This memo on optimizing U.S. policy toward China is the result of multiple rounds of discussion among participants of The Task Force on U.S.-China Policy. Compiled by Task Force co-chair Susan Shirk, research professor and director emeritus of the 21st Century China Center, and Task Force member Rick Waters, senior non-resident fellow at the Asia Society Policy Institute's Center for China Analysis, this memo does not represent a formal consensus statement signed by Task Force members. Instead, it provides a distillation and synthesis of key insights from their extensive discussions.

Executive Summary

In this policy memo, we distill and synthesize key insights that emerged from many discussions among the Task Force members. The ensuing recommendations aim to reinforce American leadership, safeguard economic and national security interests, and promote a sustainable long-term strategy for managing U.S.-China competition. 

1. The Chinese government faces significant self-inflicted domestic problems, which are more severe than most outsiders recognize. While Xi Jinping remains steadfast in his geopolitical ambitions, pursues high-tech self-sufficiency, and focuses on regime security, he has an interest in stabilizing relations with the U.S. China’s internal difficulties create opportunities for negotiation on various bilateral issues.
    
2. Negotiations can begin with trade and investment and extend step by step to broader issues including China’s assuming greater geopolitical responsibility, exercising restraint toward its Asian neighbors, and curbing interference with critical U.S. infrastructure. A laddered approach is more feasible than a “grand bargain.”
    
3. The U.S. should introduce economic pressure and positive incentives in a phased and targeted manner to achieve negotiating leverage while avoiding escalation to a trade war.
    
4. Negotiations that offer Beijing a clear choice between competitive coexistence and deepening contestation will resonate with many inside China and strengthen U.S. standing among allies, partners and other countries. Diplomatic initiatives taken now can increase internal pressure on Xi to moderate his policies, stabilize U.S.-China relations, and set the stage for his successors to pursue a more pragmatic course—even if he does not.
    
5. Technology restrictions should be risk-based, periodically reassessed, and aligned with U.S. interests and those of its allies. Attracting talents, higher education collaboration, and science diplomacy enhance U.S. competitiveness. Restrictions on investments and talent flows should take care to protect national security without eroding America’s technological edge or hindering beneficial scientific cooperation. One of the most complex challenges in U.S.-China negotiations is determining whether existing or future technology restrictions should be open for discussion.
    
6. Strengthening deterrence and Taiwan’s asymmetric capabilities is an urgent priority amid rapid PLA modernization. At no point should Washington suggest it would abandon Taiwan or other partners as part of any bargain with China.
    
7. The U.S. should increase security, economic, and technology collaboration with allies in the Indo-Pacific region, while selectively engaging China in some appropriate regional initiatives as well. We must be vigilant not to squander U.S. advantages or weaken our global standing in our competition with China.
    
8. While U.S. policy is unlikely to alter the trajectory of the People’s Liberation Army (PLA) modernization, recent developments suggest China may be open to limited discussions on risk reduction.
    
9. China’s policies in Xinjiang, Hong Kong, and Tibet, and its effort to build support for them, demand a sustained counterforce. While the U.S. has limited ability to influence China’s domestic policies, it must firmly oppose efforts to export authoritarian practices beyond China’s borders.

This Executive Summary, along with the ensuing Policy Recommendations, is not a signed statement from the Task Force but represents our best effort to distill key insights and recommendations from wide-ranging discussions among Task Force members at this juncture.