War in Israel and Ukraine, hybrid warfare and espionage - China plays innocent from the countryside

I.

Irrespective of the very moderate reaction of the Israeli government on 19 April 2024 to the Iranian attack on Israel on 13 April 2024, the biggest beneficiaries of both this Iranian military action and the attack on Israel by Iranian-backed Hamas on 7 October 2023 are not Iran and certainly not the Palestinians, but Russia and China in particular. Although China plays the geopolitical innocent from the countryside and gives itself the appearance of a mediator and a benevolent representative of the interests of the Global South, China's actions are by no means aimed at conflict minimisation or even conflict resolution. As China's geo-economic struggle on Russia's side shows, China is striving to reorganise the global distribution of power in its favour. To this end, armed conflicts are not ruled out, even if others are nobly allowed to take precedence. Although China is by no means minimising conflict, it has a great interest in minimising its own costs.

Furthermore, Russia should not lose its war in Ukraine, but must not outgrow its new role as China's junior partner. Iran should quietly join forces with Hamas and Hezbollah to foment chaos and conflict in the Middle East, but should not rise to become an independent hegemonic power in the Middle East. And the Palestinians, who have been suffering since Hamas' attack on Israel on 7 October 2023, are useful cannon fodder for further positioning the Global South against the West on the one hand and escalating internal social tensions and conflicts in the West on the other. Other forms of hybrid warfare against the West have been promoted for years by means of espionage.

But although China is only playing innocent, parts of German big industry and German politics are only too happy to fall for this feigned innocence. Some are lured by the hope or blinded by the illusion of being able to hold their own on the Chinese sales market in the future despite Xi Jinping's nationalistic industrial policy. Or the fear of the costs of a gradual withdrawal from China fatally drives them to the conclusion that they need to invest even more in China because they have already steered their own business model into dangerous dependence on the Chinese regime. The others who believe in China's innocence, on the other hand, still seem to believe in the neo-Marxist concept of "Change through rapprochement"¹, although this has already failed with regard to Russia.

II.

With regard to the geopolitical and geo-economic challenges facing the West today, it should be emphasised that the concept of "change through rapprochement" did not lead to the collapse of real socialism in Central and Eastern Europe and the fall of the Iron Curtain in 1989. Real socialism collapsed because the Soviet Union and its satellite states were economically at the end of their tether after decades of a centrally planned economy and could no longer survive the arms race that they themselves had initiated in the 1970s and 1980s. It was the West's consistent security and defence policy and the implementation of the NATO Dual-Track Decision that promoted the collapse of the Eastern Bloc.² The intensification of economic and trade relations as part of the concept of "change through rapprochement" is likely to have delayed this collapse. The billion-euro loan to the GDR, which the Minister President of Bavaria Franz Josef Strauß (CSU) arranged in 1983, also belongs in this category.³

Fatally, after 1989, in dealing with Russia and then also with China, the historically false narrative was followed that a political upheaval and a development from dictatorial rule to liberal democracy could be brought about constructivistically through "change through rapprochement", so that a consistent security and defence policy could be dispensed with and replaced by economic and trade policy. This false narrative was then labelled "liberal", although it is based on neo-Marxist base-superstructure thinking, in which the economic base determines the political superstructure. However, the relationship between economics and politics is more complex.⁴

In some liberal modernisation theories, a convergence thesis can also be found, according to which the subsystems of purposeful rational action influence each other in modernisation processes and the modernisation of one subsystem can promote the modernisation of other subsystems. In contrast to basic superstructure thinking, however, it does not assume deterministic processes and the primacy of one subsystem over another and emphasises in particular that this influence or structural coupling only succeeds if the respective subsystems are able to maintain their own logic. However, if politics succeeds in overriding the inherent logic of the economy to such an extent that the economy can no longer limit the power of politics, then the social division of power is cancelled out. This has not only been the case in Russia for years, but to an even greater extent in China. If there is no effective social division of power between business and politics and politics completely dominates the economy, then the intensification of economic and trade relations cannot easily push politics into a process of modernisation and liberalisation. "Change through rapprochement" then even supports autocratic and totalitarian regimes - contrary to its own intention.⁵

Since the Chinese Communist Party Congress in October 2022, Chinese head of state and party leader Xi Jinping has succeeded in further expanding and securing his autocratic rule and the elimination of social power-sharing between business and politics. It is currently unlikely that Xi and his totalitarian control system will come under existential pressure as a result of the property crisis in China or other economic problems. In view of the Taiwan issue and the new global East-West conflict that has arisen as a result of the Russia-Ukraine war, in which China is not only on Russia's side but also supports Russia economically and keeps it capable of war, as well as the conflict in the Middle East, in which China's ally Iran plays a central role, no one should imagine that China can be led onto a more peaceful path or even to break away from Russia and Iran through "change through rapprochement". On the contrary: "change through rapprochement" and the further intensification of economic and trade relations are likely to support Xi and his totalitarian system of rule for the time being and thus also the axis between Russia, China and Iran.

III.

In his book "The Grand Chessboard", published in 1997, the former National Security Advisor to US President Jimmy Carter, Zbigniew Brzezinski, had already outlined the dangerous scenario of a future grand coalition between China, Russia and Iran. This coalition would not be united by ideology, but by complementary grievances. In scope and reach, it would be reminiscent of the challenge once posed by the Sino-Soviet bloc, even if this time China would probably be the leader and Russia the follower.⁶

Building on this prophecy by Zbigniew Brzezinski, which has unfortunately come true, the British-American historian Niall Ferguson argues that today the new Cold War is emerging faster than the old Cold War after the Second World War:

"For now, fortunately, we are in Cold War II, not World War III. However, Cold War II is proceeding rather faster than Cold War I. If the Russian invasion of Ukraine was our equivalent of the Korean War of 1950-53, we have (thus far) skated past a second Cuban Missile Crisis - over Taiwan - and have already entered a period of détente, a sequence that took two decades last time around. Since last November's presidential summit in Woodside, California, the Chinese have seemed genuinely keen to avoid a showdown and want to engage in serious, if frosty, dialogue with their American counterparts, reminiscent of 1969-72.

But the surprise attack on Israel by Hamas last October propelled us all the way to 1973... In short, in Cold War II we seem to be getting the 1950s, 1960s and 1970s compressed together in a somewhat bewildering mash-up."⁷

However, this parallel should be viewed with great caution. Does China really want to come to an understanding with the USA and the West today as it did between 1969 and 1972? Or does China want to keep the USA and the West quiet?

At that time, China was economically at rock bottom and did not play a major role in the global economy. Today, China is almost as big as the USA in terms of GDP.

In 1969, the Ussuri River incident led to the climax of the rift between China and the Soviet Union. This border conflict on the Ussuri River almost led to a major war between China and the USSR, following a number of armed clashes beforehand. Today, China is firmly on Russia's side in the Ukraine war.

It is also striking that China has so far done nothing to protect the trade route through the Red Sea, even though its goods are transported through the Red Sea. So China obviously has nothing against armed conflicts in the Middle East. As so often in recent years, China is playing the innocent bystander on this issue.

Furthermore, although China warns against the formation of new blocs, it is actively promoting them itself. On the one hand, China is trying to form new strategic alliances and regional trade agreements and, above all, to create dependencies through the One Belt One Road strategy. On the other hand, China is blocking existing international organisations such as the WTO and the UN Human Rights Committee.

But will the new coalition of China, Russia and Iran really last in the long term? How long will this axis last?

The relationship between China and Russia has little in common with a partnership of equals. Through its war in Ukraine, Russia has degraded itself to China's junior partner, although Russia is seeking imperial hegemony through its war in Ukraine. Putin's invasion of Ukraine is a desperate attempt to forge the Eurasian Union he has long aspired to with blood and violence. China, however, has not the slightest interest in a Eurasian Union. That is why China's behaviour in the Ukraine conflict is such that Russia must remain China's junior partner in the long term. From China's point of view, this junior partner should not be weakened to such an extent that China can no longer benefit economically and politically from Russia as an enemy of the West. However, Russia should by no means be in a position to limit China's hegemonic claims.

On the other hand, Russia will certainly not want to resign itself to the role of China's junior partner and will fuel conflicts globally wherever it perceives Russia to benefit, and - once the Ukraine war has ended in one way or another - in case of doubt also against China. In other words, despite all public statements, the relationship between China and Russia is not designed to promote peace, but to accelerate the crisis.

In geopolitical terms, Russia and China now have Iran exactly where they wanted it to be in the autumn and through its inclusion in the BRICS+. But neither China nor Russia will accept Iran as an equal partner. Overall, therefore, the axis of China, Russia and Iran is indeed - as Zbigniew Brzezinski surmised back in 1997 - a coalition without ideology, united by complementary grievances and - it must be added - by common enemies: the USA and the West.

For this reason, we must agree with Niall Ferguson when he emphasises that the armed conflicts and disputes in distant countries must ultimately concern us. They are part of a single war being waged by a new axis against our fundamental values: Democracy, the rule of law, individual freedom. Niall Ferguson predicts that the counter-arguments of the isolationists will therefore not last long.

This is presumably one of the reasons why China is playing the geopolitical innocent. Neither the Global South nor the isolationists in the USA and Europe should be woken from their cosy slumber. After all, the China-Russia-Iran axis could break faster than expected if it comes under the pressure of a consistent security and foreign policy like that of NATO in the 1970s and 1980s.

¹ See Egon Bahr: Change through rapprochement, speech at the Protestant Academy in Tutzing on 15 July 1963, online: https://www.1000dokumente.de/index.html?c=dokument_de&dokument=0091_bah&object=facsimile&st=&l=de

The question of how to deal with an opponent of the system is the guiding question behind the political concept of "change through rapprochement" developed by Egon Bahr and Willy Brandt in the early 1960s. After the construction of the Berlin Wall, Bahr and Brandt wanted to facilitate peace-keeping progress in relations with the Eastern Bloc states and especially with the GDR with a new Ostpolitik in the growing East-West conflict. By intensifying economic and trade relations, a rapprochement was to be made possible and the long-term goal of overcoming the antagonism between communist and capitalist states was to be achieved. The entire concept therefore had a kind of neo-Marxist component consisting of an economic "basis" and a political "superstructure".

In terms of realpolitik, however, the concept of "change through rapprochement" and the new Ostpolitik probably had less of an impact via the economic basis than via political processes. In particular, the Helsinki Final Act was wrested from the Soviet Union and its satellite states through political negotiations in the course of the CSCE process.

² It was a stroke of luck that the collapse of real socialism and the Eastern bloc was peaceful.

³ Cf. Norbert F. Tofall: China's change through trade. And the fatal confusion with "change through rapprochement", Commentary on Economics and Politics by the Flossbach von Storch Research Institute, 14 October 2022, p. 7.

⁴ Cf. ibid. p. 7.

⁵ Cf. ibid. p. 7-8.

⁶ This was pointed out this week by Niall Ferguson: The Second Cold War Is Escalating Faster Than The First, Bloomberg, 21 April 2024, online: www.bloomberg.com/opinion/articles/2024-04-21/china-russia-iran-axis-is-bad-news-for-trump-and-gop-isolationists

⁷ Cf. ibid.

Legal notice

The information contained and opinions expressed in this document reflect the views of the author at the time of publication and are subject to change without prior notice. Forward-looking statements reflect the judgement and future expectations of the author. The opinions and expectations found in this document may differ from estimations found in other documents of Flossbach von Storch AG. The above information is provided for informational purposes only and without any obligation, whether contractual or otherwise. This document does not constitute an offer to sell, purchase or subscribe to securities or other assets. The information and estimates contained herein do not constitute investment advice or any other form of recommendation. All information has been compiled with care. However, no guarantee is given as to the accuracy and completeness of information and no liability is accepted. Past performance is not a reliable indicator of future performance. All authorial rights and other rights, titles and claims (including copyrights, brands, patents, intellectual property rights and other rights) to, for and from all the information in this publication are subject, without restriction, to the applicable provisions and property rights of the registered owners. You do not acquire any rights to the contents. Copyright for contents created and published by Flossbach von Storch AG remains solely with Flossbach von Storch AG. Such content may not be reproduced or used in full or in part without the written approval of Flossbach von Storch AG.

Reprinting or making the content publicly available – in particular by including it in third-party websites – together with reproduction on data storage devices of any kind requires the prior written consent of Flossbach von Storch AG.

© 2024 Flossbach von Storch. All rights reserved.