“Ukraine and Taiwan are on the front lines of the global struggle between freedom and tyranny,” writes Hudson President and CEO John P. Walters in the Wall Street Journal, citing then President of Taiwan Tsai Ing-wen’s remarks at a March 2023 Hudson event.
Walters argues that to overcome the axis of aggressors from Beijing to Moscow and from Tehran to Pyongyang, the United States needs to identify common threats and lead coalitions of like-minded allies against them. To do so, the US should target the “no-limits” China-Russia collaboration that underwrites Vladimir Putin’s war machine. By rebuilding the strength of the US-led alliance system to win the war in Europe, Washington can help deter the Chinese Communist Party’s expansionism in the Indo-Pacific.
Bottom Line
“The Taiwanese people want peace, not conflict, and history tells us that the best way to avoid war is through building strength.”
Rising Axis showcases the depth of Hudson’s analysis on how America and its allies can compete with and defeat the axis of aggressors.
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Facts and Figures
1. The People’s Republic of China uses its economic power to infiltrate and weaken the West, support Russia, and tip the global balance of power in its favor.
- Rather than follow the liberalizing obligations of the World Trade Organization, Chinese leaders aim to control global supply chains and manufacturing chokepoints. The PRC uses state subsidies, intellectual property theft, market restrictions, regulatory interventions, and currency manipulation.
- The PRC now controls 80 percent of the world’s solar energy manufacturing capacity and dominates the production of silicon wafers for solar panels. Beijing is now pursuing dominance in lithium ore batteries and electric vehicles.
- Beijing weaponizes its dominance over critical industries. According to Hudson’s Mike Gallagher, Xi Jinping “seeks a future where he could turn off the lights in Green Bay or Geneva knowing we could not do the same in Guangzhou.”
- By neutralizing Europe’s economic influence, China can harm America’s ability to build a coalition to resist an invasion of Taiwan. Policymakers should encourage Europeans to reverse their dependency on Beijing by decoupling European supply chains from the PRC, combating Chinese dumping practices, and rejecting Chinese-led infrastructure proposals.
2. Because of Chinese support, Russia poses a military threat to America’s European allies.
- With Western sanctions becoming more restrictive, China has become a key supplier of advanced weapons system components, such as machine tools, ball bearings, and semiconductors. Russia, with the support of other members of the axis, can produce nearly all military hardware necessary for a land war in Europe.
- Customs data shows that Beijing has supplied Moscow with over $300 million worth of dual-use items, which can be used to manufacture various weapons, each month. In 2023 alone, China accounted for 90 percent of Russian imports of goods that fall under the Group of Seven’s high priority export control list.
- Because of China’s support, the Russian military can fight grinding wars of attrition and weather mounting casualties. Most North Atlantic Treaty Organization militaries and defense industries are not designed to face such a threat.
3. By targeting the Chinese economy, the US can still preserve peace through strength and deter the new axis.
- Beijing has successfully converted economic engagement with the West into burgeoning military power and support for America’s enemies. Russia’s war machine in Ukraine overwhelmingly runs on imports of Chinese microelectronics and machinery, and indeed, the total revitalization of Russia’s military industrial base is due to China’s economic support.
- An American-led campaign of economic pressure should include tariffs on industries nurtured by the CCP industrial policy, export controls on a greater range of strategic technologies, and comprehensive investment restrictions. The American financial system can impose significant costs on China for its support of Putin.
- A new American energy strategy emphasizing hydrocarbon exports can also bring the European and Asian alliance system greater energy security while mitigating price spikes that come from pressure on the Russian and Iranian oil and gas sectors.
For more, read Jonathan Ward’s op-ed “Want a Stable World? Disengage from the Chinese Economy.”