While you weren't looking, everything with China went off the rails

Donald Trump, Xi Jinping
US President Donald Trump and China's President Xi Jinping attend a bilateral meeting on the sidelines of the G20 Summit in Osaka on June 29, 2019.
  • US-China relations have taken a nosedive over the last few months.
  • Instead of focusing on the trade war, the Trump administration is laser focused on even more contentious parts of the relationship in an attempt to push US policy toward a harder line before it leaves power.
  • Meanwhile China has picked a huge fight with Australia — of all places — projecting its anger at the US at its allies.
  • This is an opinion column. The thoughts expressed are those of the author.
  • Visit Business Insider's homepage for more stories.

In the last few months the US has been rocked by a contentious election and another surge in the coronavirus pandemic. While Americans were rightfully preoccupied with these events, the relationship between the US and China has taken a foul turn. You can be forgiven if you were not paying attention.

The trade war, which used to be the hottest point of contention between the two economic powers, has been all but forgotten. No one in Washington really seems interested in coming to any kind of deal with Beijing. Deals require cooperation, and there is almost none of that to spare in the US-China relationship.

Instead the focus of the relationship has turned to other more divisive matters, like retaliating against China for its seizure of power in Hong Kong. This, in part, is because the outgoing Trump administration is using its last few months in power to set US-China relations on a hardline course that - it thinks - the Biden administration will find it difficult to pull back from. 

But trying to bind the Biden team to a hardline course is probably unnecessary. There is little evidence to suggest a Biden administration would take a much softer line on China. For both parties - Democrats and Republicans - the political winds have changed. The US no longer thinks that cooperating with China's economic growth will push China toward an open society, so the US no longer wishes to cooperate.

Read more: The US and China are breaking up. The only question now is how ugly it will get.

China's view of the US has changed too. Beijing has come to see the US as a declining power, and sees China as a rising power. The US's mishandling of the coronavirus pandemic has only bolstered this view. Chinese leaders believe their role on the world stage right now is to pick up America's slack as it wanes, and to push back on any country that seems to question its new status.

You can see how this is a problem.

'Bandit logic'

In the last few months the US has put economic sanctions on high level members of the Chinese government for human rights abuses against Uighur Muslims and members of the Falun Gong religious minority.

It also put sanctions on politicians involved with China's political takeover of Hong Kong, including Hong Kong Chief Executive Carrie Lam. These sanctions are no small thing. Lam can no longer open a bank account, as not even China's state-owned banks are interested in violating US sanctions by having her as a customer. She says she's forced to keep "piles of cash" at home.

The US has also sanctioned Chinese companies for human rights abuses and doing business with the Maduro regime in Venezuela. Recently, the Trump administration has also banned US investment in Chinese companies with ties to the Chinese military.

Chinese state media outlet Xinhua has called these sanctions, "Blatant political bullying and bandit logic." But there are no signs that these crackdowns on China will slow down as the administration comes to a close.

The US just announced that it will sell $280 million worth of weapons to China's enemy, Taiwan. Congress seems ready to pass a bill forcing Chinese companies on US exchanges to adhere to US accounting standards or face expulsion. In a recent speech, Secretary of State Mike Pompeo referred to Chinese authorities as "jackbooted thugs."

China has said that it will retaliate against the US with its own sanctions against US officials in Hong Kong, adding more aggression to a plate that is already more than full. Over the last year China's been practicing a new form of statecraft called "Wolf Warrior" diplomacy. It's just as petulant as it sounds.

For example, China is currently in a fight with Canada because it has been holding two Canadian citizens without due process for two years. It detained these men - Michael Spavor and Michael Korvig - in retaliation for the Canadian government's arrest of Chinese telecom giant Huawei's CFO at her home in Vancouver. The arrest was made after the US accused the company and its CFO, Meng Wanzhou, of violating US sanctions on Iran.

China had also recently picked a fight with another US ally, Australia. The fight blew up over nothing and everything. Last month China sent Australia a list of 14 grievances. The list included a complaint about negative stories about China in Australian media, and anger over Australia's calling for an investigation into the origins of COVID-19. To punish Australia, China slapped an up to 200% tariff on Australian wine and is vowing to do more. 

How to make friends

Earlier this month during a debate at the Center for Strategic and International Studies,  Yan Xuetong, the Dean of the Institute of Modern International Relations at China's prestigious Tsinghua University, explained why these conflicts have gotten so bad. It is because they are a projection.

"The fundamental reason for... the deterioration [of China's relationship with Canada and Australia] is that they take sides with the US to contain China," he said. "In 90% of issues they stand with the US, less than 10% of issues with China!"

Going full-antagonist is not how China will move US allies into its camp, obviously, but isn't about making friends. Wolf Warrior diplomacy suggests that China's authorities are performing for President Xi Jinping, for the Kremlin, and for other fellow travelers who believe in the decline of the West. This is all about drawing a line in the sand. 

This is not lost on the incoming Biden administration, which has emphasized a return to US leadership and allyship.

Jake Sullivan, Biden's National Security Adviser, is already showing support for Australia in its conflict with Beijing. The Trump administration was a window of opportunity for China. It could have used Trump's animosity toward US allies to drive a wedge between the US and its allies. Now that window has closed, and what China likely faces is a very angry America and her very angry friends..

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