In the aftermath of the assault on the Capitol, much of the nation’s attention was focused on “why.” But another question is equally important: “What next?”

The problem the authorities faced on Jan. 6 was not an inability to respond, but failure to anticipate the threat. Going forward, counterterrorism efforts should emphasize connecting the dots in the far-right extremist universe — not a simple task, given the dispersed and fast-moving nature of the threat.

Read the rest at The New York Times

As it is currently organized, the U.S. government is ill-equipped to deal with the growing number of national security challenges that exist at the intersection of commercial and defense technology. Innovation opportunities are slipping between Washington’s organizational gaps, and America’s enemies are too.

Read the rest at War on the Rocks

ABSTRACT

In October 1957, Poland proposed the Rapacki Plan for the denuclearisation of Central Europe. While North Atlantic Treaty Organization (NATO) members attacked the initiative, Canada viewed it as a means to ease Cold War tensions. Although Canada joined with its allies to reject the Plan, it embarked on a quest for counterproposals to restrain NATO nuclear sharing and reduce the chances of nuclear war. Canada’s efforts alarmed Western allies and helped lead to a second Rapacki Plan. Overall, this article details Canada’s struggle to assert itself as a middle power and provides a robust example of Western interest in the Rapacki Plan.

Read the rest at Cold War History

Extending the New Strategic Arms Reduction Treaty, or New START, with Russia was one of President Biden’s first foreign policy acts after he took the oath of office on Jan. 20. The treaty would have otherwise ended on Feb. 5, leaving the U.S. and Russia without any agreed upon limits on their strategic nuclear forces for the first time since 1972. When relations are as bad as they are now between Moscow and Washington, U.S. national security would suffer from severe uncertainty over an unconstrained Russian nuclear arsenal.

Read the rest at The Hill

In a December 2020 New York Times interview, Ukrainian President Volodymyr Zelensky welcomed Joe Biden’s election as U.S. president. Zelensky observed that Biden “knows Ukraine better than the previous president” and “will really help strengthen relations, help settle the war in Donbas, and end the occupation of our territory.”[1]

While Zelensky’s comments may prove overly optimistic, there is little reason to doubt that the Biden presidency will be good for Ukraine. The incoming president knows the country, and he understands both the value of a stable and successful Ukraine for U.S. interests in Europe and the challenges posed to Ukraine and the West by Russia. That might—might, not will, but might—help break the logjam on the stalemated Donbas conflict, which Zelensky of course would welcome. Perhaps less welcome to the Ukrainian president may be Biden’s readiness to play hardball to press Kyiv to take needed but politically difficult reform and anti-corruption steps. Ukraine’s success as a liberal democracy depends not just on ending its conflict with Russia but also on combating corruption and advancing still necessary economic reforms.

U.S.-Ukraine Relations under Trump

In one sense, U.S. policy toward Ukraine during the Trump administration had its strengths. It continued political and military support for Kyiv, including the provision of lethal military assistance that the Obama administration had been unwilling to provide. It maintained and strengthened Ukraine-related sanctions on Russia. And it took further steps to bolster the U.S. and NATO military presence in central European states on Ukraine’s western border.

However, Donald Trump never seemed committed to his administration’s policy. His primary engagement on Ukraine was his bid to extort Kyiv into manufacturing derogatory information on his Democratic opponent, a bid that led to his impeachment.[2] Beyond that, Trump showed no interest in the country and consistently refused to criticize Vladimir Putin, who has inflicted more than six years of low-intensity war on Ukraine.

The Biden presidency will end this dichotomy in Washington’s approach to Kyiv. The president and his administration will align on policy. That new predictability will mean that Ukrainian officials no longer have to worry about late night presidential tweets or the subjugation of U.S. policy interests to the president’s personal political vendettas.

Two Challenges Confronting Ukraine

As Biden takes office, two principal challenges confront Ukraine. The conflict with Russia poses the first.[3] In March 2014, in the aftermath of the Maidan Revolution, Russian military forces seized Crimea. Weeks later, Russian security forces instigated a conflict in Donbas, masked poorly as a “separatist” uprising. The Kremlin provided leadership, funding, heavy weapons, ammunition, other supplies and, when necessary, regular units of the Russian army. Now in its seventh year, that conflict has claimed the lives of some 13,000 people.

While Moscow illegally annexed Crimea, it has not moved to annex Donbas. It appears instead to want to use a simmering conflict in that eastern Ukrainian region as a means to put pressure on, destabilize and disorient the government in Kyiv, with the goal of making it harder for the government to build a successful Ukrainian state and draw closer to Europe. (Moscow has interfered elsewhere in the post-Soviet space to try to maintain a Russian sphere of influence.)

Without the Kremlin’s cooperation, Kyiv on its own cannot resolve the conflict in Donbas, and Crimea poses an even harder question. However, meeting the second of the challenges facing Ukraine—implementation of reforms and anti-corruption measures needed to build a fair, robust and growing economy—lies largely within Kyiv’s purview. Unfortunately, after a good start by Zelensky and his first government, reforms have stagnated, oligarchs retain undue political and economic influence (including within Zelensky’s Servant of the People party), and the judicial branch remains wholly unreconstructed.[4] Among other things, this depresses much-needed investment in the country.

Progress Toward a Resolution in Donbas?

The Biden presidency might well play a more active role in the moribund negotiating process regarding Donbas. As co-chairs of the “Normandy process,” German Chancellor Angela Merkel and French President Emmanuel Macron have had little success of late in implementation of the 2015 Minsk agreement, which laid out a path to a settlement and restoration of full Ukrainian sovereignty over Donbas.[5] Unfortunately, it appears that the Kremlin calculates that the benefits of keeping Kyiv distracted currently outweigh the costs, including of Western sanctions.

Zelensky believes that a more active U.S. role could change that calculation and inject momentum into the process. At a minimum, the Biden presidency should appoint a special envoy to coordinate with the Germans and French, and, more broadly, with the European Union, Britain, Canada and others on Western support for Ukraine and sanctions against Russia. That position has gone unfilled since September 2019.

Whether Biden, who will face many demands on his time, will choose to engage personally is a different question. He knows Ukraine, having traveled there six times when he served as vice president. And, unlike Trump, who sought quick victories, Biden understands that solving a question like Donbas would require an investment of his time over a sustained period. It would make sense if it became clear that his engagement would shake up things in a way that would increase the prospects of a settlement and return of Donbas to Ukrainian sovereignty.

At first glance, the Kremlin might not welcome that kind of U.S. involvement, but there are good arguments for it. First of all, the United States is Ukraine’s strongest Western supporter, and Washington’s voice carries considerable weight in Kyiv. Second, Russia’s current conflict against Ukraine is not just about Donbas; it is also about Ukraine’s place in Europe, that is, where the country fits between Russia and institutions such as the European Union and NATO.[6] Addressing that question will require diplomatic finesse. Given the trans-Atlantic relationship, which will be revived under Biden, it is difficult to see such a geopolitical discussion taking place without American participation.

As for Crimea, Ukraine cannot at present muster the political, diplomatic, economic and military leverage to effect the peninsula’s return. Still, the U.S. government knows how to do non-recognition policy.[7] It did so for five decades with regard to the Baltic states’ incorporation into the Soviet Union. The Biden presidency will remain supportive of Kyiv’s claim to Crimea and not recognize its annexation by Russia—and the White House will express this view.

Domestic Reform

After an encouraging start on reform, Zelensky wavered in 2020. He has to do more, and Biden can be helpful, though in a manner the Ukrainian president may not appreciate. A big part of the problem is that Zelensky himself seems to have lost his way. Ruslan Ryaboshapka, his reformist first prosecutor general, observed that “Instead of fighting oligarchs, [Zelensky] chose to peacefully coexist with them.”[8] Biden could well prove the kind of friend that Ukraine needs now: supportive but direct with Zelensky on what must be done, and ready to push him to take politically hard measures that he might prefer to avoid.

Biden has already shown that he can do this. As vice president in the Obama administration, he had the lead on U.S. engagement with Ukraine. When necessary, he applied “tough love,” famously withholding a one-billion-dollar loan guarantee until then-President Petro Poroshenko fired a prosecutor general who was viewed widely, inside and outside of Ukraine, as corrupt.[9]

A dose of such tough love now seems necessary with Kyiv. One question concerns access to low interest credits under Ukraine’s stand-by agreement with the International Monetary Fund.[10] The IMF conditions disbursements of those credits on how Ukraine implements reform commitments that it made to secure the agreement. The Biden administration should, and almost certainly will, back the IMF in insisting that Ukraine needs to deliver on its commitments in order to secure additional disbursements.

Likewise, the Biden administration should make more bilateral U.S. assistance conditional on Ukraine tackling particular reforms. In doing so, it should consult and coordinate closely with the European Union, which has greater assistance resources available. Introducing a higher degree of conditionality to Western assistance programs could usefully ratchet up the pressure on the leadership in Kyiv to take reform steps that are in the country’s broader interest but opposed by key oligarchs or political groups who stand to lose from such reforms.

Priority should go to encouraging reform of the judicial branch, including the Constitutional Court, which has a core of judges who appear beholden to special interests. The high court reversed earlier laws requiring members of parliament and government officials to disclose their assets and could threaten other reforms.[11]

At home, the Biden administration can assist Ukraine by implementing a ban on anonymous shell companies by requiring disclosure of who actually forms companies in the United States as contained in the Corporate Transparency Act, part of the National Defense Authorization Act.[12] This will make it more difficult for corrupt Ukrainians to shelter ill-gotten gains in U.S. assets.

The Biden presidency is good news for Ukraine and those who wish to see it develop into a modern European state. It will mean more high-level but hard-nosed U.S. support. That could lead to greater progress on reform within the country. And, with some imaginative diplomacy and luck, it might even help break the logjam with Russia over resolving the fate of Donbas.

[1] Kramer, Andrew E. “With Trump Fading, Ukraine's President Looks to a Reset With the U.S.” The New York Times. The New York Times Company, December 19, 2020. https://www.nytimes.com/2020/12/19/world/europe/trump-zelensky-biden-ukr....

[2] Nichols, Tom. “Trump Is Being Impeached over an Extortion Scheme, Not a 'Policy Dispute'.” USA Today. Gannett Satellite Information Network, January 30, 2020. https://www.usatoday.com/story/opinion/2020/01/30/trump-impeachment-blac....

[3] Masters, Jonathan. “Ukraine: Conflict at the Crossroads of Europe and Russia.” Council on Foreign Relations. Council on Foreign Relations, February 5, 2020. https://www.cfr.org/backgrounder/ukraine-conflict-crossroads-europe-and-....

[4] Iliyas, Boktakoz. “Anti-Corruption Backtracking in Ukraine – Has Ze Reform Moment Passed?” Control Risks. Control Risks Group Holdings Ltd., December 17, 2020. https://www.controlrisks.com/our-thinking/insights/anti-corruption-backt....

[5] “Ukraine Walks a Tightrope to Peace in the East.” International Crisis Group, January 29, 2020. https://www.crisisgroup.org/europe-central-asia/eastern-europe/ukraine/ukraine-walks-tightrope-peace-east.; “Ukraine Ceasefire: New Minsk Agreement Key Points.” BBC News. BBC, February 12, 2015. https://www.bbc.com/news/world-europe-31436513.

[6] Tefft, John F. “ Reflections on Russia, Ukraine and the U.S. in the Post-Soviet World.” American Foreign Service Association, n.d. https://www.afsa.org/reflections-russia-ukraine-and-us-post-soviet-world.

[7] Pompeo, Michael R. “Crimea Is Ukraine.” U.S. Department of State. U.S. Department of State, February 26, 2020. https://www.state.gov/crimea-is-ukraine-3/.

[8] Kranolutska, Daryna, and Volodymyr Verbyany. “Ukraine's Leader Is Being Broken by the System He Vowed to Crush.” Bloomberg.com. Bloomberg, December 16, 2020. https://www.bloomberg.com/news/articles/2020-12-17/ukraine-s-leader-is-b....

[9] Subramanian, Courtney. “Explainer: Biden, Allies Pushed out Ukrainian Prosecutor Because He Didn't Pursue Corruption Cases.” USA Today. Gannett Satellite Information Network, October 3, 2019. https://www.usatoday.com/story/news/politics/2019/10/03/what-really-happ....

[10] “IMF Executive Board Approves 18-Month US$5 Billion Stand-By Arrangement for Ukraine.” International Monetary Fund. International Monetary Fund Communications Department, June 9, 2020. https://www.imf.org/en/News/Articles/2020/06/09/pr20239-ukraine-imf-exec....

[11] “Ukraine's Constitutional Court Attacks Anti-Corruption Laws.” The Economist. The Economist Newspaper, November 14, 2020. https://www.economist.com/europe/2020/11/14/ukraines-constitutional-cour....

[12] Pearl, Morris. “Commentary: Congress Just Passed the Most Important Anti-Corruption Reform in Decades, but Hardly Anyone Knows about It.” Fortune. Fortune Media IP, December 26, 2020. https://fortune.com/2020/12/26/ndaa-2021-shell-companies-corporate-trans....

Originally for Stanford International Policy Review

This op-ed by Aynne Kokas and Oriana Skylar Mastro was originally published in the Australian Financial Review.

The images of bare-chested, flag-waving MAGA loyalists overtaking the US Capitol flooded US social media and news channels in the days following the January 6 siege against the electoral college count. Memed and amplified, the same images circulated widely on Chinese social media and state-owned news sites without even the need for critical commentary.

The literal destruction of the US Capitol at the hands of President Donald Trump's followers required little imagination to characterize abroad as the downfall of American democracy.

There are many reasons for pessimism. According to one of the most authoritative indexes, Polity, the United States is no longer the world’s oldest continuous democracy, dropping in status to a system that is part democracy, part dictatorship.

Beyond the domestic concerns faced in the aftermath of the breach of one of America's most hallowed buildings, the Capitol siege was a win for China. US soft power, one of its comparative advantages in the great power competition, has taken a huge hit.

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Soft power is “the ability to get what you want through persuasion or attraction in the forms of culture, values, and policies”.⁠ The US has been the primary beneficiary of soft power, with its globally recognized brands, pop culture, fast-food chains, world-renowned universities, and political values.

It is relatively low cost and high impact compared with other forms of power. The United States' relative attractiveness is one of the reasons America prevailed in the Cold War.

The Chinese government is having a propaganda field day. More than ever, the US looks like a country in decline, discouraging to allies and potential partners. Chinese commentators have noted that America's days as the "city on the hill" have come to an end. This is karma, some say, payback for the US supporting opposition groups, as in Hong Kong. As one netizen commented on the popular microblog website Weibo: "So lucky to be born in China."

China has also been trying to increase its soft power through traditional mechanisms such as building its media, education, and tourism sectors. It has enjoyed only moderate success in these areas because of its censorship, pollution, and lack of independent civil society.

But COVID-19 has led to the strengthening of other Chinese public diplomacy efforts, such as its landmark Belt and Road Initiative global trade and investment scheme.

Related initiatives such as the Digital Silk Road, a program to build out global digital infrastructure using Chinese technology, and the Health Silk Road, a plan to export Chinese health expertise through things such as COVID-19 laboratories and vaccine diplomacy, draw on China's comparative advantage in a top-down soft power approach.

Meanwhile, the Trump administration has undermined the historical sources of US soft power. It has shuttered visa lines, investigated international students on campus, and driven the rise of a culture of nationalism. The cancellation of the Fulbright US Student Program and the Peace Corps program in China are prime examples. And the COVID-19 decreased US media production, educational exchange and tourism, which shrank opportunities for promoting its democratic values on the global stage.

A bird’s-eye view of America's relative soft power may seem to offer cause for optimism. Even after four years of Trump's buffoonery and "America First", the US is still far ahead of China, ranking fifth in overall soft power, while China ranks 24th. And isn’t this what matters in competition?

Yes and no. The problem is two-fold. First, the US relies more on its political values as a soft power source than Beijing does. Ironically, this has especially been the case during the Trump administration. National Security Adviser Robert O’Brien has argued that democracies and authoritarian countries such as China “are offering a different approach to the world”. Secretary of State Mike Pompeo has argued to international audiences that democracy is “what we’ve got right”.

Second, Beijing has tried to leverage its comparative advantages to build soft power through pathways other than political values, especially where a top-down government approach is effective. China set up COVID-19 testing labs in Palestine in agreement with Israeli and Palestinian authorities. It extended its hand in Africa by building more than 70 percent of its 4G infrastructure.

Depending on need, useful solutions can be as compelling as political principles.The future of the US as a world leader is at stake. American military base access worldwide depends on perceived political alignment between the US and its allies. In the tech sector, the widespread adoption of US platforms relies on other countries finding that benefits to allowing in foreign platforms outweigh the potential political risks.

Successful multilateral treaty negotiations on issues such as global trade and climate change rely on the perception of a dependable US political system.

On Jan. 6, the U.S. Capitol was assaulted and occupied for the first time since 1814. Five people were killed, including a Capitol Police officer. Two Republican Representatives have introduced a bill to establish a national bipartisan commission to investigate the attack. We agree that a commission is needed. Here, we sketch the mandate, major areas of inquiry, and legislative language that we believe are needed to guide this effort.

Read the rest at Lawfare Blog

Sanctions will remain part of the US toolkit for dealing with Russia under the incoming Biden administration. Certain principles should guide their use and could increase the chances that they will achieve US policy goals: sanctions should be embedded in an overall Russia policy, linked to a specific policy goal, understood by the Kremlin, clearly reversible if Russia ceases the offending action, and coordinated with US allies.

As Joe Biden prepares to become the 46^th president of the United States, speculation has begun on what a Biden administration will mean for US policy toward Russia and sanctions on Russia. Sanctions will remain part of the US toolkit for responding to egregious Russian misbehavior. It would be useful if the new administration set down principles early on for their application.

As relations between Washington and Moscow—and, more broadly, between the West and Russia—deteriorated over the past decade, the United States and Europe applied an increasing number of sanctions in response to Russian actions. The United States has now sanctioned Russia for its aggression against Ukraine, cyber and disinformation activities aimed at affecting US domestic politics, and support for Syria and Venezuela, among other things. The United States has long applied sanctions on the Soviet Union and Russia due to human rights concerns.  The 1974 Jackson-Vanik amendment denied permanent normal trade relations status to the Soviet Union until Moscow allowed religious minorities to emigrate. The 2012 Magnitsky Act sanctioned Russian officials involved in serious human rights violations such as torture or extrajudicial killings (it was later amended to apply to other countries as well).

The sanctions result from both executive orders and legislation. Some target individuals with visa denials and asset freezes. Other sanctions hit specific companies. Still others aim at key elements of the Russian economy, particularly the financial, energy, and high-tech sectors.

The sanctions have had an impact on Russia’s economic growth, though the exact amount is difficult to measure and a subject of debate. Some sanctions may not be felt for some time. For example, sanctions that deny Russian companies access to American technology and financing for developing new and technically challenging oil fields do not constrain Russian oil production now. They will, however, limit Russia’s ability to develop new oil fields requiring high-tech extraction techniques as current wells are depleted.

The Kremlin regularly pooh-poohs sanctions, but Russian officials miss no opportunity to call for their lifting. Lifting sanctions was a key point during Vladimir Putin’s intervention in the virtual G-20 summit in November. True, in most cases, sanctions have not achieved their desired goal. Russia has not, for example, ended its conflict against Ukraine in Donbas. Sanctions, however, may well have deterred the Kremlin from other steps. Russian and Russian proxy forces have not tried to seize Mariupol, as many feared they might in 2015, and Putin dropped the claims to vast amounts of Ukrainian territory he made in  2014 (so-called “Novorossiya”).

When the Biden administration takes office, sanctions will undoubtedly remain an element of US policy toward Russia. To enhance its effectiveness, the administration should base its sanctions policy on certain principles.

First, the Biden administration should embed sanctions in a broader US policy toward Russia.  If the Trump administration had an overall Russia policy, it never articulated it. Absent a broader framework, sanctions seemed to take on a life of their own.

An overall policy should include strong measures to deter and push back against Russian misbehavior. These measures include enhancing the NATO military posture in the Baltic region, support—including lethal military assistance—for Ukraine, and sanctions. The overall policy should also include dialogue, both to apply guardrails, such as arms control, on what has become an increasingly adversarial relationship and to professionalize discussion of hard issues that might (or might not) chip away at some problems over time. The Reagan administration successfully used this combination in the 1980s.

Second, sanctions are not an end in themselves and should not be treated as such. They offer a means to achieve a policy goal and, thus, should be clearly linked to that goal, as in “this sanction will apply until Moscow does X” or “if Moscow does X, Washington will respond with this sanction.” The aim of sanctions should be to affect Kremlin calculations of the benefits and costs of its actions, hopefully tipping the balance against those actions that threaten key Western interests.

The Kremlin should also have clarity on what it must do to get the sanctions lifted. Thus, the sanctions should be tied to a single policy goal. Sanctions that seek to get Russia to correct two different kinds of misbehavior—for example, a ban on the export of dual-use technologies stemming from Russia’s aggression against Ukraine and the attempted poisoning of Sergey Skripal in Britain—likely will achieve neither objective.

Third, sanctions should seek to deter, if possible. It is easier to deter and dissuade an adversary from taking an unwanted action than  compel the adversary to reverse an action it has already taken. Specifying the sanction(s) that would result from a particular Russian action in advance could have a greater chance of affecting the Kremlin’s cost-benefit calculation.

Fourth, for sanctions to be effective in achieving their policy goal, Moscow has to believe that, if it takes the action desired by Washington, the sanction will be lifted. Unfortunately, US sanctions do not have the best history in this regard. The 1974 Jackson-Vanik amendment applied to the successor states, including Russia, following the Soviet Union’s 1991 collapse. Russia permitted open emigration, leading the Clinton administration in 1994 to determine that Russia had fully complied with Jackson-Vanik. Yet it was not until 2012 that Congress removed Russia from the amendment’s purview and granted the country permanent normal trade relations status—and then only in the Magnitsky Act, which applied new sanctions. If the Kremlin concludes that the sanction will remain in place regardless of what it does, it will have no      incentive to change its behavior.

Fifth, coordination with allies, particularly the European Union (EU), can dramatically enhance the impact of sanctions. Multilateral sanctions send a stronger political message. They also generate a greater economic impact. When the United States and European Union began consulting on sanctions against Russia after its seizure of Crimea, EU trade with Russia dwarfed US-Russia trade. Europe, thus, had more to withhold.

Currently, the fate of the Nordstream 2 gas pipeline could complicate sanctions coordination with Europe. The US government has good reasons to oppose Nordstream 2, which is hardly a commercial project. Renovating the Ukrainian pipelines would have been vastly cheaper, but Russia wants to circumvent Ukraine for geopolitical reasons. Nordstream 2, however, could pose a major problem between the Biden administration and Germany, the pipeline’s main European backer. Finding a solution to this issue will strengthen Washington’s ability to maintain a united sanctions front with Europe against Russia.

Sixth, the US government might consider pairing a carrot with sanctions to affect Kremlin thinking. For instance, to break the deadlock on a Donbas settlement, Washington could work with Berlin and Paris on a plan for a UN-mandated peacekeeping force and interim international administration. The peacekeeping force and interim administration would deploy to Donbas, providing a transition between the departure of Russian and Russian proxy forces and full restoration of Ukrainian sovereignty. When offering this as a face-saving way to help Russia leave Donbas, Washington and its partners could quietly add that failure to take up the offer would trigger additional sanctions.

Seventh, the Biden administration should consult with Congress as it shapes its sanctions policy. This coordination should prove easier than it has during the past four years, when both Democrats and Republicans on Capitol Hill did not trust the White House’s management of sanctions. That mistrust led to an overwhelming vote for the 2017 Countering America’s Adversaries through Sanctions Act, which gave Congress power to block the lifting of sanctions. The Biden administration will want to ensure that, if Moscow moves to correct offending misbehavior that justifies lifting sanctions, Congress does not block their lift. If the Kremlin adjusts its policy on a particular question and the linked sanction remains in force, that will undercut the power of all other and any future sanctions. Sanctions, in that case, would become just a means of punishment, not of attaining a policy objective.

Within these principles on sanctions, there is room for creative thinking. For example, would it make sense, when targeting individuals for visa sanctions and asset freezes, to sanction their families as well? It is one thing if a Russian businessman cannot travel to the United States or Europe; it would be quite another if his spouse could not make her annual shopping trip to London and his kids could not attend school in the United States or Britain.

Principles such as the above offer a structure for managing sanctions policy toward Russia. They also could increase the chances that sanctions succeed in achieving their desired policy outcomes.

. . .

Steven Pifer is a William Perry Research Fellow at Stanford’s Center for International Security and Cooperation. A retired Foreign Service officer, his 25+ years with the State Department included assignments as Deputy Assistant Secretary responsible for Russia and Ukraine, Ambassador to Ukraine, and Special Assistant to the President and Senior Director for Russia, Ukraine and Eurasia on the National Security Council.

Originally for Georgetown Journal of International Affairs

This op-ed by Oriana Skylar Mastro and Zack Cooper originally appeared in Australian Financial Review.

Australia’s trials are not the first time Beijing has used economic coercion against another country.

It has become so common that we are becoming desensitised to it. Some notable examples include Beijing’s limitations on rare earth exports to Japan in 2010, Norwegian fish exports in 2010, Philippine tropic fruit exports in 2012, Vietnam’s tourist industry in 2014, Mongolian commodities trade in 2016, and South Korean businesses in 2017. In each case, Beijing sought to achieve a political objective by imposing economic penalties.

This case is different. Beijing has typically been ambiguous about the purpose or nature of its coercive economic statecraft. Despite evidence otherwise, it blamed the Japanese ban on meeting a yearly quota, the Philippine ban on pesticide exposure, the tourism drop to Vietnam on changing Chinese preferences, and the closure of South Korean stores on fire code violations. In Australia’s case, though, Beijing is doing away with these pretenses.

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China has not been shy this time about connecting its punitive actions to its unhappiness with Australian policies. The Chinese foreign ministry has listed a “series of wrong moves” by Australia for the disruption in relations. Beijing’s embassy in Canberra then gave a list of 14 “mistakes” to the Australian press.

These grievances include Australia’s foreign interference legislation, foreign investment reviews, funding for Australian think tanks, and unfriendly media reporting. Some of these criticisms are particularly ironic coming from Beijing, which often objects to foreign interference in other countries’ domestic affairs.

A core component of China’s strategy is a disinformation and propaganda effort designed to paint its moves as merely defensive, a proportionate and legitimate response to actions taken by the other side.

Australia has done nothing ‘wrong’

Let’s be clear: Australia has done nothing “wrong” in promoting and protecting its democratic institutions at home. It should not censor its media, obstruct analysis by outside experts, or shy away from safeguarding its democratic processes.

This time, the current trade restrictions are about more than making an example of Australia or showing smaller powers that they’ll pay if they have something to say about how the Chinese Communist Party governs at home. Beijing’s aims have taken on new proportions. Party leaders are now willing to punish democracies simply for upholding basic democratic principles within their own countries.

The message is clear: curtail some of your democratic principles or pay the price.

The US needs to work with like-minded states around the world to address this new threat. Free countries need to speak out together in Australia’s defence. If democracies do not hang together, they will hang separately. We should articulate that China’s actions are more than a violation of international law; they threaten the health of our democracies at home. Such a reframing would show Beijing that economic coercion will no longer be treated as a low-stakes tactic.

But words are not enough. We need coordinated action. US alliances are designed primarily to deter and defend against military attacks. Chinese actions make clear, however, that there are alternative methods for undermining peace, prosperity and freedom that our alliances do not adequately address. New alliance consultations to protect against economic attack would enhance our deterrence against China.

Washington should also launch a series of discussions with its allies to determine what new institutional mechanisms, commitments, and structures are needed to defend against economic attacks, not just military ones.

We should ensure the ability to take joint reciprocal action against Beijing in the economic realm, particularly to defend smaller countries. China engages in economic coercion because it is effective and relatively risk-free. But if instead like-minded countries responded together when one was attacked economically, this would go a long way in discouraging Beijing from employing such tactics.

Using all the tools of power

A critical first step is mapping dependencies on China and investigating how to limit over-dependence that open democracies to unacceptable economic vulnerability. As in the military realm, we need to enhance our resiliency against attack by avoiding over-dependence on any single import, export, or supply chain decency. This is a task that the so-called D10 (G7 plus Australia, India, and South Korea) should take up early next year.

The good news is a collective response to Chinese economic coercion will be more feasible under a Biden administration. President-elect Joe Biden and his senior advisers have articulated a preference for multilateral responses to Chinese aggression.

And while President Donald Trump relied mainly on military moves to warn and punish Beijing, Biden’s team prefers to make use of all tools of power. For these reasons, there has even been talk of rejuvenating past efforts like TPP. US allies and partners are also likely to see Biden as more reliable, making them more willing to undertake the risky venture of joining forces against Beijing.

The United States, Australia, and other allies and partners tried to welcome China into the international community. This was the right move. It has been good economically for many advanced economies, including Australia and the United States. But there is a flip side to every coin.

Australia has become too vulnerable to the whims of Beijing. And the US has few options to protect against such economic pressure. The incoming Biden administration needs to fundamentally rethink the nature of alliances so that countries like Australia have a third option the next time Beijing forces a choice between freedom and prosperity.