Douglas Paal, vice-president for studies at the Carnegie Endowment for International Peace, is deeply worried that strategic competition is taking over the China-US relationship.

The China expert has watched and participated in US-China relations in the past four decades in a career at the Central Intelligence Agency, the State Department, the US embassy in Beijing, the American Institute in Taiwan and JPMorgan Chase International.

"That's what needs to be adjusted. We need to find a way to channel that strategic competition into non-conflicting set of policies as much as possible," Paal said in an interview with China Daily.

Such a goal, Paal believes, can be achieved since even the Soviet Union and the United States found a way to have their ships sail around each other and not get into conflict.

To Paal, it's natural for China to develop its military capabilities, but it's also natural for the US to remain in the Pacific. "We just have to find a way to not let that turn into strategic competition. Right now it's turning into strategic competition," he warned.

Paal was among the first to call for a Sunnylands-type of summit between Chinese President Xi Jinping and US President Barack Obama since, in his words, "strategic competition is coming at us."

If that is not managed well, Paal believes both sides will become captive of the military industrial complex. "Our perception of the other side as enemies will take over all our thinking. That will ruin the 21st century if we're not careful," he said.

While the shirt-sleeves summit between Xi and Obama a year ago at the Sunnylands estate in Rancho Mirage, California, had raised hope of bringing the rising power and existing power closer together, that spirit is widely seen as having been lost in the last few months.

Tensions over the East China Sea and South China Sea, China's announcement of the East China Sea Air Defense Identification Zone (ADIZ) and cyber security have become the focal points in bilateral relations.

Such issues have distracted the Obama administration into talking only about the negatives, Paal said.

"They have taken the view that speaking loudly is important. Speaking loudly only worsens the atmosphere for cooperation," he said, describing the style as "megaphone diplomacy".

Non-strategic move

Paal noted that the two countries always have challenges and differences, but that administration officials have the responsibility to also tell the story of cooperation with China, such as on North Korea, Iran, climate change and a bilateral investment treaty.

"You can't just talk about the negative stuff. Otherwise, policy will drift, farther and farther into the hands of people who really have a negative and destructive attitude toward the other, both in China and the US," he said.

In his view, top leaders must make clear what they want to achieve and what they want to avoid.

To Paal, the sixth China-US Strategic and Economic Dialogue (S&ED) to be held in Beijing in early July will be a good chance to put things back on track. But he is worried that there doesn't seem to be anyone in charge of the China policy in the White House now, unlike Tom Donilon, the national security advisor in the first Obama administration, or Hank Paulson, the Treasury secretary under George W. Bush.

He described the recent indictment of five People's Liberation Army officers by the US Justice Department for cyber theft as a "non-strategic move" and counterproductive to the effort to get the issue under control. "This tells me that there is nobody in charge," said Paal, who served both Republican and Democratic presidents.

He said Susan Rice, the national security advisor, needs to fly to China now and talk to Chinese leaders about what the US really is trying to do, sharing both concerns and prospects for future cooperation.

Paal believes a coherent policy and a better atmosphere will send a signal to the US bureaucracy that this is something that the administration wants to make work successfully, instead of just carrying on some disputes in another forum in Beijing, referring to the S&ED.

A critic of Obama's recent foreign policy speech at the West Point, Paal believes the White House should state clearly that power shifts are taking place around the world and the US has no reason to panic.

"But we have reason to be careful and how we address the other powers in the world, so that we don't put ourselves in a strategic competition that will waste vast fortunes of tax money," he said.

Paal believes the US should also state that it is going to be more accommodating in the future to other powers, but the US has certain principles it hopes to persuade other powers to accept. And the US hopes China, Russia and India will support certain institutions and legal norms that have been very successful in managing conflicts and prosper together under that system.

Paal disagreed with the thinking by many Chinese that the US is trying to contain China. However, he said he understood why people would think like that. "Part of the contribution is the articulation of the American policy toward China has been largely negative and through megaphones, not persuasion," he said.

China connection

Paal got interested in Asia and China at an early age. He recalled that as a child at his parents' farm in Pennsylvania there was a monastery type of facility next to the farm where priests were being trained in Chinese and Japanese languages.

"I used to go there to use their swimming pool. I think they were saying to me: ‘Go to Asia, go to Asia,'" Paal said.

However, what really got him interested in Asia and China was the Vietnam War, when he was an undergraduate at Brown University. With a good chance to be drafted, he wanted to find out why the US was fighting there. And he found a China connection. In those years, China was actively supporting the communist movement in Southeast Asia.

"The more I studied, the more interested I got in Chinese history, Japanese history," Paal recalled.

He decided to pursue a PhD in political science at Harvard University, under professors such as John Fairbank. He focused on modern Chinese history, mostly intellectual history. At the same time he became fascinated by modern Japanese history, especially the Meiji restoration. He learned both Chinese and Japanese languages.

After graduation, Paal was recruited by the CIA in 1976 when George H. W. Bush was the director under President Gerald Ford. He stayed on when Jimmy Carter became president and expressed deep interest in developing a relationship with China.

Paal, still a young man, was made deputy national intelligence officer for China at and became very involved in the normalization of relations between China and the US.

His CIA identity was overt, even during his post at the US embassy in Beijing in 1980 when he was borrowed by the State Department.

Paal then worked for two years in Singapore before joining the State Department's policy planning staff, working on papers and speeches.

He was chosen in 1986 by the National Security Council (NSC) to be responsible for the Chinese mainland and Taiwan. He became the senior director for Asia at NSC soon after George H. W. Bush came to office.

Paal founded the Asia Pacific Policy Center in the mid 1990s. It was a non-profit research organization focusing on introducing members of the Congress to Asia. But the center died after he became in 2002 director of the American Institute in Taiwan (AIT), a non-profit, public corporation under the auspices of the US government to serve its interests in Taiwan.

It was the last leg of Paal's government career. In 2006, he was soon invited to join the JPMorgan Chase International as its vice-chairman, following China National Offshore Oil Corp (CNOOC)'s failed acquisition of UNOCAL. Senior management at the bank, which put a lot of energy into the transaction, wanted to know why the deal failed and hoped someone with Paal's expertise could help on their China business strategy.

A sought-after expert on China, Paal has been busy traveling for various meetings on China. He admitted that he has traveled too much this year.

"There has been a big interest in China in the last two years," said Paal, sitting in his office at the Carnegie Endowment for International Peace on Massachusetts Avenue recently, just hours before taking off to Tasmania for a conference.

chenweihua@chinadailyusa.com

Douglas Paal, vice-president for studies at the Carnegie Endowment for International Peace, talks to China Daily in a June interview in his office in Washington. Chen Weihua / China Daily

(China Daily USA 06/27/2014 page10)