Interview: Lee Kuan Yew on the Future of U.S.- China Relations

In this book excerpt, one of Asia's greatest statesmen says competition is inevitable between China and the U.S., but conflict is not.

Former Singapore Prime Minister Lee Kuan Yew (LKY) gestures as he answers a question from the floor during the LKY School of Public Policy 7th anniversary dialogue session in Singapore September 14, 2011. (Tim Chong/Reuters)

Few individuals have had as consequential a role in their nation's history as Lee Kuan Yew, the founding prime minister of Singapore. During Lee's three-decade long tenure in office, he helped transform Singapore from an impoverished British colony lacking natural resources into one of Asia's wealthiest and most developed countries.

Over the years, Lee has also become one of Asia's most prominent public intellectuals, one whose unique experience and perspective gives him tremendous insight into trends shaping the continent.

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In the following conversation, Lee trains his sights to the most prominent geopolitical issue of our time: the rise of China. Rather than attempt to thwart China's emergence as a global superpower, Lee argues, the United States should find ways to work constructively with China in forging a new global order.

This conversation is excerpted from the book Lee Kuan Yew: The Grand Master's Insights on China, the United States, and the World comprised of interviews and selections by Graham Allison and Robert D. Blackwill, with Ali Wyne, and a foreword by Henry A. Kissinger.

How likely is a major confrontation between the United States and China?

Competition between the United States and China is inevitable, but conflict is not. This is not the Cold War. The Soviet Union was contesting with the United States for global supremacy. China is acting purely in its own national interests. It is not interested in changing the world.

There will be a struggle for influence. I think it will be subdued because the Chinese need the United States, need U.S. markets, U.S. technology, need to have students going to the United States to study the ways and means of doing business so they can improve their lot. It will take them 10, 20, 30 years. If you quarrel with the United States and become bitter enemies, all that information and those technological capabilities will be cut off. The struggle between the two countries will be maintained at the level that allows them to still tap the United States.

Unlike U.S.-Soviet relations during the Cold War, there is no irreconcilable ideological conflict between the United States and a China that has enthusiastically embraced the market. Sino-American relations are both cooperative and competitive. Competition between them is inevitable, but conflict is not.

After the collapse of the Soviet Union, the United States and China are more likely to view each other as competitors if not adversaries. But the die has not been cast. The best possible outcome is a new understanding that when they cannot cooperate, they will coexist and allow all countries in the Pacific to grow and thrive.

A stabilizing factor in their relationship is that each nation requires cooperation from and healthy competition with the other. The danger of a military conflict between China and the United States is low. Chinese leaders know that U.S. military superiority is overwhelming and will remain so for the next few decades. They will modernize their forces not to challenge America but to be able, if necessary, to pressure Taiwan by a blockade or otherwise to destabilize the economy. China's military buildup delivers a strong message to the United States that China is serious about Taiwan. However, the Chinese do not want to clash with anyone -- at least not for the next 15 to 20 years. The Chinese are confident that in 30 years their military will essentially match in sophistication the U.S. military. In the long term, they do not see themselves as disadvantaged in this fight.

China will not let an international court arbitrate territorial disputes in the South China Sea, so the presence of U.S. firepower in the Asia-Pacific will be necessary if the U.N. Law of the Sea is to prevail.

Secretary of State Hillary Clinton has declared concepts of balance of power obsolete in the 21st century: "Neither [the U.S. nor China] can afford to keep looking at the world through old lenses, whether it's the legacy of imperialism, the Cold War, or balance-of-power politics. Zero sum thinking will lead to negative sum results." What role should the balance of power play in America's strategy for addressing the rise of China?

Prudence dictates that there should be a balance of power in the Asia-Pacific region. This is reflected in a widely held consensus that the U.S. presence in the region should be sustained. A military presence does not need to be used to be useful. Its presence makes a difference and makes for peace and stability in the region. This stability serves the interests of all, including those of China.

Peace and security both in Europe and in the Pacific still depend on a balance of power. A U.S. military presence in both regions is very necessary. However, unless the U.S. economy becomes more dynamic and less debt laden, this presence will be much reduced by the end of this decade. The longer-term outlook then becomes problematic. Even if U.S. deficits are reduced, industrial productivity improves, and exports increase, the United States nevertheless cannot afford and will not be willing to bear the whole cost of the global security burden. The great danger is that the U.S. economy does not recover quickly enough and trade frictions and Japan bashing increase as America becomes protectionist. The worst case is where trade and economic relations become so bad that mutual security ties are weakened and ruptured. That would be a dreadful and dangerous development.

The world has developed because of the stability America established. If that stability is rocked, we are going to have a different situation.

The size of China will make it impossible for the rest of Asia, including Japan and India, to match it in weight and capacity over the next 20 to 30 years. So we need America to strike a balance. The question is whether the United States can continue its role as a key security and economic player in the Pacific. If she can, East Asia's future is excellent. But there will be problems if the U.S. economy does not recover its competitiveness.

The United States cannot afford to abandon Japan unless it is willing to risk losing its leverage on both China and Japan. Whether or not there is a U.S.-Japan Mutual Security Treaty, the only stable balance that can be maintained is a triangular one between Japan and the United States on the one side and China on the other. This is inevitable because of China's potential weight, which far exceeds that of the United States and Japan combined.

Why should the United States stay engaged to help East Asia's combined gross national product to exceed that of North America? Why not disengage and abort this process? Because this process is not easily aborted. No alternative balance can be as comfortable as the present one, with the United States as a major player. The geopolitical balance without the United States as a principal force will be very different from that which it now is or can be if the United States remains a central player. My generation of Asians, which experienced the last war, its horrors and miseries, and which remembers the U.S. role in the phoenix-like rise from the ashes of that war to prosperity of Japan, the newly industrializing economies, and ASEAN (Association of Southeast Asian Nations) will feel a keen sense of regret that the world will become so vastly different because the United States becomes a less central player in the new balance.

President Nixon was a pragmatic strategist. He would engage, not contain, China, but he would also quietly set pieces into place for a fallback position should China not play according to the rules as a good global citizen. In this circumstance, in which countries would be forced to take sides, he would arrange to win over Japan, Korea, ASEAN, India, Australia, New Zealand, and Russia to America's side of the chessboard.

Are Chinese leaders serious about displacing the United States as the number one power in Asia and in the world?

Of course. Why not? They have transformed a poor society by an economic miracle to become now the second-largest economy in the world -- on track, as Goldman Sachs has predicted, to become the world's largest economy. They have followed the American lead in putting people in space and shooting down satellites with missiles. Theirs is a culture 4,000 years old with 1.3 billion people, with a huge and very talented pool to draw from. How could they not aspire to be number one in Asia, and in time the world?

Today, China is growing at rates unimaginable 50 years ago, a dramatic transformation no one predicted. The Chinese people have raised their expectations and aspirations. Every Chinese wants a strong and rich China, a nation as prosperous, advanced, and technologically competent as America, Europe, and Japan. This reawakened sense of destiny is an overpowering force.

Unlike other emergent countries, China wants to be China and accepted as such, not as an honorary member of the West. The Chinese will want to share this century as co-equals with the United States.

How should U.S. policies and actions adjust to deal with the rise of China?

For America to be displaced, not in the world, but only in the western Pacific, by an Asian people long despised and dismissed with contempt as decadent, feeble, corrupt, and inept is emotionally very difficult to accept. The sense of cultural supremacy of the Americans will make this adjustment most difficult. Americans believe their ideas are universal -- the supremacy of the individual and free, unfettered expression. But they are not -- never were. In fact, American society was so successful for so long not because of these ideas and principles, but because of a certain geopolitical good fortune: an abundance of resources and immigrant energy, a generous flow of capital and technology from Europe, and two wide oceans that kept conflicts of the world away from American shores.

The United States cannot stop China's rise. It just has to live with a bigger China, which will be completely novel for the United States, as no country has ever been big enough to challenge its position. China will be able to do so in 20 or 30 years. Americans have to eventually share their preeminent position with China.

The size of China's displacement of the world balance is such that the world must find a new balance. It is not possible to pretend that this is just another big player. This is the biggest player in the history of the world.

The U.S. Congress is against any new free-trade agreements (FTAs). If the next Congress continues to oppose FTAs, valuable time will be lost, and it may be too late to try again. Congress must be made to realize how high the stakes are and that the outlook for a balanced and equitable relationship between American and Chinese markets is becoming increasingly difficult. Every year, China attracts more imports and exports from its neighbors than the United States does from the region. Without an FTA, Korea, Japan, Taiwan, and the ASEAN countries will be integrated into China's economy--an outcome to be avoided.

What policies and actions should the United States avoid in dealing with the rise of China?

Do not treat China as an enemy. Otherwise it will develop a counter-strategy to demolish the United States in the Asia-Pacific. In fact, it is already discussing such a strategy. There will inevitably be a contest between the two countries for supremacy in the western Pacific, but it need not lead to conflict.

The baiting of China by American human rights groups ignores its different culture, values, and history, subordinating the strategic considerations of U.S.-China relations to an American domestic agenda. Such a haphazard approach risks turning China into a long-term adversary of the United States. More understanding of the cultural realities of China can make for a less confrontational relationship.

With the disintegration of the Soviet Union, U.S.-China relations are no longer anchored in a common threat. China has the potential to become a superpower. America's interest is to maintain the status quo, where it is the only superpower. But in 30 years, China's growth could challenge this preeminence. U.S. policy toward China has been driven by extraneous factors, like the saturation media coverage of Tiananmen, the plight of Chinese dissidents fleeing persecution, democracy, human rights, and most-favored-nation status, autonomy for Tibet and the Dalai Lama, and Taiwan's attempts to become an independent member of the United Nations. Issues that challenge China's sovereignty and unity will arouse China's hostility. To emphasize such issues makes sense only if it is U.S. policy to contain China and to slow down or abort its rapid economic growth.

Massive economic reforms have opened up China. If liberalization is the goal of U.S. policy, then more trade and investment are the answers. The State Department draws up its report on China's human rights like a headmaster drawing up a pupil's annual report for the parents. This may make Americans feel good and make Chinese look small, but East Asians are uneasy over its long-term consequences.

It is the United States, more than any other country, that can integrate China into the international community. The difficulty arises from America's expressed desire to make China more democratic. China resents and resists this as interference in its domestic affairs. Outside powers cannot refashion China in their own image. American society is too pluralistic, its interests too varied to have a single or unanimous view of China. Sometimes the language of discourse in America has caused the Chinese to wonder if by engagement the United States does not mean an engagement in combat. China has to be persuaded that the United States does not want to break up China before it is more willing to discuss questions of world security and stability.

Can U.S. policies and actions significantly influence China's trajectory and behavior as it emerges as a great power?

Yes, indeed. If the United States attempts to humiliate China, keep it down, it will assure itself an enemy. If instead it accepts China as a big, powerful, rising state and gives it a seat in the boardroom, China will take that place for the foreseeable future. So if I were an American, I would speak well of China, acknowledge it as a great power, applaud its return to its position of respect and restoration of its glorious past, and propose specific, concrete ways to work together.

Why should the United States take on China now when it knows that doing so will create an unnecessary adversary for a very long time, and one that will grow in strength and will treat it as an enemy? It is not necessary. The United States should say: 'We will eventually be equal, and you may eventually be bigger than me, but we have to work together. Have a seat, and let us discuss the world's problems.'

This is the fundamental choice that the United States has to make: to engage or to isolate China. You cannot have it both ways. You cannot say you will engage China on some issues and isolate her over others. You cannot mix your signals.

America's greatest long-term influence on China comes from playing host to the thousands of students who come from China each year, some of the ablest Chinese scholars and scientists. They will be the most powerful agents for change in China.

As China's development nears the point when it will have enough weight to elbow its way into the region, it will make a fateful decision -- whether to be a hegemon, using its economic and military weight to create a sphere of influence, or to continue as a good international citizen. It is in everyone's interest that before this moment of choice arrives, China should be given every incentive to choose international cooperation, which will absorb its energies constructively for another 50 to 100 years. This means China must have the economic opportunities to do this peacefully, without having to push its way around to get resources like oil, and have access to markets for its goods and services. If such a route is not open to China, the world must live with a pushy China. The United States can through dialogue and cooperation with China chart a course to manage China's transition in the next 20 or 30 years into a big power.

China is an old civilization and will not easily change because of external pressure or sanctions. But changes will come when their leaders, thinkers, and intellectuals become convinced on their own that adopting certain attributes and features of other societies will benefit China.

The best way to quicken the pace and direction of political change in China is to increase its trade and investment links with the world. Then its prosperity will depend increasingly on the compatibility of its economic system with those of the major trading nations. And wide-ranging contacts will influence and modify its cultural values and moral standards.

Integrating China into the global system will build up strong vested interests in China to play by international rules. It will increase China's interdependence for trade, services, investments, technology, and information. These interdependent links could increase to a point where to break them in a unilateral breach of international obligations would carry unbearable costs.

Peace and security in the Asia-Pacific will turn on whether China emerges as a xenophobic, chauvinistic force, bitter and hostile to the West because it tried to slow down or abort its development, or whether it is educated and involved in the ways of the world -- more cosmopolitan, more internationalized and outward looking.

How should Chinese policies and actions adjust to establish a sustained cooperative relationship with the United States?

From 1945 to 1991, China was engaged in a series of wars that nearly broke them. This generation has been through hell: the Great Leap Forward, hunger, starvation, near collision with the Russians -- the Cultural Revolution gone mad. I have no doubt that this generation wants a peaceful rise. But this generation's grandchildren? They think that they have already arrived, and if they begin to flex their muscles, we will have a very different China. Grandchildren never listen to grandfathers. The other problem is a more crucial one: if you start off with the belief that the world has been unkind to you, the world has exploited you, the imperialists have devastated you, looted Beijing, done all this to you -- this is not good. If I were America, Europe, or Japan, I would spend time to make sure that the mindset of the younger generation is not one of hostility, but one of acceptance and an understanding that you are now a stakeholder, which was Bob Zoellick's very apt description of their role. Make them feel that they are stakeholders, and if this earth goes warm, they will be in as much trouble as anyone else.

It is vital that the younger generation of Chinese, who have only lived during a period of peace and growth in China and have no experience of China's tumultuous past, are made aware of the mistakes China made as a result of hubris and excesses in ideology. They have to be imbued with the right values and attitudes to meet the future with humility and responsibility. The authors of China's doctrine of peaceful emergence are acutely conscious that as China resumes its recovery, it has the responsibility and self-interest to assure its neighbors, and the world at large, that its emergence is benign, not a threat but a plus for the world, that it will try to avoid disruption and conflict. China is aware of the problems its rapid growth will present to the rest of the world and wishes to work together with the international community to minimize the disturbance. It is to the good of China to study how to mitigate the adverse impacts of its growth.

The ways in which Chinese superiority will be expressed will undoubtedly be quite different than in the earlier era. Take the current case of East Asia, where they have, obviously, established a dominant economic position in relations with their neighbors, and used that position including access to a market of 1.3 billion people and significant investments in other countries to their advantage. If states or enterprises do not accept China's position and pay appropriate deference, they are faced with the threat of being shut out of a rapidly growing market with 1.3 billion people.