Biden’s comments ‘don’t help’ China-Taiwan tensions, Eurasia Group analyst says
Eurasia Group U.S. Managing Director Jon Lieber joins Yahoo Finance Live to discuss President Biden's remarks that the U.S. would defend Taiwan in the event of an invasion from China and the outlook for China and Taiwan.
Video Transcript
- Let's bring in Jon Lieber. He is Eurasia Group US managing director. Jon, what was interesting about these comments from the president, not necessarily something we haven't heard from him before, but it was the White House kind of walking back that statement, saying things have not changed in terms of policy. Has anything changed? Did the president raise anything yesterday that would mark a shift in US policy towards China?
JOHN LIEBER: So this isn't the first time Biden has shifted a little bit on the issue of the US defense of Taiwan. What I think what's different about yesterday's comments was that he explicitly endorsed the idea of US troops being deployed to defend the Island as opposed to kind of doing what previous presidents have said.
George Bush said that we do whatever it takes to help Taiwan defend itself. And that's been the extent of the US commitment so far, is the US would help Taiwan defend itself. It's provided it with arms. But Biden really went beyond that yesterday in saying that troops would be committed to the island's defense. And this is beyond even what the US is willing to do in Ukraine. Public opinion showed very strong support for pushing back on Russia, providing support, materiel, and weapons for the Ukrainian government.
But the US public was very reticent and does not want to engage Russia directly militarily with troops on the ground. And what Biden indicated yesterday is that at least his administration seems like they'd be willing to make that commitment. That is something new. And I think that would be considered a bit of an escalation, particularly by the Chinese government.
- And can you talk a little bit about that escalation because I know that Eurasia had come out with a report back in July about the probability of conflict in Taiwan, especially also given Speaker Nancy Pelosi's visit to Taiwan. I mean, how does this all play out when you're talking about conflict there?
JON LIEBER: Yeah. And to be clear, we don't think there's going to be a military conflict between US and China over Taiwan anytime soon. But the situation is getting more tense. You've got China, who's making military preparations to take over the island and may have the ability to do so within the next several years. You've got a domestic political environment inside the US that is much more hawkish towards China than it was even five years ago, with lawmakers of all stripes encouraging things that China thinks is escalatory.
For example, the Pelosi visit to Taiwan, which the Chinese government gave very strict warnings in no uncertain terms that there would be a response and in response launched some missiles over Taiwan and did some things they hadn't done before. So you're seeing just this escalation across the board. Xi Jinping now entering into his third term likely after the party congress is over. And he has said that he wants China's policy to be reabsorption of Taiwan.
We think that could possibly happen before the end of his term, which puts the risk of a military conflict on the table sometime in the next 10 years. And this is an unstable situation. And comments like Biden probably don't help because the policy of the US so far has been strategic ambiguity where the US wasn't really indicating what it would do in case China did attack. Biden is moving away from that and moving much more towards a strategic clarity policy, indicating that the US would respond and be willing to engage with China should they attack Taiwan.
- Jon, as you said, this is not the first time that we have heard this from the president. You could argue yesterday it was a little more explicit. But he has talked about defending Taiwan before. And yet in the previous times, we also had the White House, his staff, coming back and saying, well, there hasn't been a shift in policy. So I wonder what you think is happening here? I mean, is this the president kind of testing the waters to gauge China's reaction? Or is this him-- I mean, he is the president-- but sort of speaking out of line from this ambiguity that the US has maintained on Taiwan for many years?
JON LIEBER: Yeah. I think, I mean, at this point you kind of have to say Biden's doing this on purpose. This is the fourth time he's said something like this. The White House has walked back his comments in the past. But if you look at the way they're walking it back and specifically what Biden said last night is that there's been no change to the US policy to help Taiwan defend itself. I mean, you could argue that this is all part of the same policy, but it's just now more explicit that the US will contribute here.
Another dynamic to bear in mind here is that Congress is, as I said, getting much more aggressive on the issue of China and Taiwan and is considering a new Taiwan Policy Act that they may try to pass with the National Defense Authorization Act by the end of this year that would represent a larger shift in the US position towards Taiwan to be much more supportive of them, not just their defense, but supportive of their independence.
And it's possible that-- you should look at Biden's context in the comments in the context of the administration opposing this Taiwan Policy Act. So a more hawkish position from President Biden could contribute to Congress being willing to back off on a more aggressive position if they think the administration's aligned with them. So it's a pretty complicated dance that's going on right now between Congress and the administration. But all signs are towards deteriorating relations and much more hawkishness of the US government.
- Finally, Jon, I know the president's going to be traveling here to New York later this week to address the UN General Assembly. Obviously, a lot of issues on the table, what's happening with Russia and Ukraine, but also the broader climate discussion. It's kind of the first time all the world leaders are getting together since COP26. A lot has shifted since then as a result of the concerns around energy. What do you think is going to be a central message?
JON LIEBER: I think Biden goes to this meeting, actually, with a lot to say. The US passed probably the most significant climate spending bill in its history. And it really-- the Inflation Reduction Act. It's going to be dedicating hundreds of billions of dollars to a clean energy transition over the next 10 years, primarily in the private sector through subsidies for private sector activity, tax credits, and loan guarantees and the like.
And I think that gives Biden a lot to talk about, especially in the context where European nations are now, in the short run, looking at ways they can keep the lights on throughout the winter due to gas shortages and spiking electricity prices. But in the long run, the European countries still have this commitment to decarbonization.
But where I think the real interesting topic is going to be this week is in the developing world, who simply does not have the financial resources due to higher interest rates and low levels of economic activity, a weak tax base, to finance these kind of commitments. I think you're going to see the UN and the developing world really hammer a lot on the developed world to try to contribute more to help with their both climate transition and also climate resiliency. And I think that's going to be one of the big themes of the UN this week.
- Yeah. Certainly a lot of headlines expected out of that. Jon, as always, appreciate you joining us on the show. Jon Lieber, Eurasia Group US managing director.
