 2021: 313—319].

Project. It is calculated on the basis of six components, presented as a ratio of a country’s performance to global indicators: population (TPR), urban population (UPR), steel production (ISPR), primary energy consumption (ECR), defense spending (MER) and military personnel (MPR).22 The latest available data is dated 2012, but the authors of the article have previously calculated the data for 2018 using the Correlates of War methodology [Degterev, Nikulin, Ramich 2021: 313—319].

As shown in Figure 7a, in the mid-1990s the PRC had already surpassed the United States in terms of the aggregate index of national capacity, and by the end of the 2010s it overcame the Cold War performance of the United States, significantly increasing the lead over competitors.

At this stage, the global military deployment capabilities of the United States and the PRC are not comparable. The U.S. began planning for a global military deployment system in 1943—1945 [Nikulin 2020], having by now hundreds of military cooperation agreements, military bases and their contingents in most countries [Degterev 2020: 94—97].
In Asia, this took place within the framework
of  the  San  Francisco  system  of  international relations,23 which the U.S. formed in the 1950s on the basis of a series of bilateral agreements with regional partners [Bogaturov 1997]. In turn, the PRC is still at the initial stage of global military deployment. At the same time, the PRC has a different strategic culture compared to that of the United States, in which achieving its goals by military means is an extreme measure. For Beijing the use of economic instruments seems to be more effective.

In 2014, China proposed a new concept of Asian security, based on mutually beneficial and equal cooperation between all countries in the region,24 and started forming an alternative security system in Asia [Liff 2018]. The intensification of China’s policy in this area has forced the reform of the U.S. foreign policy in the Asia-Pacific region. As a result, the Quadrilateral Security Dialogue (QUAD) with the participation of Australia, Japan and India, an informal alliance of the main U.S. partners in the region, was created to counterbalance the PRC. This was a manifestation of the transition from bilateral cooperation to mini-lateral, or limited multilateralism on the part of the United States [Khudaykulova, Ramich 2020: 25].

Of interest is the assessment of the regional balance of power in the Asia-Pacific region, which is regularly carried out by the Lowy Institute (Australia) within the framework of the Asia Power Index. To assess the power of a state in the region, the authors have identified eight groups of indicators, which consist of 128 individual indicators. Each of the indicators has its own relative weight: military (17.5 %) and economic (17.5 %) capabilities are assessed higher than cultural (10 %) or diplomatic (10 %) influence. According to this index, the United States is the strongest and most influential state in the region (81.6), with a narrowing gap with China (76.1), which is in second place. The U.S. leadership is largely due to its military superiority and intangible resources, while China leads in economic indicators and ranks first in projected indicators (future resources) by 2030.25

The military potential of the PRC in the region is also highly estimated by American analysts from the RAND Corporation. In 2015 it conducted scenario predictions of various types of military clashes between the United States and the PRC as of 1996, 2003, 2010, 2017 in two theaters of operations: in the area of Taiwan and the Spratly Islands.26 Already at that time, the PRC’s dominance in the Taiwanese scenario was observed, and by now this dominance has only intensified within the framework of the implementation of the A2/AD (anti-access/area denial) concept.

The militarization of the Indo-Pacific region with the participation of the U.S. NATO allies, which unfolded in 2019—2021, is a matter of concern. For example, in the review “Global Britain in an Age of Competition” published in March 2021, British Prime Minister B. Johnson notes that he “has launched the largest defense investment program since the end of the Cold War”.27 The review repeatedly stresses the importance of Indo-Pacific. Indeed, the record growth in military spending of London is clearly not associated with ensuring security on the shores of the English Channel.

In 2019, France adopted its Defense Strategy in the Indo-Pacific, in 2020 — the French Strategy in the Indo-Pacific, in September 2020 the Federal Republic of Germany published its political principles regarding the Indo-Pacific. The Netherlands also announced the Indo-Pacific policy.28 In April 2021, the EU’s Strategy for Cooperation in the Indo-Pacific was adopted, focusing on security issues in the context of growing geopolitical tensions in the absence of institutionalized security structures in the region.29 The EU also plans to increase its naval presence in the region and to work more actively in the framework of the ASEAN regional forum. In the era of new confrontational bipolarity Indo-Pacific is becoming the most important potential theater.


As A.F.K. Organski put it more than 60 years ago, “the question is not whether China will become the most powerful, but rather how long it will take to achieve this status” [Organski 1958: 446]. The PRC has already overtaken the United States in terms of the Composite Index of National Potential (1995), absolute GDP in PPP (2014), industrial and infrastructure development, and is catching up in terms of research and development spending, as well as defense spending, calculated by PPP. The actual U.S. influence is still greater due to intangible resources such as diplomatic influence, alliance networks, and soft power indicators [Degterev 2020]. The U.S. also retains leadership in terms of military power and its global deployment. The analysis shows that the countries have already entered a phase of relative parity of power several years ago, and the period of power transit has already begun.

It seems that power transit is the very “great struggle” that caused the adoption in 2018 of the amendment to the Constitution of the PRC to abolish term limits for the presidency [Karneev 2019: 43]. On the U.S. side, an important indicator of the active phase of the transit of power was the unprecedented restriction of freedom of speech, the formal reason for which was the internal political struggle during the last presidential election.30

In the U.S. academic sphere most of the research will be focused on finding (including empirical) shortcomings in the Chinese model of development and outright anti-Chinese propaganda in the spirit of “Kremlinology” and “Sovietology” of the previous Cold War [Voskressenski 2021: 223—230]. Accordingly, the Chinese discursive force will also grow, forming counter images and meanings [Denisov 2020].

After the Obama administration missed the time for a preemptive strike in the economic and technological sphere, the PRC successfully repulsed the belated Trump “cavalry assault” by staking on the development of the domestic market, the “double circulation” model, as well as accelerated scientific and technological development [Lomanov 2021]. Being fully aware of the danger to its own interests of the Chinese model of globalization, “ramming” of which is the Belt and Road Initiative, the United States is at the stage of active development of new initiatives for strategic deterrence [Lew, Roughead 2021]. They seem to include proposals to form new anti-Chinese coalitions, both by “bridging the ranks” of traditional allies and transferring their power to the Indo-Pacific, and by strengthening cooperation with wavering India (including through QUAD), the Republic of Korea, ASEAN countries, and the development of the Comprehensive and Progressive Trans-Pacific Partnership (TPP-11).

The uncompromising nature of the confrontation will only increase, and a new confrontational bipolarity is on the agenda. The possibilities for non-military deterrence of China by the U.S. are narrowing.


1 “We Thought We Won”. Ten Years of “Reset” in Relations between Russia and the United States [«Мы думали, что победили». Десять лет «перезагрузке» отношений России и США] // RIA Novosti. March 6, 2019. URL: https://ria.ru/20190306/1551572481.html (accessed: 08.02.2021). (In Russian).

2 How the United States Pulled Out of International Agreements under Donald Trump Administration [Как США выходили из международных соглашений при администрации Дональда Трампа] // TASS. November 22, 2020. URL: https://tass.ru/info/10068059 (accessed: 08.02.2021). (In Russian).

3 TransResearch Consortium. URL: https://transresearchconsortium.com/ (accessed: 08.02.2021).

7 To be fair, it should be noted that in the Russian-language scientific literature, the simplified version of the theory of power transit in the form of the “Thucydides trap” has become somewhat widespread [Efremenko 2020].

8 It is noteworthy that in 2020, the Telegram channel called “The Thucydides Trap” (https://t.me/lovuska) was created in the Russian media sphere, which gained 1.4 thousand subscribers as of May 2021. The channel’s description notes that “Thucydides Trap is a conflict between a hegemon and rising countries for leadership in the world. It’s a trap our world has fallen into.”

9 CNKI (China National Knowledge Infrastructure, 中国知网). URL: https://oversea.cnki.net/index/ (accessed: 10.01.2021).

10 Bergsten C.F. Two’s Company // Foreign Affairs. September — October 2009. URL: https://www.foreignaffairs.com/articles/americas/2009-09-01/twos-company (accessed: 10.01.2021).

11 Dengxiaoping xin shiqi de waijiao zhanlue sixiang shu lun // Lingxiu renwu ziliao ku [On Deng Xiaoping’s Diplomatic Strategy in the New Period // Political Leaders Data Archive]. URL: http://cpc.people.com.cn/GB/33839/34943/34983/2641962.html (accessed: 10.01.2021). (In Chinese).

12 Hong C., Kang D., Chen B. Zongshu: Xi Jinping de Xinxing daguo guanxi waijiao zhanlue shi zheyang lianchengde [Description: Implementation of Xi Jinping’s diplomatic strategy to create a “new type of relationship between great powers”] // Renmin Ribao. 2016. URL: http://world.people.com.cn/n1/2016/0213/c1002-28120530.html (accessed: 10.01.2021). (In Chinese).

13 Members and Prospective Members of the Bank. Asian Infrastructure Investment Bank // The Asian Infrastructure Investment Bank. March 31, 2021. URL: https://www.aiib.org/en/about-aiib/governance/members-of-bank/index.html (accessed: 31.03.2021).

14 How the US Waged a Trade War with Japan [Как США вели торговую войну с Японией] // Kommersant. August 17, 2019. URL: https://www.kommersant.ru/doc/4047539 (accessed: 08.02.2021). (In Russian).

15 Hideo Z. Lost 30 Years: Forced Manipulation of the Yen [Хидэо Ц. Потерянное тридцатилетие: вынужденное манипулирование курсом йены] // Nippon.com. March 22, 2016. URL: https://www.nippon.com/ru/column/g00350/ (accessed: 08.02.2021). (In Russian).

16 An allusion to one of the principles of lean manufacturing within the Toyota Production System (Editor’s note).

17 Japan and the United States Celebrate 60 Years since the Signing of a Joint Security Treaty [Япония и США отмечают 60 лет со дня подписания совместного договора о безопасности] // TASS. January 18, 2020. URL: https://tass.ru/mezhdunarodnaya-panorama/7551681 (accessed: 08.02.2021). (In Russian).

18 Observatory of Economic Complexity // MIT. URL: https://oec.world (accessed: 02.02.2021).

19 See: Major Foreign Holders of Treasury Securities // Department of the Treasury / Federal Reserve Board. 2000—2019. URL: https://ticdata.treasury.gov/Publish/mfhhis01.txt (accessed: 04.02.2021); Major Foreign Holders of Treasury Securities // Department of the Treasury / Federal Reserve Board. 2021. URL: https://ticdata.treasury.gov/Publish/mfh.txt (accessed: 04.02.2021).

20 Huawei Began to Produce Smartphones without American Components [Huawei начала выпускать смартфоны без американских комплектующих] // Vedomosti. December 3, 2019. URL: https://www.vedomosti.ru/technology/news/2019/12/03/817774-huawei-nachala-delat-smartfoni-bez (accessed: 08.02.2021). (In Russian).

21 Huawei Has Released a Complete Android Replacement for Its Smartphones [Huawei выпустила полноценную замену Android для своих смартфонов] // CNews. December 16, 2020. URL: https://www.cnews.ru/news/top/2020-12-16_huawei_vypustila_polnotsennuyu (accessed: 08.02.2021). (In Russian).

22 Chinass Public Sector is Changing Windows to a Linux-based OS [Госсектор Китая меняет Windows на ОС на базе Linux] // Astra Linux. 2020. URL: https://astralinux.ru/news/category-news/2020/gossektor-kitaya-menyaet-windows-na-os-na-baze-linux/ (accessed: 08.02.2021). (In Russian).

23 It is not officially declared who is the creator of the index, and the weights of individual components are not disclosed. For more details see: [Degterev 2020: 144—147].

24 The lower the index value, the stronger the military potential of the country. See: Global Firepower Index 2021. URL: https://www.globalfirepower.com (accessed: 08.02.2021).

22 National Material Capabilities (v 5.0.) // Correlates of War Project. URL: https://correlatesofwar.org/data-sets/national-material-capabilities (accessed: 08.02.2021).

23 In international discourse, this system is better known as “Hub and Spokes”.

24 Xi Jinping New Asian Security Concept for New Progress in Security Cooperation // Remarks at the Fourth Summit of the Conference on Interaction and Confidence Building Measures in Asia. May 21, 2014. URL: https://www.fmprc.gov.cn/mfa_eng/zxxx_662805/t1159951.shtml (accessed: 08.02.2021).

25 Asia Power Index // Lowy Institute. URL: https://power.lowyinstitute.org/ (accessed: 08.02.2021).

26 An Interactive Look at the U.S. — China Military Scorecard // RAND. 2015. URL: https://www.rand.org/paf/projects/us-china-scorecard.html (accessed: 08.02.2021).

27 Global Britain in a Competitive Age: the Integrated Review of Security, Defence, Development and Foreign Policy // UK Government. March 16, 2021. P. 3. URL: https://www.gov.uk/government/publications/global-britain-in-a-competitive-age-the-integrated-review-of-security-defence-development-and-foreign-policy (accessed: 08.02.2021).

28 Cleo P. Indo-Pacific strategies, perceptions and partnerships // Chatham House. March 23, 2021. URL: https://www.chathamhouse.org/2021/03/indo-pacific-strategies-perceptions-and-partnerships/04-france-and-indo-pacific (accessed: 30.03.2021).

29 EU Strategy for Cooperation in the Indo-Pacific // European External Action Service. April 19, 2021.
URL: https://eeas.europa.eu/headquarters/headquarters-homepage/96741/eu-strategy-cooperation-indo-pacific_en (accessed: 07.05.2021).

30 Zhukova K. Lack of Freedom of Speech: How American Social Networks Became Participants in the Political Struggle [Жукова К. Несвобода слова: как американские соцсети стали участниками политической борьбы] // Forbes. January 14, 2021. URL: https://www.forbes.ru/tehnologii/418431-nesvoboda-slova-kak-amerikanskie-socseti-stali-uchastnikami-politicheskoy-borby (accessed: 08.02.2021). (In Russian).


About the authors

Denis Andreevich Degterev

RUDN University

Author for correspondence.
Email: degterev-da@rudn.ru
ORCID iD: 0000-0001-7426-1383

Dr. of Sc. (Political Science), PhD in Economics, Head, Department of Theory and History of International Relations, RUDN University; Professor, World Economy Department, MGIMO University; Professor, Department of European Studies; St. Petersburg State University

Moscow, Russian Federation

Mirzet Safetovich Ramich

RUDN University

Email: ramich_ms@mail.ru
ORCID iD: 0000-0003-1479-2785

Postgraduate Student, Department of Theory and History of International Relations

Moscow, Russian Federation

Anatoly Vladimirovich Tsvyk

Ministry of Foreign Affairs of the Russian Federation

Email: a.tsvyk91@mail.ru
ORCID iD: 0000-0002-0563-5609

PhD in History

Moscow, Russian Federation


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Supplementary files

Supplementary Files
1. Fig. 1. Visual Interpretation of Power Transition Theory

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2. Fig. 2. Satisfaction by status-quo in world hierarchy

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3. Fig. 3. US-led and China-led Institutions of Global Economic Governance

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4. Fig. 4a. Share of U.S. nominal GDP in current U.S. dollars, %

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5. Fig. 4b. Share of U.S. nominal GDP per capita in current U.S. dollars, %

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6. Fig. 4c. Share of U.S. GDP at PPP per capita in current international dollars, %

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7. Fig. 4d. Share of U.S. GDP at PPP in current U.S. dollars, %

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8. Fig. 5. A brief timeline of the U.S. — China Trade War in 2018—2021

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9. Fig. 6a. U.S.-China trade in 2010—2020, billions USD

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10. Fig. 6b. U.S. — China trade balance in 2010—2020, billions USD

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11. Fig. 7a. TOP 5 countries by CINC1970—2018

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12. Fig. 7b. CINC 2018 components

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