A New Cold War Could Be Much Worse Than the One We Remember

A new cold War has come to seem all but inevitable. Tensions between China and the United States are mounting in step with Beijing’s growing power and ambition. Russia’s invasion of Ukraine has poisoned its relations with the West and pushed Moscow and Beijing closer together, pitting a democratic bloc anchored by the United States against an autocratic one anchored by China and Russia. Much as it did in the 20th century, Washington is teaming up with allies in Europe and Asia to contain the ambitions of its rivals.

But a cold war between the United States and a Sino-Russian bloc could be even costlier and more dangerous than the original standoff between America and the Soviet Union. Rather than embrace the prospect, Washington needs to take a step back, think through the stakes, and come up with a plan to avoid a geopolitical rupture that would substantially raise the risk of a great-power war and leave a globalized world too divided to manage shared problems. Moscow has already thrown down the gauntlet by invading Ukraine. But ties between the United States and China are not yet beyond repair—and China’s mounting economic and military strength makes it the more significant competitor.

China is in fact a more formidable rival than the Soviet Union ever was. Soviet GDP topped out at about 60 percent of U.S. GDP. In contrast, China’s economy, on its current trajectory, is set to overtake America’s during the next decade. And whereas the Soviet Union was never able to keep pace with the West’s technological advances, China is developing a high-tech sector on par with that of the United States. Yes, China’s economy is slowing and will be weighed down by domestic debt and demographic decline. But with a population that is more than four times larger than that of the United States, China will likely pull significantly ahead of America in economic output by the second half of the century.

China lags way behind the United States when it comes to geopolitical heft and reach. But history makes clear that when major powers ascend economically, expansive geopolitical ambition always follows. China is well on its way. Its navy has more warships than the U.S. Navy and its air force is the world’s third largest. The Chinese military is already capable of holding its own against the U.S. military in the western Pacific. China is on course to eventually take its place alongside the United States as one of the world’s two full-service superpowers.

China’s strategic position will also benefit from its teamwork with Russia. For most of the Cold War era, China and the Soviet Union were at odds, dividing the communist bloc. Moscow couldn’t work with Beijing against the West. But today, China and Russia are close partners. Russia, now economically and diplomatically isolated from the West, is ever more dependent on China, a dynamic that could afford Beijing leverage over the Kremlin for the foreseeable future.

If a new cold war emerges, the West will likely face an autocratic bloc that stretches from Europe to the Pacific, compelling the United States to split its forces between two distant theaters. Russian and NATO forces are now cheek by jowl in Europe, and U.S. and Chinese forces are in similarly dangerous proximity in the Pacific. A strategic landscape that is already daunting and dangerous is poised to grow only more so.

Washington would be mistaken to presume that a new cold war would play out much like the 20th-century version, with democracies on one side, autocracies on the other, and the West enjoying the upper hand. During the last round of East-West rivalry, bipolarity made geopolitical competition predictable and tractable. Stability emerged naturally from balancing between two dominant poles of power; the United States and the Soviet Union compelled most of the world’s countries to align with one camp or the other. The democratic camp ultimately outmatched its autocratic competitor, enabling the West to prevail.

In contrast, today’s world is becoming more multipolar than bipolar; even if the globe is again afflicted by a new bout of East-West rivalry, many countries, including emerging heavyweights, will likely refuse to take sides. Western democracies will find it more difficult to amass a preponderant coalition against their autocratic challengers in this multipolar world. The international system will also be much messier and more unpredictable, and thus harder to manage and stabilize, than the two-bloc world of the 20th century.

Russia’s war against Ukraine has provided a glimpse into this future. Despite the Kremlin’s bald act of aggression, more than three-quarters of the world’s countries have opted to stay on the sidelines, hoping to ride out the war’s disruptive effects on food and energy supplies while avoiding ensnarement in a new round of East-West rivalry. Some countries, such as Israel and Turkey, are protecting their relationships with Moscow. Many others are staying in the good graces of China, which has substantially increased its economic and political leverage across the global South through its Belt and Road Initiative. Some two-thirds of the world’s countries now trade more with China than with the United States. In many parts of the developing world, China has become the lender of first resort.

The fence sitters include major democracies such as India, Indonesia, and Brazil. During the second half of this century, India’s economy is likely to become the world’s second largest after China’s, Indonesia’s is set to become the fourth after America’s, and Brazil’s will likely be in the top 10. Should rivalry build between the United States and China, Washington simply cannot assume that such prominent powers, whether or not they are democracies, will be by its side.

Despite its democratic credentials, India is aligning with neither West nor East but instead seeking to serve as a bridge and broker between the two. India’s foreign minister, S. Jaishankar, recently explained that an “order which is still very, very deeply Western” is coming to an end and will give way to a “multi-alignment” world. In light of its proximity to and trade links with China, Indonesia will probably tilt more toward Beijing than toward Washington. According to a recent report from Australia’s Lowy Institute, the United States has been losing influence to China across Southeast Asia. Brazilian President Luiz Inácio Lula da Silva has declared that his country’s relationship with China is “extraordinary,” and warned that “nobody can stop Brazil from continuing to develop its relationship with China.”

At least for now, the United States can count on such long-standing partners as the United Kingdom, France, Germany, and Japan to be staunch allies. But their global sway is on the wane. When the Cold War wound down, the United States and its partners commanded almost 70 percent of global wealth. In contrast, projections show that Western democracies will account for less than 40 percent of global GDP in 2060. That may seem like a long way off, but if a new cold war materializes in this decade and lasts as long as the last one, it would not begin to wind down until around 2070.

Furthermore, America’s traditional allies may not be willing to throw their collective weight against China forever. Many European countries maintain lucrative trade links with China and are keeping their distance from the geopolitical duel building between Washington and Beijing. Germany’s Chancellor Olaf Scholz and France’s President Emmanuel Macron have both made recent trips to Beijing, accompanied by dozens of German and French CEOs. Macron caused a stir during his visit by stating that Taiwan is not Europe’s problem, and that “the worst thing would be to think that we Europeans must be followers and adapt ourselves to the American rhythm and a Chinese overreaction.”

Even if the West does hang together against China, it must factor in its own political weakness. The West was, for the most part, politically healthy during the original Cold War: Ideological moderation and centrism prevailed in liberal democracies on both sides of the Atlantic, buttressed by broadly shared prosperity. Such solid economic and political foundations produced a steady and purposeful brand of grand strategy that enabled the West to prevail against the Soviet Union.

Those days are now gone. Automation and globalization have taken a heavy toll on the economic welfare of workers in the West, undermining the social contract of the industrial era. Illiberal populism is on the loose on both sides of the Atlantic, and ideological moderation and centrist consensus have given way to bitter polarization and legislative dysfunction. Strategic steadiness has been replaced by inconstancy; U.S. foreign policy is regularly engulfed in political gamesmanship. Unless and until the United States and Europe bounce back politically, democracy will struggle to reclaim its global appeal, and Presidents Xi Jinping and Vladimir Putin will continue to have grounds for arguing that the West’s best days are behind it.

Democracies have time and again demonstrated their resilience and capacity for self-correction, a track record that provides cause for optimism that the West will eventually restore its political health. But in the meantime, the stumbling of liberal democracy weakens the allure of the Western model and its ability to outmatch autocratic alternatives. For now, the West’s top priority must be to get its own house in order—yet another reason to avoid the drain on resources and political capital that would accompany the arrival of a new cold war.

Today’s world is far more interdependent than the one the first Cold War cleaved in two. The return of geopolitical fracture would therefore do far more damage. In the 20th century, western economies were able to thrive despite minimal economic intercourse with the Soviet Union. Today, by contrast, China is deeply integrated into international markets. Severing commercial ties between China and the West, should it come to that, would wreak havoc on the global economy. Already, the United States has taken steps to move select supply chains from China to friendly nations, and to deny China access to high-end technology. This measured economic distancing from China will likely accelerate, becoming a broader economic detachment, if rivalry continues to mount.

In this interconnected age, major powers need to work across ideological dividing lines not only to manage global commerce but also to address other shared priorities, such as arresting climate change, preventing pandemics and promoting global health, avoiding nuclear proliferation and arms races, governing the cybersphere, and managing migration. The heating up of great-power rivalry would put out of reach the collective governance needed to tackle these pressing transnational problems.

History makes clear that contests between rising challengers and reigning hegemons tend to end in war. That is not good news, given the high probability that China’s raw power will soon catch up with and then surpass America’s.

As China’s strength and ambition continue to grow, Beijing and Washington will inevitably compete for primacy. At present, ideological excess and zero-sum thinking in both the United States and China are fueling a spiral of mutual hostility.  In the United States, neither Democrats nor Republicans are ready to acknowledge or even contemplate the potential end of America’s long run of primacy. A blustery nationalism similarly informs China’s politics; Xi Jinping has been using the struggle against the United States to consolidate his rule and tighten his grip at home.

A new cold war is likely unavoidable if China follows in Russia’s footsteps down the path of military aggression, whether against Taiwan or other targets. But we are not there yet. The United States and China still have an opportunity to shape the tenor and intensity of their competition and channel their relations in a more positive direction.

To arrest and reverse escalating hostility, Washington and Beijing will need sustained, constructive dialogue, and could even strive to devise a model of shared global leadership. But heading down this path would require a change of mindset in  Washington. The narrative of American exceptionalism leaves virtually no room for a peer competitor, and the prospect of a new cold war fits too readily into the prevailing paradigm. President Joe Biden foresees a century defined by a “battle between democracy and autocracy,” insisting that “autocrats will not win the future. We will. America will. And the future belongs to America.” The United States and its allies handily won Cold War 1.0. Washington can now dust off the same playbook and win Cold War 2.0.

But it will not be that easy. For the first time since World War II and the arrival of Pax Americana, the United States is about to meet its match. If the United States and China are to avoid going head to head and instead work together to tame a world that will be both multipolar and interdependent, the two countries will need to learn to live comfortably alongside each other in a global system that is ideologically diverse and politically pluralistic. Americans will need to take a leap of political imagination in order to coexist with a great power whose political system they find threatening and at odds with their messianic commitment to spreading democracy. The alternative is intractable geopolitical fracture and deepening global disarray.

China’s potential intransigence, mixed with the confrontational nationalism that infuses debate in both Beijing and Washington, may force the United States to aim lower. If so, Washington  should at least seek agreement with Beijing on guidelines for limiting and managing competition. The two countries could regularize military-to-military contacts, for example, and cordon off discussions of transnational issues, such as climate change, global health, and trade, from those of tougher issues, such as Taiwan and human rights.

Whether Washington pursues shared global leadership or only managed competition, the moment for opening a dialogue is now, while the United States still enjoys economic and military superiority, and while the two superpowers of the 21st century can still avoid the dangers and disorder that come with geopolitical rupture.