To achieve these aims he must ensure Putin loses and, to do that, secure General Secretary Xi Jinping’s help. Having established his willingness to use the awesome economic power of tariffs, Trump can now use their withdrawal to make this happen.
While tough, the General Secretary will be easier to deal with than dealing with Putin. Xi retains more negotiating flexibility than Putin because Xi has not committed, at least not yet, the terrible blunder of binding his country’s future to the vicissitudes of war. Two other factors raise prospects for working with Xi: he exercises leverage over Putin and needs U.S. financial relief, if not outright support, to address his own personal pressures and his nation’s needs.
Time is of the essence. As tariffs pile trouble on China’s already stressed economy, Xi’s maneuvering for relief spreads. From Xi’s perspective, as economic reprieve appears to retreat into an unreachable future, military actions advance in their near-term attractiveness. Working this balance to his favor, Trump can trade certainty of economic relief for the uncertainty of China’s combat outcomes in the South China Sea (SCS) and a lot more.
From decades of operating businesses under the thumb of the Communist Party of China, I learned that Xi Jinping dreads domestic unrest more than any other challenge to his role as paramount leader of the Communist Party and the People’s Republic of China.
Trump can exploit Xi’s primary concern.
Russia’s domestic strife due to Putin’s “special military operation” in Ukraine affects Xi’s resolve. Real or perceived failures in war – including more deaths or more time to yield promised results – in the SCS would tarnish Xi’s legacy, diminish his livelihood and, perhaps, lead to his death. Fanning Putin’s problems fuels Xi’s fears.
General Secretary Xi has immediate sway over Putin because China provides components for Russian weapons (U.S. intelligence shows China is surging equipment sales to Russia to help war effort in Ukraine, AP says | PBS News) and cash for Russian exports (Chinese Crude Oil Imports From Russia Rose to a Record High in 2024 | OilPrice.com). Putin committed Russia to war and has shown the leader in Beijing that war can sow or exacerbate a nation’s domestic problems.
Start now. Because of their compounding effects, Trump can reward even incremental changes in parts and cash supply from China to Russia for (1) reducing U.S. sanctions or tariffs, (2) providing U.S. financial support to end war in Europe and, for the longer term, (3) avoiding war in the SCS.
Trump has other fulcrums of power at hand. Just as Ukraine needs U.S. intelligence and weaponry, so do Russia and China seek U.S. validation and investment. Just as suspending supplies to Ukraine evoked changes that Trump sought, in a carrot and stick approach, so can depriving or supplying Russia or China of what they need cause changes in those regimes’ behaviors.
Both countries crave and will compete for the legitimacy that interaction with the United States brings. Putin wants U.S.-Russia hockey games (President Donald Trump, Vladimir Putin discuss NHL-KHL games - ESPN) for this reason. Similarly, and strange to Americans, China’s military exercises around Taiwan express Xi Jinping’s deep seeded need for attention that China considers respectful from the United States.
China survives, even thrives, on access to U.S. financial resources. In 2023, Americans provided China with about $127 billion in foreign direct investment alone. (U.S. foreign direct investments in China 2023 | Statista) Five years ago, the SEC reported that Americans owned about $1.2 trillion of Chinese securities issued in the United States. (us-investors-exposure-domestic-chinese-issuers_20200706.pdf) Just one Chinese issuer, Evergrande, defaulted on $1.2 billion of foreign bonds in 2021 (Evergrande defaults on $1.2B in foreign bonds, Fitch says, as China intervenes in debt-ridden real estate sector - CBS News). Contraction of western nations’ investments in Russia have driven up both Russian inflation and its cost of capital. Because China and Russia fail to regenerate capital, both countries look to others, primarily Americans, to fund their cash shortfalls (China seeks foreign capital old and new to bolster changing economy | Reuters).
While these few references touch just a portion of US purchases of Chinese securities, together, they point to a U.S. fundamental superpower – the United States’ ability to generate surplus capital.
This superpower gives Trump extraordinary negotiating leverage. Focusing the United States’ superpower intensely upon Beijing can end the war in Europe and avoid a potential SCS war. Beijing deserves blistering attention for at least two reasons: (1) Beijing backs belligerence in both theaters. (Behind the Scenes: China’s Increasing Role in Russia’s Defense Industry | Carnegie Endowment for International Peace , China’s Support for Russia’s War in Ukraine Puts Beijing on NATO’s Threat List - WSJ and Trump, Ishiba hit China’s ‘provocative’ South China Sea actions - Manila Standard) (2) the Communist Party of China also needs cash, lots of cash. (China unveils measures to boost consumer spending, foreign investment)
Despite Beijing’s attraction to showing accord with Russia, ending the war in Ukraine better serves China’s interest. The United States does not need Xi to divorce Putin, or to forsake their “no limits” partnership. We just need Xi to divert resources away from Putin. Xi can claim he is prioritizing domestic Chinese needs for products. He can blame tariffs. Regardless of presentation, rather than directing Chinese resources to assist Russia’s belligerence, fostering cooperation with the United States can revive China’s economy. Similarly, redirecting funds from Chinese military maneuvers in the SCS to recapitalizing China’s real estate sector can raise China’s economic prospects.
With understandable distaste, success will also bolster Xi Jinping’s tenure as China’s paramount leader. Pushing through aversions, because we must urgently create alternatives to war, Trump can invoke both China’s and Xi’s personal interests to promote peace and prosperity in the most important negotiation of his new term.
Both Trump and General Secretary Xi need a peace deal.
Inimitably, Trump could open a discussion with, “General Secretary Xi, I need your help. Russia must lose its war in Europe. It should not have invaded Ukraine. Russia may even implode due to the stress of war. You and I are the only ones that can manage such a catastrophe. You could ensure stability in Russia’s east, and I can ensure the stability of Russia’s western borders.”
For a deal to work, Xi needs face, mianzi in Chinese, to burnish his prestige within China. Telling Xi that the United States needs Xi’s help states fact, gives Xi face, and makes a pact more likely to hold. Suggesting that Xi secure Russia’s east recognizes another fact: China’s creeping conquest of currently Russian-held territories. With creeping physical presence and constricting contracts, China is securing Russian resources for its own use. (IF12748)
After dangling the carrot, Trump can then nod to the stick. Xi Jinping knows well that signs of military strength belie the financial weakness that threatens Chinese affluence, China’s stability and, indeed, the Communist Party’s domestic influence.
Trump could continue, “General Secretary, I want an agreement between us to work. I know you have problems in your real estate sector. I know real estate. And, this is important, General Secretary, I can drive U.S. and multi-lateral institutions’ cash budgets to help you. Not only am I willing to advise you and source capital from around the world to ease your real estate crisis, I’m also willing to adjust tariff rates on Chinese products sent to the United States.
“In return, I need you to suspend supplying Russia with weapons and components that may be used for making weapons. I also need you to pull back your threats, rhetorical and physical, across the South China Sea. You have made it clear that you want to control Taiwan, but that’s a problem you created for yourself. European sailors were using Taiwan
“In return, I need you to suspend supplying Russia with weapons and components that may be used for making weapons. I also need you to pull back your threats, rhetorical and physical, across the South China Sea. You have made it clear that you want to control Taiwan, but that’s a problem you created for yourself. European sailors were using Taiwan to repair ships before Chinese arrived on the island in any significant way. I will do what I can to help with framing, but you have got to pull back on your fabricated fixation with Taiwan. You and I, instead, need to focus on securing Russia’s borders, resources, and arsenals.” As Xi Jinping mulls possibilities, Trump can note that, based on recency, regency and proximity, Russia currently occupies territory that is more arguably Chinese than is Taiwan. (Why China Will Reclaim Siberia - NYTimes.com)
Yes, if negotiation achieves maximal objectives, it pushes resolution of some issues into the future. But, right now, the United States needs time to pad its positions and develop its options. Even if negotiation fails to achieve stated objectives, at least it injects questions or doubts into Communist Party considerations. These alone make the effort worthwhile. Almost any engagement that elbows for even a little more time for the United States to augment its capabilities deserves deliberation. In the long run, time favors the United States’ superpower, which creates new jobs and generates new wealth.
Closing an initial discussion and piling on praise to produce a little more mianzi pressure, Trump could add, “General Secretary Xi, China’s long history and the world will appreciate that you pushed for peace in Europe, avoided war in the South China Sea, chose a path to win without fighting and saved the world from horrible catastrophes. You have chosen to preserve and extend China’s greatness.”
Xi will welcome the subtly. The statement plays on both Chinese and Xi’s stories. Sun Tzu, an ancient Chinese strategist, lauds winning without fighting. Many Chinese do not want to go to war over Taiwan. War would sacrifice many who are the only children of two parents and the only grandchildren of four grandparents. All Chinese people have needs competing for resources with potential costs, beyond lives, of war. Their want for butter weighs heavily against Xi’s apparent, but not preferred, want for guns. Furthermore, Xi himself pushes a “Global Development Initiative” to drive international security and prosperity. Significantly for crafting an accord, Xi fears, in order, for his life, livelihood and legacy. With this unexpected approach, President Trump can alleviate all three and could make the world a safer place. It is, at least, worth a shot.