Former Treasury Secretary and Goldman Sachs CEO Henry Paulson writes in Foreign Affairs that the United States needs to stop viewing every aspect of U.S.-Chinese relations “through the prism of national security.” He laments that “China and the United States are in a headlong descent from a competitive but sometimes cooperative relationship to one that is confrontational in nearly every respect.” He asserts that the U.S. strategy to organize coalitions to “counterbalance and pressure China” will “hurt Americans more than the Chinese people.” Instead, Paulson advises Washington policymakers to “cooperate or work in complementary ways with China . . . and to maintain a beneficial economic relationship with the world’s second-largest economy.” In other words, we should continue to work with China the way Paulson did when he was Goldman Sachs CEO and Treasury Secretary under George W. Bush.
During Paulson’s 32 years at Goldman Sachs, he developed what Alex Verkhivker in a review of Paulson’s book Dealing With China describes as “intimate relations with China’s political elite, including Presidents Hu Jintao and Xi Jinping as well as banking giants, most notably the Industrial and Commercial Bank of China’s chairman Jiang Jianqing.” As Treasury Secretary, Paulson promoted cooperative relations between the U.S. and China--a continuation of the general policy approach of every post-Cold War administration, with the lone exception of the last two years of Donald Trump’s presidency. And despite China’s openly aggressive behavior since Xi Jinping took the helm in 2012, and the Chinese Communist Party (CCP) leaders’ proclaimed goal to replace the United States as the world’s preeminent power, Paulson recommends more of the same. Paulson’s policy proposals are an example of what the great James Burnham in 1950 called “the suicidal mania of American business.”
In Paulson’s lengthy Foreign Affairs article there is one word that is notably absent--communism. Paulson has the mind of a businessman. He understands business, but he shows no sense of understanding communism. He has traveled to China dozens of times and worked deals with China’s business and political elites. But one has to wonder if he knows much about the history of the CCP. Does he know that in December 2012, Xi Jinping predicted to CCP members the inevitable triumph of socialism over capitalism, and that Xi is a devoted ideological follower of Marx, Engels, Lenin, Stalin, and Mao? Does he know that Xi has emphasized that the Marxist-Leninist system is “fundamentally incompatible with the West” and that China’s “struggle and contest with Western countries is irreconcilable”?
Paulson certainly knows that American businessmen can make a lot of money dealing with China--he undoubtedly did. He worries in his Foreign Affairs article that “decoupling or deintegrating economically” from China will put American businesses at a “huge competitive disadvantage,” and that “U.S. consumers [will] pay the price.” He criticizes those in Washington who view “anything that could advance China’s technological capability as enabling the rise of a strategic competitor and aiding Beijing’s aggressive military buildup.”
To be sure, Paulson notes that China is a “formidable competitor” against which the United States “must take a very tough-minded approach.” He acknowledges that “Beijing is pursuing policies inimical to U.S. interests in many areas, and it is unlikely to adjust anytime soon.” But business is business. And American businessmen like Paulson have been around a long time. The great geopolitical strategist James Burnham took their measure in his book The Coming Defeat of Communism in a chapter entitled “The Suicidal Mania of American Business.”
Burnham characterized American businessmen “in relation to the struggle against communism” as “too ignorant, too greedy, too reactionary, and, in a certain sense, too cowardly,” though he explained that these adjectives didn’t apply to every individual businessman but rather to businessmen as a social class. American businessmen, he wrote, generally favored “trade with the enemy.” “They are irked,” he continued, “by the State Department’s restrictions on exports to the communist empire.” (Paulson labels Washington’s restrictive export policy “pushing against economic gravity”). Burnham recalled that in China in 1949 as the communists set about consolidating their control of the mainland, Western businessmen “asked only for the privilege of supplying them with what they needed to consolidate their conquest.” And that is because businessmen, Burnham explained, “are . . . abysmally ignorant about what communism is, what communists are.” American businessmen, he wrote, “do not believe that the communists are serious when they declare that they are going to conquer the world.” Businessmen think of communists, he continued, “only as rivals or competitors of the same fundamental type as themselves.” Even communists have their price and will make deals.
In an all too prophetic paragraph, Burnham wrote:
Just here is the danger, perhaps the greatest danger, for the . . . struggle against communism. The businessmen are shrewd in their own eyes, and fancy themselves shrewd bargainers. They believe that a deal can always be made, and they want a deal. What Stalin [substitute Xi] is doing is to encourage them to keep that belief and that hope. Communists, however, do not make deals; they make traps: an oath to an infidel does not bind.
Communists understand these shortcomings of American businessmen as the “inevitable expressions of the decadence of capitalism.” Burnham expressed his fear that if “businessmen are the predominant influence in deciding American policy, then the outlook is not promising.” After all, it was Lenin who purportedly said that the “capitalists are so stupid, they will sell us the rope we hang them with.”
Francis P. Sempa is the author of Geopolitics: From the Cold War to the 21stCentury, America’s Global Role: Essays and Reviews on National Security, Geopolitics and War, and Somewhere in France, Somewhere in Germany: A Combat Soldier’s Journey through the Second World War. He has written lengthy introductions to two of Mahan’s books, and has written on historical and foreign policy topics for The Diplomat, the University Bookman, Joint Force Quarterly, the Asian Review of Books, the New York Journal of Books, the Claremont Review of Books, American Diplomacy, the Washington Times, The American Spectator, and other publications. He is an attorney, an adjunct professor of political science at Wilkes University, and a former contributing editor to American Diplomacy.
