China-U.S. Relations: Current Issues and Implications for U.S. Policy

U.S.-China relations have remained remarkably smooth since late 2001, although there are signs that U.S. policy toward China is now subject to competing reassessments. State Department officials in 2005 unveiled what they said was a new policy framework for the relationship -- one in which the United States was willing to work cooperatively with a non-democratic China while encouraging Beijing to become a responsible stakeholder in the global system -- and U.S. Treasury Secretary Henry Paulson in December 2006 established a U.S.-China Strategic Economic Dialogue with Beijing, the most senior regular dialogue yet held with China. Other U.S. policymakers appear to have adopted tougher stances on issues involving China and U.S.-China relations, concerned about the impact of the PRCs strong economic growth and a more assertive PRC diplomacy in the international arena. A matter of growing U.S. concern is Chinas increasing global reach and the consequences that the PRCs expanding international influence has for U.S. interests. To feed its appetite for resources, China has been steadily signing trade agreements, oil and gas contracts, scientific cooperation agreements, and multilateral security arrangements with countries around the world, some of which are key U.S. allies. Some U.S. observers view these activities as, at best challenges, and at worst, threats, to the United States. Taiwan, which China considers a renegade province, remains the most sensitive issue the two countries face and the one many observers fear could lead to Sino-U.S. conflict. Much U.S. concern about China appears driven by security calculations at the Pentagon and in Congress. Pentagon officials question the motivations behind Chinas expanding military budget. A congressionally mandated DOD report concluded Beijing is greatly understating its military expenditures and is developing anti-satellite ASAT systems. Bilateral economic and trade issues also remain matters of concern.