What We Can Learn from Pelosi’s Taiwan Visit 

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China’s near-term response to House speaker Nancy Pelosi’s visit to Taiwan may not yet be concluded, but its main outlines are clear: significant increases in “wolf-warrior diplomacy” rhetoric; significant military exercises in and around Taiwan’s territorial waters; and suspension or cancellation of several channels of Sino–U.S. diplomatic discourse. More might be coming, but what Beijing has done so far is neither unexpected nor game-changing. 

What could be game-changing is whether China’s temper tantrum awakens American business and political leaders to realities that have been steadily accumulating even before Xi Jinping took power. In the last decade, Xi and others unambiguously abandoned Deng Xiaoping’s disingenuous, low-profile approach of “hide your strengths, bide your time.” Xi said expressly, “A military force is built to fight. Our military must regard combat readiness as the goal for all its work and focus on how to win when it is called upon.” 

Initial U.S. business reactions to China’s fist-shaking are discouraging, such as reports that “U.S. companies with Taiwan-based operations are panicking about the impact of possible Chinese military aggression.” What have these firms been doing the last ten years? (Or are the reporters the ones panicking?) Moreover, risks to U.S. investment and supply-chain reliance on mainland China are far more important. If Taiwan’s circumstances are worrying, consider the vastly greater American economic exposure in China itself. Shareholders and management might want to revisit the phrase “political risk.” 

The White House has also reacted poorly, canceling a long-planned ICBM test for fear of agitating China. Then, echoing Beijing’s alarmist rhetoric, the administration said of Beijing’s suspension of climate-change talks: “China’s not just punishing the United States . . . they’re actually punishing the whole world.” Such irresolute, apologetic behavior encourages China’s belligerence, and worries countries along its Indo-Pacific periphery. 

Pelosi’s Taiwan trip didn’t create problems, but instead exposed what has long been obvious, or should have been, about China’s growing menace. Ironically, Beijing has unwittingly provided Washington an opportunity to initiate or accelerate much-needed policy directions ignored during this and prior administrations. 

First, political-risk factors in business and economic affairs are not “back”; they never went away, although all-too-many U.S. businesses disregarded them. Now, however, is the time to reconsider existing and potential capital expenditures in, and supply-chain reliance on, China, and seek alternatives. Not least among the possibilities are relocating assets to the United States and the Western Hemisphere, not just to reduce political risk, but to enhance security for intellectual property, increase supply-chain resilience, and lower transport costs. Government “industrial policy” or subsidies are not necessary here, just business common sense. 

More forcefully countering China’s economic warfare against America and the West is critical. Decades of schemes to steal our intellectual property, force technology transfers, and weaponize Chinese “companies” such as Huawei and ZTE as arms of the Chinese state must be brought to a halt. Trade policies designed to counter Beijing’s abuses would garner widespread support not only among OECD industrial democracies, but also in developing countries threatened by China’s hegemonic “debt diplomacy” and Belt and Road Initiative. Such an initiative would have a significant, worldwide unifying impact against China, a unity precluded in recent years by internecine trade disputes among Beijing’s adversaries. 

Second, both government and business must pay greater attention to countering China’s efforts to isolate Taiwan politically and economically. Doing so in no way minimizes the need to enhance Taipei’s self-defense capabilities, but rather prioritizes embedding Taiwan’s security in a broader system of alliances and partnerships. It also requires Washington to think in larger strategic terms, at truly Indo-Pacific and even global levels, regarding China’s menace. That threat at the moment is focused on Taiwan, but the next levels up — Beijing’s aspirations for hegemony along its Indo-Pacific periphery, and then worldwide — are closely related. Taiwan is not the only country near China. Ask South Korea and Japan, Vietnam and Singapore, and India, which already profoundly grasp the larger picture. Europe, except for the United Kingdom, lags behind, but even the European Union can be encouraged to keep up. 

After World War II, the North Atlantic countries formed deep, extensive political and economic ties, including NATO, history’s most successful politico-military alliance. Only rudimentary building blocks for such structures now exist in the Indo-Pacific, but progress is being made. Japan’s tragic loss of Shinzo Abe should not diminish his strategic vision and accomplishments. He first imagined both the concept of the “Indo-Pacific,” and the Asian Quad (Japan, India, Australia, and the U.S.), which is now beginning to take shape. AUKUS, the trilateral effort to produce nuclear-powered submarines for Australia, is another building block, and there is urgent need for more such creative thinking. The ultimate Indo-Pacific partnership structures need not, and probably cannot, duplicate NATO in the near future. But there is enormous room for greater cooperation against China’s dangerous ambitions. 

Third, and the immediate focus of attention, is defending Taiwan itself. China’s post-Pelosi military exercises could foreshadow either an outright invasion or a naval blockade, the latter actually more likely because Beijing wants Taiwan without the devastation Russia is causing in Ukraine. Accordingly, China could well try to create an artificial crisis at a time of its choosing, including announcing a blockade, to see who will stand with Taiwan. If the U.S. and others fail to act, Chinese hegemony and even annexation of Taiwan will follow in due course. Deterring either physical invasion, a blockade, or a threat to Quemoy and Matsu requires action now. It should include home-porting U.S. naval vessels and stationing meaningful U.S. military forces in Taiwan. Troop deployments will be necessary in any case to train and assist Taiwanese troops to handle the new weapons systems and necessary joint military exercises. We should not repeat the mistakes made in the Ukraine crisis that failed to deter Russia’s invasion. 

China’s reaction to Pelosi’s visit is a “teachable moment.” Beijing has removed its mask, and we have seen its real intentions. We cannot miss the opportunity presented. There may not be another. 

JOHN R. BOLTON — Mr. Bolton served as national-security adviser to President Donald Trump and as U.S. ambassador to the United Nations under President George W. Bush. He is the author of The Room Where It Happened.