Biden, Taiwan, and US-China High Technology Competition

Written by Robert Sutter.

Image credit: Xi Jinping Visit-7 by Antonio R. Villaraigosa/Flickr, license CC BY-NC 2.0

Despite official disclaimers, the election of President Joseph Biden has been greeted with considerable angst in Taiwan. The fear concerns how the new US government will not follow through on various security, diplomatic and economic advances in US-Taiwan relations undertaken by the Trump government. This is despite the strong objections from Beijing, returning to the strict adherence to the One China policy prevalent during the Obama-Biden government of 2009-2017. These fears are justified, but they run up against American domestic politics opposing easing US countermeasures against China and rising American interest in closer cooperation with Taiwan as a critical resource in the acute US-China competition for high technology leadership.

Heading the list of Taiwanese concerns regarding the Biden administration, President-elect Biden’s entourage includes many senior advisers closely tied to the consistent practice of the Obama-Biden years of avoiding steps to support Taiwan that would risk serious upset of the US relationship with China. Notably – even though President Obama and his senior staff in 2014 began publicly voicing strong opposition to Chinese use of military and other coercion to “bully” and intimidate neighbours in the disputed East China Sea and South China Sea – they avoided such statements in the face of ongoing Chinese military intimidation of Taiwan. The administration’s signature rebalance policy saw the US advance relations with Japan, Vietnam, the Philippines, and other countries around Taiwan despite often strong Chinese criticism. Nevertheless, the administration at first failed to even mention Taiwan as part of the rebalance, and later continued mum on what the US was doing with Taiwan, presumably to avoid offending China in ways seen as adverse to US interests.

Consistent with such practice, 2016 presidential candidate Hillary Clinton’s tough rhetoric vowing to counter various adverse Chinese behaviour did not feature Taiwan. One of her senior campaign advisers, Jake Sullivan, now a senior Biden adviser, told the media in July 2016 that there would be no change in US handling of China-Taiwan relations if Clinton were elected.

Against this background, observers in Taiwan watch for signs that the Biden government will re-evaluate the drivers and brakes determining the recent upswing in US relations with Taiwan, with the incoming administration judging its interests would be better served by allowing recent initiatives toward Taiwan to atrophy. In particular, before the Trump government, a major brake on advancing US relations with Taiwan in the face of strong Chinese objections was that such advance would seriously upset the stability of the US-relationship with China. Such stability was a high priority for the Obama-Biden government and also a high priority for US allies and partners in Asia at that time seeking to avoid tension with Beijing. That priority in US policy ended with the Trump government’s trade war and government countermeasures against a wide range of adverse Chinese practices challenging American interests. The Biden government may seek to restore stability in US-China relations, and in the process avoid actions on the sensitive Taiwan issue that would exacerbate tensions with Beijing.

Of course, the Biden government taking steps at Taiwan’s expense to ease tensions with Beijing would run up against bipartisan congressional support for the whole of government countermeasures against China and mainstream media and public opinion very distrustful of China’s leaders. Meanwhile, the US government efforts have placed a premium on high technology competition. They fear that China has reached a stage where it could dominate such future industries and thereby place the US economy and US military –  both of which are highly dependent on high technology – in subordinate positions. In this battleground for leadership in high technology, Taiwan has come to loom more important in American calculations.

As part of their competition with China, US policymakers are wrestling with growing tension in dealing with conflicting demands to (1) secure the economic interests of the nation-state on the one hand and to (2) secure the broader interests of industries, entrepreneurs, stockholders and many others. This also concerns government interests coming from growing economic international interchange and cooperation featured in modern globalization and high technology collaboration and production chains. The requirements to achieve (1) national economic security are seen often clashing with the requirements to achieve (2) comprehensive economic security. For example, as China has risen to the point of appearing as a peer competitor with the United States, threatening to overtake America’s lead in high technology industries and dominate the economy of the future, US policymakers intensify efforts to cut Chinese access to America’s leading technology. However, they find that many webs of international cooperation support US high technology, making restrictions on Chinese access more difficult and possibly counterproductive.

Taiwan has many essential high technology capacities and gets increasing US government attention in dealing with the policy conflict explained in the previous paragraph. As the US government has moved to give more emphasis to 1 over 2, above, Taiwan’s close high technology cooperation with China warrants close and perhaps negative scrutiny from American leaders seeking reliable partners in high tech competition with Beijing. At the same time, as Taiwan cooperates more closely with the United States in building US and partner high technology capacities that are secure and separate from China, the US government objectives are better supported, and more significant US government approval of Taiwan follows.

The government and companies of Taiwan have their own calculations of costs and benefits. The growing US emphasis on (1) national economic security seems to come at the expense of existing high technology production chains that have proven profitable and advantageous for companies in Taiwan. If this US emphasis represents a net loss for Taiwan companies, the degree of disadvantage caused by the US government emphasizing (1) national economic strategy over (2) comprehensive economic security is important to calculate. It is likely but far from certain that the current direction of US policy—restricting contacts with China on high technology—will continue. Meanwhile the advantages for Taiwan in closer high technology cooperation with the United States (both bilaterally and with other allies and partners) secure and separate from Beijing need to be carefully considered.

A bottom line for Biden administration policy is that the importance and uncertainty of Taiwan’s cooperation with the United States in its high technology competition with China should be fully considered before decisions are made on changing the recent advances in US relations with Taiwan in the interests of restoring greater stability in the US relationship with China.

Robert Sutter is Professor of Practice of International Affairs at the Elliott School of George Washington University beginning in 2011. He also serves as the school’s Director, Program of Bachelor of Arts in International Affairs.

This article is part of a special issue on the US-Taiwan relations under Biden presidency.

One comment

  1. Taiwan TSMC is going to be an important supplier of microchip for Pentagon, that goes into the military electronics.

    If US lose the high technology microchip making race to China, US dollar as global reserve currency will be in trouble.
    The US Dollar is backed the massive US Military superior over other global competitors.

    If US lost the military superiority in global geopolitics, dollar will likely collapse and as a result the Wall Street will crash and hyperinflation may follows.
    Federal Reserve will not able to print billions of dollars to finance budget deficits anymore.
    Civil war America will surely happen when dollars collapse.

    Like

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