Joel Slawotsky: "Principled Realism: Thoughts on the New National Security Strategy"

Joel Slawotsky, of the Radzyner School of Law, Interdisciplinary Center, Herzliya, Israel, and the Law and Business Schools of the College of Management, Rishon LeZion, Israel has guest blogged for "Law at the End of the Day"  on issues relating to corporate liability under international law  (e.g., "Rethinking Financial Crimes and Violations of International Law", Jan. 9, 2013; "Corporate Liability Under The Alien Tort Statute: The Latest Twist" April 26, 2014) and on issues of multilateral trade and finance (Joel Slawotsky Reports From Chinese University of Hong Kong: Asia FDI Forum II--China's Three-Prong Investment Strategy: Bilateral, Regional, and Global Tracks; Joel Slawotsky--Essay "On the potential shift from the present-day architects to new architects on the definition of international law" (March 16, 2017)). He has also recently also served as Guest Editor of the Sovereign Wealth Fund special issue of Qatar University International Review of Law (IRL) (2015).

He has very kindly produced a marvelously insightful essay: "Principled Realism: Thoughts on the New National Security Strategy."  In the essay he considers the ramifications of the shifts and developments of U.S. policy as just recently delivered through the National Security Strategy of the United States (4 Dec. 2017) (hereafter the "NSS")(for my own thoughts, see here, and here).  He provides an important perspective on on what NSS might reveal of the direction of U.S. strategic thinking under the current administration. An excellent analysis of principled realism and of the emerging strategic relationships among China, Russia and the U.S.

The essay follows below.

Principled Realism: Thoughts on the New U.S. National Security Strategy

Joel Slawotsky

The recent thought provoking analysis on the National Security Strategy (“NSS”) (here) is an important contribution towards grasping the “Trump Doctrine’s” potential influence on the global governance architecture. I intentionally use quotation marks because I am far from certain that President Trump was directly involved in the document’s detailed formulation although as America’s leader and Commander in Chief, President Trump undoubtedly approved the document. The premises of the NSS also dovetail with the Trump campaign’s themes as well. Note however that some do directly ascribe the NSS to Trump (see, e.g., here).

The reason I am not sure to what extent President Trump shaped this document (any more so than previous U.S. Presidents have by themselves shaped prior NSSs) is that a similar document, Joint Operating Environment (JOE), “The Joint Force in a Contested and Disordered World,” was published in mid-2016 by the U.S. Department of Defense – bearing striking similarities to the NSS and also referencing revisionists and rivals.

The DofD document uses the word “competitor” 43 times and references “China” almost 20 times. It singles out China as harboring ambitions threatening American hegemony closely paralleling the NSS.

For the foreseeable future, the rising economic and cultural power of some Asian countries, particularly China, is breeding new and more expansive political and geostrategic ambitions backed by growing military power. (“The Joint Force in a Contested and Disordered World,” p. 28).

The DofD echoes near identical warnings raised in the NSS and references the revisionist competitors specifically as “China, Russia, Iran, and others”. Notice also the emphasis on cyber and technological threats to the U.S. military and the need to remedy any deficiencies. Again, echoing the NSS JOE 2035 notes.

China’s recent industrial and economic growth combined with its desire to once again be a regional hegemon and global power may result in new nuclear doctrine emphasizing first use and a counter force approach, versus its current counter value doctrine and capabilities. Future delivery mechanisms might include hypersonic missiles, long-range cruise missiles, and ballistic missiles with maneuverable warheads, all designed to penetrate U.S. defensive systems.. . . (“The Joint Force in a Contested and Disordered World” p. 25)

Looking ahead, competitive behavior between the U.S. and potential – and actual – adversaries will be overt and violent. But just as often, our interaction with competitors will include attempts to deter and deny us our strategic objectives or be marked by ambiguous, but still coercive pursuit of political goals backed by the threat or potential of applied military power.. . . (Ibid., p. i (Foreword))

The cyber forces and activities of many states will also likely be used to stress or fracture the social and political cohesion of competitors. . . . (p. 35)

Our forces face the very real possibility of arriving in a future combat theater and finding themselves facing an arsenal of advanced, disruptive technologies that could turn our previous technological advantage on its head – where our armed forces no longer have uncontested theater access or unfettered operational freedom of maneuver. . . . (“The Joint Force in a Contested and Disordered World” p. 15 quoting Deputy Secretary of Defense Robert Work, Remarks to the National Defense University Convocation (August 5, 2014))

Russia, China, and other revisionist states may also increasingly partner and coordinate with each other or with smaller, but militarily-active partners such as Pakistan or North Korea (Ibid., 29)

Therefore, a likely scenario is that the NSS is principally the product of “senior executives and the directors” of the United States - the “Deep State”; the network of senior defense, intelligence and key career officials who in practical terms “man the fortress” and are responsible for the overall protection and projection of American power. If so, we may look at both of these recent documents as a product of a critical mass of strategic thinking within the highest realms of the American command and intelligence communities - allied against staying the course of what they believe are failed policies. In other words, the NSS is calling out for a re-evaluation of direction – i.e., that something needs to be changed to “Make America Great Again.”

The NSS emphasizes the rivalry and competition with revisionists which appears to be conceptualized as a zero-sum game. The competition is not framed in a friendly or “co-team captain” cooperative context of “winning hearts and minds” but a “winner” and “loser” framework. Indeed, the Chinese threat is essentially lumped together with other strategic threats also viewed as “winner takes all” such as terrorism, North Korea and Iran.

The NSS document reads as a “wake-up call” describing certain nations particularly China, but also Russia, as rivals of the United States led order. Pursuant to this view, as China integrates into the international governance architecture and other developing powers surge, the “American Empire” is at risk of slipping. Such thinking is a recognition of the cyclical nature of global hegemons.

History has never set any precedent that an empire is capable of governing the world forever. (Cite here).

As Trump’s campaign theme of MAGA indicates, and as his election demonstrates, a large segment of the U.S. citizenry agrees with the assessment that the United States in essence is “losing the game”. If one believes that the U.S. is losing at the game responses might be: to leave the game or alternatively to amend the rules before the game is lost. Is this the meaning of Principled Realism? As detailed below, the answer is probably yes.

Moreover, this perception of an America that is at risk of losing its edge is not new to the Trump Administration. Even President Obama recognized that U.S. leadership was slipping and stated that his push for the TPP was proximately caused by U.S. efforts to contain China:

Right now, China wants to write the rules for commerce in Asia. If it succeeds, our competitors would be free to ignore basic environmental and labor standards, giving them an unfair advantage over American workers … We can’t let that happen. We should write the rules. (President Obama: "Writing the Rules for 21st Century Trade").

The U.S. – under Obama – also tried mightily to persuade allies from joining the Chinese led AIIB – and failed which could be interpreted as “losing the edge.”

This past month may be remembered as the moment the United States lost its role as the underwriter of the global economic system . . . . I can think of no event since Bretton Woods comparable to the combination of China’s effort to establish a major new institution and the failure of the United States to persuade dozens of its traditional allies, starting with Britain, to stay out. (Larry Summers, "Time US leadership woke up to new economic era" (2015)).

Therefore, rather than the hyperbole that Trump is a “rogue” or claims that President Trump “use[s] foreign policy to throw red meat to your base while other cabinet members are scrambling to stop Armageddon"("Trump’s National Security Strategy Is a Farce") and is set on disrupting the current order, a more objective view suggests that the NSS may simply reflect a belief that the policies of the “Grand Bargain” – the strategy to accommodate threats and simultaneously contain revisionists is a failure. The importance of the NSS document lies in the apparent policy shift to “Principled Realism” as opposed to the perceived failures of the “Grand Bargain.”

For approximately 70 years, the American mantra encouraged free trade and the promotion of a grand bargain - a liberal international order with U.S. led international financial institutions, the WTO and initiatives such as the Washington Consensus stabilizing the world and enforced by massive U.S. military power diffused through dozens of bases in Europe, the Gulf and Asia. The United States also spent substantial sums globally to provide “stabilization” ("The End of Foreign Aid As We Know It")  and to promote “democratic values” and thus win the hearts and minds of foreign populations ("Did U.S. aid win hearts and minds in Afghanistan? Yes and no"). 

More recently, the “Grand Bargain” was perhaps also employed as a means of containing or delaying the day of reckoning. This policy of containment through the grand bargain would have encouraged China’s entry into the WTO and the economic integration of rivals such as China. This policy would also accommodate – despite saber-rattling - the nuclear ambitions of other nations.

Focusing on China, prior policies appear to have indeed been modeled on a belief that if China were integrated into the trade order and allowed to invest globally and prosper, China would somehow “modernize” in terms of rights and a domestic governance model. U.S. policy experts seem to have believed that a developing China within the rubric of the U.S. led governance architecture would lead its citizens to think Western, demand empowerment and  its citizens to think Western, demand rights, and therefore bring internal political pressure on China to become a more Western oriented state.

The 2006 National Security Strategy stated:

China’s leaders … cannot let their population increasingly experience the freedoms to buy, sell, and produce, while denying them the rights to assemble, speak, and worship. (here)

The 2002 NSS noted

In time, China will find that social and political freedom is the only source of [national] greatness (here).

U.S. policy was therefore predicated on a belief that through economic modernization, a more Western oriented and less CCP dominated China was “inevitable” and that social and political freedom was an inevitable part and parcel of China’s development. Encouraging trade and a globalized China was held out as a sort of “containment through democracy” goal of the grand bargain. Under this strategy, China would be allowed to integrate to a degree while the U.S: and Western allies would remain the globañ governance architects. However, over time China began insisting on a larger role but was rebuffed.  Indeed, a motivating factor for the AIIB was the belief that the U.S. was attempting to contain China at the IMF and World Bank. The U.S. had also sought a TPP without China--further corroborating this containment strategy.

The 2017 NSS therefore stems from a belief that the U.S. led global order under the rubric of the “grand bargain” is no longer working in favor of U.S. national security interests. This would certainly dovetail with recent developments: rather than encouraging FDI and economic integration the U.S. is more closely scrutinizing China’s acquisitions based upon national security (e.g., here, and here).

In this light, other recent developments which run counter to the “grand bargain’s” mantra of globalization also make sense: U.S. withdrawal from TPP, Paris Accords, renegotiation over existing trade agreements such as NAFTA, a U.S. reluctance to support the WTO, a more confrontational posture at the UN and states with nuclear ambitions and pruning the State Department and foreign aid.

Of course, it is not simply the failed policies to “contain” rivals but the concern that these rivals may threaten the U.S. destiny that motivates the new policy of “Principled Realism”.

The NSS clearly states this:

China and Russia want to shape a world antithetical to U.S. values and interests. China seeks to displace the United States in the Indo-Pacific region, expand the reaches of its state-driven economic model, and reorder the region in its favor. Russia seeks to restore its great power status and establish spheres of influence near its borders. (NSS, supra., p. 25).

Again, this is seemingly a realization that Russia and China are not friendly partners of the United States but rather calculating adversaries that seek to restore their greatness and export their governance models abroad.But neither Chinese nor Russian perceptions were hidden.

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We all know that after the end of the Cold War—everyone is aware of that—a single center of domination emerged in the world, and then those who found themselves at the top of the pyramid were tempted to think that if they were strong and exceptional…. we can no longer tolerate the current state of affairs in the world …("Read Putin’s U.N. General Assembly speech")

And again:

Western States try to impose their system, whether political or economic, on other societies. They do this through direct means such as trade and aid, or indirect means such as the monetary and economic policies imposed through the financial arms of the West-the World Bank and the International Monetary Fund. This is, and has always been, part of the political game played by the major powers to enhance their position at the world stage because it is economic dominance that they want to achieve through the imposition of their system on weaker societies. (Foreign Ministry Spokesperson Hua Chunying's Regular Press Conference on June 3, 2015).

Focusing on China, the initial question is whether the NSS's assessment is realistic or a mistaken perception based upon hyperbole and fear mongering. After all, some claim that China is not yet a rival to American economic power ("China’s economic power is actually a lot smaller than you think").  Some believe the United States remains “indispensable” ("Remarks by the President at the United States Military Academy Commencement Ceremony")  and that the American Empire will continue to reign unimpeded by any potential rivals.

[T]here is no United States demise. For the rest of the 21st century the United States will remain the world’s strongest military power, its most innovative economy and the chief defender of the core values on which our country was established. Our economy is the strongest it’s ever been, our corporate sheets are the strongest they’ve ever been, our unemployment rate is at a record low, we have seen 15 million new jobs created and these are honest numbers, not numbers created by a party machine. ("Centre stage in the China-US soft power contest" quoting U.S. Ambassador to Australia John Berry).

Notwithstanding these claims, it is beyond debate that China does harbor great ambitions and perceives itself as a great power that has been disadvantaged by the Western powers. It is therefore only natural that China uses its leverage - as did the United States – and insist on greater recognition and perhaps adoption of norms and ideals as preconditions for economic engagement.

A realistic evaluation of current developments reveals that any hubris of United States invincibility is misplaced (Slawotsky, "The Clash of Architects: Impending Developments and Transformations in International Law"; citing "The dollar's 70-year dominance is coming to an end").  The reality is that the U.S. role as Chief Architect is “at risk” of replacement. And this is perfectly natural should rising powers begin to potentially exert influence over the global financial, trade and legal architecture.

In particular, there does not appear to be a comparable example of a great power (or multiple powers) rising within a normative framework not of its own making, where that normative framework has not undergone substantial change or revolution as a result of the new power’s values and interests. (Chesterman, "Asia’s Ambivalence about International Law and Institutions: Past, Present and Futures").

China in particular has been remarkably successful in integrating into the existing architecture with a growing ability to influence the global governance architecture. While the NSS names Russia as an important rival it is China, not Russia, that has brought the specter of a reduced U.S. role to fruition has a currency used in trade deals and has ensconced itself as an integral and dynamic player in global affairs. By masterfully contributing to the global architecture, China has the potential (and has commenced utilizing it) to project power and influence much to the same degree as the United States has done.

It is the Chinese Yuan that may be used as a benchmark for crude oil and it is the Chinese led AIIB and OBOR that may potentially be transformative (Slawotsky, "Essay "On the potential shift from the present-day architects to new architects on the definition of international law").

And, again:

A yuan-denominated oil contract could also challenge the role of the U.S. dollar—currently the dominant commodity-pricing currency— by making it possible for crude exporters to sell the oil in another currency ("China to Shake Up Global Market With Yuan-Based Oil Futures Contract").

Encouraging oil producers to accept yuan rather than USD could also sway these energy producers to become Chinese allies ("China Is Eyeballing a Major Strategic Investment in Saudi Arabia’s Oil").

China’s AIIB continues to bring within China’s orbit new member states ("China-led AIIB approves 13 new members, Canada joins") and even Japan - the last significant U.S. ally holdout - is militating towards joining the AIIB ("Japan Could Still Join China Infrastructure Bank, Abe Ally Says").

China is indeed a global leader and has ambitions for strategic supremacy in many sectors which will project both “hard” and “soft” power. Chinese technological breakthroughs are impressive and undeniable in dual-use civilian-military technology with respect to space exploration, drones, supercomputers, etc. ("Nine ways Chinese scientists pushed the envelope in 2017") as well as artificial intelligence ("The US is losing to China in the AI race"). Chinese advances are clearly perceived--and correctly so-- as impinging on the global advantage of the United States.

China’s ambitious OBOR is also bringing many nations within China’s sphere of economic leverage and influence.

In terms of scale or scope, OBOR has no parallel in modern history. It is more than 12 times the size of the Marshall Plan, America’s post-World War ii initiative to aid the reconstruction of Western Europe’s devastated economies. Even if China cannot implement its entire plan, OBOR will have a significant and lasting impact ("China’s Imperial Overreach").

 ("China’s Imperial Overreach").

Along with China’s growing role in the economic and trade pillars of the international governance architecture, China’s military has assembled an impressive force ("China's military tech challenging West's dominance: Study")  This has resulted in China asserting itself more substantially ("Chinese paper warns Australia on 'interference' in South China Sea") China is also a growing weapons exporter ("Can China Replace the United States as the World's Top Arms Dealer?").

The NSS is therefore an explicit recognition that not only has the hoped for Westernization of China not been effective, it signals a belief that China’s trajectory may negatively impact U.S. destiny and is being grouped together with America’s historic rival, Russia. This is somewhat reminiscent of the Reagan years where U.S. policy was framed as “good versus evil” and the current scenario bears resemblances to the Reagan-era theme – replacing the Soviet Union with China - of a struggle between the “U.S. and Western democratic rights-based model versus the China socialist conformist state”. Therefore, the competition may also be understood as a test of domestic governance. Ultimately, China (as was the Soviet Union) is a suspect in attempting to subvert the United States and promote its socialist vision. The focus on technology and its use in advancement of this goal is clearly important as AI, control of data and surveillance are tools that can be used. The NSS’s emphasis on these areas is revealing.

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Where do we go from here?

The NSS document and the policy orientation is under the overarching theme of "principled realism". However, "principled realism" is undefined. It would appear that the “realism” refers to a U.S. that is realistic in assessing the ambitions and the possible success of rival nations. But joined by “principled” the term “Principled Realism” becomes an enigma. Does principled realism suggest or imply the need to vigorously and actively confront revisionist powers as opposed to backing down, or the opposite, inaction (i.e., leaving a global governance framework perceived as “a loss for the U.S. and thus inherently conflicting with U.S. interests)?

The likely meaning is a combination. Principled realism will likely translate into United States assessment of various components of the international governance architecture and disengagement from those parts of the structure the U.S. views as “a lost cause” (or not worth the resources) simultaneous with vigorous attempts at salvaging via renegotiation those parts that might be salvageable (NAFTA). Principled Realism will also result in deciding whether a particular situation requires confrontation or engagement controlling whether the U.S. in fact more aggressively confronts other nations or jettisoning the engagement as failing to advance U.S. interests. Engagement for the sake of the Grand Bargain seems over.

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How will Principled Realism be implemented?

As for U.S.-China relations the U.S. will likely cooperate with China at times and refuse in other contexts and may confront China in some others. For example, the U.S. has more severely scrutinized incoming FDI from China via CFIUS to protect vital U.S. interests. A focus on national security reviews and more intensive scrutiny of Chinese investments particularly in the financial and technology sectors is likely. Whether tariffs are utilized as part of Principled Realism is less probable due to the potential damage to the U.S. economy, but the U.S. is likely to insist on remedying perceptions of trade unfairness such as demanding reciprocity.

What will happen to the “Grand Bargain” - the attempts the U.S. has made to “socialize” rogues and despots (which can be read as “civilize” in the sense it relates to or in the context of "civilized" nations). Does Principled Realism mean those efforts are likely over? Is this effort at ensuring the growth of democratic movements and a Western model of governance now abandoned? At a minimum, these efforts are likely to be cutback, being viewed as an “unprofitable” allocation of resources the U.S. can no longer afford. Indeed, spending on “capturing hearts and minds” seems to already be in decline ("The End of Foreign Aid As We Know It"; "U.N. budget cuts highlight new U.S. approach"; "State Department to Offer Buyouts in Effort to Cut Staff";  "Tillerson to cut more than half of State Department's special envoys") .

Another major question is how Principled Realism will re-shape U.S. relations and foreign policy in general. Principled Realism may result in cutting back diplomatic efforts and aid to nations seen as aligned with China and/or hostile to U.S. interests. Rather than continuing “Grand Bargain” attempts at bringing nations within the U.S. orbit, Principled Realism would translate into stopping these failed efforts ("Trump Suggests Freezing $1.9B in Aid to Pakistan Just the Start").

Principled Realism will likely translate into result in decisions being made on North Korea and Iran as opposed to kicking the can down the road ("Trump Says U.S. Open to North Korea Talks at the Right Time").

With respect to rising powers that may share similar interests to the U.S. Principled Realism will control the policy. India for example is a regional rival to China and has declined – despite strong Chinese efforts - to join China’s OBOR. India is also wary of growing Chinese Naval power ("First Djibouti ... now Pakistan port earmarked for a Chinese overseas naval base, sources say").

Principled Realism will likely translate into enhanced cooperation with India ("The US National Security Strategy and Great Power Relations") and jettisoning engagement with Pakistan ("U.S. Suspends Most Security Assistance To Pakistan").

There may be other Western oriented nations also "waking-up" or re-examining their own national security ("France, Germany, Italy urge rethink of foreign investment in EU"; "China and Germany in a dust up over cybersecurity").  The U.S. will certainly look to allies but how does integrating these allies into "Principled Realism" work? The allure of economic self-interest will surely impact the decisions of many U.S. allies whether to join the "China Consensus.” ("Canada has everything to gain through research collaboration with China") If nations do in fact ally with China, how will Principled Realism direct U.S. reaction to this (mis)conduct?

Another crucial aspect is the objection by internal opposition on the part of the governing apparatus and population that either ideologically or for economic interests support a multi-polar world with US national interests being of secondary importance.

The old orthodoxy saw the world as a series of challenges that could be remedied as the U.S. oversaw the transformation of the system of states into a global system into which all states would be embedded ("From Global to Fortress America").

Political, media and academic elites within the United States are powerful and together with influential trade interests will oppose U.S. disengagement. They will resist the policies directed by Principled Realism. Will these interests really allow Principled Realism to be fully and effectively implemented?

The internal divides in the US are also a serious impediment to a successful implementation of Principled Realism. Although political discord in the United States is historic, the current schisms are extreme. Nothing in recent memory bears any resemblance to the almost surreal attacks and counter-attacks engaged in by some U.S. elites such as media personalities who view the current U.S. Administration as “dangerous” and members of the Administration fighting back against their belief these elites are employing “Fake News” to distort and discredit U.S. policy. The rise of the Alt-Right as well as Antifa all reflect serious fissures in the United States that lead to substantial uncertainty as to the ability to implement Principled Realism. Indeed, “pragmatic realism” may also dilute the potency of the “Principled Realism” of the NSS. The remarks of President Trump accompanying the NSS release were less hostile and more along the lines of “partnership building” ("Trump's National Security Strategy").

Last, but not least, the possibility exists that China has already advanced the prospect of a "reduced US" to an extent that it will be exceedingly hard to reverse absent an open confrontation. While it is impossible to count out the United States a successful implementation of the NSS, through Principled Realism, is hardly assured. China has a proven successful model ("My trip to China shattered my biases about developing nations") that other nations may wish to emulate or at least endeavor to align with out of self-interest.

China's rise is remarkable. In little over a decade China has become an economic superpower ("China Plots What’s Next as Influence on Global Markets Grows").  The size of the U.S economy as valued by Gross Domestic Product is approximately $19 trillion with China at number 2 at $11 trillion. On a PPP basis, China has already surpassed the United States ("World GDP Ranking 2017").

China continues to invest heavily in research and development and is positioned to lead in the important future technologies such as AI ("China Is Using America’s Own Plan to Dominate the Future of Artificial Intelligence").

How will the US regain the advantage when allies flocked to the AIIB and OBOR? Not that it cannot be undone but China already has substantial influence (here). 

Indeed, it would have been unthinkable 10-15 years ago that a vital financial institution such as the AIIB - and key part of the developing international governance architecture - would be established and led by China rather than under the control of the United States. China has already used its influence to promote its own agendas ("China Thwarts Taiwan’s Bid to Be Founding Member of AIIB").

The possibility exists that China is very close to crossing the Rubicon and will be positioned to trump the U.S. as the chief architect of the global governance architecture. This is not meant as a critique of China. The United States also used its power and influence as chief architect to shape international law, establish trade rules, the “Washington Consensus” and a promotion of U.S. policy goals.

As this essay has outlined, although Principled Realism is undefined, we can plausibly understand the meaning - and ramifications - based upon U.S. disengagement at certain levels and simultaneous attempts at re-setting other levers of the international economic and trade orders. It is probable that the NSS together with DofD, is indicative of the realization that United States control of the economic, trade, and legal orders is no longer assured. Most of the Trump Administration’s actions comport with the understanding outlined in this Essay. The next 12-18 months will be critical in determining the longer-term outcome of the U.S. efforts at retaining its current position as chief architect in the economic and legal global governance orders.