Many foreign policy analysts breathed a sigh of relief when Joe Biden replaced Donald Trump in the White House two years ago. With Biden’s hands on the wheel (and Trump’s erratic and at times reckless tenure in the rearview), the United States could return to being a stabilizing force in the world. The president himself embraced that perception. “America is back,” he pledged to allies in February 2021. After the tumult of the Trump years, an administration with a serious foreign policy agenda once again called the shots in Washington.
Yet the first two years of the Biden presidency have not vindicated this optimism or promise. Instead, confusion abounds, with a troubling disconnect between the administration’s stated priorities and its conduct. Biden’s desire to protect U.S. workers and boost U.S.-based industries has found itself at odds with the imperative of building an alliance to contain the threat of China.
The central deficiency of Biden’s national security strategy is the absence of an economic vision that will allow the United States and other countries to reduce their dependence on Chinese products and markets. With Washington unable to get allies on board on the economic front, other elements of U.S. strategy end up carrying more weight, notably the armed forces. But there, too, the administration’s recognition of the urgent military threat posed by China has not produced a sufficient change in actual policy, in terms of both the defense budget and how policymakers deploy U.S. forces. The State Department is not strong enough to make up for these deficiencies and often finds itself sidelined. Unbalanced, the administration’s strategy lacks credibility. Unless the administration puts into practice the strategy it extolls—by disciplining the president’s loose comments about Taiwan, giving friendly countries incentives to enact difficult economic transitions, enforcing export controls, significantly increasing defense spending, and boosting the capacity of the armed forces—its foreign policy will continue to be ineffective.
MUDDLED THINKING
The administration’s thinking about how economic policy relates to foreign policy has been muddled from the outset. On the one hand, the White House seeks to protect the United States from the supposed ravages of globalization and Chinese mercantilism. On the other, it preaches the virtues of alliances and the solidarity of the international community. These two goals have inevitably clashed.
The administration has ignored the pleas of allies in East Asia to help them reduce their economic reliance on China. China’s neighbors do not want paeans to democracy or military posturing that might increase the risk of war. Instead, they want a path to prosperity that weakens China’s economic grip on them. Australia, Japan, and South Korea, for example, have asked the United States to commit more seriously to free trade in the Indo-Pacific. More than simply trying to isolate Beijing, Washington needs to craft a positive economic policy that persuades its allies to develop markets and supply chains independent of China. But the economic plank of Biden’s foreign policy seems interested only in the vicissitudes of U.S. domestic politics, demanding that allies bring their economies into line with U.S. standards and offering few concessions.
The administration cannot bring itself to return to the Trans-Pacific Partnership, the Asian trade pact negotiated when Biden was vice president. It cannot bring itself to develop a “friend shoring” trade policy that increases resilience by relying on allied countries in supply chains. The Creating Helpful Incentives to Produce Semiconductors for America legislation (CHIPS) does not preclude U.S. companies from using Chinese materials or penalize China for illicitly acquiring technology, and it could actually end up helping Chinese businesses since U.S. firms that receive subsidies could still rely on supply chains that lead to China. Biden’s Treasury and Commerce Departments also have a checkered record in enforcing export controls. Moreover, his administration allowed trade promotion authority (legislation that allows Congress to vote only yes or no on trade treaties) to lapse in 2021, ensuring that no trade deals can now get ratified without amendment by Congress. It has maintained most of the Trump administration tariffs, even those leveled against allied countries, such as restrictions on European Union steel. And it has embittered allies by delivering greater subsidies to U.S. firms through the Inflation Reduction Act.
Biden’s commitment to a “foreign policy for the middle class”—a nebulous slogan that in practice seems to mean trade protectionism and subsidies for U.S. companies—appears to take precedence over building a united front with allies. The Biden administration’s defense of its recent protectionist legislation, delivered in Davos by Joe Manchin, a Democratic senator from West Virginia, was to tell Europeans that they should simply welcome efforts to strengthen the U.S. economy, even if they come at the expense of European businesses. The current government in Washington may not believe in free trade, but the one in Beijing does. China created the world’s largest free trade area last year by launching the Regional Comprehensive Economic Partnership with Southeast Asian countries, but the United States responded with only a vague initiative called the Indo-Pacific Economic Forum that no one seems able to explain.
BARKING, NOT BITING
The lack of a coherent economic policy that can support the National Security Strategy’s objective of successfully competing with China to shape international order places more stress on other areas of national power, in particular the military. The United States has had to talk tough about security in the region to reassure allies, since its economic policies have alienated them. And yet it has not backed up that talk with actions. The administration has made significant policy choices that necessitate increases in defense spending, notably the president’s departure from decades of American ambiguity on Taiwan, by repeatedly asserting that U.S. forces would defend the island in the event of a Chinese attack. Beijing could interpret Washington’s new rhetoric as a provocation and lunge against Taiwan.
But the administration has not adjusted U.S. defense spending, force structure, or the stationing and deployment of the military to account for that possibility. Nor do the admirably aggressive Department of Commerce restrictions that prevent Chinese entities from accessing U.S.-produced commodities and advanced technologies appear to have been coordinated with the Department of Defense, even though such commercial sanctions could make China more willing to go to war. A more considered, integrated approach to deterring China’s bad behavior would synchronize these sanctions both with demonstrations of American military readiness for a potential conflict (and the participation of U.S. allies in such exercises) and with diplomatic efforts to stabilize relations and reduce the potential for conflict. But the administration does not seem to have prepared for the increased military risks that come with the visits of U.S. congressional delegations to Taiwan. With the Chinese military now more active in and around the Taiwan Strait, the Pentagon has described the elevated threat to Taiwan as “the new normal.”
The administration’s foreign policy has been muddled from the outset.
Many officials in the government recognize this danger. In May 2021, the Indo-Pacific commander, Admiral Philip Davidson, testified before Congress that China is most likely to attack or attempt to blockade Taiwan between now and 2027. Avril Haines, the director of national intelligence, called the likelihood of China attacking Taiwan between now and 2030 “acute.” Bill Burns, the CIA director, concurred in that judgment. Jake Sullivan, the national security adviser, delivered a National Security Strategy that called the next ten years “a decisive decade for shaping the terms of competition, especially with [China].”
Yet the activities and budget of the Department of Defense reflect none of that urgency. The 2022 defense budget includes $109 billion in spending on issues such as homelessness, climate change, and public health research that do not boost military power and that should be the responsibility of other government departments. The administration’s first budget in 2021 increased nondefense spending by 16 percent but raised defense spending by only 1.6 percent, and that in nominal terms rather than real terms that account for inflation. The International Institute for Strategic Studies assessed in 2021 that this increase was negligible and that it made “clear that the Biden administration is not attempting to make significant changes to the spending trajectory, at least in this budgetary round, at the U.S. Department of Defense.” In both 2021 and 2022, Congress found the Biden administration’s proposed defense budgets so deficient that on a bipartisan basis it insisted on more funding for the military, adding $28 billion in the first budget and $45 billion in the second.
The urgency of the Chinese threat to Taiwan also does not seem to have fully registered in the Defense Department. It conducted a force posture review early in the administration that resulted in no meaningful changes; what marginal changes it has subsequently proposed, such as rotational stationing and dispersed bases, are not occurring at a pace consistent with the threat. The Defense Department plan proposes to reduce the size of the army and take ships out of the fleet and squadrons out of the air force in the near term to free up funding for a future force to be fielded in 2035. In other words, the department plans to limit its ability to carry out its current strategy in order to be able to field a stronger force in the distant future, well after the time frame in which U.S. officials think a Chinese attempt to take over Taiwan would most likely occur.
AFFAIRS OF STATE
The misalignment of Biden’s foreign policy goals and the administration’s conduct can also be seen at the State Department. The administration said it was committed to “elevating diplomacy as our tool of first resort” and increased diplomatic spending by 14 percent in its first two years, expanding the ranks of the Foreign Service by around 500 people. The State Department and the U.S. Agency for International Development produced a solid joint strategic plan that established institutional priorities: mobilizing coalitions to address global challenges, promoting global prosperity, promoting good governance and human dignity, revitalizing its workforce, and improving consular support for Americans abroad. This agenda has the potential to reshape the institutional culture of the State Department for the better.
But there is little evidence the State Department has succeeded in its desire to “modernize alliances and revitalize international institutions.” The department has been marginal to the successes of the Australian, British, and U.S. security partnership known as AUKUS, and has played only a minor role in galvanizing NATO support for an embattled Ukraine. The White House directly negotiated the AUKUS defense agreement, whereas the State Department struggled to handle the predictable French fury that resulted from the deal (owing to the cancellation of an Australian purchase of French submarines). CIA Director Bill Burns, not Secretary of State Antony Blinken, seems to be the White House’s emissary of choice in difficult diplomatic encounters, whether with Russia, Turkey, or Ukraine. Sullivan appears to be China’s main interlocutor and also the diplomatic heavy recently called upon to deal with German truculence about providing tanks to Ukraine. Lloyd Austin, the secretary of defense, holds monthly meetings abroad with 50 counterparts to orchestrate the delivery of weapons to Ukraine. Blinken and his department have no diplomatic equivalent in motion for galvanizing international support for Kyiv.
The 2021 Summit for Democracy, organized by the State Department, was a bust, devolving into debates about which governments were invited and failing to craft a consequential agenda: the summit inaugurated a “year of action” to strengthen democracies that produced little action. The department’s bid to promote global prosperity appears to be mostly advancing the president’s domestic economic agenda or extolling things that the State Department has little ability to affect, such as U.S. technological leadership.
SALVAGE JOB
At the midpoint of Biden’s administration, the U.S. government has been unable to untangle the contradictory elements in its ambitious strategy, nor has it compensated for these misjudgments by boosting its military and diplomatic spending. The administration’s inability to fashion an international economic policy impedes its central objective of building an effective international coalition to counter China. In this way, it tips the balance of importance away from both economic policy and diplomacy toward the exercise of military power, something the administration explicitly sought not to do.
With two years remaining in the president’s term, the administration should capitalize on U.S. public support for trade—which, according to a 2021 Chicago Council on Global Affairs study, is at an all-time high—and provide the leadership that allies need to reduce their reliance on China. Instead of enrobing protectionist policies in the ermine of a “foreign policy for the middle class,” the president could make the case for advancing democracy by tightening economic cooperation with allies and partners, instructing the Commerce Department and Treasury Department to develop policies that shift manufacturing and the sourcing of materials to allied countries, encourage countries to adopt U.S. standards by giving them greater access to the U.S. market through the Indo-Pacific Economic Forum, and offer extensive exemptions from restrictions in the Inflation Reduction Act for businesses from allied countries. Washington should couple punitive measures that target China with incentives for friendly countries to adjust their economies in ways that increase their bargaining power in dealings with China.
Instead of forcing Congress to correct the administration’s inadequate defense budgets, the administration should develop a more realistic baseline budget for carrying out its strategy—one that accounts for the rate of inflation and the requirements of the possible defense of Taiwan right now and in the future. And since a president can make the solemn commitment of defending another country only with congressional consent to a diplomatic treaty, the secretary of state ought to commence such negotiations to move toward a formal alliance. The sticker price for the administration’s national security strategy is likely around $1 trillion, or a consistent year-on-year real increase of five percent above current defense spending. Trying to cut costs by urging reforms in the Defense Department and armed forces will not produce significant savings and will only distract from the urgency of addressing what really matters: improving the military’s ability to fight and win wars, increasing stockpiles of essential weapons, and aiding allies in upgrading their armed forces. In its next two years, the Biden administration should find what was lacking in its first two, a seriousness of purpose that matches the ambitions of the White House’s strategy.
