Niall Ferguson: Donald Trump Must Split Up Putin and Xi

All Niall Ferguson wants for Christmas is a magical unicorn pony and a Sino-Russian split

Would be better off asking for pigs to fly

Cold wars make for odd couples. When Joseph Stalin met Mao Tse-tung in Moscow in December 1949, it wasn’t exactly a bromance. “I have only three tasks here,” Mao complained when the Soviet leader paid him next to no attention. “The first is to eat, the second is to sleep, the third is to shit!”

In the end, Mao got the Soviet backing his new People’s Republic desperately needed. But the price ended up being to fight the Korean War on Stalin’s behalf. [Actualy Mao was more motivated for that one than Stalin.]

That particular odd couple ended up getting a divorce. By 1960, Mao and Nikita Khrushchev were openly criticising one another. By 1969, Soviet and Chinese troops were fighting a border war.

In this new Cold War, the odd couple consists of Xi Jinping and Vladimir Putin. No two world leaders see one another more frequently. Xi has even called Putin his “best friend”. But compared with the 1950s, the roles have been reversed. China is now the giant, Russia the mean little sidekick. China under Xi remains strikingly faithful to the doctrine of Marx and Lenin. Russia under Putin has reverted to tsarism.

For America and its allies, this new odd couple is even more perplexing than Stalin and Mao. In the late 1940s and early 1950s, it was not difficult to discern the menace represented by Soviet power. Faced with a choice between Stalin or Harry Truman, Khrushchev or Dwight Eisenhower, most west European leaders didn’t think twice about taking the American side.

Today, however, the power of the People’s Republic of China is primarily economic rather than military. That makes it much harder to resist. [Yea it’s hard to resist mutual prosperity.] Consequently, the Second Cold War has a number of features that make it quite different from the first Cold War.

The first is that America is so intertwined with China that experienced observers, such as the former Treasury secretary Hank Paulson, argue that “decoupling” is a delusion. The entanglement is not just about trade and investment. It is also cultural. This year there are close to 370,000 Chinese students at American universities. The grand total of all the Soviet citizens who came to America under the 1958 cultural agreement was about 50,000 over 30 years.

The second big difference is that America’s traditional allies are much less eager to align themselves with Washington and against Beijing. This has become most apparent over Huawei, the Chinese telecommunications giant, which is the world leader in 5G equipment. The US government is warning others not to buy Huawei kit. Yet only a handful of countries — step forward, Australia — have signed up for the boycott. Others, notably the British and German governments, are ducking and weaving (not least because no western competitor can match Huawei on price).

The Silicon Valley venture capitalist Marc Andreessen famously said that “software is eating the world”, meaning that the principal trend of the past 30 years has been for the programs of Microsoft, Apple and the rest to transform one sector of the economy after another.

But if software did the eating, the meal was cooked and served by hardware. Without Gordon Moore’s law — that the number of transistors on a computer microchip doubles about every two years — we should not have advanced from the crude word-processing programs, browsers and games of our 1990s desktops to the mind-blowingly powerful capabilities of our smartphones today. That is why the Second Cold War is much more a battle over hardware than anything else.

The illusion of the month is that anything significant was achieved with the signing of the “phase one” trade deal between America and China last Wednesday. In reality, the battlefield of the Second Cold War has shifted away from trade to technology.

It is not just that America is leaning on other governments to eschew Huawei’s hardware. It is also leaning on the world’s leading makers of semiconductors, such as the Taiwan Semiconductor Manufacturing Company, not to sell their top-of-the-range chips to the Chinese. The same goes for companies selling chip-making machines, such as Holland’s ASML.

Moreover, there are other fronts in the new Cold War besides technology. A key battle is taking shape over capital flows, for example. The US government would like to reduce American investment in China. But the Chinese government is energetically wooing western banks and asset managers.

Then there is the monetary contest I wrote about in September. On the one side, America wishes to maintain an international financial system in which the US dollar is the dominant currency for trade and reserves. On the other, the Chinese tech giants Alibaba and Tencent are rolling out electronic payment platforms superior to anything America has to offer, while the People’s Bank of China is about to launch a digital renminbi.

As the Second Cold War intensifies, the role that Russia can play is quite small. It is not a serious player in either hardware or software. [The Russian scientists helping China to build a ballistic early warning system will be surprised to hear that.] And it is financially marginal: nobody wants roubles, because US sanctions have so effectively isolated the Russian economy.

What, then, does Putin bring to the table, apart from a great stockpile of mostly superannuated nuclear weapons and conventional military forces that have performed adequately but hardly brilliantly in Ukraine and Syria? [“Superannuated” or not, there’s no defense against them.] The answer is an unrivalled talent for hybrid or information warfare. [Nice projection, actually it is the West which is unrivaled here.]

Last weekend I paid my first visit to Taiwan, a fascinating island where one can see how Chinese history might have gone had the revolution of 1949 not succeeded. Spared the horrors and privations of Mao’s tyranny, the people of Taiwan have built a dynamic market economy and a vigorous liberal democracy.

Yet they are constantly menaced by Beijing, which refuses to acknowledge their de facto independence and thirsts to subordinate them to the Communist Party. The latest form this threat takes is a massive disinformation campaign on Taiwanese social media. It’s a campaign very obviously designed in Russia, assembled in China.

The Second Cold War will have more than one odd couple. If America is to succeed against China as it succeeded against the Soviet Union, Donald Trump — and his successor — must relearn the lessons of late 20th-century diplomacy. Allies matter, and frenemies are pretty good, too.

Next year will mark the 50th anniversary of Henry Kissinger’s secret flight to Beijing, which set in motion the opening of relations between America and China. It was the pivotal moment of the Cold War, exploiting the Sino-Soviet split by effectively aligning Washington and Beijing against Moscow.

The ultimate goal of American strategy in the 2020s must be to achieve a mirror image of that manoeuvre, driving Putin and Xi apart and drawing Russia into that western configuration which alone can save declining Russia from being swallowed up by rising China.

Donald and Vlad: no relationship has caused Trump more trouble. Will it ever reap a strategic reward? That might just be the Second Cold War’s crucial question.

Source: Niall Ferguson

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  2. Mark says

    Nobody wanted to listen when those who could forecast beyond tomorrow afternoon and the next big corporate merger said, “Be careful about driving Russia and China together”. Western eggheads knew better. Now there exists a growing and evolving alliance between the world’s biggest nuclear power and the power with virtually limitless military-age manpower – one of the world’s biggest energy providers and one of the world’s biggest energy consumers, which will jealously guard its relationship with the former on national-security grounds. The world’s most powerful air-defense nation, and the nation with limitless production capability. Was there actually someone who thought such an alliance was no concern for the west? If so, he’s keeping his head down now.

  3. Canosin says

    what an idiotic and ignorant author with a pile of crap in his article ……no need for further evaluation

  4. Petri Krohn says


    People on the hard Left see the Sino-Soviet split as a great tragedy. A combined Soviet-Chinese Communist block would have beaten and destroyed Capitalism for good.

    But what is the intention in Moscow and Beijing was not to fight an existential WW3 with the West. What if the ultimate aim was peaceful coexistence?

    The Sino-Soviet split was essential in enabling both US-Soviet detente and the good Chinese-American relations they still enjoy today. Kissinger saw the opening in 1970, remember “ping-pong diplomacy.”

    I am not going as far as to suggest that the Sino-Soviet split was an intentional Communist ruse or plan. But the forces of history dictated that the split was more beneficial to both countries than any “strategic partnership”. The Soviet Union and China combined would have been too powerful for Capitalism to coexist with, at least not peacefully.

    In the split the Soviet Union sacrificed some of their core interests. Russia and China are natural partners in technology and trade. They have a common interest in securing the Eurasian landmass from external destabilization. Russia is actually the best thing to ever happen to China. Before gaining Russia as its northern neighbor China spent three millennia fighting of barbarian invasions from the north.

    The geopolitical situation today is totally reversed from the days of the Cold War. The United States today is too powerful for any form of democracy or sovereignty to coexist on the same planet. A Russian Chinese strategic partnership is essential for a peaceful multipolar world.

  5. LS says

    Such piffle. Written by a contortionist and shill.

    America and the UK are turning into multi-racial, culturally left, and generally dysfunctional states. Indeed, in America, only a semblance of nationhood remains. With few exceptions, neither can make or man much of anything to a high standard anymore. The idea that these entities can sustain and win a cold war with the China-Russia bloc is laughable. And to what end and in whose interest anyway?

  6. Garry Compton says

    I saw a huge problem when the west incorporated the ” Fast lane of finances, money, high life and wealth”. The acceleration of everyone’s lives , in order to work more, make more, spend more – go faster even on the Weekends, did nothing for the average Joe. Now every one runs about, like a chicken with their heads cut off – trying to keep up with society, taxes, the jones etc. instead of just living a decent life. I don’t see this as much/ furious in Russia as it is in the US but maybe the slower economy – isn’t such a bad thing. Formosa was a surprise to me – also – in 1971. Good Article – thanks A -Emp.

  7. Savely says

    “…which alone can save declining Russia…” West still in denial that it is not Russia which in decline.

  8. tom greg says

    Yeah, perhaps this article might have had value had it been written in the 1990s. Things have changed. There is no separating Xi and Putin at this point. And also, Russian missile systems, radar systems and EW are far superior to the Yanks’.

  9. CHUCKMAN says

    Not particularly insightful, but then I’ve never regarded Niall Ferguson as insightful.

    A pretty conventional thinker, friendly to “Western” power interests.

    Kind of a literary historical think-tank type.

  10. temujin1970 says

    More wishful thinking from western so called intellectuals. They are so caught up in old style thinking that they do not notice that the world has moved on from their antiquated view of it. Russia and China know full well the Wests plan is to first dismember Russia before doing the same to China. That strategy has never changed and will never change. The west knows that if they are to maintain their 500 year long hegemony that Russia and China MUST be brought to heal. Unfortunately for western elites they have squandered their wealth oN weaponry and share dividends, buying Picasso’s and hens egg sized diamonds all the while building up the biggest debt pile in human history. Russia and China are busy doing what brought the west to prominence. Building high tech infrastructure, investing in their countries and their people and saving saving saving.
    Why do you think Russia and China are buying gold hand over fist?, they plan to jointly amass the largest hoard of gold on earth. Once that’s done they will finally pull the plug on the dollar. Then its goodbye AmeriKKKa.

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