No relationship will be as important to the twenty-first century as the one between the United States, the world’s great power, and China, the world’s rising power.

China’s development is directly transforming the lives of one-fifth of the world’s population, and is otherwise influencing billions more. China’s rapid economic growth, expanding regional and global influence, continued military modernization, and uneven human rights record are also shifting the geopolitical terrain and contributing to uncertainty about China’s future course.

After thirty-five years of “engagement,” the United States and China have a relationship that was truly unimaginable two generations ago. At the same time, there are some Americans who believe that China’s strategic interests are incompatible with those of the United States.

The Council on Foreign Relations established an Independent Task Force to take stock of the changes under way in China today and to evaluate what these changes mean for China and for the U.S.-China relationship. Based on its careful assessment of the developments in the country and China’s likely future trajectory, the Task Force recommends that the United States pursue a strategy focused on the integration of China into the global community and finds that such an approach will best encourage China to act in a way consistent with U.S. interests and international norms.

On behalf of the Council on Foreign Relations, I wish to thank Task Force Chairs Carla A.Hills andDennis C. Blair, who contributed their considerable expertise andunwavering commitment to this important project. The Council is also indebted to the individual Task Force members, whose input and insight strengthened the final product immeasurably. I also wish to thank the Council’s former Cyrus Vance Fellow in Diplomatic Studies Evans J.R. Revere, who began this project,andHitachi InternationalAffairs FellowFrankSampson Jannuzi, who, despite being on the other side of the world, skillfully brought it to fruition.

Richard N. Haass
President, Council on Foreign Relations
April 2007

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Introduction: A Policy Consensus under Strain

President Richard M. Nixon reached out to the People’s Republic of China thirty-five years ago to advance U.S. strategic interests by balancing the Soviet Union and reinforcing the split between two former communist allies. Nixon and his national security adviser, Henry Kissinger, briefed the Chinese on Soviet forces arrayed against China and also discussed the Vietnam War and Taiwan. Nixon and Kissinger sought to change the global U.S. stance from confrontation to de´tente and to extricate theUnited States fromthe VietnamWar.Theirmission shifted the globe’s geopolitical landscape.

For nearly two decades, U.S. policy toward China (and Taiwan) remained rooted in the strategic interests that led Nixon to Beijing during the Cold War. This policy has commonly been known as ‘‘engagement.’’ Through engagement, China’s relationship with the United States has been transformed from one characterized by nearconstant antagonism to one in which dialogue and cooperation have become common.

And through its engagement with the world, China itself is also transforming. The normalization of U.S.-China relations during the Carter administration helped create an international environment conducive to the launch in the late 1970s of China’s economic reforms under the leadership of Deng Xiaoping. Engagement helped integrate China into a virtual ‘‘alphabet soup’’ of multilateral organizations, including the World Trade Organization (WTO), the Association of Southeast Asian Nations Regional Forum (ARF), and the Asia Pacific Economic Cooperation (APEC) forum, to name but a few. China has become a player on the world stage.

In the security realm, China used to stand aloof. Today it is connected. China has acceded to various arms control treaties and related nonproliferation organizations, and it has gradually conformed its domestic regulations to their requirements.China has joinedtheNuclear Nonproliferation Treaty, the Chemical Weapons Convention, and the Nuclear Suppliers Group; agreed to abide by the limits of the Missile Technology Control Regime; and signed the Comprehensive Nuclear Test Ban Treaty.

China’s integration has not been linear or without turmoil. When China’s government brutally suppressed protesters inTiananmenSquare in June 1989, the United States responded by severing its security ties to Beijing and placing human rights concerns prominently on the agenda in U.S.-China relations. And when the Soviet Union collapsed two years later, the Cold War rationale used by Nixon to justify engagementwithChina—the ‘‘strategic triangle’’—evaporated, shifting the focus of U.S.-China relations toward newareas, including nonproliferation, trade, and regional security.

Today, the geopolitical terrain is shifting again, altered by the emergence of China as a major power in a world dominated by the United States since the collapse of the Soviet Union.Despite the overall success of engagement in helping to shape China’s interests in ways desired by the U.S. government, U.S. political support for engagement is under strain. As China’s economic and military power grows, there is considerable uncertainty about its future course. China’s development has raised concerns about the implications for America’s economic health, security, and global political influence.

Many Americans are not confident that China’s strategic interests are still compatible with those of the United States and argue that engagement does not sufficiently protect the United States against a China that could emerge as a threatening adversary in the future. Others have concluded as Senator Jesse Helms (R-NC) did in the late 1990s: ‘‘Those who support economic engagement with China must recognize it for what it is—
appeasement. . . .We must have a new approach.’’ ...

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About the Council on Foreign Relations:

Founded in 1921, the Council on Foreign Relations is an independent, national membership organization and a nonpartisan center for scholars dedicated to producing and disseminating ideas so that individual and corporate members, as well as policymakers, journalists, students, and interested citizens in the United States and other countries, can better understand the world and the foreign policy choices facing the United States and other governments.

The Council does this by conveningmeetings; conducting a wide-ranging Studies program; publishing Foreign Affairs, the preeminent journal covering international affairs and U.S. foreign policy; maintaining a diverse membership; sponsoring Independent Task Forces; and providing upto-date information about the world and U.S. foreign policy on the Council’s website,CFR.org.

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Task Force Members:

Roger C. Altman served two tours of duty in the U.S. Treasury Department, initially serving President Carter as assistant secretary for domestic finance and later serving President Clinton as deputy secretary. Since 1996, Mr. Altman has served as chairman and co-chief executive officer of Evercore Partners, which has become the most active investment banking boutique in the world. Previously, he was vice chairman of the Blackstone Group and responsible for its investment banking business. And, his initial Wall Street career involved Lehman Brothers, where he eventually became cohead of investment banking, a member of the firm’s management committee and of its board of directors. Mr. Altman is a trustee of New York-Presbyterian Hospital, New Visions for Public Schools and the American Museum of Natural History, where he also serves as chairman of the investment committee. He also is a member of the Council on Foreign Relations and serves on its finance and investment committee. He received an AB from Georgetown University and an MBA from the University of Chicago.

Peter E. Bass is managing director and chief of staff at Promontory Financial Group, LLC, a consulting firm for global financial services companies. He was previously a vice president at Goldman, Sachs & Co., responsible for international government affairs and chief of staff to the firm’s president and co-chief operating officer. Prior to his private sector career, Mr. Bass was a career civil servant for over ten years, holding a number of senior positions at the Department of State and the National Security Council, including deputy assistant secretary of state for Energy, Sanctions and Commodities; and executive assistant to the national security adviser.

Dennis C. Blair will hold the Omar Bradley Chair of Strategic Leadership at the Army War College and Dickinson College for 2007-2008. From 2003 to 2006 he was president and CEO of the Institute for Defense Analyses (IDA), a federally funded research and development center based in Alexandria , Virginia. Prior to retiring from the Navy in 2002, he served as commander in chief, U.S. Pacific Command, the largest of the combatant commands. During his thirty-four-year Navy career, Admiral Blair served on guided missile destroyers in both the Atlanticand Pacific fleets and commanded the Kitty Hawk Battle Group. Ashore, he served as director of the joint staff and as the first associate director of Central Intelligence for Military Support. He has also served in budget and policy positions on the National Security Council and several major Navy staffs.

Harold Brown is currently a counselor and trustee at the Center for Strategic and International Studies (CSIS); a partner at Warburg, Pincus & Co.; and on the board of Evergreen Holdings, Inc. and the Altria Group. Previously, he was chairman of the Foreign Policy Institute of the Johns Hopkins University , Paul H. Nitze School of Advanced International Studies. He was president of the California Institute of Technology from 1969 to 1977 and has served in a number of senior government positions including secretary of defense from 1977 to 1981.

Ashton B. Carter is codirector (with former Secretary of Defense William J. Perry) of the Preventive Defense Project and chair of the International Relations, Security, and Science faculty at Harvard’s Kennedy School . Dr. Carter served as assistant secretary of defense for International Security Policy during President Clinton’s first term. Dr. Carter was twice awarded the Department of Defense Distinguished Service Medal, the highest award given by the Department. For his contributions to intelligence, he was awarded the Defense Intelligence Medal.

Charles W. Freeman III is managing director of the China Alliance of independent law firms. He was until late 2005 the assistant U.S. trade representative for China affairs, responsible for developing and implementing overall U.S. trade policy toward China, Taiwan, Hong Kong, Macao, and Mongolia. He earlier served as international affairs counsel to U.S. Senator Frank Murkowski (R-AK), concentrating on trade and international finance and energy issues. He joined government service after ten years in the private and nonprofit sectors as a lawyer and emerging market venture capitalist in Boston; Asia-Pacific conference director with the International Herald Tribune; and economic program director with the Asia Foundation in Hong Kong. He is a member of the board of directors of the National Committee on U.S.-China Relations.

Aaron L. Friedberg is professor of Politics and International Affairs at Princeton University, where he has taught since 1987. In 2003–2005 he served in the Office of the Vice President as a deputy assistant for National Security Affairs. He is a member of the secretary of state’s advisory committee on democracy promotion. From 2001–2002 he was the first Henry A. Kissinger Scholar at the Library of Congress.

Paul Gewirtz is the Potter Stewart professor of constitutional law at Yale Law School and also the director of the China Law Center there. He teaches and writes in a wide range of legal fields. The China Law Center carries out research and teaching, and also undertakes a large number of cooperative projects with government and academic institutions in China on key legal and policy reform issues. While on leave from Yale at the U.S. Department of State as special representative for the Presidential Rule of Law Initiative, he conceived and led the U.S.-China legal cooperation initiative agreed to by Presidents Bill Clinton and Jiang Zemin at their 1997–1998 summit meetings. He accompanied President Clinton to Chinain 1998. Before joining the Yale Law School faculty, Professor Gewirtz served as law clerk to Justice Thurgood Marshall of the U.S. Supreme Court and practiced law at the Washington, DC, law firm of Wilmer, Cutler & Pickering.

Maurice R. Greenberg is chairman and CEO of C.V. Starr and Company. Mr. Greenberg retired as chairman and CEO of American International Group, Inc. (AIG) in March 2005. Mr. Greenberg is former chairman of the Asia Society. He is the founding chairman of the U.S.-Philippine Business Committee and vice chairman of the U.S.-ASEAN Business Council. He is a member of the U.S.-China Business Council. He served on the President’s Advisory Committee for Trade Policy and Negotiations and the Business Roundtable. He is the past chairman, deputy chairman, and director of the Federal Reserve Bank ofNew York.

Harry Harding is university professor of international affairs at the George Washington University, and a visiting fellow in the Center on U.S.-China Relations at the Asia Society. From 2005–2007, he was director of research and analysis at Eurasia Group, a political risk research and consulting firm headquartered in New York. He remains a counselor to Eurasia Group and chair of its China Task Force. Dr. Harding has served on the faculties of Swarthmore College (1970–1971) and Stanford University (1971–1983), was a senior fellow in the Foreign Policy Studies Program at the Brookings Institution (1983–1994), and was dean of the Elliott School of International Affairs at the George Washington University (1995–2005).

Carla A. Hills is chairman and CEO of Hills & Company, International Consultants, which advises companies on global trade and investment issues. Ambassador Hills served as U.S.trade representative in the first Bush Administration, secretary of the U.S. Department of Housing and Urban Development, and assistant attorney general, Civil Division, U.S. Department of Justice, in the Ford administration.

Frank Sampson Jannuzi is Hitachi International Affairs Fellow of the Council on Foreign Relations, currently serving as a visiting scholar at Keio University and a visiting researcher at the Institute of International Policy Studiesin Tokyo. Jannuzi served as the East Asia adviser to the Democratic staff of the Senate Foreign Relations Committee (1997–2006)and as the East Asia political-military analyst in the Bureau of Intelligence and Research, U.S. Department of State (1989–1997).

Michael H. Jordan is chairman of the board and CEO of EDS Corporation. He joined EDS in March 2003. Jordanis the retired chairman and CEO of CBS Corporation (formerly Westinghouse Electric Corporation). Mr. Jordan is a member of the following organizations: National Foreign Trade Council; the Brookings Institution; U.S.-Japan Business Council; Council on Foreign Relations; United Negro College Fund; the Business Council; United States Council for International Business; the Business Roundtable, and International Advisory Board of BritishAmerican Business Inc.; a director of Viventures; and a director of Aetna, Inc.

Virginia Ann Kamsky is the founder, CEO, and chairman of the board of Kamsky Associates, Inc. (KAI), established in 1980 and the first foreign investment firm approved to operate in China. Ms. Kamsky is the chairman of the board of trustees of the China Institute in America and a director of the National Committee on U.S.-China Relations. Prior to founding KAI, Ms. Kamsky was an officer of Chase Bank and served as a member of the first official U.S. banking delegation to China in 1978, when normalization of diplomatic relations between the United States and China was announced. She has served on several corporate boards, including W.R. Grace and currently, the board of directors of Olin Corporation.

David M. Lampton is dean of faculty and director of Chinastudies at Johns Hopkins-SAIS and director of Chinese studies at the Nixon Center in Washington, DC . Formerly he was president of the National Committee on U.S.-China Relations in New York City from 1988 to 1997. He is the author of Same Bed, Different Dreams: Managing U.S.-China Relations 1989–2000 and editor of The Making of Chinese Foreign and Security Policy in the Era of Reform. He is currently working on a book on China’s power and what it means for the world.

Nicholas R. Lardy is a senior fellow at the Institute for International Economics in Washington, DC. Previously he was a senior fellow at the Brookings Institution (1995–2003) and the director of the Henry M. Jackson School of International Studies at the University of Washington (1991–1995). Dr. Lardy serves on the board of directors and executive committee of the National Committee on U.S.-China Relations; is a member of the Council on Foreign Relations; and is a member of the editorial board of the China Quarterly, the China Review, and the China Economic Review.

Herbert Levin focused on China and Asia in his work in Washington on the staffs of the Policy Planning Council, National Intelligence Council, and National Security Council, and during his thirty-four years as a Foreign Service officer. Thereafter he was for five years in the office of United Nations Undersecretary General Ji Chaozhu. For the next five years he served as executive director of the America-China Society for cochairmen Cyrus Vance and Henry Kissinger. Mr. Levin has degrees from Harvard and the Fletcher School of Law and Diplomacy. He served in the U.S. Army, Far East Command, Tokyo.

Cheng Li is William R. Kenan professor of government at Hamilton College, New York. He is currently a visiting fellow at the John L. Thornton China Center in the foreign policy studies program of the Brookings Institution, a director of the National Committee on U.S.-China Relations, and a trustee of the Institute of Current World Affairs. His publications include Rediscovering China: Dynamics and Dilemmas of Reform (1997), China’s Leaders: The New Generation (2001), and the edited volume Bridging Minds Across the Pacific (2005). Dr. Li is currently working on two book manuscripts: Chinese Technocrats and Urban Subcultures in Shanghai.

Winston Lord is currently cochair of the Overseers of the International Rescue Committee. His government service has included assistant secretary of state for East Asian and Pacific affairs for President Clinton; ambassador to China for President Reagan; director of the State Department’s policy planning staff; and special assistant to the National Security Adviser for Presidents Ford and Nixon. Lord’s service outside the government has included president of the Council on Foreign Relations and chairman of the National Endowment for Democracy.

Xiaobo Lu is director of the Weatherhead East Asian Institute and associate professor of political science at Barnard College and Columbia University. He is the author of the book Cadres and Corruption (2000). His recent book (with Thomas Bernstein) is on the political and economic changes in the Chinese countryside, Taxation Without Representation in Contemporary Rural China (2003). From 2003–2004, he was a visiting professor at Tsinghua University in Beijing, Jiaotong University in Shanghai, and senior research fellow at City University of Hong Kong.

Evan S. Medeiros is currently a political scientist at the RAND Corporation in theWashington, DC, office. His research interests include China’s foreign and national security policies, U.S.-China relations, and Chinese defense industrial issues. Prior to joining RAND, Dr. Medeiros was a senior research associate for East Asia at the Monterey Institute’s Center for Nonproliferation Studies in Monterey, CA. In 2000, he was a visiting fellow at the Institute of American Studiesat the China Academy of Social Sciences (CASS) in Beijing and an adjunct lecturer at China’s Foreign Affairs College. He recently completed a book manuscript for Stanford University Press on the evolution of Chinese policies on weapons nonproliferation. He travels to Asia frequently.

James C. Mulvenon is deputy director, Advanced Studies and Analysis at Defense Group Inc.’s Center for Intelligence Research and Analysis. A specialist on the Chinese military, Dr. Mulvenon’s research focuses on Chinese C4ISR (command, control, communications, computers, intelligence, and reconnaissance), defense research/ development/acquisition organizations and policy, strategic weapons programs (computer network attack and nuclear warfare), cryptography, and the military and civilian implications of the information revolution in China.

Andrew J. Nathan is Class of 1919 professor and chair of the department of political science at Columbia University. His publications include Chinese Democracy (1985); The Great Wall and the Empty Fortress: China’s Search for Security, with Robert S. Ross (1997); The Tiananmen Papers, edited with Perry Link (2001); and China’s New Rulers: The Secret Files, with Bruce Gilley (2002, second edition 2003). Nathan serves on the boards of Human Rights in China and Freedom House and on the Asia Advisory Committee of Human Rights Watch.

Stephen A. Orlins is president of the National Committee on U.S.-China Relations. Prior to becoming president, Mr. Orlins was the managing director of Carlyle Asia, one of Asia’s largest private equity funds. From 1983 to 1991, Mr. Orlins was with the investment banking firm of Lehman Brothers where he was a managing director from 1985 to 1991 and president of Lehman Brothers Asia from 1987 to 1990. Mr. Orlins also has practiced law with Coudert Brothers and Paul, Weiss, Rifkind, Wharton & Garrison in New York, Hong Kong, and Beijing. From 1976 to 1979, Mr. Orlins served in the office of the legal adviser of the U.S. Department of State, where he was a member of the legal team that helped establish diplomatic relations with the People’s Republic of China.

Evans J. R. Revere assumed the presidency of the Korea Society in New York City in January 2007. Prior to becoming president, Mr. Revere was a career U.S. diplomat and one of the U.S. Department of State’s leading Asia experts. His last State Department assignment was as Cyrus Vance Fellow in Diplomatic Studies at the Council on Foreign Relations, where he helped launch CFR’s Independent Task Force on U.S.-China relations and served as the Task Force’s first project director. Mr. Revere previously served as acting assistant secretary of state for East Asian and Pacific Affairs and principal deputy assistant secretary in that bureau, managing U.S. relations with the Asia-Pacific region and leading an organization of 950 American diplomats and some 2,500 Foreign Service National employees. His diplomatic career included service in the PRC, Taiwan, the Republic of Korea, and Japan, and extensive experience in negotiations with North Korea.

Bradley H. Roberts is a member of the research staff at the Institute for Defense Analyses in Alexandria, Virginia. He also serves as an adjunct professor at George Washington Universityand as a member of the board of directors of the U.S. Committee of the Council for Security Cooperation in the Asia Pacific (CSCAP). Prior to joining IDA in 1995, Dr. Roberts was editor of the Washington Quarterly and a member of the research staff at the Center for Strategic and International Studies. He is also coauthor with Robert Manning and Ronald Montaperto of China, Nuclear Weapons, and Arms Control (2000).

Alan D. Romberg is director of the East Asia program at the Henry L. Stimson Center. Immediately prior to that, Mr. Romberg was principal deputy director of the U.S. Department of State policy planning staff (1994–1998), senior adviser and director of the Washington office of the U.S. permanent representative to the United Nations (1998–1999), and special assistant to the secretary of the Navy (1999–2000). He was director of research and studies at the United States Institute of Peace in 1994, following almost ten years as C.V. Starr senior fellow for Asian studies at the Council on Foreign Relations (1985–1994). A Foreign Service officer for over twenty years, he was principal deputy assistant secretary of state and deputy spokesman of the department from 1981 to 1985. His latest book is Rein In at the Brink of the Precipice: American Policy Toward Taiwan and U.S.-PRC Relations (2003).

Randy Schriver is one of five founding partners of Armitage International. Immediately prior to his return to the private sector, he served as deputy assistant secretary of state for East Asian and Pacific affairs responsible for the PRC, Taiwan, Mongolia, Hong Kong, Australia, New Zealand, and the Pacific Islands. He has also served in the office of the secretary of defense, and was an active duty navy intelligence officer who served in the first Gulf War.

Wendy R. Sherman is a founding principal of the Albright Group, LLC, a global advisory firm and Albright Capital Management, LLC, an investment advisory firm focused on emerging markets. She has served as counselor of the Department of State, special adviser to the president and secretary of state on North Korea, and assistant secretary of state for legislative affairs, which included responsibility for securing the department’s more than $23 billion annual budget appropriation. As a chief troubleshooter to two secretaries of state, Ambassador Sherman’s portfolio included Asia, the Middle East, Central America, North Korea, Russia, and Cuba, as well as transnational issues.

Arthur Waldron is the Lauder Professor of international relations at the University of Pennsylvania. He received his BA from Harvard (summa cum laude, valedictorian) in 1971 and his PhD, also from Harvard, in 1981. He lived in Asia for four years, studying Chinese and Japanese. Earlier in his career he spent a year in England, a semester in France, and a semester at (then) Leningrad State University. He has also taught as visiting professor at the Catholic University of Leuven in Belgiumand been a visiting fellow at the Institute for Southeast Asian Studies in Singapore. He has written three books in English and edited four more, including two in Chinese. His works have been translated into Chinese, Italian, Korean and Japanese. Professor Waldron is a member of the board of directors of Freedom House and of the Jamestown Foundation, and vice president of the International Assessment andStrategy Center, a nonpartisan, nonprofit 501(c)(3) research organization based in Alexandria, Virginia. He has been a regular visitor to China for nearly thirty years.

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