Initiative for U.S.-China Dialogue on Global Issues

James Green: Welcome to the U.S.-China Dialogue Podcast from Georgetown University.

This podcast series explores diplomacy and dialogue between China and the United States during four decades since normalization of relations in 1979.We'll hear from former ambassadors, Cabinet secretaries, and White House advisors who will share how they shaped the course of the most complex relationship in international diplomacy today.

I'm your host, James Green.

Today on the podcast, we talk with Ambassador Jeffrey Bader.

From his first tour in grey drab Beijing in 1981 to arriving with President Obama on Air Force One three decades later as a Special Assistant to the President, Jeff Bader has been involved in nearly every major event in U.S.-China diplomatic relations. Bader is that rare career official able to operate in both the minutiae of a state visit to the broader thinking needed to address enduring U.S. security concerns; he is also an official who jumped the unspoken barrier between career employees and political appointees, experienced at briefing Cabinet secretaries and presidents on a course of action on how to deal with China.

Given Bader's long involvement in making and executing U.S. policy towards and with China, we've broken up our discussion into two episodes to capture the richness of his experience.

In this second conversation, Bader explains the endgame of the negotiations to have China join the World Trade Organization, or WTO, in 2001 from his time as Assistant United States Trade Representative for China. He goes on to illuminate why he decided to advise then-dark horse candidate Barack Obama in the 2008 presidential race and his transition into the White House. Bader talks through President Obama's inaugural trip to Asia in 2009 which included these public remarks in Beijing, first from Chinese President Hu Jintao, then Obama:

Hu Jintao (via translator): The Chinese side is willing to work with the U.S. side to ensure the sustained, sound, and steady growth of this relationship to the greater benefits of peoples of our two countries and people across the world. 谢谢大家 – Thank you, everyone. 现在请奥巴马总统致辞 – Now we would like to give the microphone to President Obama.

President Barack Obama (with translator): Good afternoon, 下午好. I want to start by thanking President Hu and the Chinese people for the warmth and hospitality that they have shown myself and our delegation since we arrived.

James Green: Ambassador Bader ends our conversation with one thing he believes the Trump Administration has right about dealing with China -- the need for a personal connection between U.S. and Chinese presidents. And now, part two of my conversation with Jeff Bader.

I wanted to move on to your time at the Office of the United States Trade Representative and China's accession to the WTO. You went to Namibia to be ambassador and then you came back and joined USTR towards the end of the WTO accession negotiations-

Jeff Bader: Mm-hmm (affirmative)-

James Green: What did you see as your role as the [Alistar] for China in that very long 14-year accession process. How did you conceive your role of kind of getting this over the finish line?

Jeff Bader: I came back at the invitation of USTR Bob Zoellick. The bilateral trade negotiations had been completed under Charlene Barshefsky during the Clinton administration. So, what was left was essentially a ways to conform China's commitments to WTO rules. The multilateral part of the negotiation. So, that was what I was facing was a series of multilateral commitments on the part of the Chinese.

The Bush administration was pretty well committed to getting it done. Basically, Zoellick was committed to getting it done. And Zoellick was a force. And, while there were some questions in this or that corner of the security apparatus within the Bush administration particularly from, I'm trying to remember where I heard the questions coming from, maybe from Paul Wolfowitz. Zoellick's view was this was, the best WTO deal that had ever been negotiated with any acceding power. Overwhelming in U.S. interests and we need to get it done. It was strongly supported by the State Department, in that respect.

So, my mandate was basically to get it done. We wanted a positive outcome, but we had a few remaining issues. Some of which involved the interests of specific companies. Some of which were more general in nature. So, I was flying off to Shanghai, to Geneva, actually, to Geneva once a month. Meeting with the Chinese counterpart who was then Vice Minister of MOFCOM, Long Yongtu.

And we were just knocking off one issue at a time. There were issues involving quotas, tariff rate quotas for agricultural commodities. That was a big deal. There were intense issues involving insurance, particularly led by Hank Greenberg and AIG which was arguably the most powerful company in the U.S.-China relationship at the time. This was well before 2009 obviously. And Hank Greenberg was a legendary negotiator and one didn't want to be a government official with him behind you. And so, a shocking amount of negotiation involved dealing with AIG's specific demands, which had to do with setting up wholly-owned branches in every town and hamlet in China.

James Green: So, market-access related concerns-

Jeff Bader: Yeah, market access issue, yeah. But there were numerous down-in-the-weeds issues still to be dealt with. Issues about China's commitment to market access for construction companies, for infrastructure development in China, where China was very resistant to joining the WTO's plurilateral agreement on the subject. And we got a half measure. They committed to studying it or working on it over the years. Which they're still doing.

James Green: This is the government procurement agreement?

Jeff Bader: Government procurement agreement, yeah.

And just a small example, rare earths. Rare earths issue came up and, you know, at the time I barely knew what a rare earth was. I just knew that they weren't rare. I was told that. But basically no one cared. And you negotiate about things that Americans should care about. And no one was pushing the issue. And they're just kind of out there. So, we were unable to get the kinds of commitments on rare earths that would have been useful.

We finally got to the end of the process, and we're meeting in Geneva to wrap it up on September 11th, 2001. And we were about to reach closure when the first planes hit the World Trade Center. And the meeting, needless to say was aborted. And I spent the whole night on the phone with Bob Zoellick trying to figure out what to do next. In the meantime, AIG was trying to blow up the whole deal. AIG was the only entity in the world that was still paying attention to anything other than what was going on in New York and Washington. Their famous singular focus on their issues. And I remember having to go back in and try to turn around some deals that had been made at AIG's request, which could not be turned around. And arranging a visit by Long Yongtu to New York a few days later to see Hank Greenberg, which got aborted because the Chinese got scared about going to New York under those circumstances.

Anyway, long and the short of it was we got it done. And the basic vote in the Congress had occurred a few years later on Charlene Barshefsky's bilateral agreement. And they were not serious objections by large numbers of people at the time to the agreement. It was understood to be a market opening of China. It didn't provide any market opening in the U.S. Didn't do anything of the sort. So, exactly why people have since then decided that this was the greatest error in the history is a mystery to me since what it provided was market access to China across the board.

James Green: Can I quote your own testimony? You had mentioned Shanghai. That year, in 2001, China was hosting APEC and at the trade ministers meeting you and USTR Zoellick came out and in addition to the fun of the APEC discussions there was an ability to really drive home the bilateral negotiations on WTO. And then in between that and your trips to Geneva, you spoke in front of the House Ways and Means committee in which you said, "The agreement provided us with a set of comprehensive, verifiable and, as you said in your statement, Mr. Chairman," this is the Chairman of Ways and Means committee, "one way trade concessions that substantially open China's market across the spectrum to U.S. goods, services, and agriculture."

Jeff Bader: Mm-hmm (affirmative)-

James Green: What do you see now, nineteen years later, how many years later-

Jeff Bader: Yeah.

James Green: In terms of some of the areas of shortcoming. You had highlighted in your testimony IPR and market access and a number of other things. You talked about the reduction in auto tariffs, which had come down from over 80% to 25%. Not second guessing yourself at that time, but, where do you see the WTO, if you do, as not being able to address some China specific issues? Acknowledging that this was the largest accession protocol of any country to GATT or WTO at the time?

Jeff Bader: Well, as I said, I think it was a good deal at the time. China's economy was nothing like what it is now. And I think it was a good deal for at least ten, twelve years. China was not yet the manufacturing center of the world and it would not become the manufacturing center of the world because WTO. It became the manufacturing center of the world because of efforts of the Chinese and the policies of the Chinese. But they say there was nothing in the WTO agreement that preordained or foreordained China's development of an East Asia manufacturing integrated network with China as the center. But it just happened because of the efforts of the Chinese government, sound policies by the Chinese government, that drew other countries in the region into their assembly system.

Clearly, the other thing to remember was the Premier at the time was Zhu Rongji. And Zhu Rongji was emphatically committed to driving market-oriented reform in China. He was arguably the most unpopular man in China. He had no respect for existing stakeholders if they got in the way of his vision of where China should be going. I think it was a common expectation at the time that Zhu Rongji represented, if not personally, then at least his policies represented the way of the future in China. And then whoever came after Zhu Rongji was likely to follow his example.

That assumption didn't bear out. The people who came after him had a more balanced view of the political needs of the Communist Party and market-oriented reform. And China's implementation of the WTO agreement has been, let's say, literal minded. I think they've done a decent job on the specific airtight commitments. You know, tariff rate quota for x million pounds of this or that product, they fulfilled. Tariffs reduced to 9.1%, they've done it. They've done what they absolutely committed to. The spirit of the agreement, which comes more into play on issues like IPR, tech transfer, investment access, competition, they have dragged their feet. So-

James Green: Transparency.

Jeff Bader: Yeah, transparency. I mean, it's just across the board. Okay? And so, what needs to be done, in my view, is, as I was saying before, China needs to understand that it's a developed country. And we need a negotiation, in my view, among Japan, the United States, the European Union, Australia, Canada, whoever else wants to join, with the Chinese. The purpose of which is to bring China's commitments up to the level of the major Western countries. And exactly how one would structure this negotiation, how one would get to that point, and whether it could ever happen in the Trump administration, those are all difficult questions. As a matter of fact, impossible questions, because the Trump administration's never going to do it. Because it's not committed to the multilateral system. But I think for a start we should not turn our back on the multilateral system, global system of norms and international law.

And we should get the Chinese to understand that they need to accept rules of the sort that I'm alluding through the multilateral system. And if they don't, the consequence in terms of access to the U.S. and other markets will be severe. Okay?

James Green: I was talking to Wendy Cutler on this point, in which she had reminded me that in parallel with China's WTO accession negotiations was the Doha round-

Jeff Bader: Right.

James Green: And they did this both before, during, and after that.

Jeff Bader: Right.

James Green: And she had made the interesting point that there was this expectation that China was join the WTO based on 1990s disciplines and technology, and that the Doha round was going to put new disciplines on that. All WTO members-

Jeff Bader: Right.

James Green: Including China and the United States would have to adhere to. And that this is the WTO accession protocol that China put forward, that we negotiated with China in the '90s, and early 2000s was just the floor and that things would be built on it and that kind of didn't come to pass for reasons that were beyond our two countries and the challenge of negotiating a very large plurilateral agreement.

Jeff Bader: That's right, it didn't. And China resisted reopening their protocols since they said we've already given at the office. But they were able to hide behind other countries like India, who basically hadn't committed to opening their economies at the time, and the whole momentum for progress on the Doha round fizzled away over time. And I think, I think Zoellick was probably crucial to it, because he was such a powerful actor and once he moved on to a different job there wasn't someone who could make it happen.

James Green: Do you think, you've worked with a number of people who ended up working on China, senior people, I'm thinking of Bob Zoellick and John Huntsman, for example. Do you think your engagement with those folks turned them into people who got interested in China policy and felt like working with China was an important part of U.S. foreign policy? Or, I'm not asking you to kind of inflate your role, but do you think, you were quite instrumental in, I just think of those two people, and probably some other folks too, Jim Steinberg. How did you conceive your role and what role do you think you had in their engagement with China, and then for a number of them, their kind of launching from that beginning into something kind of much broader?

Jeff Bader: I would say there were a number of people Bob Zoellick certainly. Jim Steinberg, Sandy Berger, Tom Donilon, all of whom were greatly interested in China before I came along. They all felt that China's role in the world was not properly understood and that we could do better in our relationship with China with more focus and more clarity. I didn't persuade any of them, that was the case. They all started with that prejudice, if you will, that assumption. And in each case, I became kind of their consigliere, "Here's what you can do with the Chinese, here's what you can't do with the Chinese." I wouldn't describe my role as a grand strategist because each of these people was, in their own way, a grand strategist. I would describe it more as providing, I was being captain of a ship, or providing course corrections, or you know, "how do we get from here to there?" They had conceptions of where they wanted to get and I would say, "Eh, that's going to work," or, That's not going to work, or, "Here's how we do it." Or, "Here's what we can put on the table."

China policy was not partisan until when it was not. There were people, serious people, who understood China's importance in the world, the U.S. getting the relationship with China right. That sinking into a relationship of hostility with China would profoundly affect a range of U.S. equities and a range of U.S. interests in a negative way.

And that we needed to build a safety net onto the relationship. Build habits of cooperation. At the same time, as we were confronting them on a range of issues. There was a cliché in the Jiang Zemin era I remember. Jiang had his sixteen-character slogan for relations with the United States. And the essence of it was we should cooperate where we can and manage differences. That was the gist of it. Okay? And in Chinese, when you string it out with seventy-five other clichés it kind of gets lost because win-win cooperation and all of the other things the Chinese say where your eyes glaze over. That was not a meaningless cliché. The U.S. had its own version of it, which was basically a relationship based on cooperation when we can and competition when we can't. Okay?

That was a sound approach. It doesn't get you into decisions on every issue that comes along, but it's a good starting point for thinking about the relationship with China is you start with the goal of cooperating if you can, okay? But you recognize absolutely up front, there are going to be areas, perhaps a lot of areas, where you won't, and you're going to be competing and that's a Chinese point you're going to manage those differences well. Take Taiwan, for example. That's an area of difference that's not going to be overcome. But we sure as hell need to manage the difference of views, because if we don't manage the difference in views, what's the alternative? The alternative is dire. And so, I fear that we've gone off that track in the last few years, with the sudden appearance of seemingly thousands of experts on China, none of whom I've heard of, who are all writing the same thing.

About China as a predatory power whose existence threatens the United States and, as a reaction, is a threat which must be countered. And which should be a unifying principal for U.S. foreign policy. Look at National Security Advisor Bolton's speech the other day about Africa. As best I could tell, the only reason we care about Africa from the speech is because the Chinese and the Russians are there. And we have to combat them at every turn. That's a rather cramped and narrow vision of U.S. interests in the world. We used to have another cliché, if you will, which I think has some value, which was, if you treat China like and enemy, it's going to become an enemy. It was said very often, and people would roll their eyes, but just think about that in personal terms. The analogy between people and countries doesn't always work, but if you treat someone as hostile and you treat them as an enemy, they're going to reciprocate. And in that respect, countries are not very different.

Now, I'm not saying the Chinese don't bear tremendous responsibility for the deterioration of the relations, and we can go through all the things they've done that have led us to this pass. But we should not surrender our own vision, our own clarity about where the relationship should go, simply because the Chinese are screwing up. We need to kind of look beyond the next year or two and say where we want this relationship to go and what are our guiding principles.

Jeff Bader: So, I think that all the people that you alluded to understood that.

James Green: Mm-hmm (affirmative)-

Jeff Bader: That's bringing it back to where this started. That's the way they thought about the relationship with China.

James Green: Could I ask you on your role in helping them interact with China in a way that was productive? Was it difficult for – these are very smart people who are used to dealing with smart opposite numbers – and the Chinese system is sometimes quite straight-jacketed, and doesn't always produce a counterpart who can engage on these things? How did you manage that aspect of the horseshoe design and the kind of long interpretation needs of the...I mean it's really difficult to get to know your Chinese counterpart in a serious way because of the challenges on their side, of their reporting requirements and other things. How did you kind of help that process to at least get as much as you could advance the ball forward given the restrictions on the Chinese side.

Jeff Bader: Well, I think, what you said is exactly true. You know, it's not something you can overcome. It's not something where there are shortcuts either. The first time I encountered this, I think, was 1996 during the Taiwan Strait tensions where people, senior levels in the U.S. government decided, "We're fed up with dealing with the Foreign Ministry. Truly there is someone else we can deal with, who we can have a real straightforward conversation with, and we won't get just these talking points back."

Some genius decided that Liu Huaqiu, because he had a Party post, should be the counterpart, okay? And he was, by coincidence he was coming to the U.S. and people said, "Ah ha, here's our moment, we're going to establish this back channel and we're going to finally communicate." Well, needless to say it didn't work out. Tony Lake spent ten hours with Liu Huaqiu at Pamela Harriman's estate out in Middleburg, Virginia in a strategic dialogue, and we treated Liu Huaqiu like a god, and it didn't produce any startling results. He was part of the system, he wasn't going to deviate. He had his minders and his handlers with him.

And that was that. And I saw the same impulse some years later, can't remember which administration, where there was a sudden desire to meet with other members of the Politburo Standing Committee. "Why can't we meet with the members of the Politburo Standing Committee? They're the guys who make the ultimate decisions in China, not these Foreign Ministry people. So, let's figure out how to meet with, I don't know, with, you know all the players, Wang Huning and Li Zhanshu and all these guys.

And that went nowhere of course. And it went nowhere in part because the peculiarities of the Chinese system, but beyond that, I mean look let's face it, if the Chinese came to the U.S., a Chinese bigshot came to the U.S. and said, "I don't really feel like meeting with the Secretary of State, but I hear that, Denis McDonough and Valerie Jarrett are the ones that have the Presidents ear. I'd like to set meetings with them."

As a matter of fact, I knew diplomats from other countries who tried that. And they of course said, "Take a hike." We have channels for this kind of thing. And so, the Chinese side is even stronger. So, getting beyond the channels, that's not the way it's done. I think what you can do is, what Hank Paulson did with the Strategic Economic Dialogue and then what Tim Geithner and Hilary Clinton did with the Strategic and Economic Dialogue where they have a two-day event, and they would have a private dinner at Blair House, and private small meetings. Just a few people involved. A lot of correspondence, a lot of interaction; you can get somewhere with that. But you can't do it with people who are outside of the regular channels. It's not going to hold.

So, in Hillary's case she did it with Dai Bingguo and in Tim Geithner case and in Hank Paulson's case it was Wang Qishan. And those were productive. I think they got further along than usual. Hank was on the phone all the time with Wang Qishan, so was Tim Geithner. Phone calls, social meetings, those things can have some utility. But you can't pick your interlocutor, it's built that way.

James Green: I'd love to move to your time at the NSC in the Obama administration, but before getting to the specifics of the policy, and I'll certainly ask about that, I just wanted to ask your remarkable transition. How you saw yourself and others moving from a career Foreign Service officer for three decades? Near there?

Jeff Bader: Yeah.

James Green: To then moving to Brookings and the think tank world and consulting some, and then moving into the political kind of circles. I would say, it's relatively unusual for people to do that successfully. It's not rare for people to do it, but it's relatively rare for people to be successful about it. How did you work with, you had mentioned some of the folks before, the political levels, when you were a career person and then how did you transition to the kind of political level? And then we can get to the specifics of your time in the Obama administration.

Jeff Bader: Well, you recall when we were at the NSC in the late Clinton administration, we were exposed to a lot of political actors. In the process you learn how political people think differently from the way they think at the agencies that we came from. You develop a different perspective on policy.

James Green: So, you once told me this story of how you were an advisor to candidate Obama on Asia policy, and I don't know if you could share, but I found it an interesting one of a phone call you got from someone you used to work with Dick Holbrooke, making the suggestion about where advisors were on the Democratic capital “D” side of the advisory system, of the ecosystem in advising the presumed, the presumed nominee that year, which was Hillary Clinton.

Jeff Bader: Right.

James Green: And you had worked for Holbrooke when he was Assistant Secretary?

Jeff Bader: That's right. The Secretary for East Asia in the '70s.

James Green: And you were the?

Jeff Bader: Staff Assistant.

James Green: The Staff Assistant. Yeah. In the state department system, that sort of relationship is a unique one, and it's how people often make their careers, is they build up a relationship with an Assistant Secretary and then they’re off to Jakarta, or off to Beijing, or off to Tokyo and that helps cement their position either for the Assistant Secretary job or the Undersecretary or some other kind of assistant job. And so, Dick Holbrooke's a larger than life person, throughout his time in and out of government. I guess I would just ask, what it was like to get that call and how you handled that?

Jeff Bader: Well, he was I guess my first sort of godfather in the U.S. government, and he was, as you say, a larger than life figure. He was profoundly effective in every job I saw him. He was a person with massive self-confidence that was matched by the ability to live up to the self-confidence that he projected. Which divided the world into people who thought he was the greatest and people who detested him, because they saw only the superficial. He also, by the way, was a hugely moral actor. His interests in refugee issues was second to none; very interested in the Tibet issue for example. But, I worked for him in the '70s and then he helped get me into thee China field. But then he was not part of my professional life. We'd see each other periodically. I saw him in 1992 when he came out to Hong Kong where I stationed. And we had dinner and he told me he didn't think he'd be going into the Clinton administration because candidate Clinton did not agree with his views on China. Which in essence, Clinton's view was revocation or conditionality of MFN. And Dick was resolutely opposed to that and the dangers in U.S.-China relations if candidate Clinton when on the path he was talking about during the campaign.

Jeff Bader: And, Dick, to his great credit was very candid, upfront with Bill Clinton about that and Dick told me that basically had terminated his chances. But, of course, as in politics, things turned around and he didn't get the Washington job, and he wasn't named ambassador to Japan, which I think was his next choice. But he was named the ambassador to Germany, and I did that for a while and then that turned to becoming Assistant Secretary for Europe, and he then negotiated the Bosnia issue. I spoke to Clinton subsequently about, Holbrooke. He admired Holbrooke. And then Hilary loved him. they both were huge admirers of Holbrooke, But Dick to me was a model. He said, "Here's what I'd do on China, and I don't agree with you." And it killed his chances in the short run. In the long run, I think it enhanced his image with them.

Bring us up to 2008, when I was for campaign Obama, and I was one of the very few people who were in the Asia field, there were about five of us, who were supporting candidate Obama and Dick was in charge of the whole foreign policy apparatus, as I recall, for Hilary, and he called me. And, in essence said, I had said something public. I was quoted in Time Magazine saying something that was read as negative about Hilary. It was an article by someone or another in Time. Or Newsweek. I think it was Time. Explaining why a number of people who were for the Clintons were now supporting Obama, and I was an example, and I explained why.

And Dick called me and kind of read me the riot act saying, "You need to understand that Hilary's going to win, and we're all going to come together, and don't make it harder to come together by your gratuitous public commentary. And I was told at the time, Dick was making a number of calls to people basically lassoing them. This is politics, I mean you can't take these things personally. I did take it personally, however, at the time. And I shot back something that I can't repeat on microphone. The gist is "I don't give a something or other, about coming together. I'm supporting candidate Obama. Period. And I'm not doing this for a job. I don't care if I get a job or not. I'm doing this for the country, and I have heard what you said, and I'm not interested in what you had to say."

Dick in his characteristic fashion immediately got off the high horse and was suddenly very mollified. He’s a negotiator. He found that he didn't have the leverage over me that he thought he had. That I wasn't interested in a job. And if you're not interested in something, you've got leverage, right?

At that point he realized, "I better be nice to this guy, because I can't bully him to get to my conclusions, so let's try a different tack." So, we did have a very pleasant conversation after that. And I saw Dick a number of times during the administration when he was doing Afghanistan.

This was a man with a gift. I actually saw him, the last time I saw him, the night before he had his aneurysm, I was at the White House, at the West Wing, at the entrance where the awning is. And I was coming out from a meeting with the President. And, Dick was going in.

"Oh, how are you doing." I hadn't seen him for a little while. So, we chatted for 10-15 minutes by the entrance, he seemed fine to me.

He seemed completely normal. We had a lovely chat about 6-7PM. And then I heard the next morning at 8AM that he had an aneurysm in the Secretary of State's office and was taken off to hospital and never revived.

And there's been a lot written about Dick. I think George Packer is doing a book on him now, which I think will be the definitive book, saying Packer is very good.

James Green: So, Obama wins the nomination, wins the Presidency. You guys come in and you wrote your book at Brookings about the Asia policy. But the centerpiece of much of the foreign policy was looking, doubling down on Afghanistan and there were some other components of the Obama foreign policy. But one of the big parts was this kind of rebalancing the U.S. focus away from the greater Middle East towards Asia. You had this kind of broad concept, a number of the different advisors, who were there, who then went to the administration. How did you see the execution of that in actually coming into office and putting the policy pieces into place?

Jeff Bader: Well, let me be modest on that point. The whole notion of rebalancing I regard it largely as a Tom Donilon concept, okay? And I think that's kind of the way that people at that level think, partly for strategic and partly for tactical reasons. He knew that they were getting out of Iraq, and even though, as you say, they were doubling down on Afghanistan, they did not want to make it into the centerpiece or U.S. foreign policy. They wanted to kind of manage the issue. So, for someone like a Donilon, Tom was describing the strategic terms, you know? We're trying to move from this obsession with the Middle East and obsession with Western Asia towards the part of the world that really matters. Matters more. And that's Asia, okay?

So, we came up with this notion of rebalancing and again, political people can look at these phrases that don't necessarily come naturally to some of us who were brought up in the foreign policy apparatus, as opposed to the public interface.

My own conception was more modest. My own conception was somewhat defensive. Number one I had seen a succession of administrations screw up U.S.-China relations by coming in with wrongheaded ideas, thinking they could radically alter the U.S.-China relationship by kind of whacking them with a two-by-four. And then it never worked out. I'd say that with Reagan, when it distinctly did not work out and ends up with the '82 Communique. I saw it with Bill Clinton with conditional MFN, which he had to back down on. And to a lesser degree with George W. Bush, who talked about China as a strategic competitor rather than a strategic partner. That's an odd formulation, that I think his political people came up with. And after 9/11 he had to abandon that, completely.

And in fact, he never referred to China as a strategic competitor once he was President. That was a campaign phrase. I understand that some of his top advisors, who I will not name, in the White House, used the phrase and he said, "What are you doing? We're done with that." Okay?

And of course, a lot of problems the first year, even with Bush, remember with the EP3 episode. So, I didn't want a repetition of that. So, number one, I wanted to skip off to a stable start in the relationship with China. Number two, allies. And partners in Southeast Asia. You know, I was a Democrat in a Democratic administration, but my views about foreign policy were fairly traditional in regard to Asia. And my concern was that Japanese, Koreans, Southeast Asians had memories of previous administrations, particularly the Carter administration, but not exclusively. Beyond that, Congressional members, that made them think that Democrats were hostile to their interests.

They remembered Democrats on the Hill in 1980s on Japan, very protectionist on trade. They remember Carter, President Carter threatening to pull troops out of South Korea, and Southeast Asia the resented all the hammering on human rights and wanted to concentrate on economic issues. So, there was a sense encouraged, I think, by Republicans in Washington, that you Asians are really Republicans. Your interests coincide with ours. And I never felt that was right. Never felt it was fair. And I felt that the right kind of attention to Asian interests would help combat that false narrative and serve U.S. interests.

So, I started out with very much an incentive to build relations with Southeast Asia, with Koreans and with the Japanese and just to keep the China relationship on an even keel. Okay? That was the way I conceived of my own priorities. And I mean, none of them being easy; keeping the relationship on an even keel doesn't mean ignoring it. It meant a tremendous amount of attention. But we did a tremendous amount on Southeast Asia, for example. And a tremendous amount on Japan and Korea. I spent a lot of time with the senior leadership of Korea along with Hillary Clinton and Barack Obama with the President Lee Myung-bak and Foreign Minister, with their National Security Advisor and we became close to them. And we did a lot for them, when the Cheonan was sunk and when Yeonpyeong Island was shelled.

We concluded the FTA, we provided military support during crises, we extended U.S. leadership off the U.N. command. We did a whole bunch of things for the Koreans, they really appreciated it. And Japanese presented a number of problems, in part because the LDP lost and Hatoyama was Prime Minister for a year and the DPJ was new to political power and didn't wield it very well. So that was a huge challenge. In Southeast Asia we did any number of things, as you know. Joining the East Asia Summit, signing the Treaty of Amity and Cooperation, setting up an Ambassador to ASEAN, first visit ever to ASEAN headquarters. It was a whole bunch of things. So, Tom Donilon called it the rebalance and Kurt Campbell called it the pivot. I just did it.

James Green: Right.

Jeff Bader: Without calling it anything.

James Green: Within that on the China part of it, could you talk a little bit about how you handled or thought about the competing interests. I have a short list, but I'm sure there's a much broader one of South China Sea, cyber, market access, human rights, I mean there are a huge range of things. I don't know if it's helpful to think about, you had mentioned President Obama's trip in '09, and then the return one, Hu Jintao to the U.S. Is that a helpful way to talk about balancing those interests?

Jeff Bader: Well, I'd say the main trajectory was 2009, we were building up to the Obama visit, and we're trying to keep everything stable. And trying to make incremental progress on issues. We set up the Strategic and Economic Dialogue to get the main actors interacting with each other on a regular basis. The Hu Jintao visit had problems with the public messaging, which did not go well. And I think the private meetings were fine. But the public messaging created a backlash in the United States, which the media loves to do.

And then in 2010, I think in my book I called the chapter, "The Year of Living Assertively," the Chinese did a number of things that, we regarded as threats to our national interest. And we had to push back. It was a year of pushing back. South China Sea, their excessive support for the North Koreans after the sinking of the Cheonan, their hostility to Japan. Difficulty on economic issues. By the way, when people look back and wonder why more wasn't done on economic issues under the late Bush administration and the Obama administration, I think people forget. There was one issue that overwhelmed all other issues. And that was currency. That's all anyone outside talked about. And that's what Hank Paulson and Tim Geithner focused on, was currency. And the Chinese-

James Green: Backing up a little bit, the financial crisis that was melting down the U.S. economy and global economy. So, you had both of those two things.

Jeff Bader: Well, you had that as well. So, you had China running like 8% or 9% global surpluses in their trade. In part because of a barely disguised manipulated currency, or certainly an undervalued currency. And you had a recognition by Obama and Bush and Paulson and Geithner that stagnation in the Chinese economy at the time when we were shedding millions of jobs, was profoundly contrary to U.S. interests, you had those two things. So on the one hand, people want to coordinate on stimulus and secondly they wanted to drive the Chinese currency value up. Those were the two issues. Market access continued, and there were continuing discussions, at USTR, and supported by the administration, fighting market access issues tooth and nail. But those were the two big ones. And so, every meeting we had with the Chinese under Obama the first year or two, I would say close to 50% of the meeting would be economic. And almost all of that would be currency. Some stimulus.

And then the non-economic portion, Iran was very heavy with the Iran nuclear program. And North Korea nuclear program. Those two issues would eat up.

If you look at Presidential agendas, Presidential meetings, you get a sense of what an administration's agenda is. And I think that gives you an idea that those three issues dominated discussions at the head of state level.

James Green: And in your experience, given the amount of time, three or four issues is kind of all you can get to in that level of meeting?

Jeff Bader: Sure. You know what a meeting is like. It's a two-hour meeting off which each side gets to speak for one hour, but there's consecutive interpretation, so actually each side is just speaking for a half hour. And I gather after I left, Obama got fed up with this and I think they tried to set up some sort of simultaneous interpretation method for which I bless them. I mean it's so tedious to sit through these lengthy interpretations. You lose some quality, but I applaud their efforts. I think the way our senior leaders look at it not unsensibly, is "Hey, you know, we're in the era of Google Translate, I can sit down and I can read People's Daily, you know maybe not so accurately, but why do I have to sit here for fifteen minutes while an interpreter goes through his elaborate notes?” I'm sympathetic if they can work that out.

James Green: So you had mentioned Hu Jintao's visit in '11 and then there was an effort to get to know the then Vice President, to be President Xi Jinping. Can you talk a little bit about your time in the administration and what the thinking was on how that handover of power would go, and what U.S. policy might look like?

Jeff Bader: Not that much, James, because I was gone before, I left in 2011. I mean Xi took office in what? End of 2012?

James Green: That's right, yeah.

Jeff Bader: In 2012. The only thing I remember clearly is Joe Biden's, Vice President Biden's trip to Beijing, to China, and he spent like ten, eleven hours talking to Xi Jinping. Spent a lot of time with Xi. And I had dinner with Vice President Biden shortly thereafter and got his perceptions on Xi Jinping. So that was revealing. They got on quite well, and Biden certainly admired what he saw as a politician’s instincts on the part of Xi Jinping. You know the guy had been down in Fujian and then in Zhejiang and he thought like a mayor and a governor in many respects, you know? Get the sewers operating and fix the ports and improve the educational system. Thought like a local official in many ways.

And then my only other brief interaction, I came in as an outsider when the administration was trying to decide after he became President and they were looking for when should they see the guy. How were they going to see him? It was the beginning of 2013. And they weren't going to see him until APEC, end of the year. And I came in and argued strongly for doing something much sooner. It was an argument that was well received by Danny Russell, less well received by some others. And they decided to-

James Green: Danny Russell who had taken your position as Senior Director?

Jeff Bader: Danny Russell, I'm' sorry, was the Senior Director at NSC.

And it led to a meeting in Sunnylands in the spring of 2013, which I continue to think is the right way to try to get off to a good start. President Trump, who I do not admire as a human being or as a President, and about whom I am, extremely negative in virtually all respects. One thing he does have right, although to a fault, is his emphasis on personal relationships. Now, he does it in part because he doesn't begin to understand the importance of state-to-state relationships, or institutions, or history, or what the history of China is, or what the history of France is, or what the history of Germany is. He doesn't have a clue. All he knows is a deal with another head of state of government.

But leaving aside the ignorance part, that's a good instinct. The instinct that I've got to have a good relationship with Xi Jinping. I gotta have a good relationship with Abe, even some of the less desirable people.

James Green: Why do you think that's so important in the Chinese context of having a good state-to-state, at that head of state level?

Jeff Bader: I don't think it's especially important in the Chinese context. I think it's important in any relationship.

James Green: Any diplomatic relationship.

Jeff Bader: Any diplomatic relationship. it's important in the Chinese context, I think it's been useful for Trump and the U.S. and just again, providing a safety net. Everything else this administration is doing towards China is more or less hostile. And constituencies being built up on both sides that want their relationship to tank, is good if you have a counterpart at the presidential level who is left with the impression at least, that the head to state to head of state level is important to the U.S. side and they can pick up the phone and call them, which they do not infrequently to work out a problem. I mean, Xi Jinping obviously called President Trump about ZTE, when the U.S. was going to shut it down. Whether that was a good decision or a bad decision, leave that aside. It's clear that Xi Jinping's call, was crucial in saving ZTE.

James Green: That's one of the few times I can think of where the Chinese side actually initiated the call.

Jeff Bader: That's right. The Chinese side initiated, which is not common, but I think that Xi Jinping has realized that having a good relationship with Trump prevents a free fall in their relationship. And Trump, just for his own reasons, because of his modus operandi, wants to have a good relationship with him. So, I give him credit with that. But nothing else.

James Green: Maybe we could just end, you've written about Xi Jinping's view of the world and China as a rule maker not a rule taker. Clearly a different kind of China than when you went in the 1980s. How should we think about China going forward and a country that wants to make rules? In a lot of ways it seems at this point, it's kind of an un-gestated sense of yes, China should be a rule maker, but what that actually means kind of day-to-day, that hasn't manifested itself, but how should we think bout for the next decade about where China is in the international system?

Jeff Bader: Well, I think the first thing that we need to do is the U.S. needs to commit itself to the international system and to multilateral decision making. If the U.S. does not, as this administration does not, we're leaving the door open for China to be a Rule Maker with a capital R and a capital M.

If we're at the table, and we're involved and we're putting forward a serious proposals then they are naturally going to get traction with others. If we've just taken a hike and either withdrawn from the organization completely or made clear our disdain for the organization, then countries in that organization all look to others for guidance about the future.

So, the first thing we've got to do is be there. And mean it. And have an interest in international governance and international rule-making. I understand, I'm not a scholar, but I know a little history here, a fair amount of the history of realist school versus the John Ikenberry school, which believes in international norms. I get it. I think serious people understand that neither side is completely right. That you can't conduct a foreign policy based entirely upon international rules and governance and ideals and you cannot do that. It’s not Woodrow Wilson in 1918.

On the other hand, it's not a Hobbesian world either, and just going out there and saying, "We're big and tough and we're going to get our way, and we don't care about the global structure because we don't need it," is doomed to failure. It's a much longer argument, but there's no question in my mind that that is not going to get you where you want to go with a nation. So, you gotta have both.

China as rule maker; I don't really like the phrase. I think China as a rule shaper, China as a participant, in rule making. I think for the most part, we have to accept that. Accepting it doesn't mean that their proposals carry the day, but we do have to accept the notion that 1.3 billion people and X% of global GDP and a rising power that their interests need to be protected through the global system. That the global system was designed without their participation and that it's natural and acceptable that they're going to play a role going forward.

On the other hand there are areas where…I saw former Minister Wang Yi's speech the other day, lengthy speech, about China's foreign policy and you had to look long and hard to find a reference to international rules in there, it's buried in there. I didn't find the phrase 'International law,' anywhere. There's a lot of 'win-win,' a lot of, 'cooperation,' that sort of thing. But not according to any norms or laws. And I think the Chinese, we have our own sins in the last couple years, particularly under Trump. But the Chinese have never really committed ideologically, in my view, to the international system of law and norms across the board. They regard them as sort of tactical, in a tactical way. Now, the worst of it, obviously, is the South China Sea, and I can kind of understand their position there in the sense that there goes a territorial issue. And it's obviously important for national security purview since it's their backyard.

But, I'm sorry. There are international norms and that's why Hillary Clinton made the speech, the presentation she did in Hanoi in 2010. And we should never give up. The position of principal about the nine-dash line’s unacceptability and the primacy of the U.N. Convention on the Sea in determining rights within the South China Sea, those are fixed principles.

And the Chinese, we accept them in the Caribbean. The Chinese at some point are going to have to come around to that, in my opinion, and their position is unacceptable until they do. Okay?

I think that the other area where they are in international norms where they're certainly contrary to our interests is the whole digital information technology area. Where they have a series of foundations for what they do based on extreme sovereignty, disregard of stakeholders besides governments, indifference to privacy, and acceptance of surveillance. A whole series of norms that, if you will, are Western norms, that I think they're respected generally in the United States and in Europe. It's a tough one, because they're not so much respected outside of that area.

I think the Chinese have a certain amount of traction in the developing world with their positions on these issues. So, I think that's an issue where, I think that and the South China Sea issue are ones where we need to stay true to our principles and hold firm.

I think in other respects the Chinese are somewhat malleable. Okay? I think on U.N. issues, and WTO issues, and international organizations, generally we can work with them. Non-proliferation issues, and certain degrees of accommodations, such as we accommodate others are appropriate. But the Chinese, they need to understand that these international principles matter. Particularly in the WTO area.

Jeff Bader: And of course, they've done some things outside of the system. The creation of the Asia Infrastructure Investment Bank, which I don't see in any way as a threat to U.S. interests. I think that the administration's noise about it was inappropriate. Asia desperately needs an infrastructure. I don't understand policies of administrations where we get up and scream about Chinese offering assistance or aid to someone.

And we say to them "You can't take it." And they say, "Why?" "Because we don't like them." And you're going to become subordinate to their interests and you're going to fall into a death trap, and they say, "Fine, can you fund the dam, or the road?" "No, no, no, we don't do that kind of thing. But don't take any money from them."

That is a completely untenable and ridiculous position, which no country in the world is ever going to accept. They may wink at us, but they're not going to. So, and the AIIB, I think the Chinese are generally trying to live up to international standards. They've gotten a serious President, who's got background in these institutions. Belt and Road Initiative is a bit of a different set of challenges. It's a longer discussion.

I don't think we should be supportive of the Belt and Road Initiative, but I don't think we should regard it as a global threat.

James Green: Ambassador Jeffrey Bader thank you so much, it's really great to hear about your incredible career and your views on where we are today on China. I appreciate the time.

Jeff Bader: Thank you James. It's great to talk.

James Green: Ambassador Jeff Bader - speaking with me from Los Angeles, CA. You’ve been listening to the U.S.-China Dialogue Podcast from Georgetown University. I’m your host, James Green.