The relationship between Washington and Beijing wasn't always so dysfunctional.Carlos Barria / Reuters

The United States and China are again seeking to resolve their long-running dispute on trade this week as a high-level delegation from Washington arrives in Beijing for another round of negotiations. In recent days, however, peaceful engagement with the Middle Kingdom hasn’t been on Washington’s mind.

The U.S. dispatched warships through the strait between the Chinese mainland and Taiwan, earning the inevitable rebuke from Beijing, which still claims the island as part of China. U.S. Secretary of State Mike Pompeo, meanwhile, warned one of America’s closest allies, Israel, about getting too close to China, pointing to risks over technological cooperation with Beijing.

These divergent events typify what has become a highly dysfunctional relationship between Washington and Beijing. At one moment, the two are striving to overcome their differences on trade, which if successful would likely lead to even greater integration between their economies. The next, they are sparring over a lengthening list of issues, from territorial rights to cutting-edge technology and infrastructure projects.

Neither government seems to have a coherent strategy for dealing with the other. Do the U.S. and China want to be friends? Enemies? Frenemies? What exactly do they envision their future relationship to be?

“That is the question,” John Negroponte, the director of national intelligence under President George W. Bush and now a professor at the University of Virginia, told me. In Washington, he continued, “is anyone really thinking about the long-term relationship? To the extent they are, they are thinking about it in a negative, adversarial direction.”

As China quickly becomes a superpower, how its relations with the U.S. unfold will shape global affairs. If they descend into confrontation, the world could again split into two blocs competing for dominance, as happened during the Cold War. More cooperative ties, conversely, would bolster global economic prospects, as well as hopes that pressing international problems, such as climate change and nuclear proliferation, could be addressed.

“Do we want to preserve one world, one system? The relationship with China is critical to that,” Negroponte added. “Clearly, if there is one world, two systems, it’s going to be much harder to deal with global issues.”

Only a couple of years ago, few even imagined we’d be asking these questions. Cooperation with China was a core principle of American foreign policy. Ever since Richard Nixon’s 1972 summit with Mao Zedong in Beijing, Washington’s goal has been to entice China into the U.S.-led global order through bonds of trade and investment.

But recently, many think-tankers and policy makers in the U.S.—most prominently, President Donald Trump—have characterized that strategy as a colossal mistake. In their view, an overly generous U.S. transformed China into its chief rival for world economic and strategic supremacy. Worse still, Beijing has, its detractors insist, cheated its way to superpower stature by pilfering American technology and factories. And when you also consider China’s steady military buildup and assertive foreign policy, the country has appeared in Washington’s eyes to be more and more a threat, rather than a partner.

What changed? Mostly policy in China. President Xi Jinping, who took power in 2012, introduced a series of aggressive initiatives aimed at expanding China’s political and economic clout on a global scale. He launched the Belt and Road Initiative to construct infrastructure around the world, financed by Chinese banks and built by Chinese companies. A new industrial program known as “Made in China 2025” marshaled heavy state aid to accelerate the development of homegrown technology and national corporate champions in sectors from electric cars to robotics. Domestically, Xi has been busy devising a high-tech surveillance state to crack down more thoroughly on dissent and solidify his stranglehold on the nation.

The U.S. response has been sharp, and startling. No longer would Washington so blithely accept China’s rise. Trump hiked tariffs on Chinese imports to compel Beijing to play fair on trade and open its restricted markets. The administration has lobbied its allies to bar telecom equipment from China’s Huawei Technologies, arguing that the mysterious company poses a security risk. This month, Washington warned Italy not to participate in Xi’s Belt and Road plan, stating that such a step “lends legitimacy to China’s predatory approach to investment.” Pompeo recently vowed that the U.S. would prevent China from choking off shipping through the South China Sea, most of which China claims as its own territory.

Beijing’s leaders have been caught off guard by the hostile American reaction to its new initiatives. “They thought they were too powerful and the Americans would not take a risk of rupturing the relationship,” Minxin Pei, an expert in U.S.-China relations at Claremont McKenna College, told me. “They were wrong.”

Yet neither side seems prepared for a full-fledged slugfest, either. Beijing, for all its bravado, is aware that China—still poor by the standards of advanced economies—requires access to U.S. investment, consumers, and technology to continue its drive for development. Washington knows the Chinese market has become a crucial source of sales and profits for American companies from General Motors, to Qualcomm, to Starbucks, and the White House desires Beijing’s cooperation on other important matters too, such as defusing the North Korean nuclear conundrum.

That interdependence has left policy makers in both countries strategically adrift. By default, both seem to have settled into a “two-track” approach—bitterly bickering to protect their perceived national interests, while trying to reap the benefits of continued trade and investment.

Such an approach may not be sustainable, though. Jennifer Harris, a fellow at the Roosevelt Institute, a think tank, and a former State Department official, told me that in the 1980s, the U.S. had similar trade battles with Japan, but due to the strong defense alliance between the two, the disputes never spilled over into a wider conflict. No such constraint exists with China. For China, she said, “there is no bigger security issue than delivering on economic growth. The U.S. turning to tougher economic practices adds up to conflict going from security to economics to security and snowballing.”

What’s needed is a major strategic rethink on both sides of the Pacific, but that doesn’t seem to be happening. Hostility toward China has become a popular plank on both ends of the U.S. political spectrum. China, for its part, seems willing to take some steps to accommodate U.S. concerns—but only to a point. Beijing appears intent on preserving the core of the aggressive policy platform that sparked the deterioration in relations. For instance, Chinese Premier Li Keqiang didn’t mention the “Made in China 2025” program in his annual address to the National People’s Congress in March, in an apparent attempt to appease Trump. He nevertheless stressed that the advancement of high-tech sectors would continue to be a top government priority. In other words, the language changed, but Beijing’s ambitions have not.

“I don’t see signs Beijing is trying to make strategic concessions to make the Americans worry less about China,” Claremont McKenna’s Pei said.

Perhaps the dangerous downward spiral between the world’s two great powers can be reversed if they find common ground, such as in global concerns like climate change. A successful trade deal could also help rebuild confidence. The prospects for a turnaround, however, are not encouraging. One of the big sticking points in the ongoing trade negotiations is an enforcement mechanism; the Americans simply don’t trust Beijing to adhere to its paper commitments. In this tart relationship, sweeteners are becoming harder to find.

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