“We must maintain a holistic view of national security. We take the people’s security as our ultimate goal, political security as our fundamental task, and economic security as our foundation.”
—Secretary General Xi Jinping, April 2014.
Are we ready for what comes next?
The news this week is that the United States of America has decided to destroy Huawei. Hikvision is next on the chopping block. Magnitsky Act sanctions on Xinjiang officialdom are the logical next step. The sudden strengthening of Taiwan against PRC military aggression is now possible.
No trade deal is happening. Now that the hope of finding a deal has gone, a host of initiatives aimed at hobbling the Chinese surveillance state and military machine that had been put on hold for months are falling into place.
I am glad. These are—in my mind at least—good things. Necessary countermeasures.
But are we ready?
I am deeply concerned that we have not prepared the American people for what is coming, nor why it comes.
The Chinese will respond. They are smart people. They are clever—clever and outraged. I cannot foresee the exact nature of that response yet. It might be with rare earths. It might be with something else entirely. What it is in particular does not matter so much. The Party will find a chink in our economy and twist the screw. They will find a way to take something of ours down. They have been attacked. They will attack back.
This will not be like negotiating imports with Japan. With the attack on Huawei we have entered a new phase in Sino-American relations. Understand: the Party will read what is happening as the sharp edge of an economic, social, and ideological assault on their system of government. This is what their theorists have long said must happen. For better or worse, they now believe we are playing for existential stakes.
The word they will use is struggle. Party leadership has spent the last week preparing its people for a hard and vicious struggle. That is what all this Korean War and Long March brouhaha is all about. It is not an attempt to signal anything in particular to Western observers. The intended audience is the Chinese themselves. The People’s Republic of China is about to jump headfirst into a bitter struggle with the United States. This conflict will hurt the people of China. They are being prepared to bear that burden.
What burdens are our people prepared to bear?
There is widespread support in Washington for taking the actions needed to damage China’s surveillance-industrial complex. There is no such support among the broader American public. The harsh truth is that the American public does not care about China. At this point in time they do not care much about anything outside of America’s borders. This is obvious to anyone who has stepped outside of the Beltway, or barring that, looked at the poll numbers collected by those who have.  No one is getting elected this cycle because of their tough stance on China.
That is the political reality of the present moment. We will ride through this conflict not with the people we want, but with the people we have. But that people can be prepared. This is not the first time Americans have stood indifferent to the maneuvers of rising tyrannies. Indifference can be changed. It has been changed many times before.
But not by accident.
We do not face war. But we do face something like unto it. Economic weapons will be drawn and used. We will face a rough time. Before us lies an escalating circle of punishment and counter-punishment. The Chinese people will hurt dearly.
But so will ours.
Victory won will be worth its price. But that price will be paid. The Chinese understand this. They prepare their people for the contest that is coming.
We would be wise to follow their example.
 See my earlier post, “You Do Not Have The People,” Scholar’s Stage (3 March 2018). For more recent data see John Halpin, Brian Katulis, Peter Juul, Karl Agne, Jim Gerstein, and Nisha Jain, America Adrift: How the U.S. Foreign Policy Debate Misses What Voters Really Want (Washington DC, Center for American Progress, May 2019). Note also the Reagan Foundation’s finding that two in five Americans believe China is an ally of the United States.
 There is no one single summary of Chinese documents on threat perception. Samantha Hoffman, “Programming China: the Communist Party’s autonomic approach to managing state security,” PhD diss, University of Nottingham (2017), chapter 2 and Matthew Johnson, “Securitizing Culture in Post-Deng China: An Evolving National Strategic Paradigm, 1994–2014,” World and Local Conflicts, vol 4, iss 1 (2017), pgs. 62-80 cover a fair bit of it, even though neither of them focus on the importance the regime gives to “economic security” or “financial security.”
By now you have noticed the Chinese are floating the idea of some kind of action on the rare earth front. This is more of a problem in the short to medium-term. The US (and Canada) have several rare earth deposits which are currently not under development because they cannot compete and cost (including environmental cost) with Chinese rare earths. If Chinese rare earths disappear from the market, then these projects can be brought online.
Normally permitting and development take several years, but it is reasonable to assume that these will be fast-tracked if American security is at stake.
Probably the larger issue is that the economies of the major global economies are so intertwined, and have become so fragile whatever economic dislocations there are on the horizon will cause catastrophe everywhere.
Here are some pretty pictures from China. http://worldcomplex.blogspot.com/2016/03/minority-report.html
Who will bear the cost? China doesn't produce our food, healthcare, military hardware or education. They make our toys. People won't be rioting in the streets demanding Trump sue for peace if the price of iPhones triples, or if the PRC surges troops on the Taiwanese border. Even if they stop buying soybeans or whatever that affects a tiny interest group, one among thousands. I don't mean to dismiss your concerns, or sound indifferent to the harm that a great power struggle could do. But it seems to me that you're right that most Americans don't care about anything outside the border, and China's ability to impose costs on those inside the border of the United States is comparatively limited.
@Mickeyman– Correct. China produces about 90% of the worlds rare earths, but only has about 30% of the world's reserves. One question that people often forget though is that the rare earths are not just about mining. They have to be separated and refined after they have beeb mined, and this takes a high initial capital investment to set up.
@Anon–My wager is they will target a specific sector or a specific company. They will find some component in Boeing planes that require Chinese manufacture, some chemical used in Adalimumab or so forth. Something proportional to us hitting Huawei. Alternatively, I suppose they could use cyberweapons, imprison staff of an American company in China, or something of that sort. They will get creative.
In the long run this is a fight for the United States to win. But the people need to know that it will be a fight.
China not only produce 90% of RE, it has 36% of the world's reserves but that's just only part of the story. While the US gov could shorten the time span providing the permit which normally takes 7-10 years for a mine to operate it's not gonna solve the issue of refining the minerals in the short term. It's gonna take like 10 years to develop these capabilities and certain RE are hardly found in the US. In other words US is dependent on China. US won't win the war
I think at this stage China is still trying to inflict pain in very specific points without generating a nationalist backlash in the American public at large. If a few influential interest groups, whether soybean producers or Boeing or Apple, can be made to feel sufficient pain, they will start to exert their influence on the federal government and policy. But if China starts locking up Americans, ramping up cyber attacks, etc, then they're just giving politicians like Trump the fuel they need to build up anti-China sentiment in the general public, which ensures that the current conflict will continue despite the economic pain that may be inflicted on the US. It's tough to tell where a line can be drawn between those two (e.g. how would the American public react to a rare earth export ban? A perceived threat that cannot be countenanced, or a complex and confusing business dealing?), but I think the CCP is trying to avoid inflaming anti-China sentiment in the general US public at this time.