Clash of the titans – will the US and China fall into the trap of war as they battle to be the top dog?

Roddy Gow studies the growing rivalry between the superpowers

Some of your readers will have heard of the Thucydides Trap, but for those who have not, it may have an application in the increasingly tense relations between the United States and China, as the latter appears to represent a growing challenge to the former in global markets on the 70th anniversary of the creation of modern China.

The Thucydides Trap refers to a situation where one great power threatens to displace another and war is almost always the result, although it does not always have to be. Graham Allison, the American political scientist and professor at the John F. Kennedy School of Government at Harvard and author of Destined for War. Can America and China Escape the Thucydides Trap? writes, “as China challenges America’s predominance, misunderstandings about each other’s actions and intentions could lead them into a deadly trap first identified by the ancient Greek historian Thucydides. As he explained: “It was the rise of Athens and the fear that this instilled in Sparta that made war inevitable.” The past 500 years have seen 16 cases in which a rising power threatened to displace a ruling one. Twelve of these ended in war.

How does the trap affect China and the US? Viewed from one perspective there appears to be a seemingly unstoppable China rising to displace the United States – an extraordinary reversal of the 1978 situation where 90 per cent of Chinese people were surviving on under $2 a day and now only 1 per cent are. The trap is, as Henry Kissinger said, a way to look through the news and noise of today to understand what is happening.

There may need to be an event to trigger conflict. North Korea could be the provocateur or a violent intervention in Hong Kong or Taiwan in the way that the assassination in Sarajevo started the chain of events leading to the First World War.

What are the causes of the current situation and can they be reversed? What does the current trade war with China initiated by the US administration hope to achieve? Is it the reversal of China’s seemingly unstoppable growth? Is it the protection of American manufacturing and other jobs? Is it an attempt to prevent intellectual property theft?

Wendy Cutler, vice-president of the Asia Society Policy Institute was previously acting deputy US trade representative. She recently noted that fresh negotiations which will include not just ministerial-level meetings, but ongoing discussions at the vice-ministerial level are heartening. She said: “I think what would be extremely helpful now is for both sides to quiet down and let the negotiators do their work – if China and the US can establish a better atmosphere in the coming months”. However, as I write, the US administration has just threatened to stop Chinese companies listing on the NYSE and NASDAQ.

Failure to resolve these and other issues will probably exacerbate the trend of China challenging the hegemony of the United States

China has several challenges to tackle and its ability to do so will accelerate its growth and potential threat to displace the United States. Right now, the US economy is the biggest in the world. It produces roughly $20 trillion worth of goods and services every year. China produces about $13 trillion worth of goods, so it’s still a bit behind.

George Magnus, previously senior economic advisor at UBS Investment Bank and now research associate and author at the China Centre, Oxford University, doesn’t entirely agree