A special report on Chinas place in the worldFriends, or elseLiving with Chinas rise will test Americas diplomacy as never before Dec 2nd 2010 | from PRINT EDITION IN A recent essay Hugh White, a former Australian security and defence official, describes the following exchange with his American counterparts: “I put this catechism to them: Do you think America should treat China as an equal if its power grows equal to Americas? The answer is always no. Then I ask, Do you think China will settle for anything less than being treated as equal? The answer to that is always no, too. Then I ask, So how do you expect the US and China to get along? I usually get a shrug by way of reply.”That shrug is a measure of Americas difficulty in designing a China policy. America wants China to be a thriving market for its goods. It also wants China to become an active, responsible power in world affairs. Yet at the same time it feels threatened by Chinas growing economic, industrial, diplomatic and military might. When America dislikes a position China has taken, it cries foul. This mix of partnership and rivalry is a recipe for confusion.One way to resolve these tensions would be to put security first. America could aim to block China now before it gets any stronger. America won the cold war by isolating the Soviet economy and stalemating its armed forces. But trying that again would be a bad idea, as Robert Art explains in a recent issue of Political Science Quarterly. For one thing, the cost would be astronomical; for another, America might suffer as much as China. The two countries economies are intertwined and China owns more American government debt than anyone else. In war, nations override such factors out of necessity. If an American president tried to override them in peace out of choice, he would face dissent at home and opprobrium abroad.The risks of containment In any case, a policy of containment risks backfiring, except against an unambiguously hostile China. Unless America could persuade large parts of the world to join in, China would still have access to most markets. A belligerent United States would risk losing the very alliances in Asia that it was seeking to protect. And Joseph Nye, of the Kennedy School at Harvard, has argued that the best way to make an enemy of China is to treat it like one.America may one day feel it has no choice but to focus on security alone, which is what China fears. By contrast, to focus on economics and forget security makes no sense at all. America has vital interests in Asia. It wants to prevent nuclear proliferation in the Korean peninsula and Japan. It has allies to protect and threats to police. It needs accessible sea lanes and open markets. America is the worlds pre-eminent power. It cannot surrender Asia without losing influence everywhere else.Hence for the past 15 years America has fallen back on a two-track China policy. Barack Obama articulated the first track on his visit to China in November last year. He told the students at Fudan University, in Shanghai: “The United States insists we do not seek to contain Chinas rise. On the contrary, we welcome China as a strong and prosperous and successful member of the community of nations.” This means, as the president later explained in front of Hu Jintao, his Chinese opposite number, that Chinas “growing economy is joined by growing responsibilities”.“Engagement” is backed by a second policy, best described as hedging. America must be able to deploy enough force to deter China. Presidents do not articulate this track quite so eagerly, but Admiral Robert Willard, head of Pacific Command, was clear enough in his remarks to Congress earlier this year: “Untilit is determined that Chinas intent is indeed benign, it is critical that we maintain the readiness of our postured forces; continually reinforce our commitment to our allies and partners in the region; and meet each challenge by the PRC in a professional manner that is consistent with international law.”America faced some straightforward, if terrifying, calculations in its monochromatic relationship with the Soviet Union. By contrast, its technicolour dealings with China are less apocalyptic, but many times more complexalmost unmanageably so. In principle, the policys two tracks fit together well. Engagement is designed to reward good behaviour and hedging to deter bad. In practice, however, the hedge risks undermining the engagement. To see why, consider that the existence of two tracks acts as an excuse to leave important issues unresolved in America. China hawks and China doves can all support the policy, because both can continue to think that they will ultimately be proved right.That is politically handy in Washington, but hardly ideal as a policy. The engagement tends to be run by China specialists in the state department and the hedge tends to be run out of the Pentagon. In theory the policys two dimensions shou