AIIB Affirmative

Glossary / Files Notes

Glossary of Important Terms

Asian Infrastructure Investment Bank (AIIB) --- lots more information on this below in
the “Background Info on AIIB” section
Runde, et. al, 15 --- director of the Project on Prosperity and Development and holds the
William A. Schreyer Chair in Global Analysis at CSIS (3/20/15, Daniel Runde is director of the
Project on Prosperity and Development and holds the William A. Schreyer Chair in Global
Analysis at CSIS. Matthew P. Goodman is the William E. Simon Chair in Political Economy and
senior adviser for Asian economics at CSIS. Conor Savoy, deputy director of the Project on
Prosperity and Development, and Amy J. Studdart, deputy director of the Simon Chair in
Political Economy, also contributed, “The Asian Infrastructure Investment Bank,”
http://csis.org/publication/asian-infrastructure-investment-bank, article downloaded 4/23/16,
JMP)
Q1: What is the Asian Infrastructure Investment Bank (AIIB)
A1: The AIIB is a multilateral development bank that will finance infrastructure needs in the
Asia Pacific region. There are two prominent multilateral development banks already working on
development needs in the region: the Asian Development Bank (ADB) and the World Bank, with
the ADB also investing the majority of its funds in infrastructure projects.
The AIIB was first proposed by Chinese President Xi Jinping at the October 2013 Asia Pacific
Economic Cooperation (APEC) meeting in Indonesia as a means of leveraging Chinese financial
capital and experience in infrastructure development to bridge the widely acknowledged
“infrastructure gap” in Asia. The bank was established by a Memorandum of Understanding
signed by 21 countries in October, 2014. The MOU specifies that it will have authorized capital
of $100 billion, with initial subscribed capital of $50 billion. As of March 18th, the bank has 32
members, including 6 non-regional members. Notable regional powers that have signed on
include India, Vietnam, the Philippines, Indonesia, and New Zealand. Last week, the United
Kingdom announced that it would join the AIIB; this announcement triggered similar statements
by Germany, Luxembourg, France, and Italy. Australia, which up until now refused to join, has
now signaled that they may sign on to the Bank.
The bank is part of a broader agenda being pursued by Beijing to create new regional and global
economic institutions, including the New Silk Road infrastructure fund and the BRICS led New
Development Bank. The AIIB is the most high profile and fleshed out initiative. These are seen
as being separate from and potential challengers to the existing U.S.-led Bretton Woods
institutions such as the World Bank and Asian Development Bank. China has indicated that it
would be open to Japanese and American membership in the Bank, though at this moment that
appears unlikely.
As it stands, China will control the largest voting share (at present, somewhere around 36
percent), although the exact degree of control will be determined by the final governance
structure of the bank, which remains uncertain.

The Silk Road Economic Belt and the 21st century Maritime Silk Road
Sometimes referred to as the Belt and Road Initiative, The Belt and Road (B&R) or The One
Belt One Road (OBOR). Unveiled in 2013 and designed to better connect China to rest of Asia
and Europe.

Bretton Woods Institutions

Bretton Woods Project 15 (8/23/15, “What are the Bretton Woods Institutions?”
http://www.brettonwoodsproject.org/2005/08/art-320747/, article downloaded 6/17/16, JMP)
The Bretton Woods Institutions are the World Bank, and the International Monetary Fund (IMF).
They were set up at a meeting of 43 countries in Bretton Woods, New Hampshire, USA in July
1944. Their aims were to help rebuild the shattered postwar economy and to promote
international economic cooperation. The original Bretton Woods agreement also included plans
for an International Trade Organisation (ITO) but these lay dormant until the World Trade
Organisation (WTO) was created in the early 1990s.
The creation of the World Bank and the IMF came at the end of the Second World War. They
were based on the ideas of a trio of key experts – US Treasury Secretary Henry Morganthau, his
chief economic advisor Harry Dexter White, and British economist John Maynard Keynes. They
wanted to establish a postwar economic order based on notions of consensual decision-making
and cooperation in the realm of trade and economic relations. It was felt by leaders of the Allied
countries, particularly the US and Britain, that a multilateral framework was needed to overcome
the destabilising effects of the previous global economic depression and trade battles.
In his opening speech at the Bretton Woods conference, Henry Morganthau said the
“bewilderment and bitterness” resulting from the Depression became “the breeders of fascism,
and finally, of war”. Proponents of the new institutions felt that global economic interaction was
necessary to maintain international peace and security. The institutions would facilitate, in
Morganthau’s words, “[the] creation of a dynamic world community in which the peoples of
every nation will be able to realise their potentialities in peace”.
The IMF would create a stable climate for international trade by harmonising its members’
monetary policies, and maintaining exchange stability. It would be able to provide temporary
financial assistance to countries encountering difficulties with their balance of payments. The
World Bank, on the other hand, would serve to improve the capacity of countries to trade by
lending money to war-ravaged and impoverished countries for reconstruction and development
projects.
Asian Development Bank (ADB)
http://www.investopedia.com/terms/a/asian-development-bank.asp
Asian Development Bank
DEFINITION of 'Asian Development Bank'
Founded in 1966, its headquarters are in Manila, Philippines. The Asian Development Bank's
primary mission is to foster growth and cooperation among countries in the Asia-Pacific Region.
It has been responsible for a number of major projects in the region, raising capital through the
international bond markets.
BREAKING DOWN 'Asian Development Bank'
The two largest shareholders of the Asian Development Bank are the United States and Japan.
Although the majority of the Bank's members are from the Asia-Pacific region, the industrialized
nations are also well represented. Regional development banks usually work in harmony with
both the International Monetary Fund and the World Bank in their activities.

Note about IMF Reform / CP Reform Existing MDBs

The “IMF Reform” argument was originally part of the larger counterplan to beef up existing
Multilateral Development Banks (MDBs) and better integrate China into them. After cutting a
few articles I realized that Congress, completely unexpectedly, actually passed the IMF reforms
in December (they were originally negotiated in 2010). Some of the counterplan evidence written
prior to the end of 2015 includes a number of necessary recommendations, including
congressional passage of IMF reform. I ultimately decided to include the IMF reform argument
in the “case” section but wanted you’all to be aware of its relationship to / overlap with some
parts of the counterplan.

Special Thanks to Collin Roark for his help the negative file.
 Background Info on AIIB

Great Overview of the Issue

http://www.nytimes.com/2015/12/05/business/international/china-creates-an-asian-bank-as-the-
us-stands-aloof.html?_r=0

“Demystifying the AIIB: Implications for China, Japan, and the United States”
https://www.youtube.com/watch?v=XpgGRQn5mdQ

“Comments on the China-sponsored Asian Infrastructure Investment Bank”

https://piie.com/events/comments-china-sponsored-asian-infrastructure-investment-bank

AIIB President speaking at Brookings Institute

http://www.ciel.org/sibling-or-rival-jin-liqun-of-new-asian-infrastructure-investment-bank-
speaks-at-brookings/

1AC
 1ac China Rise Adv

China’s rise is inevitable --- U.S. failure to seek membership in the AIIB sends the
signal that it doesn’t want to integrate China into global economic governance and
crushes America’s ability to shape the global order
Wyne, 15 --- contributing analyst at Wikistrat, and a global fellow with the Project for the Study
of the 21st Century (4/7/15, Ali, “The American World Order and China’s New Bank,”
http://warontherocks.com/2015/04/the-american-world-order-and-chinas-new-bank/, article
downloaded on 5/3/16, JMP)
The United States has sensibly declared its intention to rebalance towards the Asia-Pacific, which
is increasingly the nerve center of the world economy. Republican and Democratic administrations
have consistently, moreover, affirmed that they embrace the rise (or resurgence, depending on one’s
perspective) of China. Assistant Secretary of State for East Asian and Pacific Affairs Daniel Russel
articulated that consensus in congressional testimony last summer:

We view China’s economic growth as complementary to the region’s prosperity, and China’s expanded
role in the region can be complementary to the sustained U.S. strategic engagement in the Asia-Pacific.

The administration’s handling of the Asian Infrastructure Investment Bank (AIIB), however,
illustrates the difficulty the United States is having as it tries to align its mindset with its rhetoric .

China announced that 46 countries have either joined or applied to be members of the AIIB —
among them several close U.S. allies in Europe and Asia. The outcome evidently surprised the
United States, which had lobbied them heavily to stay away from the enterprise. Now the White
House has tempered its position and is proposing that the AIIB work in partnership with established
development institutions such as the World Bank and the Asian Development Bank.

Even if China’s motives in launching the AIIB are purely self-interested, the bank responds to a pressing
need. According to an August 2014 policy note by the G-20, “the OECD estimates that $70
trillion in additional infrastructure capacity will be needed globally” by 2030. A January 2013
report by the World Economic Forum forecasts that $5 trillion of such investment will be
required through then (translating to $75 trillion over the next 15 years). While the need for
infrastructure may be greatest in Asia, it is universal; as such, the decision by some close U.S.
allies to apply for membership in the AIIB is less about begrudging acquiescence to China’s
strategic preferences than about a sensible assessment of the gains to be had by participating in
the economic initiatives of a country that continues to grow by over 7 percent annually and is
poised to have the world’s largest economy.
Observing the swift progress the bank has made, Jane Perlez notes that “the institutions backed by
the United States have not met the growing demands for roads, railroads, and pipelines in Asia .” A
former high-ranking Treasury official told me that the United States is hamstrung in this aspect
of its competition with China, partly because of Congressional dysfunction and partly because of
the private-sector orientation of the country’s economy. In China, however, government has long
played an outsized role in the economy, and Xi Jinping has proven an astute practitioner of geo-
economic statecraft.
The defensiveness with which the United States initially reacted is disproportionate to the challenge the
AIIB poses — for now, at least. Erik Voeten cautions against concluding that “modest shifts in the
distribution of where aid comes from will have seismic geopolitical consequences.” He also
notes that China’s “patchwork of [bilateral and regional trade] agreements does not form a
substitute for the global market access that the WTO provides.” More importantly, though,
America’s hesitation to embrace the AIIB sends a concerning signal to the Asia-Pacific : Its allies in the
region do not want to have to “choose” between the United States and China. Instead, they seek to
strengthen their military and diplomatic ties with the former while sharing in the economic fruits
of the latter’s rise. The more the United States appears to be trying to force a choice, the more its
allies in the region will, if reluctantly, side with China. China is a permanent resident of the Asia-
Pacific, after all, while the United States is a distant power.
By declaring it would not apply for membership in the AIIB, the United States reinforced the
impression that it is resistant to China’s further integration into the institutions of global economic
governance — an impression that is especially regrettable considering that the United States has done
more than any other country to facilitate that very incorporation .

Strengthening that view is Congress’s ongoing failure to ratify a set of December 2010 reforms
by the International Monetary Fund (IMF) that would roughly double the fund’s “private equity,”
shift over 6 percent of quota shares to emerging-market and developing countries (EMDCs), and
make four EMDCs (Brazil, Russia, India, and China) among the fund’s ten largest shareholders,
with China becoming the third-largest member country. Last March a group of nearly 100
academics and policymakers argued that Congressional approval of those reforms would
contribute to “involving emerging powers more deeply in the institution and avoiding their
disengagement.” Continuing to stall, they warned, “would diminish the role of the United States
in international economic policymaking.” U.S. Treasury Secretary Jacob Lew affirmed that
assessment in testimony last month before the House Committee on Financial Services:
Our international credibility and influence are being threatened….The IMF reforms will help
convince emerging economies to remain anchored in the multilateral system that the United
States helped design and continues to lead.
A rising China will inevitably deploy initiatives that reflect its vision of a more inclusive, Asia-
centric economic system where aid is disbursed and infrastructure provided with few strings
attached. Delaying reforms of the IMF, the World Bank, and comparably influential economic
institutions will only incentivize it to do so more aggressively and with less regard for U.S.
preferences. A rising China will also, inevitably, demand a greater role for the yuan; already,
Germany and Australia have declared their support for that push, and IMF Managing Director
Christine Lagarde believes the yuan’s inclusion in the basket of global reserve currencies —
presently including the dollar, the euro, and the yen — is inevitable.
The United States can continue to play a central role — even the central role — in the evolution of
world order, but not if it attempts to stall or reverse deeply rooted system-level trends: The rise of
China is one, as is, more broadly, the movement of the world’s center of economic gravity to the Asia-
Pacific. While one may dispute Larry Summer’s proposition that “the United States lost its role as
the underwriter of the global economic system” last month, it is difficult to disagree that the
Bank’s success “should lead to a comprehensive review of the U.S. approach to global economics .”
Such a review would likely conclude that including China in its economic initiatives and participating in
China’s gives the United States more leverage to shape the Asia-Pacific’s economic order —and
economic order writ large—than, respectively, excluding China and shunning its efforts .

U.S. concerns over Chinese governance prevents efforts to positively reform the
AIIB and facilitate multilateral diplomacy and deep cooperation with China
Edwards & Qahir, 15 --- *Associate Professor of Diplomacy and International Relations,
Seton Hall University, AND **Diplomacy graduate student at Seton Hall (4/6/15, Martin &
Katayon, “US should stop blocking China’s AIIB and join allies in new club,”
https://theconversation.com/us-should-stop-blocking-chinas-aiib-and-join-allies-in-new-club-
39406, article downloaded 4/23/16, JMP)
China’s growing economic clout is complicating US efforts to maintain its grip on the world’s leading
multilateral economic institutions – as it’s done since the end of World War II.

The creation of the Asian Infrastructure Investment Bank (AIIB), established last year by China
and many other Asian countries, has brought this challenge and how to address it front and center .
The AIIB is similar to the Asian Development Bank (ADB) and the World Bank – in that it’s
intended to finance infrastructure investments – except that it will serve more as an instrument of
Chinese rather than Western influence.
Thus far, the US has reacted by trying to marginalize the bank’s impact, urging other Western
powers to follow its lead and steer clear. As we’ve seen in recent weeks, that strategy has failed
miserably, with Australia, the United Kingdom, France, Germany and even Taiwan now
interested in becoming founding members. Of the major powers, only Japan has continued to
follow its ally’s lead.
This represents a serious setback for the White House’s ability to lead the international economic
order on its own terms. While the narrative of the day is that of a policy defeat for the Obama
administration, some larger points are worth noting.
Manage multilateralism, don’t block it

First, the very existence of the AIIB is a self-inflicted problem for the US. It could have been
avoided had the US been willing to cede some power at the IMF and ADB.
Second, objections to European and other Western countries joining it are shortsighted because
the best way to influence its actions is by being on the inside .

Finally, the AIIB is a good thing for both China and the US over the long term as it shows the rising
power’s interest in taking on more global responsibilities – exactly what the White House has sought –
so arguments against it are counterproductive.
Hoisted on its own petard
The AIIB is intended to solve a problem by providing money to support the trillions of dollars of
infrastructure investment that emerging markets will need in coming years.
With a veritable ocean of foreign exchange at its disposal, creating a regional development bank
right now makes perfect sense for China. It is a vehicle for the Chinese government to help aid
regional development as well as a signpost to demonstrate its international prestige.
But China would not have been so willing to create its own international bank had it felt
appropriately valued in the ones that already exist. What is frequently omitted in the discussion
of the AIIB is the extent to which this problem was created by dysfunction between Washington
and Tokyo over reforming the Asian Development Bank, as well as within Washington around
International Monetary Fund reform.
The Asian Development Bank has been dominated by the US and Japan since its creation in
1966. China is the largest economy in Asia, while only the third-largest shareholder in the Asian
Development Bank. As it has been custom that the president of the ADB is Japanese, Chinese
attempts to gain influence within the bank commensurate with its economy’s size have been
blocked.
Similarly, IMF reform was proposed in 2010 by the G20. Under the proposed reforms, China’s
voting power was to double, making it the third-largest shareholder at the IMF behind only the
US and Japan. Brazil and India would both become top-ten “quota-holders” as well, displacing
Saudi Arabia and the Netherlands. In this manner, global economic governance would be
reinvigorated, as these emerging economies would receive a voice at the IMF equivalent to their
influence.
Though IMF reform has been approved by more than 150 countries, including many that would
lose influence under the proposals, the US Congress has refused to budge.
Despite warnings from the rest of the G20 underscoring the urgency of passing the reforms,
Congress has sought to squeeze compromises on the IRS and healthcare from the White House
in exchange for its support.
While the Obama Administration wants the reforms, it has refused to sacrifice its signature
health care law or link it to other measures. So at this point, IMF reform simply won’t happen in
the current Congress. Given China’s inability to produce reforms of the existing development
banks that would address China’s concerns, its move to create its own development bank was its
only way forward.
US objections are shortsighted
Washington has been on the wrong side of this issue by dismissing the AIIB rather than
celebrating it.
For the past year, the White House has raised concerns about how the new bank would operate,
suggesting that the AIIB would have insufficient safeguards .
The AIIB might undercut the World Bank and the Asian Development Bank, the argument goes,
as countries might prefer the promise of cheap money from Beijing without the strings the other
lenders attach. But questioning Chinese governance of the bank not only reminds our allies of our
shortcomings in IMF reform, it also overlooks the surest route to reforming the AIIB .

Cooperation is always more difficult in large groups with divergent preferences than smaller
ones. The growing list of AIIB members (including South Korea, Norway and Denmark) means that
the Chinese will have to accommodate those countries concerned about safeguards.

Rather than push back on AIIB, the US should welcome the participation of many countries. It will
fall to China to figure out how to reconcile this diverse membership. This will ensure that fighting
climate change and improving environmental standards will not be sacrificed in favor of growth at any
cost.

Chinese engagement should be welcomed

For years, Washington has sought to encourage China to be a “responsible stakeholder” in the global
economy. The AIIB demonstrates that China seeks to embrace this challenge, and the fact that it is doing
so multilaterally rather than bilaterally should not be overlooked .

The US has helped to support regional development banks in Africa and Europe, so a new one in
Asia should not be the threat that it is made out to be. The need for infrastructure in emerging
Asian economies is so acute that the two banks need not be in competition.
Embracing AIIB will help keep US-Chinese relations moving forward by moving beyond the sharp
rhetoric of recent weeks. It will also give us a means to smooth over relations with European allies .
More importantly, joining the AIIB gives the US a seat at the table, and a way to work with allies to
moderate Chinese behavior.

What will make the difference in the long term in shaping US relationships with Asia is working with
allies to address common challenges. Multilateral diplomacy is not just a means to an end, but an end
in itself, and enmeshing China in a network of international organizations, regardless of who created
them, provides the best route for deepening cooperation between the US and the People’s Republic
of China.

Engaging on the AIIB is critical --- it’s the focal point for China’s expanded
international role and cooperation will help resolve Myanmar conflict and spillover
to cybersecurity and the South China Sea
Noori, et. al, 15 --- Program Specialist, Middle East & North Africa Programs at United States
Institute of Peace (8/24/15, Maral Noori, Daniel Jasper and Jason Tower, “Overcoming Barriers
to U.S.-China Cooperation,” http://www.usip.org/publications/2015/08/24/overcoming-barriers-
us-china-cooperation, downloaded on 4/21/16, JMP)
In 2011, U.S. president Barack Obama announced plans to "pivot" toward Asia. In 2012, Chinese
president Xi Jinping expressed his hope for "a new type of relationship" with the United States. A lack
of strategic trust between the two countries, however, prevents critically needed productive
cooperation. This Peace Brief addresses the misunderstandings behind this mistrust and a
possible way to move beyond them.
Summary
The United States has urged China to take on greater international responsibility and to
leverage its rise to power by adhering to international law and urging its strategic partners to do
the same. However, Beijing’s adherence to its principle of noninterference has drawn sharp U.S.
criticism, as has its tendency to support incumbent governments in contentious states.
Beijing is presenting a more flexible and proactive foreign diplomacy. At the same time, it is
concerned about U.S. military policies and diplomatic campaigns seemingly targeted at
containing China or undermining Chinese efforts to influence global institutions.
Identifying common ground is more imperative than ever if what Beijing calls a "new type of
major country relations" are to be manifest in cooperative frameworks, policies, and joint
initiatives.
Washington and Beijing need to build strategic trust, overcome domestic policy hurdles,
demonstrate their willingness to participate as leaders in the international community, and better
coordinate to fill gaps in global governance and development issues.
About this Brief
In April 2015, the American Friends Service Committee (AFSC) and the United States Institute
of Peace (USIP) convened government officials and leading policy analysts from the United
States and China to discuss how both countries can jointly support peace and development
initiatives. These discussions, implemented collaboratively with the Chinese People’s association
for Peace and Disarmament and the China Foundation for Peace and Development, informed this
Peace Brief. Maral Noori is a program specialist at USIP. Daniel Jasper is the public education
and advocacy coordinator for Asia at the AFSC. Jason Tower is the East Asia Quaker
International Affairs representative at the AFSC.
Introduction
In late 2011, the Obama administration announced plans to "pivot" toward Asia, and in late
2012, shortly after taking office, Chinese president Xi Jinping expressed his desire for "a new
type of relationship between major countries in the twenty-first century."1 Chinese
interpretations of these relations usually highlight a greater voice in global governance and
sharing power with the United States. Yet many in Washington think that Beijing’s true
intentions are to challenge the U.S. presence in Asia at a time when Washington intends to
consolidate its regional leadership. Many U.S. analysts point to Chinese initiatives such as the One
Belt One Road or the Asian Infrastructure Investment Bank (AIIB) to argue that China is pushing to
reshape international institutions and responding aggressively to Washington’s initiatives . Chinese
experts point to U.S. diplomatic efforts to undermine Chinese initiatives and argue that Washington is
trying to contain China in Asia. They also question U.S. policies, which they insist exacerbate
tensions over regional maritime disputes. Both nations’ directives leave ample room for
interpretation and have added to mounting tensions. Because misunderstandings abound, identifying
common ground is imperative.

U.S.-China Relations and Global Governance

Washington has urged Beijing to take on greater international responsibility. From the U.S.
perspective, China should leverage its rise to power by supporting international law and urging
its strategic partners to comply. Response to chemical warfare in Syria was a key example as
Washington urged Beijing to agree to a UN intervention against the Assad regime. Beijing’s
preference for a softer approach and strict adherence to noninterference drew sharp criticism
from U.S. observers, who characterized it as irresponsible.
From Beijing’s point of view, China has prioritized international trade—particularly with the
United States—and investment mechanisms as it remakes its diplomacy, emphasizing that
security is rooted in development. Unbalanced governance structures in the International
Monetary Fund and World Bank have left China feeling slighted and unwelcome in global
financial discussions. Thus, the entry of Chinese state-owned enterprises into developing markets
created competition in spaces where formerly the United States and Bretton Woods institutions
held comfortable control. China offered developing nations less restrictive terms for
development aid, investment capital, and trade, which proved a boon to Latin America and
Africa. The creation of the AIIB highlights Beijing’s understanding of its new role. Beijing prioritizes
economic contributions and investment in its global engagement in shouldering its fair share of
international responsibilities. U.S. efforts to halt AIIB exemplify Washington’s distrust of Chinese
foreign investment and reinforce China’s perceptions that the United States does not welcome China’s
economic rise. For its part, Washington asserts the existence of serious gaps in the social and
environmental safeguards of Chinese-supported efforts—concerns echoed by civil society
representatives across the developing world.
On global policy issues, Beijing tends to focus on economics and Washington on security. Were
this to emerge as a division of labor, however, neither party would benefit. It is critical that a
shared security incorporate both domains. In recent months, bilateral cooperation on global
nontraditional security issues has seen some success. In April, the Chinese Ministry of Public
Security and the U.S. Department of Homeland Security held their first ministerial meeting,
signaling at least a willingness to discuss joint efforts. The two powers also found grounds for
collaboration during the Ebola crisis in West Africa—as evidenced by a Chinese-trained Liberian
engineering firm helping establish the U.S. Ebola Treatment Center. These measures may seem
like basic starting points but have provided camaraderie in the security realm. In more contentious
cases, such as Myanmar, cooperation has proven elusive despite a track 1.5 dialogue. Challenges
include not only lack of mutual trust but also local Myanmar concerns.
Since opening up, Myanmar has moved a little closer to the West. China considers this suspect, even
conspiratorial. Many in Beijing viewed Burmese protests to stop construction of the Chinese-
backed Myitsone Dam as Washington’s doing. Yet Washington’s interest in Myanmar has largely
been economic. Myanmar is a vast, untapped, and resource-rich market. For Beijing, conflict on the
Sino-Myanmar border and the proximity of Washington’s focus make Myanmar a security issue. This
intersection of economic and security concerns looks like a crisis but could be an opportunity. China’s
economic involvement could help provide the infrastructure necessary for Myanmar to become a viable
market. In turn, the United States could work more productively with China to ensure that
development is inclusive, safe, and profitable . Additionally, given the sixty-year civil war and talks for
a nationwide cease-fire, U.S. and Chinese support to help end the conflict is needed now more than
ever.

Finding common ground on which to build a more trusting relationship, then, needs to be a priority in
both Chinese and U.S. foreign policy agendas.

Strategic Trust
Lack of strategic trust between the United States and China prevents productive cooperation. Both sides
have largely continued to act as if their relationship is a zero-sum game. These tensions have only
intensified over recent security concerns in the East China Sea and the South China Sea. Moreover,
Washington has cited concerns about Beijing’s steady increase in military spending, from $10
billion in 1997 to $145 billion in 2015, and sees China as a direct threat to its allies and interests
in the Asia-Pacific.2 Beijing sees the U.S. military presence in the region and across Asia as its
greatest security threat. It is also keenly aware that Washington maintains the world’s highest
military spending, up from $560 billion in 2015 to a requested $585 billion in 2016.3
Washington also routinely accuses Beijing of cyber attacks on government agencies—most
recently in June 2015 when both the Office of Personnel Management’s systems and corporate
computer systems were breached.
Both sides lack strategic trust in trade, despite China being Washington’s second largest trade
partner ($592 billion in 2014).4 A sense of competition is constant. As Washington pushes
forward with the Trans-Pacific Partnership, Beijing pursues the Regional Comprehensive
Economic Partnership. Each framework tacitly excludes the other country, underscoring the
mistrust. Further, the two nations continue to compete for influence in Myanmar, a nascent
democracy still threatened by conflict.
Points of tension should not prevent the United States and China from overcoming their
challenges, enhancing cooperation, and fostering deeper mutual understanding and strategic
trust. The private sectors and nongovernmental organizations on both sides could launch this
process by enhancing their own cooperation.
Ultimately, Washington and Beijing need to compartmentalize early on and hope that positivity on
some ends—such as cooperation in Myanmar—will spill over to others—such as cyber security and
the South China Sea. Both sides will need to commit to greater transparency so that in a moment of
crisis, chances are minimal for misunderstanding to lead to a major conflict.

Domestic Politics
Political interests undermine the bilateral relationship. U.S. hard-liners fear an increasingly
powerful China. The military threat is used both to rationalize increasing U.S. defense funding
and to counter any Obama administration attempt to constructively engage China. Even the U.S.-
China climate change and clean energy cooperation joint announcement was denounced, with
Republicans complaining that China would not be required to make changes for sixteen years.5
Similar hard-line Chinese sentiments are a growing trend. Conspiracy theories or perceived
illintentions related to U.S. policies abound, and nearly any negative outcome in China’s foreign
diplomacy is blamed on Washington. The political transition in Myanmar is an example.
To prevent domestic politics from inhibiting constructive cooperation, both the Obama and Xi
administrations should devise strategies to manage the impacts of interest groups on the
relationship. Such strategies might include more talks to repair damaged cooperative efforts,
such as civilian nuclear cooperation (a current point of contention on Capitol Hill), or perhaps to
explore Chinese mediation in U.S.-North Korea relations. Another option might be to establish a
track II dialogue on the impact of interest groups on the relationship that could generate stronger
awareness of the dynamics.
Willingness
Although Washington is intent on spreading liberal democracy and continuing as a global leader,
Beijing demonstrates growing commitment to what President Xi terms "strive to achieve"—a
more active involvement in global governance and international affairs.6 This policy looks to
reshape China’s traditional approaches to foreign development assistance, trade, and investment.
Washington, on the other hand, is often willing to step within another state’s boundaries to
confront conflict and fulfill what it sees as its responsibility as a global leader. A willingness gap
in the relationship is clear as both countries struggle to adhere to their foreign policy principles in
a changing global arena.
Beijing and Washington need to continue to show flexibility in their foreign policy. Extreme applications
of principles damage each side and their ability to cooperate constructively. Perhaps it is time for them to
change their political narratives and take on their shared role in the international community. The AIIB
is one arena for such cooperation. Because its rules and guidelines have yet to be fully defined,
the AIIB provides Western states an opportunity to share experiences with China and China an
opportunity to integrate its approach to development with those that other states have already developed.

Capability
The final barriers to cooperation involve capability. China is newer to the field of peace and
development, has yet to fully establish the AIIB, and has only recently become a major
contributor to UN peacekeeping missions. Meanwhile, the United States can no longer provide
the support needed in least developed countries, a gap further handicapped by congressional
emphasis on U.S. defense rather than development and humanitarian assistance.
China and the United States can be complementary. China is strong in engineering, construction, and
infrastructure, and the United States is strong in developing risk and security guidance—areas where
Chinese and Western analysts alike have pointed out key gaps in Chinese approaches. For optimal impact,
the two countries need to coordinate their development efforts.

Conclusion

As security tensions continue to rise in Asia and as China begins launching global
initiatives, it is imperative that Washington and Beijing find ways to collaborate.
As Beijing academic Wang Jisi recently wrote, both countries risk seeing the emergence of competing
global institutions, which may result at best in wasted resources and at worst in deeper conflict and
tensions across the developing world.

The AIIB is a possible starting point. Fifty-seven countries signed the bank’s charter in
June 2015, and the bank has emerged as a global initiative promising to remake the face of
global finance. Washington might be well advised to engage with the AIIB. Because
the AIIB will target infrastructure and development projects in least developed countries and conflict
hotspots, its emerging portfolio is an opportunity for Chinese-U.S. cooperation. Development lending
could prove a minimally politically sensitive testing ground.

South China Sea conflict goes nuclear.

Christensen 6/5/15 – Thomas J., Boswell professor of world politics and director of the China
and the World Program at Princeton University, is a former U.S. deputy assistant secretary of
state for East Asian and Pacific affairs, “China's Rising Military: Now for the Hard Part”
http://www.bloombergview.com/articles/2015-06-05/china-s-rising-military-now-for-the-hard-
part
One reason for this is that no consensus exists in East Asia on the territorial status quo , as there did between the two Cold
War camps in most regions of the world. The People’s Republic of China, in the center of a region of great importance, has
maritime
sovereignty disputes with several of its neighbors, including two formal U.S. allies (Japan and the Philippines) and one security
partner (Taiwan). Laboratory research on prospect theory , a psychological exploration of risk-based decision-making,
demonstrates that most actors accept much bigger risks and are willing to pay larger costs to defend what they
believe is rightfully theirs than to obtain new gains at others’ expense. In a world in which conventional conflict could
conceivably escalate to nuclear war, this human tendency is a force for stability; attacks across recognized boundaries by
either side would be risky, and deterrence against such attacks is relatively credible. But in East Asia today, governments draw
competing maps about the maritime domain. There are significant differences between mainland China and
Taiwan about the sovereign status of the government on the island, and between China and Japan over who owns the islands known as
Senkaku in Japan and Diaoyu in China. There is also disagreement among China, Taiwan, the Philippines, Vietnam,
Brunei and Malaysia over ownership of islands, rocks and reefs in the South China Sea. We should take no comfort in the apparent
sincerity of all the claimants. If all actors truly feel they are defending rightful claims against the revisionism of others,
the chicken game of international security politics is more likely to lead to a deadly collision. These
disputes are fueled by historical victimhood narratives and postcolonial nationalism. For the countries
involved, defending sovereignty claims and recovering allegedly stolen territories are core missions. China is no exception.
Since the 2008 financial crisis, China has been more confident abroad and more afraid at home. The country's elite
and its citizens feel that its power position on the international stage has improved drastically. But the foundations of its export-led and
investment-fueled growth model were shaken at the same time. Top
leaders worry about rising social discontent . It isn't a
good time for Chinese leaders to look weak on defense. And China doesn't have to be the actor that sparks a dispute for
tensions to escalate. In 2010, for example, China often reacted sharply to events initiated by others, such as Japan’s arrest of a Chinese fishing
boat captain and crew near the Senkaku Islands. Since then we have seen a mix of Chinese assertiveness -- such as its placement and then
removal last year of an oil rig in waters disputed with Vietnam and its continuing land reclamation projects on South China Sea reefs -- and its
abrasive reactions to others’ actions, such as an upgraded Chinese maritime presence near the Senkakus since the Japanese central government
purchased some of the islands from a private Japanese family in 2012. The
Chinese leadership could use its conventional
military power to threaten U.S. partners and to impose high costs on U.S. forces if they intervened to assist their
allies. The ability to conduct such asymmetric warfare against the U.S. can potentially affect how disputes are managed in
peacetime and who might prevail politically if a fight were to occur. The U.S. has ways to reduce a threat posed by China’s ability to wage
asymmetric warfare. But a future U.S. president might be reluctant to use some of the more effective methods the American military has at its
disposal -- such as destroying or disabling military targets on the Chinese mainland -- especially early in a conflict when such measures would be
most effective. For example, attacking China's potent ballistic missiles, their launchers and their command-and-control systems before the
missiles strike U.S. bases and surface ships would be an efficient way to reduce the threat. Chinese submarines, which can fire torpedoes and
cruise missiles or lay sea mines, pose another potential threat. TheU.S., all things being equal, might be tempted to attack
submarine ports and naval command-and-control systems on Chinese soil. But all things are not equal. No U.S.
president has ever launched robust conventional attacks against the homeland of a nation with nuclear
retaliatory capability. Moreover, the conventional mobile ballistic missiles and submarines China has
developed to counter superior U.S. forces overlap dangerously with the land-based missiles and
submarines that China is developing to provide a secure nuclear retaliatory capability. If the U.S. were to
attack missile systems and submarines for the purpose of protecting against conventional attack early in a conflict, Washington could
unintentionally compromise portions of China’s nuclear arsenal as well. Chinese leaders could mistakenly view
this as an attempt to eliminate China’s nuclear deterrent, risking escalation. China adheres publicly to a no-
first-use doctrine on nuclear weapons, a position that would seem to mean that no amount of conventional firepower leveled against it would
cause it to resort to a nuclear response. But internal Chinese military writings suggest that no-first-use is more of a
guideline than a rule and doesn't necessarily apply under conditions in which a technologically superior foe
attacks crucial targets with conventional weapons.

The suspicious atmosphere allows military conflict to erupt at any time --- both sides
must manage competition to prevent war and expand cooperation on global
governance issues that represent existential risks
Shambaugh, 15 – professor of political science and international affairs at George Washington
University, and a nonresident senior fellow at the Brookings Institution (David, “In a
fundamental shift, China and the US are now engaged in all-out competition,” South China
Morning Post, 6/11/15, http://www.scmp.com/comment/insight-
opinion/article/1819980/fundamental-shift-china-and-us-are-now-engaged-all-out?page=all
//Red+JMP)
The relationship between the United States and China has rightly been described as the most important
relationship in world affairs. It is also the most complex and fraught one. These two titans are the
world's two leading powers and are interconnected in numerous ways bilaterally, regionally, and
globally. vc It is therefore of vital importance to understand the dynamics that underlie and drive
this relationship at present, which are shifting.
While Washington and Beijing cooperate where they can, there has also been steadily rising
competition in the relationship. This balance has now shifted, with competition being the dominant
factor. There are several reasons for it - but one is that security now trumps economics in the
relationship.

The competition is not only strategic competition, it is actually comprehensive competition:

commercial, ideological, political, diplomatic, technological, even in the academic world where
China has banned a number of American scholars and is beginning to bring pressure to bear on
university joint ventures in China.
Mutual distrust is pervasive in both governments, and is also evident at the popular level. The last
Pew global attitudes data on this, in 2013, found distrust rising in both countries. Roughly two-
thirds of both publics view US-China relations as "competitive" and "untrustworthy" - a
significant change since 2010 when a majority of people in both nations still had positive views
of the other.
One senses that the sands are fundamentally shifting in the relationship. Viewed from Washington, it
is increasingly difficult to find a positive narrative and trajectory into the future. The
"engagement coalition" is crumbling and a "competition coalition" is rising. In my view, the
relationship has been fundamentally troubled for many years and has failed to find extensive
common ground to forge a real and enduring partnership. The "glue" that seems to keep it
together is the fear of it falling apart. But that is far from a solid basis for an enduring partnership
between the world's two leading powers.
The macro trajectory for the last decade has been steadily downward - punctuated only by high-level
summits between the two presidents, which temporarily arrest the downward trajectory . This has been
the case with the last four presidential summits. Occasionally, bilateral meetings like the Strategic
and Economic Dialogue, which will convene in Washington in two weeks' time, provide similar
stabilisation and impetus for movement in specific policy sectors . But their effects are short-lived,
with only a matter of months passing before the two countries encounter new shocks and the
deterioration of ties resumes.

The most recent jolts to the relationship, just a few months since Xi Jinping and Barack Obama
took their stroll in the Zhongnanhai (the so-called Yingtai Summit), have been the escalating
rhetoric and tensions around China's island-building in the South China Sea. Behind this
imbroglio lies rising concerns about Chinese military capabilities, US military operations near
China, and the broader balance of power in Asia.
But there have been a number of other lesser, but not unimportant, issues that have recently
buffeted the relationship in different realms - in law enforcement (arrests of Chinese for
technology theft and falsification of applications to US universities), legal (China's draft NGO
and national security laws), human rights (convictions of rights lawyers and the general
repression in China since 2009), cyber-hacking (of the US Office of Personnel Management
most recently) and problems in trade and investment. Hardly a day passes when one does not open
the newspaper to read of more - and serious - friction.

This is the "new normal" and both sides had better get used to it - rather than naively professing a
harmonious relationship that is not achievable.

This has given impetus to an unprecedented outpouring of commentary and reports by

Washington think tanks in recent months. I have lived and worked there a long time, and cannot
recall such a tsunami of publications on US-China relations - and they are all, with one exception
(Kevin Rudd's Asia Society report), negative in nature, calling for a re-evaluation of US policy
towards China, as well as a hardening of policy towards China across the board.
A qualitative shift in American thinking about China is occurring. In essence, the "engagement" strategy
pursued since Nixon across eight administrations, that was premised on three pillars, is unravelling.
The American expectation has been, first, as China modernised economically, it would liberalise
politically; second, as China's role in the world grew, it would become a "responsible
stakeholder" - in Robert Zoellick's words - in upholding the global liberal order; and third, that
China would not challenge the American-dominant security architecture and order in East Asia.
The first premise is clearly not occurring - quite to the contrary, as China grows stronger
economically, it is becoming more, not less, repressive politically. There are any number of
examples, but political repression in China today is the worst it has been in the 25 years since
Tiananmen. With respect to the other two, we are not witnessing frontal assaults by China on
these regional and global institutional architectures. But we are witnessing Beijing establishing a
range of alternative institutions that clearly signal China's discomfort with the US-led postwar order .
Make no mistake: China is methodically trying to construct an alternative international order.
This disillusion with China in America probably says much more about America than it does about
China. One pattern has repeated itself over the past two centuries of the relationship: America's
"missionary impulse" to transform China in its image has repeatedly been disappointed by not
understanding the complexities on the ground in China and by China's unwillingness to conform
to American expectations. So, once again, this seemingly has more to do with the United States
and its unrealistic expectations, than with China.
Despite this overall macro climate in the relationship, the United States and China still have to
coexist, and to do so peacefully if at all possible. We have business to do with each other - both
commercial and diplomatic business.
Perhaps the most immediate opportunity - and one that would give an enormous boost to the
relationship - would be the conclusion of a bilateral investment treaty. But negotiating this treaty
is hung up in the queue behind the Trans-Pacific Partnership agreement. Given the difficulty the
White House is having getting that agreement finalised and through Congress, there may be little
appetite in Washington to conclude an investment treaty with China this year.
Also high on the agenda at present is the real need to forge practical cooperation on a number of so-
called "global governance" issues, including North Korea, Iran, Islamic State, Afghanistan,
counterterrorism, anti-piracy, climate change, maritime security, economic stability, energy security,
sea-lane security, and setting global rules for cyber activity .

To date, China has been extremely reluctant to collaborate openly with the United States on such
global governance issues, but now it possibly seems more feasible. This is because President Xi has
personally endorsed more "proactive diplomacy" by China in the global governance arena . This won't
solve the problems in US-China relations, but it will help.
The upcoming Strategic and Economic Dialogue and Xi's September state visit to Washington
are golden opportunities to discuss these issues, try to forge tangible cooperation, and arrest the
negative dynamic in the relationship. The question is whether it will be temporary again, or a real
"floor" can be put beneath the relationship. If the past is any indicator, we should not expect too
much.
What worries me is that in this increasingly negative and suspicious atmosphere, "tests of credibility"
will increase. The best we can probably hope for over the next two to three years - as President Obama
becomes a lame duck and the election cycle stimulates more heated rhetoric about China - is
tactical management of the relationship, with sensitivity to each side's "red lines" and "core
interests", while hoping that no "wild card" events occur. This could include another military incident
in the air or at sea, or renewed tension over Taiwan.

Even the current situation in the South China Sea has real potential to haemorrhage, as China is
not going to stop its island-building activities and hence will not meet American demands that it
do so. Or if China, having fortified the islands, proclaims an air defence identification zone over
the South China Sea. What is Washington to do then? The potential for military confrontation is
not insignificant.

So, looking to the future, the key responsibility for both countries is to learn how to manage
competition, keep it from edging towards the conflictual end of the spectrum, while trying to expand
the zone of practical cooperation.

Neither country has any playbook to guide such a relationship. Henry Kissinger envisions what
he calls "co-evolution" between the two powers, but even he concludes that this will require
"wisdom and patience". But it is not at all clear to me that the respective political cultures and
existing political systems, national identities, social values, and world views will afford such a
strategic grand bargain today.
Thus, these two great nations are likely to find it increasingly difficult to coexist - yet they must.
However fraught, this is a marriage in which divorce is not an option. Divorce means war.

Independently, China will be forced to turn to aggressive military actions if the U.S.
doesn’t support its growing role in the global economy via the AIIB
Lipscy, 15 --- Assistant Professor of Political Science and the Thomas Rohlen Center Fellow,
Shorenstein Asia-Pacific Research Center, Freeman Spogli Institute for International Studies,
Stanford University (5/7/15, Phillip Y., “Who's Afraid of the AIIB; Why the United States
Should Support China's Asian Infrastructure Investment Bank,”
https://www.foreignaffairs.com/articles/china/2015-05-07/whos-afraid-aiib, downloaded 4/23/16,
JMP)
When China first proposed creating the Asian Infrastructure Investment Bank (AIIB) in 2013, it
generated considerable anxiety in Washington and many other capitals. Many pundits and
policymakers view the AIIB as a bid to undermine or replace the international architecture
designed by the United States and its allies since the end of World War II. Although several U.S.
allies, including Australia, Germany, and the United Kingdom, have declared their intention to
join the AIIB, others, including Japan, have expressed ambivalence. For its part, the United
States has made it clear that it will seek to influence the institution from the outside. But it would
be a mistake to shun or undermine the AIIB. Rather, it should be welcomed. Both the United States
and Japan have far more to gain by joining the AIIB and shaping its future than remaining on the
sidelines.
The details remain vague, but the AIIB is meant to be a multilateral development institution that
will focus on infrastructure needs in Asia. There is no question that this is a deserving cause.
Asia’s large population, rapid growth, and integration with the global economy all generate
demand for better infrastructure. A report by the Asian Development Bank (ADB) estimates the
region needs about $750 billion annually in infrastructure-related financing. Citing historical
underinvestment, McKinsey & Company, a global management consulting firm based in New
York City, proclaims a “$1 trillion infrastructure opportunity” in Asia. Although precise
estimates vary from one report to another, the broad point is uncontroversial: Asia needs more
infrastructure, and international financing can help.
Why, then, is the AIIB itself controversial? There are essentially two reasons. First, Western
governments fear that the AIIB will, in one way or another, undermine existing international aid
institutions. U.S. policymakers have publicly expressed concern that the AIIB will undercut
social and environmental standards adopted by existing institutions such as the World Bank and
International Monetary Fund (IMF). An underlying fear is that the AIIB could eventually
overshadow and undermine these institutions, which are based in Washington and seen as closely
reflecting U.S. interests. Japanese policymakers have expressed similar reservations.
Second, there is concern about China’s intentions within the broader context of its economic and
geopolitical rise. The AIIB signals that China intends to play a larger international role. Will
China act like a responsible stakeholder by further integrating itself into the existing world order,
or will it focus more on challenging U.S. hegemony by seeking to undermine and replace the
post–World War II international architecture? The AIIB seems to indicate that China is
interested in the second scenario. After all, why else would China choose to design its own
development institution from scratch rather than working through existing institutions?
Yet both sets of concerns are largely misplaced. The AIIB is highly unlikely to undermine existing aid
organizations, and the creation of the AIIB conveys very little information about China’s broader
international intentions. On balance, the United States and Japan have more to gain from joining
the AIIB and shaping its future than seeking to exert influence as bystanders.
INSTITUTION IN-CROWD
China has a unique relationship with post–World War II international organizations. After the
Chinese civil war, Chiang Kai-shek’s Taiwan remained the de jure representative of all of China
in major international organizations. This was a serious fault line of the early Cold War,
triggering the Soviet boycott of the UN Security Council in 1950. However, the United States
used the boycott to its advantage, securing UN Security Council authorization for operations
against North Korea during the Korean War. The Soviet Union grudgingly returned to the
council to aggressively exercise its veto, but the question of Chinese representation remained
unresolved.
China exacerbated its international isolation by withdrawing from several international
organizations, such as the Universal Postal Union and the World Meteorological Organization, in
protest of Taiwan’s membership. As a result, by the 1960s, China had essentially no
representation in the postwar institutional architecture. There were a few occasions on which
China endorsed proposals that would pose competition with existing institutions. For example,
the premier of China, Zhou Enlai, encouraged Indonesia under President Sukarno to challenge
the architecture: “In these circumstances,” he said, “another UN, a revolutionary one, may well
be set up so that rival dramas may be staged in competition with that body which calls itself the
UN but which is under the manipulation of United States imperialism and therefore can only
make mischief and do nothing good.”
China sent the largest delegation and won the most medals at Sukarno’s “Games of the New
Emerging Forces,” an athletic competition created to pose direct competition against the
Olympics, from which China was excluded. Indonesia also became the only country in the UN’s
history to formally withdraw from the organization in 1965, and Sukarno proposed the creation
of an alternative institution, the New Emerging Forces Organization (NEFO). The proposal
raised concerns among U.S. policymakers, who worried that the initiative might entice
developing countries away from the UN. NEFO ultimately went nowhere, though, as Sukarno’s
grip over his own country slipped. Indonesia returned to the UN only a year later.
If China’s isolation from the international architecture had continued in subsequent decades,
such challenges may have become more serious. However, in a pivotal UN General Assembly
vote in 1971, China displaced Taiwan as the sole representative of its country in the UN.
Although membership in other organizations came with varying lags, within about a decade,
China had completely turned the tables on Taiwan.
China’s history of contestation over representation sets the scene for contemporary debates about
the international architecture. For decades after the end of World War II, a major Chinese foreign
policy objective was to secure recognition and status in postwar international organizations.
Once that status was secured, China’s unique method of entry gave it significant advantages that
were denied to many other rising powers. The postwar architecture systematically advantaged
the major Allied powers of World War II over countries on the wrong side of the war (Japan and
Germany) or countries that were weak or colonized (Brazil and India). In many respects, China
avoided these disadvantages: it automatically assumed the formal privileges that had been
granted to the Republic of China, most notably permanent membership and veto power in the
UN Security Council.
These factors mean that when it comes to major international institutions, China is more of a
status quo power than one might expect. Much of the contemporary Chinese foreign policy
narrative emphasizes China’s contributions to the Allied victory in World War II against fascism
and militarism. Undermining the architecture is not in China’s interest: it provides material
benefits, enhances Chinese legitimacy, and is not obviously biased against China. For sure,
Chinese underrepresentation is an important problem in several areas, such as in the voting rights
of the IMF and the representation of Chinese nationals among the personnel of major
organizations. However, for the most part, China has more to gain from incremental adjustments
of the architecture than from a wholesale redesign.
HOW AID WORKS
The AIIB does not alter this basic picture. It is useful to consider some features of contemporary
development aid. Development aid is a highly competitive and fragmented policy area. There are
at least 28 multilateral international organizations that already specialize in international
development akin to the AIIB. In addition, most major economies also engage in bilateral aid
through their own aid agencies. These include 29 members of the Development Cooperation
Directorate of the Organization for Economic Cooperation and Development and a host of
developing countries, including China. To top it off, numerous private foundations and firms
participate in development directly or indirectly. On a yearly basis, the ADB and Inter-American
Development Bank each disburse the equivalent of about 40 percent of the World Bank’s
disbursements. Yearly U.S. bilateral aid is typically on a par with World Bank disbursements.
Aid organizations often work collaboratively, pooling expertise and resources to implement
projects. However, competition is also an important feature of contemporary development aid. Donors
have numerous channels through which they can give out aid; likewise, potential recipients can receive
aid from a wide range of sources. This is particularly true for the rapidly developing countries of Asia,
which the AIIB will target.

The competition imposes accountability and places important limits on international aid organizations. A
good example is the United Nations Development Program. The UNDP is considered one of the
premier international development organizations. It was established in 1966 as a major agency of
the United Nations, and it has near-universal membership. However, the agency was created with
a decision-making structure that limits the influence of important donor states: following the
broader UN principle that each member state should have equal representation, the organization
follows a one-country-one-vote rule. Hence, the United States, one of the largest donors to the
organization, has the same voting power as Nepal, a major aid recipient.
This means that large donor states feel their interests are not sufficiently reflected in UNDP
decision-making. As a consequence, they have effectively shifted their attention elsewhere,
depriving the UNDP of resources and forcing the organization to pursue “noncore” arrangements
over which it has limited control. The UNDP has faced a chronic shortage of funding: adjusted
for inflation, core disbursements by the UNDP peaked in 1981 and have steadily declined to
about half those levels.
This type of competition has two implications for the AIIB. First, to remain relevant, aid
organizations must be accountable to their stakeholders. If the AIIB is seen as being overly dominated by
China, other members will turn their attention elsewhere, depriving the organization of resources,
attention, and skilled staff. There is no plausible scenario under which the AIIB could supplant existing
organizations such as the World Bank and ADB unless the organization suitably reflects the concerns and
interests of the broader international community.

Second, maintaining governance and accountability standards in development aid is already

extremely difficult, particularly when dealing with relatively successful developing countries that
can pick and choose from a wide range of multilateral, bilateral, and private financing sources.
For this reason, the entry of the AIIB as an additional funding source in Asia is unlikely to make a
significant difference in social and environmental standards . If China truly seeks to undercut the
quality and conditions of existing aid agencies, it can already do so more expediently through
bilateral aid and overseas activities of its state-owned enterprises.
INSTITUTIONAL POWER
Many pundits and policymakers see the AIIB in zero-sum terms: if China is successful, the
United States and its allies lose. A recent article in the conservative Japanese Sankei newspaper
is illustrative, arguing that the AIIB represents China’s attempt to follow Sun-tzu’s teachings to
subdue the United States and Japan without engaging in direct combat. But there is a
fundamental problem with this worldview: international institutions are not like military equipment or
strategic territory, which makes a country more powerful and potentially threatening .

Multilateral international institutions are fundamentally cooperative arrangements, premised on mutual

benefits. On net, the activities of the AIIB are much more likely to bring benefits rather than costs to the
United States as well as the broader international community. The most obvious of these is the
positive spillover of economic development. China itself is testament to the importance of
infrastructure investment for growth. Better infrastructure in Asia will mean more economic
activity and business opportunities not only for Chinese firms but also for American, European,
and Japanese firms. For sure, some infrastructure can be designed to bring disproportionate
benefits to specific countries: for example, roads and pipelines that direct traffic toward China.
However, in an age of interconnected markets and global supply chains, it is practically
impossible to limit positive spillover effects to a single country.
Multilateralism will also make it more difficult for China to overtly manipulate projects funded by the
AIIB. An important reason the United States established multilateral institutions after the end of
World War II was to reassure its allies that their voices would be heard and that the United States
would not seek unilateral domination. Multilateralism not only enhances but also constrains the ability
of powerful states to get what they want. For all the shortcomings of U.S. foreign policymaking
since the end of World War II, its emphasis on multilateralism has been a resounding success.
Take trade. Before the 1930s, U.S. trade policy oscillated between openness and closure
depending on which political party controlled Congress. The contemporary trade architecture,
initially based on the General Agreement on Tariffs and Trade and more recently the World
Trade Organization and a host of regional arrangements, prevents such dramatic swings. It also
surely benefits U.S. economic interests by maintaining the free flow of international commerce
The same logic applies to the AIIB. The AIIB will likely give China some important advantages akin
to what the United States and Japan enjoy, respectively, in the World Bank and ADB. However, China
will also be constrained by other members of the institution. The structural advantages that China
enjoys in the AIIB will be beneficial only insofar as other members take the institution seriously
and provide funding, skilled staff, and coordination. If the institution is perceived as being unfair
or nontransparent, it will become nothing more than a shell organization through which China
disburses bilateral foreign aid.
To put it differently, China has a basic choice. It can create an AIIB that is mutually beneficial, reflects
the broader concerns of its members, and perhaps modestly overrepresents Chinese interests. If, instead,
China seeks to dominate the AIIB, the institution will shrivel into irrelevance. In the former case, U.S.
membership in the AIIB will provide an opportunity to influence and shape the trajectory of an
institution that will make a meaningful contribution to economic development in Asia. In the latter case,
there is no meaningful threat to U.S. interests anyway.

COOPERATIVE CONFLICT
Realist international relations scholars have predicted that China and the United States face inevitable
conflict based on the idea that power transitions create turbulence as rising powers seek to assert
their newfound authority and status quo powers resist. An optimistic alternative, based on the liberal
tradition, predicts a more benign outcome, in which the pacifying effects of economic interdependence,
international institutions and norms, and, perhaps one day, democracy will push Beijing and
Washington toward cooperation rather than conflict .
Between these two extremes is a third possibility that ought to be taken more seriously: the renegotiation
of the world order. To some degree, contestation over international institutions replicates the functions
performed by military clashes in prior eras. It shapes geopolitical and economic outcomes, provides
markers for relative status among states, and integrates states into groupings that share common values
and purposes.

Japan’s emergence in the late twentieth century is illustrative. Scholarly work in the early 1990s
predicted confrontation between Japan and the United States as the former emerged as a major
economic power. The political scientist Kenneth Waltz, for example, forecasted that Japan would
increase its military capabilities and perhaps acquire nuclear weapons as it reemerged as a great
power and reasserted its authority. Others worried that tensions between the United States and Japan
could intensify as the latter sought to reestablish its predominant position in the East Asian region .

For the most part, Japan instead maintained close ties with the United States and focused its diplomatic
attention on international institutions as venues for promoting its newfound status and policy prescriptions
for the international order. A crucial battleground for competing Japanese and American visions has been
international economic institutions. In the World Bank and IMF, Japan sought to achieve greater
voting rights and recognition for its economic approach, which has emphasized greater state
intervention and a focus on basic infrastructure. Japan also sought to create regional institutions
through which it could exercise influence, such as the ADB and the failed Asian Monetary Fund.
Of course, China differs from Japan in many respects, but its proposal for the AIIB is best seen
in this light. The AIIB would give China somewhat greater material and ideological influence
over multilateral development lending than it currently enjoys. Perhaps equally important, the
AIIB can be interpreted as a marker of status and prestige . One could argue that a multilateral
development bank is one of the bells and whistles that comes with contemporary great power status : the
United States has the World Bank, Japan has the ADB, and the EU has the European Bank for
Reconstruction and Development. China will have the AIIB.
The upshot is that the influence and prestige of contemporary international institutions give countries a
new avenue through which to gently contest the contours of the world order. There is less of a need to
resort to coercion or military conflict. The heart of the matter is this: Does the United States prefer a
world in which China seeks to establish its influence and international prestige by building multilateral
development banks or one in which it seeks to do so by building aircraft carriers? Pushing back against
the former sends the troubling message that the United States is concerned about not just the means but
the ends of China’s rise. The AIIB provides an opportunity to acknowledge and applaud China’s
emergence as a builder of multilateral institutions and a contributor to global public goods. The
institution may very well give China more influence over development in Asia, but it will be a
more transparent and accountable way of exerting influence than through bilateral economic or
military pressure. The AIIB may or may not ultimately succeed, but it poses very little risk to U.S.
and Japanese interests, since it enters a crowded, competitive field of multilateral development agencies.
The United States thus has every incentive to encourage, not discourage, Chinese foreign policy
initiatives such as the AIIB.

Failure to recalibrate U.S. economic policy toward China risks miscalculation that
triggers great power conflict
Wyne, 15 --- contributing analyst at Wikistrat and a global fellow at the Project for the Study of
the 21st Century (6/1/15, Ali, “Is America’s Mind-set the Greatest Threat to Its Future?”
http://nationalinterest.org/feature/america%E2%80%99s-mind-set-the-greatest-threat-its-future-
13004?page=show, article downloaded 5/3/16, JMP) ***Joseph Nye is a professor at the
Harvard Kennedy School and one of the most esteemed analysts of world affairs
Nye suggests that the greatest threat to U.S. influence may not be debt, political gridlock, or even the
resurgence of China, but America’s own psychology. Near the end of his book, he identifies two
scenarios that could cause it to enter “absolute” decline, which he defines as Roman-style “domestic
deterioration or decay”: “the United States becomes too fearful and overreacts to terrorist attacks by
closing inwards,” or it overreacts “by becoming overcommitted and waste blood and treasure as it did in
Vietnam and Iraq.”

America’s reaction to the progression of the China-led Asian Infrastructure Investment Bank (AIIB)
suggests that Nye’s concern is justified. The AIIB is a fledgling enterprise , after all, not an imminent
challenge to global economic governance, and it responds to a pressing global need for high-quality
infrastructure. The United States should have welcomed the institution and asked to play a role in
shaping its norms and arrangements . By lobbying vigorously against it—only to see 57 countries
sign up as founding members, including close allies—the United States inflated the Bank’s
strategic significance and compounded the apprehensions of its Asian-Pacific allies that it seeks to
thwart China’s continued economic rise.

America’s comprehensive national power will long surpass China’s. If, however, the United States reacts
defensively to every indicator of Chinese progress, failing to discern between Chinese actions that
compromise vital U.S. interests and those that do not, it will distort the magnitude of the Chinese
challenge and render itself more susceptible to making the sorts of miscalculations that have
precipitated great-power conflicts in the past. How the United States handles the continued ascent of a
country that proclaims its own exceptionalism will be a multi-generation, perhaps even multi-century,
litmus test of its psychology. Two others come to mind:

· The application of military force, the asset in which the United States has the greatest
comparative advantage, is producing diminishing strategic returns . After nearly 15 years of
principally U.S. efforts in Iraq and Afghanistan, those two countries’ prospects are highly
uncertain. The global terrorist threat continues to diffuse—and, in certain quarters, metastasize—despite
an intensified campaign of U.S. drone strikes (Reuters reports that the United States carried out
2,320 strikes against the Islamic State of Iraq and the Levant (ISIL) between August 8 and
March 12). Will the United States double down on its application of conventional military power, or
will it make greater use of diplomacy and geoeconomics? As it emerges that the United States is
playing more of a role in supporting Saudi Arabian strikes against Houthi rebels in Yemen, and
given extant pressure by some policymakers to deploy troops against ISIL and/or bomb nuclear
facilities in Iran, the United States must guard against getting dragged back into Middle Eastern
quicksand. Nye argues that because “revolutions [in the region] may last another generation,
smart application of force will be essential….a Kennan-like policy of containment may have
more promise than efforts to occupy and control.”
· Some of the principal challenges to regional orders across the world are incremental, not
existential: consider Iran’s nuclear odyssey, Russia’s slow-drop incursion into Ukraine, and
China’s “salami-slicing” campaign in the South China Sea. The dilemma: opposing them without
precipitating an escalatory spiral from which there would be no easy avenue of extrication. Will
the United States convince itself of its impotence if it is unable to win quick, decisive victories or
if it goes through occasional rough patches of strategic setbacks?
The balance of power has always been in flux; so, too, have the contours of world order; and so,
too, has the nature of the challenges that that order poses to U.S. interests. The United States has
always adapted—even if sometimes clumsily—and, in view of its prodigious resources, there is
no reason why it cannot do so again. It is ironic that perhaps the most sensible advice in this
regard comes from the most famous declinist, Paul Kennedy: in his 1987 classic The Rise and
Fall of the Great Powers, he concluded that “the only serious threat to the real interests of the
United States can come from a failure to adjust sensibly to the newer world order.” Here’s to hoping
that the United States heeds that judgment.

Ensuring peaceful rise is necessary to prevent World War 3 --- lack of engagement
on AIIB has wrecked U.S. leadership
Lehmann, 15 --- Emeritus Professor at IMD, Lausanne (Switzerland), currently Visiting
Professor at Hong Kong University and at NIIT University in Neemrana, Rajasthan (India)
(4/2/15, Jean-Pierre Lehmann, “China And The US: The AIIB Fiasco & America's Colossal
Loss Of Face,” http://www.forbes.com/sites/jplehmann/2015/04/02/china-and-the-us-the-aiib-
fiasco-americas-colossal-loss-of-face/print/, article downloaded 6/14/16, JMP)
It is very worrying for the world that American policy makers should be capable of making such
outrageous errors, scoring own-goals, as the decision to play poker against China over the Asian
Infrastructure Investment Bank (AIIB) and losing so spectacularly and humiliatingly.
There is today, I think, little disagreement that the decision to invade Iraq in 2003 was the US’
most monumental foreign policy error since the Vietnam War. Until then during the previous
four decades on balance the US could be described as a benign hegemon. With the collapse in
the early 1990s of the Soviet Union as a military threat and Japan as an economic threat, the US
emerged as the global uncontested hyper-power. Then with the illegal and ill-considered
invasion of Iraq George W Bush blew it. In the last dozen years it has been pretty much downhill for
both American power and American prestige.

The US, according to many, is in decline. That, however, does not mean that it is about to be replaced.
As Zbigniew Brzezinski wrote almost twenty years ago (1997): ““No state is likely to match the
US in the four key dimensions of power – military, economic, technological, and cultural – that
confer global political clout.” It was true then, it remains true now. The US since Iraq may have lost
a good deal of credibility in its hard power clout, but, as Professor Joe Nye repeatedly reminds us: it
remains supreme in soft power; hence “the American century will survive the rise of China”.

China is indeed an emerging great power, but Joe Nye is right: the notion that it will replace the US as
global hegemon in the foreseeable future is fantasy . It is a notion, incidentally, that one finds
mainly among foreign pundits, but that I at least have not come across among Chinese thought
leaders. They are more than conscious of the immense challenges that lie ahead. There was no
dancing in the Chinese street when the IMF announced that China had overtaken the US in
aggregate GDP. At the per capita level, China is still a middle income country and the jury is out
on whether it will succeed to graduate, as it hopes to by 2030, to high income status.
Having said that, there is no doubt that not only China is indeed a rising great power, but it is the first
rising great power for a century. The record of former rising great powers – whether Portugal and
Spain in the 16th century, the Dutch in the 17th, the British and French in the 18th and 19th,
followed by the Germans, the Japanese, the Soviets and the Americans in the late 19th and early
20th centuries – in terms of bullying, blood, oppression, etc, etc, is hardly comforting: thus the
insistence among Chinese policy makers and thought leaders that what they aspire to is the
“peaceful rise” of China to great power status.
Whether China achieves the aim of being the first ever great power to rise peacefully remains to be seen.
It is the key question of the 21st century, the answer to which may determine whether the
world will fall into a cataclysmic third world war or whether the pattern will be broken and
a new 21st century global paradigm of enhanced peace and prosperity emerges.

As things stand currently, signals are mixed. China has territorial disputes with virtually all its
neighbors. As I tell my students in India, I personally do not fear for the moment China breaking
out as not just a great power, but an imperialist great power, but then I live in Switzerland. If I
were a citizen of India, Indonesia, Vietnam, etc, I would possibly feel differently. The closer one
gets to China, by and large the greater the apprehensions.
Apart from the territorial disputes and occasional naval skirmishes in the East and South China seas,
perhaps most alarming for China’s southern neighbors are Beijing’s policies of diversion and damming of
rivers from the Tibetan Plateau to the country’s more populated and industrialized north away
from feeding into the rivers providing water to billions in South and Southeast Asia. Water, as
Indian scholar Brahma Chellaney argues, may be Asia’s “new battleground”.
Thus the jury is out here too. By no means, at the moment, can China be condemned as a malign
imperialist power; nor however is it a cuddly panda bear.
The outcome will depend on essentially two factors. The first is how Beijing responds to its multiple
domestic issues and challenges – social, political, economic, technological, environmental,
demographic, gender and cultural. As many Chinese policy makers and thought leaders
emphasize there is an urgent imperative of deep reforms in all these areas. The second determining
factor is how the outside world, especially the established powers, and of course above all the US,
respond and adjust to China’s great power rise.

Among China’s policies that a priori would seem to merit close attention and a positive response
is the New Silk Road Economic Belt and New Maritime Route, which could have the effect of a
fundamental re-engineering of the planet, providing opportunities for enhanced global prosperity,
connectivity, employment and entrepreneurship. Among other possible beneficial consequences,
it will integrate into the world economy areas, specifically in Central Asia, that have hitherto
been marginalized. Samarkand may once again become a hub!
China is a fragile rising great power. In contrast to the US, it is highly dependent on access to
global resources (energy, minerals, food) and to global markets. The New Silk Road serves its
national purpose in an enlightened way by also serving extensive global interests. There is as
Beijing and every other capital in Asia are acutely conscious a huge need for improved
infrastructure – measured in the trillions of dollars. Having been rebuffed by the established powers
in its request for an enhanced role in existing US dominated international organizations, the IMF, the
World Bank and its regional affiliates, Beijing has proposed to set up a new China driven global
multilateral institution: the AIIB. (This is in addition to the New Development (so-called BRICS)
Bank.)
Whereas there may be areas in which China’s expanding power might better be contained; there are other
initiatives for which it should be engaged and encouraged. The AIIB is a clear case of the latter. As I
told a senior American official, “you keep haranguing the Chinese about being ‘responsible stakeholders’,
the establishment of the AIIB is about as solid and constructive an illustration of stakeholder
responsibility one could imagine” .

Washington urged and pressured its allies not to join the AIIB. Fortunately Washington was
ignored by over forty capitals, including by its closest ally, the UK, for which London was
severely publicly admonished. In Europe, Berlin, Paris, Rome, Luxembourg, The Hague,
Brussels, Stockholm, Bern, Oslo, etc, quickly followed, as Asian capitals also rapidly signed up
(with still the exception of Tokyo, but that may come), and indeed with both Hong Kong and
Taipei keen to get a piece of the action, and even Israel expressing interest. The AIIB express train
is taking off and a peeved US stands embarrassingly on the platform.

Washington’s colossal imbecility in opposing the bank has resulted in a colossal loss of face. It is, as
suggested above, a spectacular own goal. It has eroded not only the US’ hard (financial)
power, but also its soft power, leadership and prestige.
Readers of Forbes, especially members of the American business community, should seek to
ensure that these kinds of errors are not repeated. The world is in a period of flux, characterized by
great uncertainty and volatility. To accommodate constructively the rising power of China – emerging
from a long period of subjugation to Western imperialism and ostracism – the existing hegemon
must display qualities of responsible and enlightened leadership . The AIIB saga was a fiasco in every
sense, demeaning the status of the US. Let us hope the appropriate lessons are learned. Pax Americana is
still needed.
 1ac Plan + Solvency --- Join AIIB

Plan: The United States federal government should substantially increase its
diplomatic and economic engagement with the People’s Republic of China over the
Asian Infrastructure Investment Bank with the purpose of joining the bank.

U.S. should engage China to join the AIIB --- allows it to exert net more influence
Knight, 15 --- Faculty Director of the SIS Honors Program and Assistant Professor at American
University's School of International Service and expert on international political economy
(4/3/15, Sarah Cleeland Knight, “The Asian Infrastructure Investment Bank – Three Questions
for Sarah Cleeland Knight,” http://www.american.edu/sis/news/20150403-3Q-Cleeland-Knight-
Asian-Infrastructure-Investment-Bank.cfm, article downloaded 5/11/16, JMP)
A growing number of countries are joining the China-led Asian Infrastructure Investment Bank
(AIIB) – despite U.S. objections. Sarah Cleeland Knight, an expert on international political
economy, recently argued that the United States should also join the bank. We asked her for her
insights:
Q: Why did China create the AIIB and what are the U.S. concerns?
A: China announced its intention to create the AIIB in October 2014 to fund major infrastructure
projects (roads, bridges, electrical grids, etc.) in less developed Asian countries. The AIIB will
essentially serve as a World Bank for Asia, except that China will presumably have much greater control
over AIIB decision-making. China has long complained that the World Bank and other institutions
created by the United States and the United Kingdom in the aftermath of WWII, including the
International Monetary Fund and the World Trade Organization, do not allow countries outside
the United States and Europe to exert much decision-making authority. China initially sought to
boost its influence within these extant institutions, but the U.S. Congress balked at giving China
more authority, so China is now creating its own institutions.
The United States cannot possibly fault the mission of the AIIB, as there is a serious need for
infrastructure investment in Asia. But the United States has voiced concerns about the AIIB’s
administrative structure and lending policies. The AIIB doesn’t even exist yet, so we don’t know
if these concerns are valid or are really a cloak for broader concerns about China creating a rival
institution to the World Bank and further increasing its influence throughout Asia.
Q: Why have a growing number of U.S. allies decided to join the bank?
A: The real question here is why the United Kingdom decided to join the bank. The U.K.’s
decision was announced in mid-March and evidently took the White House by surprise. The
U.K. was the first major ally to break ranks with the United States on the AIIB, and the
announcement from London opened the floodgates for other allies to follow and also join,
including Germany, France, Italy, Australia, and Israel. So it makes sense to evaluate the U.K.’s
decision with scrutiny.
We don’t have all the answers right now, but The Financial Times is reporting that the decision
originated from Prime Minister David Cameron’s office and went forward over objections from
the U.K. Foreign Office. So there are some bureaucratic politics at work here. But, in a nutshell,
the U.K. (Cameron) decided that the benefits of joining the AIIB and bandwagoning with China
against the United States clearly outweighed the costs of angering the United States on this issue.
What should be worrisome to the United States is whether its allies will side with Beijing over
Washington on other issues as well. Such a trend would signify declining U.S. influence not only
in Asia but also worldwide. But we need more data points before we can see a trend.
Q: Why do you believe the United States should now join the AIIB?
A: The United States, at this stage, is standing virtually alone in protest of the AIIB. So it would be far
better for the United States to join its allies as a founding member of the AIIB and hope to exert some
influence from the inside. Such an obvious reversal on the AIIB is going to require some diplomatic
fine-tuning. I believe that the United States should send a delegation of Treasury Department and other
officials to meet with their Chinese counterparts on the details of how the AIIB will be structured and its
decision-making processes. The United States should come away from those meetings satisfied that the
AIIB is an important institution to promote economic development throughout Asia. And then the United
States should do its best, working quietly with China, to ensure that it actually does .

The plan will rebalance the relationship with China --- preventing a collision
between the rising powers
Lee & Fullilove, 5/17/16 --- *President, East Asia Institute (South Korea), AND **Executive
Director, Lowy Institute for International Policy (Australia) (Michael, “Crisis in Global
Governance: A Conversation with Richard N. Haass and the Council of Councils,”
http://www.cfr.org/global-governance/crisis-global-governance-conversation-richard-n-haass-
council-councils/p37852, article downloaded 5/30/16, JMP)
LEE: And at the same time, you know, there is interesting AIIB, the Asia Investment Infrastructure
Bank, initiated by China. So in Asia, we thought there is a coming of a kind of competition between
China-led economic and trade or even investment organization versus U.S.-led TPP . But I see this is not
a good idea if the economic, you know, cooperations should be work together. So, I think it’s
more rational for USA to be a member of AIIB rather than just to, you know, vetoing AIIB. So, by
participating in AIIB, you know, we can make the governments more democratic and transparent rather
than by (conflict ?).

HAASS: I’ll talk about trade. Just on trade very quickly, world trade has not been growing for
about the last five years—very little. And, you know, more than anything it’s because economies
aren’t growing. But also, it’s now been, what—I lost count of the years, but since, what, 15 years
ago, the Doha Development Round. Global trade talks are going nowhere. It’s not clear they can
revive given, you know, any time you try to get agreement with 190 countries, good luck. And
that’s the old-fashioned legally binding approach, very, very tough.
So what we’re seeing is the proliferation of regional, and bilateral, and various types of
multilateral trade agreements, which are at best second best. There’s people like Jagdish
Bhagwati who think they’re actually quite, on balance, bad. But I would simply say I think
they’re second best in what issues they can handle, and I think it comes up against now also the
domestic pushback. So I think it—I think it has been a rough time for trade. And I think more
than anything it’s—at the global level you can’t get it negotiated, and at the domestic level it’s
not clear you have the support.
FULLILOVE: Can I just add one—
MABRY: Sure.
FULLILOVE: Can I just pick up something Professor Lee said about the Asian Investment
Infrastructure Bank? Because one issue we haven’t—we haven’t talked too much about China so
far, and everybody in this room knows that one of the features of international relations is that
sometimes established and rising powers collide. And this relationship between China and the United
States is going to be very important to many of the global governance challenges that we talk about in
the report, not just the ones in Asia but globally.

And it seems to me that the United States and like-minded countries need to get the right balance of
engaging and hedging with China, and sometimes we get that balance quite wrong. For example, on the
AIIB, I didn’t understand why the United States was so negative about the—about that particular
initiative. Because if we’re not going to allow China the ability to set up some kind of infrastructure
investment bank in Asia, where it’s required, then what prerogatives are we going to allow China?

On the other hand, I would be—so I think, in a way, we were—I think the United States was
hedging too much in relation to China. But then on other issues—and we’ve mentioned the South
China Sea—I would say that President Obama has been too soft. I would say he’s been too down
the engagement end.
So this is going to be, this relationship—these are just examples of this, but this relationship
between the United States and China is going to be so important. Can the two countries come up—
arrive at an order, a new—a new modus operandi where each of them can achieve their objectives, but
allow the other side to exercise its prerogatives and allow everybody else in Asia to also exercise their
prerogatives? Can they get that balance right? And the importance of statecraft, and leadership, and
getting the right mix of engaging and hedging, and choosing where to engage and where to hedge is
so hard, which does come back to leadership.
MABRY: Mmm hmm. Excellent.

U.S. involvement will allow AIIB to safeguard its independence from China, develop
higher standards and transparency, reverse perception of containment and boost
the credibility of its Asia rebalance
Lazarus, 3/2/16 --- MA candidate at The Fletcher School, Tufts University (Leland, “Why the
U.S. Should Embrace the AIIB; There are compelling reasons for the U.S. to join China’s new
development bank,” http://thediplomat.com/2016/03/why-the-u-s-should-embrace-the-aiib/,
article downloaded 4/24/16, JMP)
China’s new Asian Infrastructure Investment Bank (AIIB) has been the source of considerable debate .
While its supporters believe the bank will fill a much needed investment gap in Asia’s economic
development, its naysayers worry that China will use it to further its own economic and strategic goals
in the region. They say the very structure of the AIIB allows China to use its weighted voting
power to exercise a disproportionate amount of influence in the bank. Still others feel that the
AIIB is unnecessary because the world has three development banks – the World Bank, the
International Monetary Fund (IMF), and the Asian Development Bank (ADB) – that already deal
one way or another with Asia’s development.
So far the United States has been ambivalent about the AIIB, and several scholars suggest that
U.S. officials harbor the same doubts about the bank. Specifically, U.S. officials and academics
criticize the bank for two reasons: 1) Its voting structure gives China a disproportionate voting
share, which means it can effectively manipulate the bank to further its own economic and
strategic goals in the region; 2) The AIIB will not follow the same high standards as existing
financial institutions when deciding which projects to fund, forgoing important criteria like
environmental protection, human rights, and anti-corruption.
Does the AIIB’s legal structure really give China so much power and influence? Not necessarily. External
and internal pressure will cause the AIIB to act independently and give itself powers in order to
safeguard its independence from China, and U.S. involvement will expedite that process.

International Pressure
While China has a 30 percent weighted voting share, its influence in the AIIB can be checked by
international pressure. In many ways, China has already altered the AIIB due to pressure from the
international community. The AIIB Founding Members were able to use their collective bargaining
power to revise the bank’s Articles of Agreement and “enmesh China in a network of
international norms and standards.” This forced China to become more flexible and alter the
AIIB rules. Suspicion and opposition by the United States and Japan also checked China’s
ambitions with the AIIB. The evidence suggests that the AIIB’s member states can “make China play
by the rules.”
Currently, China has a poor track record in terms of following high standards when it comes to the
projects it funds around the world. From oil and resource extraction projects in Cambodia, Burma,
and Mongolia, to railroad and canal construction projects in Brazil, Peru, and Nicaragua, to
bridge and other infrastructure projects in Mali and Ethiopia, the Chinese Development Bank and
its Export-Import Bank have given loans to unstable governments, signed construction deals for
unnecessary infrastructure, and ignored villagers who have been abruptly uprooted with little
compensation. U.S. officials believe that the AIIB will adopt the same low standards as China’s national
banks. They point out that, since the AIIB will not have a resident staff involved in the day-to-
day project oversight, the bank could not possibly ensure that its clients will follow through on
high standards and transparency.
Higher Standards
It is still uncertain which standards the bank will use , since the AIIB has yet to choose which projects
it will fund. For example, the bank still has not decided whether it should approve coal-fired power
plants, projects that are shunned by existing institutions. However, recent changes in the AIIB’s
governance structure may suggest that China is amenable to change. Originally, the Chinese did not want
a board of directors to be in charge of projects because they thought a board would just slow down
the project with superfluous oversight. After consulting with the British, however, the Chinese
changed their minds and added the board. This suggests that, if the U.S. joins the AIIB, it can persuade
the bank to adopt higher standards and transparency, just as the British persuaded the bank to form a
board of directors.

The AIIB Will Carve Its Own Niche

The AIIB’s Articles of Agreement specifically confer on it an “international character,” as
stipulated in Article 31. It cannot receive special outside funds that may jeopardize its
independence, and its member states must “refrain from all attempts to influence (the bank’s
employees) in the discharge of their duties.” This can provide a legal basis for a member state to
bring a claim against China if it is ever seen as influencing AIIB officials. Additionally, Article
2, Section IV gives the AIIB flexibility in its functions, stating that it can “undertake such other
activities and provide such other services (to) further these functions.” This clause gives the
AIIB leeway to grant itself implied powers in the future for the sake of functionalism; if it needs
to form subsidiary bodies or has to take some sort of emergency action, it can do so
independently.
Indeed, international organizations tend to grant themselves powers not explicitly expressed in
the original charters over time in order to more effectively carry out their functions. In the
famous Reparations for Injuries case in 1949, the International Court of Justice declared gave the
United Nations the power to bring a claim against Israel for the assassination of UN envoy Count
Bernadotte at the hands of Israeli religious extremists. In the Certain Expenses case of 1962, the
ICJ gave the UN General Assembly the authority to force member states to pay for UN
peacekeeping operations. In both of these cases, the ICJ used the implied powers doctrine to
bestow on the UN more powers in order to enforce its distinct will from its member states.
In this same vein, the AIIB will most likely grant itself more powers as time goes on to ensure its
own relevance. Failure to do so would hinder the legitimacy of the AIIB as a whole. Mass
withdrawal would leave the bank broke, and its officials unemployed. Excessive control by
Beijing would also prevent the AIIB Board of Governors and Board of Directors the freedom to
make independent decisions. Such overt control by a member state will deprive the organization
of a distinct will, which would in turn hinder its efficiency and impartiality, if a member state
like China interfered excessively with the organization’s operation.
Why the United States Should Join the AIIB
Despite all its misgivings about the AIIB, the United States should join the bank to ensure its financial
influence in Asia. First, it would limit China’s voting power in the bank by coordinating with like-
minded developing member countries such as Great Britain, Australia, and New Zealand, thus prodding
China toward pursuing cooperative behavior. Second, the U.S. could help raise the AIIB’s quality of
governance, credit and banking culture and environmental and social standards . Third, the U.S. could
better integrate the AIIB with existing major multilateral development banks, such as the World Bank and
Asian Development Bank, in the form of co-financing and joint project preparation and supervision .
Fourth, the U.S. would be in a good position as a reliable partner in Asia’s infrastructure building and
economic development. And fifth, it would ensure that American businesses will be well informed about
infrastructure projects financed by AIIB.

Finally, if the U.S. continues to dig in its heels about the AIIB, it may miss out on an important chance
to put teeth behind its Asian rebalance strategy. Tobias Harris of the Sasakawa Peace Foundation
believes that U.S. opposition to the AIIB was a knee-jerk reaction to China’s growing influence in Asia,
and missed an opportunity to help China with technical assistance to improve the bank . Specifically,
the White House was wary about the AIIB’s standards, and the Treasury Department steadfastly
rejected China-led initiative that might rival the existing Bretton Woods system. By shunning the
AIIB, the U.S. “disregarded the principles of its own Asia strategy and contributed to the impression
that it seeks to contain China.”

AIIB president Jin Liqun had this to say about U.S. opposition to the AIIB: “The U.S. risks
forfeiting its international relevance while stuck in its domestic political quagmire.” He warned
the U.S. that “history has never set any precedent that an empire is capable of governing the
world forever.” If the U.S. is serious about its Asian rebalance strategy, it should work with China to
improve the AIIB as a member, instead of opposing the bank altogether.

U.S. participation in the AIIB ensures that China exercises constructive global
leadership --- SQ sends the signal of containment
Bergsten, 15 --- director emeritus and senior fellow at the Peterson Institute for International
Economics (3/15/15, Fred, “US should work with the Asian Infrastructure Investment Bank;
Washington should sign up and bless the desire of its friends to join, writes Fred Bergsten,”
https://next.ft.com/content/4937bbde-c9a8-11e4-a2d9-00144feab7de, article downloaded 5/2/16,
JMP)
China’s decision to create a new development bank for Asia is proving a highly divisive
enterprise. The Asian Infrastructure Investment Bank, due to open its doors later this year, has
sparked deep divisions between Beijing and Washington. The latter argues that the bank will
undermine existing international institutions and that it will be a vehicle for a broader expression
of Chinese strategic interests. Now the AIIB has also become a source of major discord between
the US and some of its chief allies, including the UK, which has decided to become a founder
member of the new institution.
That sparked an angry response in Washington, a sorry development that reflects the huge mistake the US
has made in opposing a bank aimed at helping to meet Asia’s need for trillions of dollars of investment in
energy, power, transportation, telecommunications and other infrastructure sectors.
China and 20 other Asian countries agreed in October to establish the AIIB. Beijing will provide
the bulk of capital and founding members include India, the second largest shareholder, as well
as two Gulf Arab states, Kuwait and Qatar. A number of non-regional countries were invited to
be founder members, an offer rejected by the US, which then lobbied allies, including Australia,
South Korea, the UK and other European states, not to join.
Washington argues there is no need for a new development lender, given the World Bank and the
Asian Development Bank. There are dark mutterings in DC that AIIB’s Chinese leadership may ignore
international lending norms and support projects that promote Chinese political, or even military,
interests.

The US is wrong to adopt this position. President Barack Obama has called for more Asian
infrastructure investment. The existing institutions are only scratching the surface of those needs and have
adopted different priorities in recent years. Competition is good for development lending as well as other
markets. Concerns about backsliding from standards on transparency, procurement and anti-
corruption are justified but the way to address them is to join the institution and work from within ; it
is nonsense to argue that carping from outside will be more effective.

Most importantly, this issue represents a fresh skirmish in the inevitable competition for leadership
of the world economy in the 21st century. As the incumbent power, the US naturally wants China
to support the international rules and institutions that it has led for 70 years. As the rising power,
China naturally challenges a status quo it had no role in creating and wants to begin shaping a modified
order itself.
The US has correctly urged China to exercise leadership consistent with its expanding power, and to
provide more resources to support development and other global goals. When the Chinese move in those
directions, as they are doing with the AIIB, it is short-sighted and hypocritical for the US to seek to block
them. This is especially true when the Obama administration has not persuaded Congress in four
years to adopt legislation to provide enhanced roles for China and other emerging economies in
the International Monetary Fund, as agreed by all other countries; and has opposed increasing the
capital of the Asian Development Bank.
This US hostility reinforces the Chinese view that US strategy is to contain and suppress it; so
increasing rather than decreasing the prospect of uncooperative Chinese behaviour. The UK and
other US allies, by contrast, are wise to accept China’s invitation to join.
The US should reverse course. It should join the bank and persuade Congress to provide the small
amounts needed to fund a minority share. It should bless the desire of its friends in Asia and Europe
to join, to help counter any untoward Chinese actions.
And it should encourage the World Bank and the other current multilateral lenders to co-operate
closely with the new institution. The AIIB initiative can then play a positive role in the world
economy and capitalise on China’s growing willingness to exercise constructive global leadership .

The plan reverses the perception of hostility

Marston, 16 --- Southeast Asia analyst at a Washington, D.C., think tank (2/28/16, Hunter, “A
Four-Point Plan for Reviving the U.S. Role in Asia,” http://nationalinterest.org/blog/the-
buzz/four-point-plan-reviving-the-us-role-asia-15342?page=show, article downloaded 5/3/16,
JMP)
Downplay the Current Mindset of Rivalry
The great challenge of the century for future American leaders will be accounting for China’s rise. In
the immediate term, the next president should focus on two measures which can downplay the current
mindset of rivalry between Washington and Beijing. The next administration should learn from the
Obama administration’s strategic mishandling of China’s announced Asian Infrastructure
Investment Bank (AIIB). When Beijing announced its new regional economic initiative,
Washington voiced strong opposition and wasted serious political capital by leaning hard on allies and
partners to not join the AIIB. Despite its vociferous resistance, Australia, the United Kingdom,
Germany, and France, all joined China’s infrastructure bank. Only Japan held off, citing
concerns with transparency and governance, before announcing its own $110 billion funding for
regional infrastructure via the Asian Development Bank.
Competition for infrastructure projects across Southeast Asia between the United States, Japan
and China, does not present a no-win scenario. In fact, the United States should let China’s AIIB
thrive, because it signals a net positive for all parties concerned : the United States and Japan, China,
and especially Southeast Asian countries in need of infrastructure development and connectivity, which
will provide trade links throughout the region.

As part of reducing the sense of rivalry, Washington and Beijing must also take steps to mitigate the
chances for strategic mistrust and conflict . James Steinberg and Michael E. O’Hanlon in their book,
Strategic Reassurance and Resolve: U.S.-China Relations in the Twenty-First Century, provide a
compelling case for enhanced cooperation between the two sides, even amidst escalating competition .
Yet, strategic rivalry need not breed armed conflict.
The region holds the potential for both explosive economic growth as well as great power conflict, as the
United States and Japan, two of the three largest economies in the world, attempt to accommodate
China’s rise within the liberal international order of free market democracy that has largely set
global norms since World War II.
The contradiction is that China is neither liberal nor democratic; nor, as the world’s fastest
growing economic power for several decades, does it embrace free market standards espoused by
the West. The stark differences of Chinese social values and conceptions of governance have
created great uncertainties for other countries, who find themselves wrestling with the question:
is China a revisionist power seeking to rewrite the rules of the game, or will China attempt to fit
into the world order that has enabled its rise thus far?
The next American president would do well to corral a strong foreign policy team with Asia
expertise and to give the above questions some serious consideration. The ability of both parties’
candidates to articulate a credible Asia policy to the American public will win votes, and it will
also determine U.S. standing in the world in the Asian century.

CASE
 2ac Cybersecurity Addon

Plan spills over to solve cybersecurity – that’s Noori.

Escalates into a major war with China

Chen, 5/28/16 --- veteran of the Tiananmen Square democracy movement; he has authored
over ten books, writes a regular column for Radio Free Asia, and is regularly invited to speak on
Voice of America Chinese , Pokong, was translated by Stacy Mosher, a translator and editor
based in New York City, “This is How a Bloody U.S.-China War Could Start,”
http://nationalinterest.org/feature/how-bloody-us-china-war-could-start-16383, article
downloaded on 6/13/16, JMP)
Editor's note: The following is a translation of Chapter 14 of the book If the U.S.and China Go to
War《假如中美开战》 by the author and analyst Chen Pokong. The current volume was
published in Chinese in 2013 and was later translated to Japanese.
The chapter sketches the hypothetical beginnings of a conflict scenario between the United States and
China. In it, the U.S. responds to provocative Chinese cyberattacks by launching one of its own, tearing
down the Great Firewall. In response, Chinese authorities clamp down Internet access completely, which
America quickly responds to. Ultimately, regime-organized street violence endangers the lives of
American consular staff, and U.S.-China relations quickly descend from the current modus vivendi to
outright hostilities.

While both the United States and China can be expected to avoid going to war, it’s by no means difficult
to imagine a scenario in which such a war might break out . Let’s consider such a development from
the perspective of a young Chinese computer technician named Xiaolu:
After returning home from work one Friday evening, Xiaolu follows his usual practice of turning
on his home computer and preparing to access his favorite overseas websites through proxies that
will help him break through the Chinese government’s internet firewall. To his great surprise, he
finds himself able to freely browse the Voice of America website without a proxy. He tries the
BBC Chinese-language website, and then Radio Free Asia, Epoch Times, Boxun, the Chinese-
language websites of the New York Times and the Wall Street Journal. . . surfing all of them
with ease, he wonders if there’s some bizarre fluke in the system. He quickly telephones a friend
and tells him to give it a try, and the friend reports the same experience. Overjoyed, Xiaolu
contacts all of his friends and tells them to log onto the internet as fast as they can.
The situation continues the next day, and China’s streets and microblogs are abuzz with the
news. People wonder if the Chinese government has suddenly decided to lift its internet
blockade, and if this means political reform has also been launched.
Xiaolu stays glued to the internet all the next day and evening, too excited to sleep until he
finally drifts off near dawn. By the time he awakens, the sun is high and the clock shows that
noon is approaching. Luckily it’s still the weekend, and Xiaolu doesn’t need to be at work.
Rolling groggily out of bed, he slouches over to his computer and goes online again, only to see
a blank wall. Not only the foreign websites, but even China-based websites have disappeared and
have been replaced with a uniform message of “Page not found.” Shocked, disheartened and
angry, Xiaolu wonders what happened. He turns on his television just in time to hear a CCTV
presenter read out this news bulletin:
“The United States has used the pretext of alleged Chinese hacker attacks on American
websites to blame on the Chinese government and People’s Liberation Army. These baseless
accusations originate from the pathological fantasies of certain individuals in the United States,
and we have always categorically refuted them. The United States is now using the pretext of
‘freedom of information’ to interfere with China’s normal internet operations and oversight. This
is a genuine cyberattack and a blatant cyberinvasion. It is a plot to overturn the Chinese
government.
Interfering with and sabotaging China’s internet is a brazen violation of Chinese sovereignty
and dignity. It is a last-ditch effort by American hegemonism to obstruct China’s rise following
its failure to impose ‘peaceful evolution.’”
Xiaolu now understands that his earlier access to overseas websites was due to the United States
playing a technological wild card that destroyed China’s internet blockade. His current inability
to go online is due to the Chinese government taking the drastic step of cutting off all internet
access after losing its “Great Firewall” to America’s technical superiority.
Through his shortwave radio, Xiaolu hears an announcement by the U.S. government:
“Safeguarding freedom of expression and freedom of information is a universal value. The
United States of America firmly upholds the Chinese people’s freedom of information, the
deprivation of which is an infringement of fundamental human rights. . . .”
Related reports and discussion show that the cyber operation, codenamed “Airborne Freedom” and
launched by the United States, is in fact retaliation for a cyberattack by China. China has for some time
been carrying out cyberattacks and cyberespionage against U.S.-based websites, and repeated warnings
from Washington to end the attacks have met with only temporary pullbacks by Beijing, followed by
renewed onslaughts. Reaching the end of its patience, the United States has finally decided to take action,
and a full-scale cyberwar has been launched between China and the United States.

With internet access cut off, Chinese netizens begin taking to the street to express their
indignation, their eyes directed straight forward or upward to signify their silent protest. The
Chinese government issues an announcement: “The relevant departments have cut off internet
access only as a temporary measure and as the only option. The United States, which launched a
cyberattack to interfere with and sabotage normal internet operations in China, must take full
responsibility.”
On the third night, internet access is miraculously restored. Strangely, however, unlike before,
only overseas websites can be accessed, and almost no China-based websites. Xiaolu is initially
baffled, but after surfing overseas websites, he gains an understanding of how the situation has
developed.
It turns out that after the Chinese government cut off all internet access, the United States used
satellite technology to provide wireless internet service to China. Operation Airborne Freedom
has entered its second phase. The U.S. government explains its rationale: “We first of all need to
ensure that American organizations in China as well as the U.S. Embassy and consulates can
continue to access the internet. . . . At the same time, we are helping the Chinese people to freely
access information. . . .”
The Sina and Sohu microblogging websites that Chinese netizens normally use have ceased
operation, and have been replaced by internationally dominant social media such as Facebook
and Twitter. The Chinese Baidu search engine has stopped working, but Google is available as a
substitute, and Chinese netizens rejoice.
The next day, the Chinese government plays a new card. The State Council issues a “Notice
Regarding the Suspension of Internet Access”:
“Malicious interference and sabotage by hostile overseas forces resulting in severe chaos in
the arrangements for our country’s internet management has aroused mass outrage among the
people. In order to ensure state security and normal information access, from this day forward
the relevant departments will carry out comprehensive inspection, maintenance and rehabilitation
of the internet. During this time, internet access will be suspended throughout the country.
Specific provisions are as follows:
1. Any work unit or individual who without authorization accesses the internet will be subject
to confiscation of his computer, a fine, dismissal from employment or other penalties.
2. Any individual who uses the internet to create or spread rumors or to transmit reactionary
information, and in particular any individual who incites opposition or subversion of the
government, will be held criminally liable.
3. All internet cafes will be temporarily closed until further notice.
4. Sales of computers must be registered under the purchaser’s name. . . .”
Over the next few days, China’s netizens continue to enjoy access to overseas websites, and
there is an explosive increase in satirical comments about the Chinese government on Facebook,
Twitter and overseas Chinese internet forums. Rumors spread of police in some localities going
door-to-door to examine internet browsing histories. Official media begin reporting on some
people being investigated and having their computers confiscated. Overseas media report that
rights defenders are being summoned and warned by the police, while some dissidents have been
placed in criminal detention on allegations of using the internet to create or spread rumors to
incite subversion of the government.
Mobilized by netizens through Facebook and Twitter, increasing numbers of people begin
standing in the streets with their eyes directed forward or upward in what come to be known as
“stand-ins.” Internet posting proclaim: “The Chinese people have stood up!” As another day
passes, police are mobilized in a massive operation during which they physically push people
away from “stand-ins.” Some protesters who resist are arrested. Four police officers grab Xiaolu
by his arms and legs and carry him off as he struggles and yells out, “The Chinese people have
the right to stand up!”
China’s PLA Daily publishes a commentary entitled “Cyberinvasion is a War of Aggression,” which
states:

“We must point out that cyberinvasion is a war of aggression. We sternly warn the American
hegemonists that today’s China is not the China of 1840; today’s China is not a China that can be
bullied or trampled upon. Under the leadership of the great Chinese Communist Party, we have
achieved economic liftoff and military modernization that will bring about the great revival of
the Chinese people. Our country and our people have the capacity to defend our homeland. In the face
of serious provocation, the full force of the Chinese People’s Liberation Army will resolutely follow the
Party’s command and is prepared to go to war at any time in retaliation against any who dare aggressive
action against our country’s sovereign rights and interests. We are prepared at all times to fight and to
emerge victorious in repelling a frontal assault by the invaders. . . .”
In contrast to this hard line, the tone of some official scholars is more temperate. In an
Associated Press interview, a professor of international relations at Renmin University of China
appeals for calm on both sides. He urges the Chinese and U.S. governments to sit down for a
face-to-face exchange of views on the mutual accusations of cyberattacks, and to resolve the
conflict through dialog and negotiation to prevent the conflict from escalating out of control.
Prohibitions on internet access are implemented in government organizations, state-owned
enterprises and all schools, libraries and other public bodies. Even so, how can the authorities
control 500 million netizens and 300 million bloggers? Most netizens ignore the prohibitions and
continue to access the internet at home. Internet access is unstable and intermittent, but the
wireless internet service that the United States is providing to China has not been cut off.
After “stand-in” protests against the Chinese government have been suppressed for two days, anti-
American protests suddenly break out in Beijing, with hundreds of people gathering around the U.S.
embassy, shouting out anti-American slogans, denouncing the United States for sabotaging China’s
internet and demanding an end to the U.S. cyberinvasion. Similar protests quickly follow in Shanghai,
Guangzhou, Chengdu, Wuhan and Shenyang, where people gather around U.S. consulates and
yell out slogans while waving the five-starred red flag of the People’s Republic of China. “Down
with American hegemonism!” “We vehemently denounce American sabotage of China’s
internet!” “Resolutely beat back the U.S. cyberinvasion!” “Creating chaos in China has ulterior
motives!” Given the uniformity of the slogans and banners throughout the country, outsiders
quickly realize that these protests have been orchestrated by the Chinese government .

Further anti-American protests break out in other cities over the next two days. The number of
participants grows from hundreds to thousands, and in Beijing and the rest of China’s largest
cities, the protests rapidly evolve into smashing and looting. People begin throwing rocks, bricks
and bottles at U.S. consulates; some set American flags on fire and toss them into consulate
compounds, while others overturn vehicles and set them alight. Black smoke rises everywhere as
cheers break out among the crowds. Bystanders scream in terror and run off.
Apart from occasionally yelling or motioning for people to desist, the Chinese police officers
stationed around the consulates spend most of their time standing idly about as rocks, bricks and
bottles fly over their heads into the consulate compounds, and no one is arrested.
On Facebook and Twitter, netizens all over China expose the identities of local police officers,
city managers and joint defense officers who are masquerading ordinary citizens to lead protests
and take part in the smashing and looting.
Washington sends a diplomatic notice to Beijing strongly protesting the violent demonstrations at the
U.S. embassy and consulates, and demanding that the Chinese government take measures to protect
American citizens and facilities. A foreign ministry spokesman responds that the Chinese
government does not approve of the radical actions around the consulates and appeals to the
Chinese public for calm. At the same time, he points out, “The problem must be resolved at its
source”; the U.S. government needs to immediately cease its cyberinvasion and end its
interference and sabotage of China’s internet before peace can be restored.
The news media report that a U.S. aircraft carrier, the USS George Washington, has led the Seventh Fleet
out of Japan’s Yokosuka naval base toward the East China Sea to form a joint force with the USS Nimitz
battle group patrolling the South China Sea.

As night approaches, the U.S. consulate in Chengdu comes under siege, and someone starts
hurling Molotov cocktails into the consulate compound and main building. The consulate catches
fire, and flames spread rapidly as smoke billows against the night sky. Suddenly excited and
terrified cries go up: “He’s dead! He’s dead!”
International media report that the U.S. consul general stationed in Chengdu has fallen victim to the
violent protests. Foreign governments issue statements condemning the atrocity. It’s reported that
he attempted to lead consulate staff out the back door to safety, only to be discovered by the
protesting mob. Chinese nationals employed at the consulate came under verbal and physical
attack by protesters cursing them as “traitors” and “American running dogs.” When the consul
general tried to protect two female staff, he was struck in the head with a brick. Also falling
victim were five consular staff, including two Americans and three Chinese, all of whose bodies
were set alight by the screaming mob
The next day, five more American aircraft carriers , including the USS Abraham Lincoln, USS
Ronald Reagan, USS Carl Vinson, USS Harry S. Truman and USS George H.W. Bush, converge
and move at speed toward Chinese waters.

The Sino-U.S. War has begun. . . .

 --- XT: Cyber Impacts

Cyber attacks cause nuclear war – accidents

Gady 15 (Franz Stefan, Associate Editor of The Diplomat, Senior Fellow with the EastWest
Institute. Article quotes: James Cartwright, retired US Marine Corps General and eighth Vice
Chairman of the Joint Chiefs of Staff, Greg Austin of the EastWest Institute in New York, and
Pavel Sharikov of the Russian Academy of Sciences, “Could Cyber Attacks Lead to Nuclear
War?”, http://thediplomat.com/2015/05/could-cyber-attacks-lead-to-nuclear-war/)
Short fuses on U.S. and Russian strategic forces have particularly increased the risk of accidental
nuclear war, according to Cartwright, while ”the sophistication of the cyberthreat [to nuclear weapons]
has increased exponentially.” “One-half of their [U.S. and Russian] strategic arsenals are continuously
maintained on high alert. Hundreds of missiles carrying nearly 1,800 warheads are ready to fly at a
moment’s notice,” a policy report compiled by a study group chaired by the retired U.S. general
summarized. “At the brink of conflict, nuclear command and warning networks around the world may be
besieged by electronic intruders whose onslaught degrades the coherence and rationality of nuclear
decision-making,” the report further points out. The War Games-like scenario could unfold in one of
the following three ways: First, sophisticated attackers from cyberspace could spoof U.S. or Russian
early warning networks into reporting that nuclear missiles have been launched, which would demand
immediate retaliatory strikes according to both nations’ nuclear warfare doctrines. Second, online
hackers could manipulate communication systems into issuing unauthorized launch orders to missile
crews. Third and last, attackers could directly hack into missile command and control systems launching
the weapon or dismantling it on site ( a highly unlikely scenario). To reduce the likelihood of
such an scenario ever occurring, Cartwright proposes that Moscow and Washington should
adjust their nuclear war contingency plan timetables from calling for missiles to be launched
within 3 to 5 minutes to 24 to 72 hours. Reducing the lead time to prepare nuclear missiles for
launch would not diminish the deterrent value of the weapons, Cartwright, who headed Strategic
Command from 2004 to 2007 and was vice chairman of the Joint Chiefs of Staff before retiring
in 2011, emphasized. However, the Obama White House has so far rejected the idea, particularly due
to the recent deterioration of U.S.-Russia relations . Also, Robert Scher, Assistant Secretary of
Defense for Strategy, Plans, and Capabilities, testified in Congress this month arguing “it did not
make any great sense to de-alert forces” because nuclear missiles “needed to be ready and effective and
able to prosecute the mission at any point in time.” Cartwright’s credibility may have also suffered
among Washington policy circles ever since he has been under investigation for leaking
information about the top secret Stuxnet virus – a sophisticated cyber weapon allegedly jointly
developed by Israel and the United States – to the New York Times. Nevertheless, a co-authored
paper, seen in draft by The Diplomat, argues that “cyber weapons and strategies have brought us to
a situation of aggravated nuclear instability that needs to be more explicitly and more openly
addressed in the diplomacy of leading powers, both in private and in public.” The authors, Greg
Austin of the EastWest Institute in New York (and a regular contributor to The Diplomat) and
Pavel Sharikov of the Russian Academy of Sciences, have concluded that “Russia now sees U.S.
plans to disrupt the command and control of its nuclear weapons as the only actual (current)
threat at the strategic level of warfare.” Laura Saalman of the Asia Pacific Research Centre in
Hawaii has also warned of the need to look at the impact of U.S. strategies and nuclear force
posture on China in a 2014 paper titled “Prompt Global Strike: China and the Spear”.

Cyberattacks escalate to nuclear war and extinction.

Nolan, 15
Andrew Nolan, Legislative Attorney at the Congressional Research Service, former Trial
Attorney at the United States Department of Justice, holds a J.D. from George Washington
University, 2015 (“Cybersecurity and Information Sharing: Legal Challenges and Solutions,”
CRS Report to Congress, March 16th, Available Online at
http://fas.org/sgp/crs/intel/R43941.pdf, Accessed 07-05-2015, p. 1-3)
The high profile cyberattacks of 2014 and early 2015 appear to be indicative of a broader trend: the
frequency and ferocity of cyberattacks are increasing,11 posing grave threats to the national interests
of the United States. Indeed, the attacks on Target, eBay, Home Depot, J.P. Morgan-Chase, Sony
Pictures, and Anthem were only a few of the many publicly disclosed cyberattacks perpetrated in
2014 and 2105.12 Experts suggest that hundreds of thousands of other entities may have suffered
similar incidents during the same period,13 with one survey indicating that 43% of firms in the
United States had experienced a data breach in the past year.14 Moreover, just as the cyberattacks
of 2013—which included incidents involving companies like the New York Times, Facebook,
Twitter, Apple, and Microsoft15—were eclipsed by those that occurred in 2014,16 the consensus
view is that 2015 and beyond will witness more frequent and more sophisticated cyber incidents.17 To
the extent that its expected rise outpaces any corresponding rise in the ability to defend against
such attacks, the result could be troubling news for countless businesses that rely more and more
on computers in all aspects of their operations, as the economic losses resulting from a single
cyberattack can be extremely costly.18 And the resulting effects of a cyberattack can have effects
beyond a single company’s bottom line. As “nations are becoming ever more dependent on
information and information technology,”19 the threat posed by any one cyberattack [end page 2] can
have “devastating collateral and cascading effects across a wide range of physical, economic and social
systems.”20 With reports that foreign nations—such as Russia, China, Iran, and North Korea—may be
using cyberspace as a new front to wage war, 21 fears abound that a cyberattack could be used to shut
down the nation’s electrical grid,22 hijack a commercial airliner,23 or even launch a nuclear weapon
with a single keystroke.24 In short, the potential exists that the United States could suffer a “cyber
Pearl Harbor,” an attack that would “cause physical destruction and loss of life”25 and expose—in the
words of one prominent cybersecurity expert—“vulnerabilities of staggering proportions.”26
 AT: SQ Solving / U.S. Supporting AIIB Now

***note when prepping the file --- the Ahmad, 15 ev in “AT: CP Cooperate But
Don’t Join AIIB” and the Lazarus, 3/2/16 ev (now in the 1ac) are also useful to
answer this argument.

U.S. not supporting AIIB now --- the plan will improve global economic governance
and recalibrate policy toward China
Son, 5/17/16 (Joshua, Market News International, “US Should Change Stance, Join Asia
Investment Bank – Analysts,” Factiva, JMP)
WASHINGTON (MNI) - The United States should join or at least be more open to the Asian
Infrastructure Investment Bank, as it would improve global economic governance, analysts said
Tuesday. "In Asia, there is competition between China-led economic and trade organization vs. the US-
led TPP (Trans-Pacific Partnership), but this is not a good idea," Sook Jong Lee, president of the East
Asia Institute said during a panel discussion at the Council of Foreign Relations. "It's more rational
for the USA to join AIIB. By participating in AIIB, we can make governance more transparent and
democratic," Lee said. With Chinese leadership, the AIIB started operation in December 2015,
with the promise to "focus on the development of infrastructure and other productive sectors in
Asia, including energy and power, transportation and telecommunications, and rural
infrastructure and agriculture development," among other development sectors. The AIIB
currently has 57 members spread across Asia, Europe, Oceania, Africa, and South America. The
U.S. government has been wary of the AIIB's presence. After the UK joined the AIIB in March, a
U.S. official told the Financial Times, "We are wary about a trend toward constant
accommodation to China, which is not the best way to engage a rising power." In April, Nathan
Sheets, Treasury undersecretary for international affairs, told a House Financial Services subcommittee
hearing that while the AIIB could be "a constructive addition" to global governance provided it
maintained high standards, the administraion is not considering an investment in the bank in the near
future. Michael Fullilove, executive director of the Lowy Institute for International Policy , who also
spoke on the panel, agreed the U.S. should change its tack towards the development bank. "The USA
and likeminded countries need to get the right balance of engaging and hedging with China,"
Fullilove said. "If we're not going to allow China the ability to set up some kind of infrastructure
investment bank in Asia where it's required, then what prerogatives are we going to allow China?"

SQ not enough --- U.S. should still try to join the bank and engage it to ensure
effectiveness
Keatley, 15 --- former editor of the Asian Wall Street Journal and the South China Morning
Post of Hong Kong (4/18/15, Robert, “China's AIIB Challenge: How Should America
Respond?” http://nationalinterest.org/feature/americas-big-strategic-blunder-not-joining-chinas-
aiib-12666, downloaded 4/23/16, JMP)
The well-worn advice that “if you can’t beat them, join them” may be the right counsel as Washington
ponders what to do next about the new China-backed investment bank intended to finance Asian
infrastructure needs while also promoting Chinese influence. And as they think about it, U.S.
officials might also relax a bit.
Doing so would be much wiser than the Obama Administration’s first reaction—attempting to
block the bank’s creation, or failing that, prevent it from becoming an important financial agency
with broad membership and significant influence. That effort failed miserably, due either to bad
judgment or inattention, so now, the new bank is off and running at high speed. Fifty-seven [4]
nations, including most of America’s closest friends and allies, have joined [4] China as
founding members of what is officially the Asian Infrastructure Investment Bank (AIIB), with
even Taiwan trying to devise what Beijing would consider “an appropriate name” so it too can be
a member. Of the world’s major economies, only the United States and Japan remain outside
(and Tokyo is considering a plan to join later with a $1.5 billion capital contribution).
As a former American ambassador to China noted recently [5], American policy has proven to be
“a major strategic blunder.” The initial U.S. response had no possible upside but did promise—
and delivered—a great deal of downside.
The new development bank, in fact, is still being developed and just how it will operate remains to be
determined. But the broad outlines are clear. First proposed by Chinese President Xi Jinping in late
2013, it is supposed to provide financing for seaports, airports, roads, railroads and other
infrastructure needs across Asia and thereby stimulate the region’s economic growth. China has
promised to provide up to $50 billion of its initial capital and hopes others will match that total.
The headquarters will be in Beijing and its first leader [6] (already chosen) will be Chinese; to
some degree, it will be a rival of the American-led World Bank in Washington and the Asian
Development Bank (ADB), a Japanese-led institution based in Manila. Though not openly stated,
but obviously true, China’s motives include using the bank to increase its political influence in
neighboring nations, where Beijing’s sometimes aggressive diplomatic and military actions have
caused great worry. In any case, there’s no doubt that the proposed AIIB will become reality,
perhaps by the end of the year.
Realizing that it chose a faulty course, the Obama Administration has already begun tacking in the new
bank’s direction. After a recent Beijing visit, Treasury Secretary Jack Lew said [7] “the US stands ready
to welcome new additions to the international development architecture” —a sharp contrast to late last
year when senior White House officials were criticizing the AIIB as unsound and unneeded, and
pressuring allies to stay away. But Lew repeated [8] a major American caveat: to be truly
worthwhile, the AIIB must “share the international community’s strong commitment to genuine
multilateral decision-making and ever-improving lending standards and safeguards.” In other words,
member states must not let the bank become an agency for advancing narrow Chinese economic
interests in corrupt ways at the expense of local citizens and the environment.
These concerns show that the initial American reaction, however unwise, was not irrational. The
Chinese record as a lender to developing nations is spotty at best. Too often it has provided loans
to kleptocratic regimes that finance Chinese companies using imported Chinese workers on
projects that mainly ship energy and raw materials back to Chinese industry; sometimes bribes
grease the way, while the local environment and economy can suffer. Some experts say the
Chinese record in Africa, for example, is no better than that of 19th century European
colonialists. Other Chinese loans, such as $86 billion to Venezuela, were made primarily for
political reasons and may never be repaid.
A few countries, most recently Sri Lanka and Myanmar, have canceled [9] Chinese-funded
projects on grounds that corruption paved their way and they serve no basic local purpose.
During his successful campaign, Sri Lanka’s new president, Maithripala Sirisena, described [10]
local Chinese projects as “robbery taking place before everybody and in broad daylight….if this
trend continues for another six years our country would become a colony and we would become
slaves.” Since taking office, he has suspended work on a $1.5 billion Beijing-funded port project.
But from the first, the AIIB was promised as something quite different, a bank that would follow
international norms and be devoted to economically sound projects of value to the borrowers. Jin
Liqun [11], the Chinese official expected to become its first secretary general, has vowed that operations
will be “lean, clean and green,” with at least half its staff recruited from overseas. Jin, a former
Chinese deputy finance minister and ADB vice president, also has said its operations will be both
corruption-free and transparent, two traits seldom found in Chinese governance. Governing
board members elected from other member states, such as Great Britain and Canada, are
expected to ensure those guidelines are followed.
Washington’s next move is unclear. To join would require a capital commitment, something a
Republican Congress is unlikely to provide even if President Obama asks. After all, the AIIB
was born partly because Congress consistently has refused to authorize a larger voice for Beijing
in international agencies that the United States dominates, which would give China a role
reflecting its new economic strength. For example, for five years it has ignored legislation
authorizing a cost-free (to U.S. taxpayers) revision of International Monetary Fund quotas
despite administration urging. Even so, the administration should swallow its pride and explore the
possibility of getting inside the tent, perhaps with Japan, rather than remain a lonely outsider. On
the positive side, Jim Yong Kim, the American who leads the World Bank, already plans talks
about future cooperation with the AIIB.
To date, the political payoff for Washington has been entirely negative. According [12] to Singapore
academic and former diplomat Kishore Mahbubani, a persistent America-basher, the AIIB’s
creation marks “the end of the American century and the arrival of the Asian century.” The claim
is nonsense—the bank is not that important, and the United States remains the world’s leading
economy, most powerful military force, and a central figure in the region; most Asian states want
to keep close relations with America. But Washington’s efforts to stiff the new bank, and persuade
friends to do the same, made it seem churlish, while Beijing appeared outgoing and generous. It also fed
the political divide between Japan and China, a major U.S. worry. Most countries ignored
Washington’s advice and signed up for their own reasons; Britain perhaps to ensure that London
(rather than Frankfurt) remains a center for trading the Chinese yuan, while others saw
investment opportunities or a source of needed finance. All this produced soft diplomacy gains for
China at America’s expense, undermining the official U.S. policy of tilting Asia’s way .
Whatever American officials do about the bank eventually, they could well relax a bit. If it does
operate on promised terms, the AIIB should be a useful contributor to Asia’s economic
development. But it cannot possibly dominate the Asian financial arena, nor replace other
institutions. According to the ADB, Asia needs $800 billion annually for a decade to meet its
infrastructure needs, a vast sum far beyond the combined capabilities of all international
agencies. (The ADB, for example, has provided only $13 billion annually in recent times though
it hopes to do more.) Huge amounts of national and private capital are also needed, and no single
government or institution can provide it alone. If the United States works to remain engaged in
Asia, it will; even a successful AIIB will not let China displace it.
So Washington’s best course could be to join up if possible. If a Republican Congress blocks the
effort, the administration should work with the AIIB directly, as well as through friendly members and
agencies like the World Bank and ADB, to keep it on the promised “lean, clean and green” course . If the
new bank succeeds, Asia will benefit significantly. And if it degenerates into another corrupt
organization designed to extract resources for Chinese industry, Beijing will suffer the political
consequences.

U.S. and Japan unlikely to join the AIIB

Orr, 5/4/16 --- US ambassador to the Asian Development Bank from 2010 to 2016 and is a
member of the Pacific Forum CSIS Board (Robert M., “PacNet #39 - The Asian Development
Bank and the Asian Infrastructure Investment Bank: conditional collaboration?”
https://www.csis.org/analysis/pacnet-39-asian-development-bank-and-asian-infrastructure-
investment-bank-conditional, article downloaded 6/7/16, JMP)
The controversy surrounding the creation of the AIIB was intense, as some countries worried
about Washington’s reaction or Tokyo’s or both. In October 2014, 22 Asian countries met in
Beijing to sign a Memorandum of Understanding to establish the AIIB; rapid progress in creating
the bank ensued. The big break was when the United Kingdom announced its intention to join the AIIB
– not necessarily pleasing other European nations who felt London had jumped the gun.
However, shortly thereafter other Europeans signed up. Japan and the US have not. It is difficult to see a
near-term chance of their joining despite many voices in Tokyo and Washington advocating just that.

U.S. not participating or investing in AIIB now

Reuters News, 4/27/16 (“U.S. Treasury official: China's AIIB can be "constructive addition"”
Factiva, JMP)
WASHINGTON, April 27 (Reuters) - The U.S. Treasury's top international official said on
Wednesday that he believes China's new development bank can be a "constructive addition" to the
world's multilateral lenders if it follows best practices and institutes proper safeguards.

But Nathan Sheets, Treasury undersecretary for international affairs, said that the United States is not
presently considering an investment in the new Beijing-based Asian Infrastructure Investment
Bank.
Sheets told a U.S. House Financial Services subcommittee meeting that the Treasury would need to
see a positive track record from AIIB before considering such an investment in the future .

Sheets also said that Greece would not have access to the International Monetary Fund's
exceptional lending facilities in the next phase of its bailout, adding that the Treasury supports
the IMF's insistence that the bailout be restructured to make Greece's debt sustainable with more
reforms from Athens and debt relief from European lenders. (Reporting By David Lawder;
Editing by Chizu Nomiyama)
 AT: IMF Reform Solves

***note when prepping file --- there is evidence in the 1ac at AT: CPs that is also
applicable to answering this argument.

IMF reform isn’t enough --- U.S. will have to address China’s growing influence
through the AIIB
Soergel, 6/10/15 --- Economy Reporter at U.S. News (Andrew, “Amid U.S. Paralysis, China
Cashing In; While Congress has failed to move forward with IMF reforms, Beijing is poised to
boost its banking power,” http://www.usnews.com/news/articles/2015/06/10/asian-infrastructure-
investment-bank-chinas-answer-to-western-marginalization, article downloaded on 6/7/16, JMP)
***Note --- Rajiv Biswas is Asia-Pacific chief economist at IHS Global Insight, an economic
analysis firm
In the meantime, China – a country whose say in the IMF is now almost comically dwarfed by
smaller economies like the U.K., France, Germany and Japan – appears to be fed up with being
marginalized and waiting for Congress to make a move.
Enter the AIIB. Through it, China gains not only more influence, but more power through that
influence.

"The situation within the IMF and the World Bank is limiting the ability of China to use its
increased economic size to put more liquidity into these institutions, which is not good for these
institutions. And it's not good for developing countries because it means the size of the lending
capabilities of the world banks is rather restricted," Biswas says. "I think what it means for
developing countries is the true size of the Chinese economy can come to bear in terms of capital
funding and development."
How the new bank will be governed has not been finalized, though a report this week from The
Wall Street Journal cited "people close to the institution" as saying China will have veto power
over major decisions in the AIIB, possibly similar to America's veto power in the IMF.
"Initial indications are that China and India will most likely have significant voting rights,"
Biswas says. "And the total voting rights of all Asian member countries will be well above 50
percent of the total AIIB voting rights."
The U.S. hasn't publicly attacked the formation of the AIIB or its international partners who
intend to be part of it, although an unnamed U.S. official in March sparked backlash by telling
the Financial Times that the U.K. was developing "a trend toward constant accommodation of
China" when the British announced interest in joining the AIIB.
"We clearly haven't made the decision to join," White House spokeswoman Jen Psaki said
shortly after the U.K. announced its plan to partner with the new bank. "We believe that, while
there's a need to enhance infrastructure around the world, that multilateral institutions should
have the highest standards that the international community has built."
The U.S. has, however, been accused of unsuccessfully pressuring its Western allies to steer
clear of the new investment bank. Officials reportedly have raised questions about China's ability
to govern the union in a noncorrupt manner, though American pleas have largely fallen on deaf
ears as the AIIB is offering something U.S. pressure can't really compete with.
"We're offering the world market access and democracy, and the Chinese are offering the world
cash. It's the old story: Does the girl marry for love or for money?" Morici says. "Nation-states
tend to marry for money, unless they feel an existential threat."
China will also command a leading role in the New Development Bank, an institution similar to
the IMF that would be spearheaded by the BRICS countries: Brazil, Russia, India, China and
South Africa. Through these new institutions and its investment of $40 billion into a Silk Road
infrastructure project, Beijing will be able to increasingly flex its economic prowess without the
restrictions placed on it by the IMF and World Bank.
For other countries, joining the AIIB is as much about funding development as it is showing a
willingness to play ball with Asia's adolescent economic titans.
"Many EU nations as well as several developed countries in the Asia-Pacific have joined the
AIIB," Biswas says. "They see this as an important opportunity to build business opportunities
for their firms and financial institutions in the fast-growing Asian markets.”
And now, even if Congress spontaneously approves IMF reforms and decides to finally share its toys,
it'll be too little, too late. Beijing went out and got its own toys to play with, and the U.S. and the
Western world will have to come to terms with China's continued emergence and influence.
 Solves SCS Conflict

AIIB will force China to be more conciliatory in the South and East China Seas
Dr. Kawai, 15 --- Professor at the University of Tokyo’s Graduate School of Public Policy (last
modified on 8/7/2015, Masahiro Kawai, ASIAN INFRASTRUCTURE INVESTMENT BANK:
CHINA AS RESPONSIBLE STAKEHOLDER?, “Asian Infrastructure Investment Bank in the
Evolving International Financial Order,” http://spfusa.org/wp-content/uploads/2015/07/AIIB-
Report_4web.pdf, downloaded 6/1/16, JMP)
(1) Challenges for China
Once AIIB is established, Beijing will be under intense international scrutiny to deliver results.
China cannot afford AIIB’s failure, as the country’s highest political leadership has driven the
AIIB initiative. Indeed, if the bank were to fail, China’s reputation and clout as an emerging
global power would be seriously damaged. To be successful, China has to ensure that AIIB does not
become a Chinese fiefdom, but rather conforms to international norms and standards of transparency
(Acharya 2015).
Essentially, running an international financial institution requires transparency of decision-making,
accountability to shareholders, coordination of different international stakeholders and consideration of
the environmental and social dimensions of infrastructure projects. But these considerations are foreign to
China’s political and social system. In addition, running a bank requires a strong credit and banking
culture, which China’s state-bank-dominated financial system lacks.
Acharya (2015) argues that, for China to succeed with this venture, the country needs to make
significant adjustments to its regional policy by abandoning its expansive territorial claims and
enhancing its military and economic transparency . Absent such changes, it would be difficult to
establish trust with the many other AIIB members who are apprehensive about Beijing’s geopolitical
intentions. If this optimistic argument is correct and China adjusts its policies, any resulting
success of AIIB would mean that not only China but also Asia and the West, including the
United States and other countries which have invested in the current system of global
governance, would all be winners.
This suggests that AIIB management must promote the transparency of its governance and effectiveness
of operations, and that China’s highest political leadership has to take a more conciliatory approach to
neighboring countries on territorial disputes and issues in the South and East China Seas .
 Relations Solve War / Outweighs

Failure to establish good relations guarantees war --- coop key to economy and
climate solutions
Ash, 10/16/15 (Timothy Garton Ash, “If US relations with China turn sour, there will probably
be war; America needs a strategy to handle its superpower rival that can last 20 years. Instead we
get soundbites,” http://www.theguardian.com/commentisfree/2015/oct/16/us-relations-china-
war-america, downloaded 4/22/16, JMP)
What is the biggest challenge facing the next president of the United States? How to deal with
China. The relationship between the emerging and the enduring superpower is the greatest geopolitical
question of our time.

If Washington and Beijing do not get it right, there will probably be war somewhere in Asia some time
over the next decade. Vladimir Putin’s neo-imperialist Russia and the brutality of Islamic State are
medium-sized regional challenges by comparison. Climate change and the world economy cannot be
managed without American-Chinese cooperation. All this demands a bipartisan American grand
strategy for the next 20 years, but US politics seems incapable of generating anything more than
a partisan soundbite for the next 20 minutes.
 AT: Relations Resilient

Expanding economic engagement key to maintain foundation for relations --- lowers
risk of conflict
Dollar, 15 --- Senior Fellow, John L. Thornton China Center at Brookings (9/30/15, David,
“INTERNATIONAL ECONOMIC GOVERNANCE AND CHINA’S RISE: HOW SHOULD
THE UNITED STATES AND JAPAN RESPOND?”
http://www.brookings.edu/~/media/events/2015/09/30-international-economic-governance-
chinas-rise/20150930_china_economic_governance_transcript.pdf, article downloaded 6/12/16,
JMP)
DR. DOLLAR: The leaders on the two sides, U.S. and China, leaders that for a long time said that
the economic relationship was the foundation of the overall relationship, and I don’t think this is true
anymore. I think the economic relationship is stagnating and that as Ken was intimating, I think the
real positive area of U.S.-China relations is cooperation on global public goods like climate change and
nonproliferation in Iran, these kinds of issues. And that’s positive but I worry that that can easily be
kind of opportunistic and without that deeper economic integration that may not persist . So when
you look for markers I would be looking for do we get a bilateral investment treaty between
China and the United States, do we get TPP, does China eventually join TPP or negotiate some
kind of free trade agreement with the U.S. I think without deeper economic institutional
integration I think it’s going to be hard to advance all aspects of the relationship. And then the risks of
conflict become much greater.

U.S. opposition to AIIB causes Chinese media to spin narrative of economic

containment
Solis & Dollar, 15 --- Senior Fellow & Philip Knight Chair in Japan Studies at Brookings,
AND **Senior Fellow, John L. Thornton China Center at Brookings (9/30/15, Mireya & David,
“INTERNATIONAL ECONOMIC GOVERNANCE AND CHINA’S RISE: HOW SHOULD
THE UNITED STATES AND JAPAN RESPOND?”
http://www.brookings.edu/~/media/events/2015/09/30-international-economic-governance-
chinas-rise/20150930_china_economic_governance_transcript.pdf, article downloaded 6/12/16,
JMP)
MS. SOLÍS: And do you think – exactly. Do you think the Chinese understand that in terms of
overall approach the United States wants to work with China but then there are the messy
unwieldly domestic politics, the congress not moving on the IMF reform, do you think that they
see that and make that distinction?
DR. DOLLAR: So I’ve been in plenty of meetings with senior Chinese leaders, I think they get
what I said and they often start the meeting by some short version of what I just said. But frankly
in the Chinese media, the Chinese internet, there’s a lot of focus on these negative things, the U.S.
opposing AIB, the U.S. not supporting China’s growing weight in the IMF. So you definitely have a
very dynamic narrative in social media in China that the U.S. is trying to keep China down
economically, which I find a little bit ironic and frustrating because I think the United States has been
really quite engaging.

SOLVENCY
 Solvency – U.S. Join AIIB

Joining the bank is key to give U.S. ability to gain market in Asia and ensure
compromises to crises
Chakko, 15 --- Former U.N. correspondent (3/18/15, George,
http://blogs.cfr.org/asia/2015/03/16/the-aiib-debacle-what-washington-should-do-now/, article
downloaded 5/3/16, JMP) ***note --- this evidence is a comment posted in response to an
article
I fully go along with Elizabeth’s wise second option. Prophetic futuristic thinking has not
necessarily been a U.S. govt. talent, nor its strength. In this globalized village the U.S. has all to gain
by joining the AIIB instead of a ‘narcissistic’ self-isolating withdrawal , all the more as the U.S. has
lost and continues losing influence in the wider world at large. It is only by being in the club that the
U.S. will ever have any tangible leverage on the democratization of such institutions and the market. It
would be absolutely foolish on Obama administration to let this chance go unutilised.

Secondly, since the bank is catering to infrastructure development, where the true economic growth lies
at field level, the U.S. has a direct chance to have a good bite on the Asian market pie, especially for
U.S. companies having an eye on a vast, world’s largest growing market (Asia). Pres. Obama’s Asia
pivot has been a very smart decision, based on an unchallengeable perception that this century belongs to
Asia. So the leading economies of a stagnant Europe lost no time in immediately jumping into the AIIB
waggon with a lead given by an adept colonial past-master the U.K. followed by France,
Germany, Italy etc. with a hundred percent surety that Australia & New Zealand will follow suit.
To dis-advise them makes no economic sense, neither political..
Thirdly, many seem to underestimate that economic engagement is the best forerunner for more
political adjustment, compromise and leverage in times of crises in Asia. Interestingly, since the AIIB is
a China-led initiative, China per force will have to be more accommodating and cannot afford any
hegemonic attitude towards its neighbours in Asia. We have already seen a remarkable turnaround by
the Chinese president towards Modi government and India, because China wants India to play an
important strong role in SCO and BRICS and in the Asian market. There is one issue that has not
surfaced yet though. How the BRICS New Development Bank will tally/align with the goals of
AIIB remains to be seen. Irrespective of that the situation created by AIIB bespeaks only
advantages to U.S. economy than any negatives. One can only hope that Washington will not
resort to self-harm by letting a golden chance go waste.
 U.S. Participation Gives Influence in AIIB

U.S. should join the AIIB --- gives it greater influence in the bank
Obe, 1/18/16 (Mitsuro, Dow Jones Newswires Chinese (English), “U.S. Should Join China
Infrastructure Bank, Former Envoy to ADB Says,” Factiva, JMP)
Japan and the U.S. should join a Beijing-led infrastructure bank officially launched over the weekend,
said a former U.S. envoy to the Asian Development Bank.

"We need to have some influence on the management of this institution. We are not going to have
any influence by sitting on the outside," Robert Orr, who served until this month as U.S. ambassador
to the Manila-based ADB, said during farewell remarks Friday in Tokyo.

The Beijing-led Asian Infrastructure Investment Bank was conceived by China as an alternative
to the Japan-dominated ADB and the Washington-controlled World Bank. It is also aimed at
boosting China's soft power and challenging the U.S.-led global development order, especially in
Asia.
 U.S. Participation Ensures Higher Standards

***note when prepping file --- this ev is also very good to answer many of the AIIB
Bad Turns

U.S. participation will ensure higher standards for the AIIB --- joining is net more
effective than continued opposition
Moore, 15 --- Associate Professor of International Relations at the School of Public Affairs at
Zhejiang University and a member of the National Committee on US-China Relations (3/31/15,
Greg, “No Escape: America Should Join China's New Bank,”
http://nationalinterest.org/feature/no-escape-america-should-join-chinas-new-bank-12508, article
downloaded 4/24/16, JMP)
China’s Asian Infrastructure Investment Bank (AIIB) got several major boosts this past week,
when the UK, Germany, France, Italy, Turkey and South Korea all announced plans to join, in
addition to India and others already on board. This wave of U.S. allies [4] flocking to join the
China-led financial institution demonstrates the limits of Washington’s influence over its allies,
at least in financial matters, for U.S. diplomats have been working overtime in recent months to
discourage its allies from joining the AIIB.
The United States’ concerns about the new bank are legitimate. This is not just a U.S. power play to keep
China’s influence down. U.S. Treasury Secretary Jack Lew and others have warned [5] that at present the
bank appears to be well below international standards in governance, transparency, environmental/labor
safeguards and other global lending norms. Chinese state-run corporations and institutions have not
scored high historically on issues of transparency, insulation from partisan Chinese governmental
political machinations or adherence to objective rules-based governance, among other things,
and so concerns about the potential for problems regarding the AIIB are not unfounded.
However, the question raised here is whether or not the United States’ extant strategy of trying to isolate
the new institution is really the best strategy for addressing these concerns. My conclusion is that it is
clear (especially now) that it is not, and the United States should simply sign on to the AIIB prior to
the March 31 deadline for founding members for the following reasons.
First and foremost, doing so would allow it to work with its allies and other like-minded partners to
help shape the new institution and hold the bank’s leadership accountable to global standards .

Second, the Wall Street Journal reported that China has relinquished its veto at the AIIB [6] as a
condition to the accession of a number of Western European partners, and this should allay some
concerns the United States has had that Beijing would be able to use the bank to forward its
(sometimes alternative) political agenda via AIIB lending, for example. Relinquishing the veto is
a major concession, and appears to be a sign of Beijing’s willingness to be accountable to the
international community to some degree.

Third, the United States has argued for some time that it desires to see China become “a
responsible stakeholder” in the international system. This is a reasonable and rational request,
and one that the Chinese themselves have found agreeable and have generally embraced (perhaps
its maritime policies and things like its support for the Pyongyang regime following the sinking
of South Korea’s Cheonan aside). China’s establishment of the AIIB could be a significant way for
China to demonstrate it is indeed serious about becoming a responsible stakeholder , for surely there is a
need for more loans in the region of the sort the bank could conceivably offer.
Fourth, it is clear the U.S. policy of attempting to isolate the Chinese in their establishment of the bank ,
and to encourage U.S. allies not to join, has failed, and it appears certain that the bank will move
forward with or without the United States’ blessing. The United States must now move on, in search
of a “what next” strategy. Joining the bank is the most reasonable choice at this point, particularly
since the United States could have significant help from its allies in working inside the new bank to make
sure it maintains high standards.

Fifth, and related, now that the bank appears poised to move forward with a successful launch, the
United States would truly look like a stick in the mud by staying out, and doing so might cost the United
States more in damaged relations with Beijing in the long run than whatever the United States might
hope to gain (if anything at this point) by staying out.

Last, by joining the AIIB as a founding member, the United States could reserve the right to
withdraw from membership in protest down the road if U.S. (and general Western) concerns are
not adequately addressed. The United States would have greater leverage in this sense by being
in the bank than by remaining outside it.
American policy makers should have more confidence in their liberal policy proclivities than
their current policy demonstrates. The rest of the world knows that global standards for such
institutions are everyone’s “best practices” currently, and these standards reflect cherished liberal
(and humanitarian) values. If China chooses to flout these values and practices, and instead
chooses to use the AIIB for partisan political gain, it will be painfully obvious to everyone, and
the other members would likely criticize Beijing for this. Given its level of interdependence with
the rest of the world, China is highly accountable and vulnerable to international pressure if it
misbehaves. Let us give China the benefit of the doubt for now, and let’s allow them the chance
to prove they are responsible stakeholders (or not).
As Daniel Drezner, Jack Lew himself and others have pointed out, the United States should have
supported reforms of the Bretton Woods institutions earlier. If it had, perhaps there would have
been no market for the AIIB, or at least less support for its establishment. As things currently
stand, however, a continued U.S. policy of trying to isolate Beijing over the AIIB only serves to isolate
Washington, and does less to address Washington’s legitimate concerns about the bank than
becoming a member likely would.
 Plan Solves Relations / China Rise Adv

***note when prepping file --- this ev is a good answer to any arguments why allies
would not approve of the plan or be concerned that the plan was a signal of U.S.
weakness

The plan signals to China that the U.S. accepts its growing responsible leadership ---
and prevents China from dominating regional institutions
Revere, 1/25/16 --- Nonresident Senior Fellow, Foreign Policy, Center for East Asia Policy
Studies at Brookings (Evans J.R. Revere, “U.S. policy and East Asian security: Challenge and
response,” http://www.brookings.edu/research/presentations/2016/01/25-policy-and-east-asian-
security-revere, article downloaded on 5/29/16, JMP)
The China challenge
Without question, the preeminent geo-strategic challenge facing the United States in East Asia is the one
posed by an economically and military powerful China eager to establish itself as a dominant -- perhaps
the predominant -- actor in the region. For U.S. policy makers, the main task in responding to this
challenge is trying to accommodate China’s determination to play a greater role while
simultaneously reassuring allies and partners that Beijing will not be allowed to become the
regional hegemon. In doing so, Washington must also tackle the challenge of keeping U.S.
relations with China on a positive plane and establishing a modus vivendi with a Beijing whose
intentions are opaque, whose ambitions are multi-dimensional, and whose ideological
underpinnings run counter to core U.S. values.
China seeks a central role in regional institution building and intends to bring its considerable economic
power to bear to ensure its voice is heard. Beijing’s establishment of the Asia Infrastructure Investment
Bank (AIIB) and its “One Belt, One Road” initiative, together with its activist membership in Asia’s
Regional Comprehensive Economic Partnership (RCEP), reflect both its ambitions and its increasing
clout.

As long as these efforts remain transparent and open to broad participation, and as long as they
adhere to globally accepted standards and do not undercut the role of existing institutions, they
are to be welcomed. After all, the United States has long urged China to be a “responsible
stakeholder,” and it is to be expected that a more economically powerful China would want to
have a say in making the rules and shaping the institutions in which it participates.
But as China’s power and influence grow, U.S. policy makers are increasingly focused on how to ensure
that China does not rewrite the rules of the regional economic and political order in a way that damages
the status quo or enables Beijing to dominate regional institutions to the detriment of the United States
and its interests -- and to the consternation of America’s allies and partners .

Washington’s response to China thus far in this area has been problematic. U.S. rejection of AIIB
membership sent the wrong signal to Beijing about U.S. willingness to cooperate with a more activist
China. It also appeared to contradict Washington’s longstanding “stakeholder” argument.
Washington’s decision not to join meant that the United States would not be a part of the decision-
making fabric of the organization -- preventing the United States from exercising leverage and from
helping to shape the organization’s development. One task for future policy makers will be to revisit
this ill-advised decision.[i]
 AT: AIIB Bad Turn --- Top Level

U.S. wins no matter what --- either China demonstrates it is a responsible

stakeholder or the AIIB fails and existing multilateral institutions look better
Harris, 15 --- Economy, Trade, and Business Fellow at Sasakawa Peace Foundation USA (last
modified on 8/7/2015, Tobias, ASIAN INFRASTRUCTURE INVESTMENT BANK: CHINA
AS RESPONSIBLE STAKEHOLDER?, “The U.S. Response to the Asian Infrastructure
Investment Bank,” http://spfusa.org/wp-content/uploads/2015/07/AIIB-Report_4web.pdf,
downloaded 6/1/16, JMP)
Third, as the United States has learned through its own experience with multilateral institutions –
especially multilateral development institutions – it is difficult to run them well. The United States
could, therefore, afford to be more sanguine towards China’s multilateral initiatives. As China has already
discovered with AIIB, a genuinely multilateral institution is difficult for a single country to dominate.
Essentially, China’s pursuit of multilateral institutions could work in favor of the United States,
regardless of how the institutions turn out. If the institutions succeed, it means that China has accepted
the constraints that come with participation – that, in effect, China has accepted the logic of Washington’s
“responsible stakeholder” argument. If the institutions fail because China has alienated other participating
countries, the incumbent multilateral institutions will look even better by comparison.
 AT: AIIB Bad Turn --- U.S. Leadership

AIIB isn’t a threat to existing institutions or U.S. leadership --- engagement on this
issue is the best way to influence China
Katzenstein, 15 --- taught at the University of New Orleans and the University of Minnesota,
through an affiliation with the Humphrey Institute he was one of the trainers for the initial
Chinese WTO delegation (5/12/15, Lawrence, “Why the U.S. should support the AIIB,”
http://globalriskinsights.com/2015/05/why-the-u-s-should-support-the-aiib/, article downloaded
6/14/16, JMP)
While many fear China’s rise and emerging power in international institutions, the AIIB represents a
unique opportunity for the United States.

While it’s currently difficult to predict the impact of China’s proposed Asian Infrastructure
Investment Bank, its broad outlines have taken shape. Moreover, the support of 57 nations and
offers of coordination with the Asian Development Bank, the World Bank and the IMF afford
the new institution relevant expertise.
The founding prospective members have recently entered into a series of meetings to negotiate
the details of the bank’s operations. Since the bank will finance infrastructure in one of the most
active areas of the global economy, and became controversial when the U.S. tried to block its
allies from joining, its rise holds lessons for both the U.S and China.
This article will question the relevance of the power transition framework in this case. A
subsequent article will deal with the likely operations and possible investment opportunities
afforded by this institution.
The AIIB and the U.S. -China Power Transition
Some have written about China’s economic rise overturning the existing the multilateral institutions set
up by the U.S. at Bretton Woods.
There has been a parallel concern about China’s strategic rise and the security of Asian states at odds with
China in the East and South China Seas disputes.

Analysts have invoked the theory of power transition, drawn from peace research, to look at any
potential U.S.-China rivalry. A classic example of a power transition leading to war was
Germany’s capability growth compared with that of Britain’s prior to the onset of WWI.
However, the rise of a new power in relation to the lead power needn’t always result in war .
We saw this when the U.S. surpassed Britain after WWII. In fact, Japan’s economic growth in
the 1980s led to joint global governance, as well. But, there were even those who predicted a
coming war with Japan.
Framing the China-U.S. relationship in power transition terms is pernicious and self-fulfilling. Identifying
a rivalry for global hegemony fuels nationalistic angst in both countries. Pessimists in the U.S. see
China’s participation in the AIIB and BRICS development bank as a first step in trying to displace the
U.S. from global financial leadership.

Their counterparts in China see the U.S. and Japanese coordination in the Asian Development
Bank, the IMF, the World Bank, and the new Trans Pacific Partnership as an effort to contain
China in a Cold War fashion.
It may be more accurate and productive to draw from the political integration literature instead.
The development of the EU demonstrates how instrumental economic integration was in
restructuring the bitter German-French rivalry after two world wars.
Since the U.S. and Japan constitute the first and third largest economies in the world, and since some
estimates currently show the Japanese Air Force and Navy to be more capable than the PRC’s even
without U.S. help, there is no immediate reason to fear competition with China . Indeed, the U.S. and
Japan are among China’s top 5 trading partners.
The U.S. accounts for 8% of China’s imports and 19% of China’s exports. Japan accounts for 8.4
%. and 10%. China could not easily afford to lose nearly a third of its exports.
Moreover, a new multilateral investment bank in a region that will require $800 billion in
infrastructure projects over the next ten years can only supplement much needed funding. Since
the bank’s focus will be on loans that cut across national borders and enhance international
connectivity in support of trade and production networks, these investments should have a
positive impact on U.S. allies in ASEAN like the Philippines.
This explains why India, often a rival of China’s, is the bank’s second largest shareholder.
Lessons from miscalculation: US and Japanese dominance in the IMF and ADB
One positive aspect of the global system is that nations that miscalculate will soon be snapped
back to reality. Such was the case with the U.S. opposition to the AIIB and China’s recent
provocations in the South and East China Seas.
One reason that China initiated the AIIB was U.S. intransigence in reforming the IMF to reflect
the growth of the Chinese economy.
Each nation’s quota dictates the size of its subscription or financial contribution, and the weight
of its voting power. This is based on the relative size of its economy. The U.S. Congress resisted
these reforms despite their support by our allies and has done so since 2010. The numbers are
instructive:
[chart omitted]
China’s interests in the Japan-led Asian Development Bank were served poorly, as well. With
Japan holding 15.7% of the shares, and the U.S. holding 15.6%, China’s 5.47% share was
negligible.
Redressing the “Century of Humiliation” with a new Chinese hegemony?
Of course, U.S. and Japanese resistance to China’s expanding influence reflects some basis for concern .
China’s current foreign policy seems to draw as much from the rules of the Imperial Chinese
state system as from the rules of the modern global system. This is not surprising, since the Party
has used the “Century of Humiliation” to secure mass support since the 1989 events in
Tiananmen Square.
National restoration from this perspective would not only include the successful repatriation of
Taiwan, but also the restoration of China at the center with neighboring states serving as “little
brothers.” China’s economic projects like the AIIB and the Silk Road project reflect some of this
sentiment.
Since these states are no longer tributaries, they can accept China’s largesse and also retain
alliances and trade with each other, Japan, and the U.S. The restoration of Imperial hegemony is
now impossible.
A more realistic goal would be comparable to U.S. influence in the Americas. China will simply
have to accept U.S. and Japanese influence in Asia in the same way that the U.S. has accepted
Chinese influence in Latin America.
China’s recent quiescence in the South and East China Seas may reflect a “lesson learned,” or
may simply reflect China’s enduring patience in obtaining its goals. One would hope for the
former.
Really new China?
Amitai Etzioni has argued that the U.S. should strongly counter Chinese coercive acts like those in the
Senkaku/ Diaoyu Islands, while supporting Chinese contributions to international governance,
including the AIIB. Others have taken similar positions.

He correctly notes that the international system has often been modified by state interactions and that this
is just another example. Still, others have held that China’s growth has outpaced its diplomatic skills.
These will only be acquired by an actively engaged China.

It’s in the United States’ interest to help shape China’s development as a collaborator and challenge its
hegemonic tendencies, since the result will be profitable for both parties.

U.S. opposition not key to leadership --- zero-sum thinking undermines it

Harris, 15 --- Economy, Trade, and Business Fellow at Sasakawa Peace Foundation USA (last
modified on 8/7/2015, Tobias, ASIAN INFRASTRUCTURE INVESTMENT BANK: CHINA
AS RESPONSIBLE STAKEHOLDER?, “The U.S. Response to the Asian Infrastructure
Investment Bank,” http://spfusa.org/wp-content/uploads/2015/07/AIIB-Report_4web.pdf,
downloaded 6/1/16, JMP)
6. LESSONS LEARNED
This analysis suggests that there are four lessons the U.S. government should draw from its
confrontation with China over AIIB.
First, the U.S. government’s first response to China’s efforts to create new institutions or otherwise write
the region’s rules should not be “how do we stop this?” AIIB will not be the last time that China proposes
a new institution. The United States by no means has to accept or participate in every institution
China proposes, but when the institution is designed to address a widely acknowledged problem,
the U.S. government needs to offer its own solution rather than defending the status quo for its
own sake.
Second, the United States must avoid zero-sum thinking when it comes to agenda setting and
institution building in Asia. Legitimate U.S. leadership in Asia requires not just trumpeting U.S. values
and interests but also listening to the concerns of other countries in the region , especially the region’s
small and medium-size powers. The United States is competing with China not over who gets to write
the rules in the twenty-first century but over whose position in the region is seen as most legitimate and
respectful of the sovereignty and national interests of all countries in the region. As an offshore power
with a long history of sustained bilateral and multilateral engagement in Asia, the United States actually
enjoys a considerable advantage, whereas China is locked in protracted territorial disputes with the same
countries it is trying to pull into its orbit through trade and investment. The United States must be
careful not to squander this advantage by pressuring its allies and partners to choose between the
United States and China or by letting the “great game” with China take precedence over regional
problem solving.

The plan is a necessary component of strategy to sustain hegemony

Daalder & Kagan, 4/24/16 --- *U.S. ambassador to NATO from 2009 to 2013 and president
of the Chicago Council on Global Affairs, AND **senior fellow at the Brookings Institution (Ivo
& Robert, The Washington Post, “U.S. disengagement would be costly,” Factiva, JMP)
The economic, political and security strategy that the United States has pursued for more than
seven decades, under Democratic and Republican administrations alike, is today widely
questioned by large segments of the American public and is under attack by leading political
candidates in both parties. Many Americans no longer seem to value the liberal international order that
the United States created after World War II and sustained throughout the Cold War and beyond.
Or perhaps they take it for granted and have lost sight of the essential role the United States plays in
supporting the international environment from which they benefit greatly. The unprecedented
prosperity made possible by free and open markets and thriving international trade; the spread of
democracy; and the avoidance of major conflict among great powers: All these remarkable
accomplishments have depended on sustained U.S. engagement around the world. Yet politicians
in both parties dangle before the public the vision of an America freed from the burdens of
leadership.
What these politicians don't say, perhaps because they don't understand it themselves, is that the
price of ending our engagement would far outweigh its costs. The international order created by
the United States today faces challenges greater than at any time since the height of the Cold
War. Rising authoritarian powers in Asia and Europe threaten to undermine the security
structures that have kept the peace since World War II. Russia invaded Ukraine and has seized
some of its territory. In East Asia, an increasingly aggressive China seeks to control the sea lanes
through which a large share of global commerce flows. In the Middle East, Iran pursues
hegemony by supporting Hezbollah and Hamas and the bloody tyranny in Syria. The Islamic
State controls more territory than any terrorist group in history, brutally imposing its extreme
vision of Islam and striking at targets throughout the Middle East, North Africa and Europe.
None of these threats will simply go away. Nor will the United States be spared if the
international order collapses, as it did twice in the 20th century. In the 21st century, oceans
provide no security. Nor do walls along borders. Nor would cutting off the United States from
the international economy by trashing trade agreements and erecting barriers to commerce.
Instead of following the irresponsible counsel of demagogues, we need to restore a bipartisan
foreign policy consensus around renewing U.S. global leadership. Despite predictions of a "post-
American world," U.S. capacities remain considerable. The U.S. economy remains the most dynamic
in the world. The widely touted "rise of the rest" - the idea that the United States was being
overtaken by the economies of Brazil, Russia, India and China - has proved to be a myth. The
dollar remains the world's reserve currency, and people across the globe seek U.S. investment
and entrepreneurial skills to help their flagging economies. U.S. institutions of higher learning
remain the world's best and attract students from every corner of the globe. The political values
that the United States stands for remain potent forces for change. Even at a time of resurgent
autocracy, popular demands for greater freedom can be heard in Russia, China, Iran and
elsewhere, and those peoples look to the United States for support, both moral and material. And
our strategic position remains strong. The United States has more than 50 allies and partners
around the world. Russia and China between them have no more than a handful.
The task ahead is to play on these strengths and provide the kind of leadership that many around
the world seek and that the American public can support. For the past two years, under the auspices
of the World Economic Forum, we have worked with a diverse, bipartisan group of Americans and
representatives from other countries to put together the broad outlines of a strategy for renewed U.S.
leadership. There is nothing magical about our proposals. The strategies to sustain the present
international order are much the same as the strategies that created it. But they need to be adapted and
updated to meet new challenges and take advantage of new opportunities .

For instance, one prime task today is to strengthen the international economy , from which the
American people derive so many benefits. This means passing trade agreements that strengthen
ties between the United States and the vast economies of East Asia and Europe. Contrary to what
demagogues in both parties claim, ordinary Americans stand to gain significantly from the
recently negotiated Trans-Pacific Partnership. According to the Peterson Institute for
International Economics, the agreement will increase annual real incomes in the United States by
$131 billion. The United States also needs to work to reform existing international institutions, such as
the International Monetary Fund, so that rising economic powers such as China feel a greater stake in
them, while also working with new institutions such as the Asian Infrastructure Investment Bank to
ensure that they reinforce rather than undermine liberal economic norms .
 AT: AIIB Bad Turn --- International Institutions

***Note when prepping file --- this ev can also be used for a AIIB key internal link

U.S. engagement with China on the bank is necessary to ensure the integrity of
international institutions
Olson, 11/9/15 --- Research Fellow at the Hinrich Foundation (Stephen, “Time for the US to
Join the Asian Infrastructure Investment Bank; Sitting on the sidelines is probably not the smart
option” http://thediplomat.com/2015/11/time-for-the-us-to-join-the-asian-infrastructure-
investment-bank/, downloaded 4/23/16, JMP)
From any objective point of view, the U.S. badly botched its initial response to the establishment of
the China-led Asian Infrastructure Investment Bank. Citing its concern over the potential
operational practices and policies of the bank, the U.S. strongly discouraged its close partners in
Europe and Asia from joining. However, the most important players, including Britain, Korea,
and Australia, rejected the U.S. overtures and proceeded to join. This heavy-handed and
resoundingly unsuccessful attempt to pressure allies to eschew the AIIB left the U.S. looking
ineffectual and somewhat out of touch with present-day realities.
With the AIIB set to commence operations by year-end, U.S. President Barack Obama – and whoever
will succeed him – will need to demonstrate a defter touch in managing the next phase . Four basic facts
should help illuminate the development of U.S. policy as the bank moves from drawing board to
reality:
Fact #1: There is a need for significant infrastructure funding throughout Asia, which is beyond
what the World Bank or Asian Development Bank (ADB) can deliver. Viewed strictly from that
perspective, the establishment of an additional source of funding through the AIIB could be
positive and productive.
Fact #2: The exact lending policies and practices of the AIIB are not yet firmly established.
Concerns that the AIIB might establish lower standards than those typically required by either
the World Bank or ADB, may or may not ultimately prove to be justified. But at this stage, we
simply don’t know for certain. What is certain however is that countries on the outside are
unlikely to have much influence.
Fact #3: China has already been and will continue to be a significant source of funding for
infrastructure projects throughout Asia. The AIIB does not therefore represent something entirely
“new” on the regional development scene. What is “new” is that the AIIB would place some
portion of China’s funding within the framework of a multilateral institution.
Fact #4: China’s voting rights in existing institutions such as the World Bank and IMF are
significantly underrepresented, given the size of its economy. While most member countries in
these institutions acknowledge that China deserves a larger say, these sentiments have not yet
been fully translated into concrete reality – and it is unclear when or if they ever will be.
While these four points are essential to frame the discussion, they generate little debate. The real
debate about the AIIB revolves around the rather ill-defined question of whether the AIIB will be
a “competitor” to the World Bank and the Asian Development Bank. Of course, this is a
somewhat loaded question depending on the precise definition of “competitor.” If making
additional sources of funding available for infrastructure projects is viewed as “competing” with
the World Bank or ADB, then, yes, clearly the AIIB is a competitor. But since the mission of the
AIIB will overlap with the mission of these other institutions, the question arises as to why its
efforts would not be seen as complimentary. And indeed, the Presidents of both the World Bank
and the ADB have already signaled their desire to work cooperatively with the AIIB.
In reality, the heart of the debate, at least from the U.S. perspective, has less to do with the development
agenda and more to do with global leadership in multilateral institutions. Since the founding of the
Bretton Woods system in the aftermath of WWII, the United States and its philosophically like-
minded partners have been mostly successful in crafting a set of global institutions which reflect their
values and priorities. And the governance structures of these institutions have unapologetically tilted
towards developed-world, free-market democracies: The World Bank is always run by an American,
the IMF is always run by a European, and the ADB is always run by a Japanese. But China’s
stunning economic rise now puts it in a position where it can credibly aspire to reconfigure the game
board – both in terms of existing institutions, as well as with the establishment of new ones. The AIIB,
obviously, is the most consequential gambit thus far.

Since China’s rise was predicated on a very different form of government, a very different view
on the role of the state in the economy, and trade and investment politics that sometimes seem
closer to mercantilism than free trade, the philosophical foundations of the postwar system of global
institutions could increasingly be challenged by these alternative philosophies, as China’s role and
influence increases.

The U.S. standoffishness towards the AIIB is driven therefore by broader concerns about the long-term
impact of growing Chinese leadership in international institutions. This leaves Washington with a
difficult, but unavoidable question: What should the U.S. policy response be to China’s desire to play
a more proactive leadership role in the global system of multilateral institutions, and specifically the
AIIB?

The evidence thus far suggests that sitting on the sidelines is probably not the smart option.
Engagement, and a full-throated advocacy for the principles upon which the current system is built,
makes more sense. The U.S. fumbled the opening kick-off, but it’s time to move on. Initial discussions
on joining the AIIB should be commenced as soon as is practical.
 AT: AIIB Bad Turn --- Chinese Domination

Joining gives the U.S. a better way to respond to China’s rise

Salze-Lozac'h, 15 --- senior director of economic development and chief economist for The
Asia Foundation (7/22/15, Véronique Salze-Lozac'h, “To Be or Not To Be Part of AIIB,”
asiafoundation.org/in-asia/2015/07/22/to-be-or-not-to-be-part-of-aiib/, downloaded 4/23/16,
JMP)
June 29, 2015, may have marked a turning point in multilateral development financing in the
Asia-Pacific region. On that day, 50 countries signed the articles of agreement of the $50 billion,
China-led Asian Infrastructure Investment Bank (AIIB). While there is a lot of excitement about
the potential of this new multilateral financing institution, and much discussion of its potential
role in addressing Asia’s infrastructure gap, the focus lately has been more on who will join and
who will not than on what the AIIB will do.
Since China’s President Xi Jinping announced in 2013 the rising world power’s intention to
launch a bank to address Asia’s infrastructure needs, several countries have been weighing the
pros and cons of becoming part of what many see as an attempt by China to counterbalance the
role of Western countries in other multilateral economic institutions. Indeed, the AIIB is often
regarded as a potential competitor to the International Monetary Fund (IMF), the World Bank, and the
Asian Development Bank, which many would claim are dominated by American, European, and
Japanese interests.
As of now, AIIB has approved 57 countries as potential founding members. Apart from China,
which will have a leading role, founding members include India, Indonesia, Singapore,
Myanmar, Mongolia, Pakistan, Bangladesh, the Republic of Korea, and Cambodia, as well as
Brazil, Britain, Australia, France, Germany, and Spain. At last month’s signing ceremony, seven
of these 57 countries delayed their signing of the agreement, among them three Asian nations:
the Philippines, Malaysia, and Thailand. The United States and Japan, two of the world’s biggest
economies, decided not to join.
China will be the largest shareholder, with 26.06 percent of the votes, giving it an effective veto
over major decisions, followed by India with 7.5 percent and Russia with 5.92 percent; however,
it is expected that all founding members will have the right to create the governance and
operational rules of the bank. This important prerogative is one argument advanced by founding
members to justify their willingness to be part of this initiative from the beginning rather than to
adopt a wait-and-see attitude. Indeed, while there is little argument about Asia’s need for
infrastructure, there is much concern over how this need will be addressed by a new organization with no
history and in which the rules of governance, criteria for selecting projects, and environmental
standards are still being developed .

The need is certainly enormous. In a region that is home to the world’s fastest-growing
economies, the infrastructure investment gap has been estimated at $8 trillion between 2010 and
2020, according to figures from the Asian Development Bank. The emphasis on trade, regional
economic cooperation, and connectivity, to sustain high growth rates in the future, calls for huge
investment efforts from governments – in hard infrastructure such as roads, railways, harbors,
electricity, and telecommunications, but also in “soft” components such as policies and
regulations to ensure that investments are efficient and yield positive results. The AIIB’s
intention to support this much-needed infrastructure development is therefore welcomed both by
governments and by businesses managing ever-expanding regional and global supply chains.
The Asian-led AIIB also represents a new, distinctively Asian development tool, bringing
regional know-how and expertise to the problem of matching the supply of infrastructure to
specific regional needs. This newcomer development actor may also provide opportunities for
collaboration with existing multilateral agencies. IMF chief Christine Lagarde, speaking at the
opening of the China Development Forum in Beijing earlier this year, said that the IMF and the
World Bank would be “delighted” to cooperate with the AIIB.
Challenges, however, are also numerous. While China likes to present this initiative as a “win-win”
situation for Asia, there are concerns that the new bank may cut corners on environmental, social, and
anticorruption standards. It is, in fact, anticipated that loans will be made at commercial rates with
few or no non-economic conditionalities such as environmental protections. Moreover, AIIB will
differ from an organization like the Asian Development Bank by focusing on building
infrastructure rather than prioritizing poverty reduction. There is also a risk of misallocation of
funds to support mega-projects that have little impact on poverty or inclusive economic growth.
Finally, the task of leading a complex, multilateral organization spanning an array of national
interests will not be easy.
There is no doubt that the AIIB will give China greater influence within the region and beyond. When
calling the AIIB the “new type of multilateral bank for the 21st century,” Chinese Finance
Minister Lou Jiwei made no secret of China’s intention to play a more predominant role in Asia.
However, the question is not whether the AIIB will give a greater role to China in the region, but
whether the best way to respond to this development is to join it or to stand apart .

As mentioned before, signatory nations will have an opportunity to influence AIIB governance
and operations. Nations deciding to stay out of the AIIB, like Japan and the U.S., will have no way to
express their concerns or to influence the development of requirements, criteria, and rules of
governance. By joining, Japan and the U.S. would also be able to push for good coordination with the
other multilateral development organizations. Finally, on the inside, they would be in a better position to
ensure that the AIIB brings truly effective benefits to regional development and regional trade, and to
observe carefully how the AIIB affects the Trans-Pacific Partnership (TPP) and its members’
economies.

As Paolo Mauro, in his recently published article, “Why America Should Join the AIIB,” has
pointed out: “Decisions like the one the United States is facing – whether or not to join the AIIB –
should not be based on speculation about other countries’ motivations , but rather on an estimation of
what can be accomplished by choosing one way or the other.”
AIIB won’t spur Chinese hegemony --- will trigger more cautious and peaceful
behavior by China
Acharya, 15 --- professor of international relations at American University (6/19/15, Amitav,
“No need to fear the AIIB: Rather than ushering in a Chinese Asian fiefdom, the new investment
bank puts China under intense pressure to deliver. And success requires abandoning its territorial
claims,” http://www.straitstimes.com/opinion/no-need-to-fear-the-aiib, article downloaded on
6/11/16, JMP)
RECENT reports affirm that China's shareholding - and voting power - in the Asian
Infrastructure Investment Bank (AIIB), will be 30 per cent, while that of India - the next major
shareholder - will be around 8 per cent.
Since some of the decisions by AIIB require a super-majority of 75 per cent, China has the ability at least
to veto any significant decisions by the AIIB. This may stoke further anxiety about the AIIB among
Western nations and some of China's neighbours.

Many observers see the AIIB as a symbol of China's rise, as well as a victory for its economic
diplomacy.

Even those countries which have joined it, such as India, Australia, Britain, Germany, France
and Italy, are apprehensive that they might contribute to an initiative that might enhance China's
authority and feed into geopolitical ambitions that are not always welcome.
They need not worry. The AIIB should be seen by the international community not as a triumph for
China, but a major challenge to its rise.

The AIIB is important for several reasons. First, it challenges the principle of "Asean centrality"
in the Asian regional architecture. It represents the most serious initiative by China in Asian
cooperation.

Until now, the Asean has been in the driver's seat of most Asian regional institutions. The Asia
Pacific Economic Cooperation (Apec) forum launched in 1989 was a Japanese-Australian
initiative. China had little to do with the establishment of the Asean Regional Forum in 1994 and
of the Asean Plus Three process in 1997, and the East Asian Summit in 2005.
Second, the AIIB is the final nail in the coffin of Deng Xiaoping's "China should not lead" dictum, which
governed China's foreign policy during the 1980s and 90s.

This is buried by the AIIB and other regional and global initiatives by China, such as the Silk
Road Fund, and the New Development Bank and the Contingent Reserve Arrangement being set
up by the Brics (Brazil, Russia, India, China and South Africa) grouping, in which China is a key
player.
But the AIIB is good news for the international community.
It poses no risk of Chinese hegemony, while putting China's leadership capacity to its most severe test
to date.

The AIIB is not an "alternative" or "parallel" form of multilateralism. It is in keeping with "open
regionalism".
Participation is open to not only any country in Asia, but also outside. Germany, France, Britain
and Italy, all four G-7 members, have already signalled their participation.
Failure will damage China's image
THE AIIB, the Silk Road Fund, the NDB and the CRA are all mainly economic in purpose. China will
find it much more difficult to organise global and Asian cooperation in political and security affairs.
For example, China has proposed the idea of a Conference on Interaction and Confidence-Building
Measures in Asia, calling for "Asian solutions to Asian problems" . But this initiative has found little
traction - and has even evoked suspicion.
Its prospects are diminished by China's territorial disputes with its neighbours and the mistrust and
apprehensions about Chinese geopolitical intentions and power in the region.

Having proposed the AIIB, Beijing will be under intense international watch to deliver results. China
has to ensure that it does not usher in a Chinese Asian fiefdom, but conforms to international norms and
standards of transparency for such institutions.

But can China sustain it at a time of lower economic growth and growing demands for its
internal social and welfare spending to satisfy its own people?
If the AIIB fails, China's image and clout as an emerging global power will be seriously damaged. But if
China succeeds with this venture - and success here requires China making significant adjustments to
its regional policy by abandoning its expansive territorial claims and enhancing its military and
economic transparency - Asia and the West, including the US, and indeed the entire system of global
governance, will be the big winners.

U.S. opposition will fail --- the plan allows U.S. to shape the regional order alongside
China
White, 14 --- professor of strategic studies at the Australian National University (10/22/14,
Hugh, “U.S. Resistance to China’s Regional Bank Is Futile,”
http://www.nytimes.com/roomfordebate/2014/10/20/a-chinese-rival-to-the-world-bank/us-
resistance-to-chinas-regional-bank-is-futile, article downloaded 5/3/16, JMP)
America is right to worry about Beijing’s proposed Asian Infrastructure Investment Bank because it is
about much more than economics. Beijing naturally hopes that this massive fund will enhance its
claims to regional leadership.
Just as Washington has tried to use the Trans Pacific Partnership trade pact to block China’s
political ambitions in Asia, China is hoping to use the investment bank to push back. The
difference is that the investment bank, unlike the trade pact, will probably work.
The economic case is hard to fault. Asia needs huge investments in infrastructure, and existing
institutions like the Asian Development Bank have neither the capital nor the management
capacity to deliver them. China has plenty of money and enormous expertise, having delivered in
recent years perhaps the most remarkable infrastructure-development program in history.
But of course the new bank would reflect and promote China’s priorities and values, not
America’s. It would enhance China’s role as the leading power in Asia, and therefore diminish
U.S. regional leadership. This is exactly why Washington has been lobbying so hard against it.
Those efforts seem destined to fail. Not even Australia, America’s warmest ally in Asia, will oppose it,
because the economic logic is too strong. Meanwhile the trade pact is struggling. And this should
make U.S. policymakers ask a deeper question: can the pivot toward Asia really work? Does it
make sense to keep trying to compel China to accept a subordinate role as a "responsible
stakeholder" in a U.S.-led system?
Or is it time for the United States to accept that China’s economic growth is inevitably transforming
Asia’s political balance, too? Perhaps Washington needs to stop trying to preserve the old Asian order,
and try instead to maximize its role, alongside China, in the new one. That would mean supporting
China’s Asian Infrastructure Investment Bank.

U.S. involvement checks Chinese domination within the AIIB and ensures
accountability and transparency
Tay, 14 --- chairman of the Singapore Institute of International Affairs and an associate
professor teaching international law at the National University of Singapore (10/31/14, Simon,
China Daily : European Weekly, “Asian bank will not just be China's domain,” Proquest
database, JMP)
Giving special recognition to ASEAN and floating public bonds would signal nation's intention
to help region
China has launched the Asian Infrastructure Investment Bank with the conspicuous absence of the United
States and its major allies. With China hosting the Asia-Pacific Economic Cooperation summit in
November, this issue is coming to a boil.
The US' absence should not surprise. The bank proposal runs against the established regional and
global order, in which the US dominates the World Bank while the Japanese traditionally head
the Asian Development Bank.
Yet such arrangements, based on history, fail to reflect the reality of China's current and still
growing economic weight. The existing banks also seem unable to meet the real needs for
infrastructure across Asia, both now and in the future.
From now to 2020, it has been estimated that Asia needs $8 trillion for infrastructure. Indonesia
alone is said to need $230 billion. The Greater Mekong subregion, linking less developed parts
of Vietnam, Laos, Cambodia and Thailand, is estimated to need about $50 billion.
The new bank, with startup capital of $50 billion, is therefore important and necessary. Indeed,
China's financing of neighboring countries projects is already dominant. Yet many projects have
generated accusations that China is buying political influence and is giving insufficient
consideration to social and environmental protection. Construction of the China-supported
Myitsone dam in Myanmar, for example, has been stopped because of such fears.
The new bank could take on rules and processes that are fairer and more transparent. Although China
will take the majority stake, the interests of different countries can be accommodated to create a bank for
Asia.

But this depends on the countries that participate in the new bank. As such, the US efforts to keep
countries out could be counterproductive. It would be better to have countries such as South Korea
and Australia take part and weigh in on the rules to govern the new bank. While they were absent
at the launch, it will not be too late to have them join. Similarly, Japan must consider taking part.
While Sino-Japanese tensions have risen over territorial and other issues, both are economically
interdependent. Both are deeply engaged with ASEAN and the wider region. There are also
precedents in Sino-Japanese cooperation on economic issues.
One is the ASEAN+3 Macroeconomic Research Office, a small but key institution to monitor
regional financial stability. This followed the ASEAN+3 currency swap agreements under the
Chiang Mai Initiative Multilateralization, which now has some $240 billion pledged, the bulk of
it equally from China and Japan.
If the Japanese do not directly participate in the bank, another option is to develop cooperation
through the Japanese-led Asian Development Bank. The region would benefit if both banks
coordinate their efforts and work together. Efforts are being made to bring the leaders of Asia's
two largest economies together, and their agenda would benefit from a discussion on the
modalities for cooperation between the two banks.
Another step to signal China's intention to help the region would be to allow a special
recognition for ASEAN collectively. Such recognition would be consistent with Beijing's
repeated assurances that it recognizes and supports the group's centrality. This would be
significant, notwithstanding the fact that some poorer members cannot contribute much to the
bank's share capital.
Another key to make a better bank is to float public bonds and other market instruments for
infrastructure funding. Such a move would bring at least two benefits. First, the deep pockets of
private savings across Asia could be mobilized, on top of government funds. Second, since
private investors seek returns, there would be greater market disciplines and due diligence in
determining which projects get the green light.
For China, such moves would further the internationalization of the yuan. While the new bank
will have its headquarters in China, the best placed financial centers to take up this role would be
Hong Kong and Singapore, both of which can tap regional and global capital, and both of which
are also renminbi clearing centers.
What about US objections? Some will remember how, during the Asian financial crisis of 1997-
98, Washington persuaded Japan and others not to support calls for an Asian monetary fund.
However, the reality today is that, given the real needs for infrastructure, a simple "No" will no
longer suffice.
If US allies - and even the US itself - join this initiative, Beijing could not dominate as some fear.
Instead, all could join to create a truly Asian bank to help build not just infrastructure, but cooperation
across the region.
 AT: Containment Good --- Engagement Good ***

Engagement fails because the U.S. isn’t effectively executing it --- not because the
strategy itself is flawed. Clinging to U.S. hegemony fails and undercuts critical
cooperation.
Shixin, 15 --- Associate Professor at the institute of International Studies, Shanghai Academy of
Social Sciences (9/29/15 (Dr. Jiao Shixin, Institute for China-America Studies, “The Problem
with American “Engagement” with China,” http://chinaus-icas.org/materials/problem-american-
engagement-china/, downloaded 4/22/16, JMP)
How to deal with a rising China has become America’s primary strategic issue since the 2008
financial crisis. In many American scholars’ views, with its emergence as the world’s second
largest economy, China is becoming more and more assertive, and becoming more and more
aggressive in the maritime territorial dispute with its neighbors. Most importantly, the US is very
concerned that a rising China will take actions to challenge and replace its leadership in East Asia . All of
this has triggered significant debate regarding China policy in the US. Many leading scholars and
think tanks believe that the current strategy of cooperation has not achieved America’s strategic
objectives—in short, that the engagement strategy has failed. Some American Scholars think that
the domestic consensus on engagement has fallen apart, and some have suggested that U.S should adopt a
tougher policy toward China.

Yet if we think the engagement strategy has indeed failed, it is really because the US has been
pursuing the wrong goals and with the wrong intentions . The cooperation relationship with China isn’t
wrong itself, and the collaborative relationship has brought huge strategic benefits to United States. This
policy of cooperation should not be reconsidered. Rather, it is America’s goals and intentions that
need adjustment.

What does Sino-US cooperation bring to the world and to the US? It brings peace and prosperity,
with the US benefitting the most. The policy of reform and opening up pushed China’s integration
into the international system, which was an important condition for the expansion of US power in the
post-Cold War era. Without strategic cooperation with China, it would have been difficult for the United
States to increase its global influence throughout that period, and America’s leadership would not have
become so established globally. The pursuit of cooperation under the engagement strategy is very
helpful to America’s strategic interests. It promotes the global expansion of the United States in such
a way that “globalization” has become “Americanization.” This has been a foundation of long-term
economic growth in U.S in the Post-Cold war. If it is necessary for U.S to adjust the engagement
strategy, what should be changed is not the policy of cooperation, but using cooperation as a means
toward the strategic end of maintaining hegemony.

The strategic goal or intention behind the engagement strategy has been to shape China by
bringing it into an international system and international order that is dominated by the US, and
then pressure China to conform to America’s vision for it. Essentially, this is a huge and
impractical goal. The strategic objectives of the United States with regard to China have two
aspects: the first is to establish American-style democracy in China—to change China from the
inside; the second is to bring China into the post-WWII international system that was constructed
by the US—to tame China from the outside to conform to the strategic interests of the United
states. In reality, the two objectives are very difficult, if not impossible to achieve.
In the case of the first US goal, different cultures have different democratic systems: China and
the United States have different civilizations and political cultures, which means that between
China and the United States, the same democratic notions are bound to produce different forms
of institutions. American democracy is not suitable for China’s national conditions, and it is
impossible to establish in China. It is clearly not feasible to make China’s democratization an
objective of the engagement strategy.
With regard to the second US goal, incorporating China into the international system that the United
States established and using liberal norms to assimilate China into an international rules-based order will
not cause China to relinquish its sovereignty and independence . Nor do they mean that China’s
interests will be subordinated to the US under the common international rules. In fact, China is
learning how to use international law to safeguard its national interests, and has a long history of
opposing inequality in international relations. As China rises, its pursuit of a more equitable
international political and economic order will only grow stronger. It is simply not feasible to use
international standards to ensure China’s compliance with America’s strategic interests. China’s
diplomatic behavior will grow increasingly in line with the common interests of international
community, not just America’s.
All in all, the US engagement strategy has been motivated by two impossible goals. It is
revealing that even when the United States makes significant other gains by cooperating with
China, many American scholars are nonetheless disappointed by the engagement strategy.
Ultimately this is because they judge the success or failure of engagement by reference to its
unrealistic and impractical strategic intentions .

How should the United States adjust its China policy? Some American scholars have suggested
that US take tougher policy toward China, either by containing or punishing China. These
recommendations raise significant concerns. After the establishment of the People’s Republic of
China, the United States implemented a policy of containment and isolation for a long time, but the
policy was certainly a failure. The United States had to return to the strategic orbit of cooperation
with China in the Nixon era. Today, China is very different than it was then. It is broadly integrated
with the rest of the world, and has become the world’s second largest economy. The gap in relative power
between China and the United States continues to narrow and China and the United States have
established relationships of mutual dependence in the economic, security and global governance
domains, among others. It is very difficult for us to imagine the consequences of the US implementing
strategy of containing China. The Chinese saying comes to mind, 杀敌一千，自伤八百, “sacrifice
eight hundred men in order to kill one thousand.” It should be obvious that strategies of containing or
acting tough on China lack sense, and would lead the US into the dead-end of power politics.

Since the cold-war thinking of containment is not feasible, how should U.S adjust its strategy of
engagement with China? The first adjustment should be to abandon its unreasonable strategic
objectives and build a China strategy on the basis of equality. China is very different from the United
States, China has its own historical and national conditions, and its own political genetic
makeup. Policymakers in the United States should realize that the engagement strategy is
incapable of altering China’s path of developing its own model of socialism. The United States
should not expect to transform China through “peaceful evolution.” Even if China somehow
adopted American-style democracy, it would not behave according to America’s will. Russia
introduced Western democracy after the cold war, but what happened? Russia’s experience with
democracy has not improved its relations with the US, and it doesn’t conform to America’s
strategic vision. The United States should not assume that the “peaceful evolution” of countries
towards an American model will ensure alignment with its interests.
The second adjustment is that American needs embrace the concept of “harmony without
sameness.” This idea can be found in traditional Chinese thought. It means even when there are
differences between people, they can still enjoy peace, harmony and cooperation. China and the
United States have very different histories, political systems and paths of development. These are
not a reasons for them to clash with one another, but can be reasons for establishing mutual
respect, exchange and a complementary relationship. Unfortunately, the logic of the US
engagement strategy is precisely opposed to this thinking. Nonetheless, we are pleased to see that
some of America’s friends have accepted the Chinese way of thinking on such matters. On
September 17, President Xi Jinping had a meeting with some American business representatives
and former officials in Beijing. They agreed that China and US should establish “harmony
without uniformity,” and should build cooperative relations. If the United States adjusts its
strategy towards this direction, then engagement with China will update to Version 2.0. This
revised principle of engagement should not only be the mantra for US-China relations, but also for the
entire world.

Third, the United States should be wary of the temptations of “global leadership” or hegemony . World
politics is changing, all kinds of global issues and challenges will continue to arise that no single country
can cope with alone. The world must work together to deal with global governance. This is a truth
that United States also understands. In an increasingly interdependent world, leadership in global
governance also means assuming greater responsibility, which is different from traditional hegemonic
leadership. Unfortunately, the United States’ current engagement strategy is still to defend the
international order with a view to maintaining America’s leadership. Assessed by this criteria,
the strategy has been considered by many scholars to have failed already. If the United States still
cannot resist the temptation of hegemony, and cannot, together with China and other big countries,
assume the responsibilities and obligations of global governance the engagement strategy will not
have a successful future, and it will be difficult for both China and the US to build a new type of great
power relations.
 AT: Containment Good --- Plan Solves / AT: Blackwill

***note when prepping file --- there is more evidence in “AT: AIIB Bad Turn ---
Chinese Domination” that is useful to support this argument

Plan is key to check Chinese aggression

Blackwill, 5/26/16 --- Henry A. Kissinger Ssenior Fellow for U.S. Foreign Policy at the
Council on Foreign Relations, served as Deputy Assistant to the President and Deputy National
Security Advisor for Strategic Planning under President George W. Bush as well as U.S.
Ambassador to India (Robert D., “China's Strategy for Asia: Maximize Power, Replace
America,” http://nationalinterest.org/feature/chinas-strategy-asia-maximize-power-replace-
america-16359, article downloaded 5/27/16, JMP)
Xi’s Foreign Policy
What sets Xi’s foreign policy apart the most is his willingness to use every instrument of statecraft, from
military assets to geoeconomic intimidation, as well as explicit economic rewards, to pursue his various
geopolitical objectives. In general, Xi’s policy has been characterized by bullying over territorial
issues and selective beneficence on economic matters, with the looming application of
geoeconomic coercion ever present. A third of my new book on geoeconomics analyzes China’s
use of economic instruments for geopolitical purposes.
This approach has been clearest in China’s relations with Southeast Asian states, many of which
are embroiled in a simmering territorial dispute with Beijing over the South China Sea. Beijing’s
hardening position on these territorial disputes has been accompanied by generous investment
and trade packages to Southeast Asian states, and these too appear to be coordinated centrally to
geopolitical ends.
A mixture of hard and soft policies has likewise characterized China’s relations with India.
During Xi’s first visit to India, Chinese troops launched one of their largest incursions ever into
disputed territory with India. China has sought to use the border to keep India off balance and
reduce its maritime military investments, which is at least one reason Beijing has been unwilling
to delineate the Line of Actual Control (LAC) despite Indian Prime Minister Narendra Modi’s
public request that the two countries do so.
With respect to Japan, China has pursued a tough and nationalistic policy. Under Xi, China has
dramatically escalated its territorial dispute with Japan through its declaration of an Air Defense
Identification Zone (ADIZ) in the East China Sea.
Aside from developing stronger ties with other states, an important element of Xi’s multifaceted
strategy has been to energetically create and participate in multilateral institutions. Some of these, such as
AIIB, will be useful for dispensing geoeconomically oriented loans to neighbors. The misguided refusal
of the United States to participate in the AIIB’s creation, and Washington’s failed attempt to persuade
friends and allies not to join, denied the United States an opportunity to influence the bank’s rules,
development trajectory and China’s potential use of the bank as a geopolitical instrument .
 AT: Containment Good --- Containment Fails / U.S.-China
Relations Good

Containment will fail --- reemphasizing engagement is necessary to ensure

cooperation on critical issues like Korea
Carpenter, 5/26/16 --- senior fellow in defense and foreign policy studies at the Cato Institute
(Ted Galen, “America's Doomed China Strategy,” http://nationalinterest.org/blog/the-
skeptics/americas-doomed-china-strategy-16365, article downloaded on 5/29/16, JMP)
Two developments in the past month indicate that Washington’s mixed policy of engagement and
containment (or “congagement”) toward China has begun to tilt more toward containment. The first
development was the visit of Secretary of Defense Ashton Carter to India [4] in mid-April and
the signing of a bilateral cooperation agreement on military logistics. The other episode is
President Obama’s just-completed trip to Vietnam and the announced lifting of the long-standing
arms embargo on that country. As usual, American officials insist that the marked change in U.S.
policy toward Hanoi is not in any way directed against China [5]. But such statements strain
credulity, especially when viewed in the larger context of U.S. warships conducting “freedom of
navigation” patrols in the South China Sea and bluntly reminding Beijing of America’s security
obligations to the Philippines under a bilateral defense treaty.
The containment side of U.S. policy has gone from merely assembling some of the necessary
components, to be activated at a later date if necessary (first gear), to the initial phase of activation
(second gear). More emphasis is likely to be placed on China as a serious strategic competitor, if not an
outright adversary. But developing any kind of a containment policy against China is almost certain to
prove hopelessly difficult. Despite the sometimes inflammatory rhetoric coming from Donald
Trump and some other China bashers, the bilateral economic relationship remains quite extensive and
crucial. China is America’s second largest trading partner. In 2015, the United States exported
$116 billion in goods to China [6] while importing $482 billion. Disrupting that relationship would
be extremely costly and painful for both countries.
That point underscores one key reason why reviving anything even faintly resembling the Cold War–era
containment policy that worked against the Soviet Union is a hopeless quest. America’s economic
relations with the USSR were minuscule, so there was little sacrifice on that front in taking a
hardline stance against Moscow. That is clearly not the case today regarding America’s
economic connections to China.
There is also the matter of assembling a reliable alliance against Beijing. Conducting a containment
policy against the Soviet Union during the Cold War was feasible because (at least during the crucial
formative stages) neither the United States nor its key allies had much of a political or economic
relationship to lose with Moscow. The costs, therefore, of shunning Moscow were minimal. That is
clearly not the case with China. Most of the East Asian countries, including close U.S. allies Japan and
South Korea, already have extensive economic links with Beijing. Indeed, China is Japan’s largest
trading partner [7], accounting for one-fifth of that country’s total trade. It would not be easy for
those countries to jeopardize such stakes to support a confrontational, U.S.-led containment policy aimed
at Beijing. Tokyo undoubtedly has concerns about China’s behavior in the East China Sea (and about
overall Chinese ambitions), but it would still be a reluctant recruit in a hostile containment strategy .
Indeed, as time passed during the Cold War, even the containment strategy directed against the
Soviet Union proved increasingly difficult for U.S. leaders. That was especially true after the
early 1970s, when West Germany’s policy of Ostpolitik sought better relations with communist
East Germany, and indirectly with Moscow and the rest of the Soviet bloc. As connections
deepened between democratic Europe and the USSR, support for hard-line U.S. policies began to
fade. That point became evident in the 1980s, when U.S. leaders attempted to persuade their
European allies to reject the proposal for a natural gas pipeline from the Soviet Union to Western
Europe, fearing that it would give Moscow an unhealthy degree of policy leverage. Much to
Washington’s frustration, key European allies rejected the advice.
If the United States attempts to mobilize regional support for a containment policy against China, it will
start out operating in an environment even less conducive than the policy environment regarding the
Soviet Union in the 1980s. Washington’s courtship might be welcomed by very small countries,
such as the Philippines, that are already on extremely bad terms with Beijing. Larger powers,
though, are more likely to see what benefits they can entice and extract from Washington,
without making firm commitments that would antagonize China and jeopardize their own
important ties to that county.
There is a final reason why an overt containment policy against China would be a poor option for the
United States. Several troublesome global or regional issues will be difficult to address without
substantial input and cooperation from China. It is nearly impossible, for example, to imagine progress
being made on the difficult and complex issue of North Korea’s nuclear and ballistic missile programs
without China’s extensive involvement.

The United States needs to lower, not increase, its level of confrontation toward China. That also
means restoring respect for the concept of spheres of influence [8]. In attempting to preserve
U.S. primacy in East Asia and the western Pacific, U.S. leaders are intruding into the South
China Sea and other areas that logically matter far more to China than to America. Such a
strategy is likely to result either in a humiliating U.S. retreat under pressure or a disastrous
military collision. A containment strategy is a feeble attempt to evade that reality.
 AT: Containment Good --- Hardline Fails / AT: Heg Good

***note when prepping file --- this evidence uses the word “dumb” --- you might
choose to note that prior to reading it or avoid reading it altogether.

Primacy based approaches to China’s rise fail – results in US-China war

Glaser, 15 – John, B.A. in Political Science from the University of Massachusetts Amherst,
media relations manager for Cato (“The US and China can avoid a collision course – if the US
gives up its empire,” The Guardian, 5/28/15,
http://www.theguardian.com/commentisfree/2015/may/28/conflict-us-china-not-inevitable-
empire //Red+JMP)
The problem isn’t China’s rise, but rather America’s insistence on maintaining military and
economic dominance right in China’s backyard

To avoid a violent militaristic clash with China, or another cold war rivalry, the United States should
pursue a simple solution: give up its empire.
Americans fear that China’s rapid economic growth will slowly translate into a more expansive
and assertive foreign policy that will inevitably result in a war with the US. Harvard Professor
Graham Allison has found: “in 12 of 16 cases in the past 500 years when a rising power
challenged a ruling power, the outcome was war.” Chicago University scholar John Mearsheimer
has bluntly argued: “China cannot rise peacefully.”
But the apparently looming conflict between the US and China is not because of China’s rise per se,
but rather because the US insists on maintaining military and economic dominance among China’s
neighbors. Although Americans like to think of their massive overseas military presence as a
benign force that’s inherently stabilizing, Beijing certainly doesn’t see it that way.
According to political scientists Andrew Nathan and Andrew Scobell, Beijing sees America as
“the most intrusive outside actor in China’s internal affairs, the guarantor of the status quo in
Taiwan, the largest naval presence in the East China and South China seas, [and] the formal or
informal military ally of many of China’s neighbors.” (All of which is true.) They think that the
US “seeks to curtail China’s political influence and harm China’s interests” with a “militaristic,
offense-minded, expansionist, and selfish” foreign policy .

China’s regional ambitions are not uniquely pernicious or aggressive, but they do overlap with
America’s ambition to be the dominant power in its own region, and in every region of the
world.
Leaving aside caricatured debates about which nation should get to wave the big “Number 1”
foam finger, it’s worth asking whether having 50,000 US troops permanently stationed in Japan
actually serves US interests and what benefits we derive from keeping almost 30,000 US troops
in South Korea and whether Americans will be any safer if the Obama administration manages to
reestablish a US military presence in the Philippines to counter China’s maritime territorial
claims in the South China Sea.
Many commentators say yes. Robert Kagan argues not only that US hegemony makes us safer
and richer, but also that it bestows peace and prosperity on everybody else. If America doesn’t
rule, goes his argument, the world becomes less free, less stable and less safe.
But a good chunk of the scholarly literature disputes these claims. “There are good theoretical and
empirical reasons”, wrote political scientist Christopher Fettweis in his book Pathologies of
Power, “to doubt that US hegemony is the primary cause of the current stability.” The international
system, rather than cowering in obedience to American demands for peace, is far more “self-
policing”, says Fettweis. A combination of economic development and the destructive power of
modern militaries serves as a much more satisfying answer for why states increasingly see war as
detrimental to their interests.
International relations theorist Robert Jervis has written that “the pursuit of primacy was what great
power politics was all about in the past” but that, in a world of nuclear weapons with “low
security threats and great common interests among the developed countries”, primacy does not
have the strategic or economic benefits it once had.
Nor does US dominance reap much in the way of tangible rewards for most Americans:
international relations theorist Daniel Drezner contends that “the economic benefits from
military predominance alone seem, at a minimum, to have been exaggerated”; that “There is little
evidence that military primacy yields appreciable geoeconomic gains”; and that, therefore, “an
overreliance on military preponderance is badly misguided.”
The struggle for military and economic primacy in Asia is not really about our core national security
interests; rather, it’s about preserving status, prestige and America’s neurotic image of itself. Those are
pretty dumb reasons to risk war.

There are a host of reasons why the dire predictions of a coming US-China conflict may be wrong , of
course. Maybe China’s economy will slow or even suffer crashes . Even if it continues to grow, the
US’s economic and military advantage may remain intact for a few more decades, making China’s
rise gradual and thus less dangerous.
Moreover, both countries are armed with nuclear weapons. And there’s little reason to think the
mutually assured destruction paradigm that characterized the Cold War between the US and the
USSR wouldn’t dominate this shift in power as well.
But why take the risk, when maintaining US primacy just isn’t that important to the safety or
prosperity of Americans? Knowing that should at least make the idea of giving up empire a little
easier.
 AT: China Say No

China wants U.S. participation

Xinhua, 3/26/16 (“AIIB president ‘patient in waiting’ for US,”
http://www.shanghaidaily.com/business/finance/AIIB-president-patient-in-waiting-for-
US/shdaily.shtml, article downloaded 4/23/16, JMP)
JIN Liqun, president of the Asian Infrastructure Investment Bank, said yesterday that he was “patient
in waiting” for the United States to decide on whether to join the bank.

“Even if you decide not to join, that does not mean we cannot work together,” Jin said in a panel
discussion with other multilateral bank leaders on the final day of the Boao Forum for Asia in
south China’s Hainan Province.
The AIIB, a not-for-profit multilateral development bank initiated by China , was officially established
in December last year with 57 founding members. Jin said more than 30 countries are waiting to
join and that “the new members problem will be solved by the end of this year.”
Hong Kong may also be allowed to become a member, he said.
“Hong Kong is an international financial center,” Jin said. “We believe Hong Kong has a role to
play in facilitating the financing of the AIIB. For instance, the AIIB can issue bonds in Hong
Kong and can also have currency swaps with Hong Kong.”

OFF CASE
 AT: T – Economic Engagement

We meet
ICAS, 4/22/16 (Institute for China-America Studies, “A Bimonthly Survey of Research and
Analysis on US-China Relations,” http://chinaus-icas.org/wp-content/uploads/2016/04/ICAS-
Bulletin-April-22-2016.pdf, article downloaded, 4/23/16, JMP)
Assertive Engagement: An Updated US-Japan Strategy for China
Dennis Blair
Sasakawa Peace Foundation USA, April 2016
Blair explores possible futures for Chinese foreign policy and contends that the likely short-term
future trend is toward greater power and assertiveness. As such, he argues that the current
USJapan strategy toward China is inadequate. He puts forward a strategy of “assertive
engagement” that contains “assertive” elements such as greater US-Japan coordination and
internal balancing capabilities and a commitment to matching China’s ‘grey zone’ activities in
the maritime domain. On the “engagement” side he recommends continuing to increase ties with China
on the economic level, both by including China in TPP and supporting the AIIB.

Plan is economic engagement

Chakko, 15 --- Former U.N. correspondent (3/18/15, George,
http://blogs.cfr.org/asia/2015/03/16/the-aiib-debacle-what-washington-should-do-now/, article
downloaded 5/3/16, JMP) ***note --- this evidence is a comment posted in response to an
article
I fully go along with Elizabeth’s wise second option. Prophetic futuristic thinking has not
necessarily been a U.S. govt. talent, nor its strength. In this globalized village the U.S. has all to gain
by joining the AIIB instead of a ‘narcissistic’ self-isolating withdrawal , all the more as the U.S. has
lost and continues losing influence in the wider world at large. It is only by being in the club that
the U.S. will ever have any tangible leverage on the democratization of such institutions and the
market. It would be absolutely foolish on Obama administration to let this chance go unutilised.
Secondly, since the bank is catering to infrastructure development, where the true economic
growth lies at field level, the U.S. has a direct chance to have a good bite on the Asian market
pie, especially for U.S. companies having an eye on a vast, world’s largest growing market
(Asia). Pres. Obama’s Asia pivot has been a very smart decision, based on an unchallengeable
perception that this century belongs to Asia. So the leading economies of a stagnant Europe lost
no time in immediately jumping into the AIIB waggon with a lead given by an adept colonial
past-master the U.K. followed by France, Germany, Italy etc. with a hundred percent surety that
Australia & New Zealand will follow suit. To dis-advise them makes no economic sense, neither
political..
Thirdly, many seem to underestimate that economic engagement is the best forerunner for more
political adjustment, compromise and leverage in times of crises in Asia. Interestingly, since the AIIB is a
China-led initiative, China per force will have to be more accommodating and cannot afford any
hegemonic attitude towards its neighbours in Asia. We have already seen a remarkable turnaround by
the Chinese president towards Modi government and India, because China wants India to play an
important strong role in SCO and BRICS and in the Asian market. There is one issue that has not
surfaced yet though. How the BRICS New Development Bank will tally/align with the goals of
AIIB remains to be seen. Irrespective of that the situation created by AIIB bespeaks only
advantages to U.S. economy than any negatives. One can only hope that Washington will not
resort to self-harm by letting a golden chance go waste.
 AT: CPs That Don’t Have U.S. Join

Joining bank is best option --- allows U.S. to exert influence and helps ensure that
U.S. companies have fair access to the bidding opportunities
Economy, 15 --- C.V. Starr senior fellow and director of Asia Studies at the Council on Foreign
Relations (3/16/15, Elizabeth C., “The AIIB Debacle: What Washington Should Do Now,”
http://blogs.cfr.org/asia/2015/03/16/the-aiib-debacle-what-washington-should-do-now/, article
downloaded 5/3/16, JMP)
It is time for Washington to take a step back and regroup. Its Asian Infrastructure Investment Bank
(AIIB) strategy, ill-considered from the get-go, has now taken a major hit with the announcement
this past week by the United Kingdom that it plans to join the Chinese-led AIIB. Washington’s
concerns over the AIIB are well-established: the competition the AIIB poses to pre-existing
development institutions such as the World Bank and Asian Development Bank; concern over
the potential for weak environmental standards and social safeguards within the AIIB; and the
opportunity for China to use AIIB-financed infrastructure for greater leverage in the region.
From all accounts, the Obama administration has expended serious energy trying to dissuade its
allies from joining the bank at least until greater clarity is offered as to the decision-making
structure of the institution. With the defection of the UK, however, it appears likely that
Washington’s carefully constructed coalition will gradually unravel—both Australia and South
Korea are apparently reconsidering their earlier reluctance to join the bank and could well use
the UK’s decision as political cover for deciding to join the bank.
At this point, therefore, Washington has three choices:
1) Continue to press its allies not to join the AIIB until governance procedures for the bank are
assured;

2) Join the AIIB itself; or

3) Drop the issue.

Option one is clearly a losing proposition. There is no sense expending further political capital
trying to persuade regional and other actors not to join the bank. It is a small-potato issue that is
making the United States look weak at a time when U.S. influence in the region is otherwise
quite strong.
Option two, which I—along with virtually every other China analyst outside the U.S. government—
supported back in October is that the United States join the AIIB. There are several reasons why this
is a good idea. It would allow the United States a seat inside the tent where it could be both a positive
force for best governance practices and an internal critic if things go awry. It also would likely help
ensure that U.S. companies have fair access to the bidding opportunities that will arise from the AIIB’s
investment financing. Joining now will be hard to accomplish in a face-saving manner, but the United
States could begin by publicly recognizing the need for the financing capabilities in Asia that the AIIB
can provide and by moving quickly to work with Australia, South Korea, and Japan to work out common
principles of accession.

Option three is for the United States to back away from the AIIB, release other countries from
any pressure they might feel from the United States not to join, and let the AIIB rise or fall on its
own merits. Chinese-led resource and infrastructure investment has encountered significant
difficulty in a number of countries, including Zambia, Myanmar, Vietnam, Brazil, and Sri Lanka,
among others. If the AIIB does not do a better job than China’s own development banks, it will
be a stain not only on Beijing but also on all the other countries that are participating. If it does
operate at the same standard as the World Bank and Asian Development Bank, then it will be a
welcome addition to the world of development financing. The United States does not have to be
in every regional organization in the Asia Pacific; it is not in the Shanghai Cooperation
Organization, for example, and it is only an observer in the Conference on Interactions and
Confidence-Building Measures in Asia. It can sit out the AIIB or assume observer status as well.
Washington’s priority should be on advancing U.S. ideals and institutions through the pivot or
rebalance rather than blocking Chinese initiatives unless absolutely necessary. (Let’s not confuse
China’s effort to develop the AIIB with its push to implement an Air Defense Identification
Zone, for example.) Opposition to the Asian Infrastructure Investment Bank has become a millstone
around Washington’s neck. It is time to remove it one way or another.

***note when prepping file --- this evidence also answers the “co-financing”
argument about why the status-quo policy solves.

Not joining will give the U.S. significantly less influence

Ahmad, 15 --- professor of economics at Dutchess Community College (5/2/15, Seemi,
“China’s new development bank leaves United States on sidelines,”
http://www.poughkeepsiejournal.com/story/opinion/valley-views/2015/05/02/chinas-new-
development-bank-leaves-united-states-sidelines/26782171/, article downloaded 5/29/16, JMP)
The United States has declined to join the AIIB. In the previous year, the United States had strongly
opposed even the formation of the AIIB and urged U.S. allies not to join. The stated objections
were that such a bank would be a tool of Chinese foreign policy and that its standards would be
less rigorous than those of the current lending institutions. A more obvious reason is that the
AIIB would be in direct competition with the World Bank and the International Monetary Fund
(IMF), where the United States holds a majority vote. Meanwhile, China holds only a 5.71
percent vote in the World Bank and a 3.81 percent vote in the IMF. The AIIB will be headquartered
in Beijing and although China agreed to give up any veto power, it will wield a powerful influence on the
decision making at the AIIB.

This week, China’s President Xi Jinping announced that it would assist its southern neighbor,
Pakistan, with a massive 15 year, $46 billion spending plan for ports, roads, rail, pipelines and
energy. The funding could come from the AIIB. Chinese officials have described the China-
Pakistan Economic Corridor as part of a broader policy called “One Belt, One Road.” Western
China will be linked to the Middle East’s oil and trade through a much shorter route; without it,
much of China’s trade is dependent on a route through the Strait of Malacca.
The prospect of participating in development projects in the Asian continent and having a say as
a founding member, has been too attractive an opportunity to pass. Ignoring the United States’
plea not to join the AIIB, European allies of the United States, as well as Israel and other nations
lined up to join AIIB before the March 31 deadline set by China.
Many analysts criticized the United States for not joining, and blamed Congress for not moving forward
the IMF reform package that would provide China and other emerging economies with a larger say
in the IMF. Others have faulted European nations as well as the United States for not reforming
Western-dominated institutions, thereby pushing China to chart its own course. Although United
States officials are now talking about working in partnership with the AIIB, the US now will have
significantly less influence by sitting on the outside .

As China’s influence continues to grow, it is in the strategic interest of the United States to be involved at
the founding level of institutions such as the AIIB. Our global allies recognized the seemingly limitless
potential of a partnership with China and its burgeoning economy; they will be the rule makers, while we
the United States will be sitting on the sidelines, trying to get back into the game .
 AT: CPs That Don’t End U.S. Opposition to AIIB

AIIB is China’s first signature contribution --- continued opposition fuels perception
of containment
Roach, 15 --- Senior Fellow, Jackson Institute of Global Affairs (3/26/15, Stephen,
“Washington’s Big China Screw-up; U.S. efforts to oppose a $50 billion China-led infrastructure
bank have backfired. Experts explain why,” http://foreignpolicy.com/2015/03/26/washingtons-
big-china-screw-up-aiib-asia-infrastructure-investment-bank-china-containment-chinafile/,
article downloaded 6/9/16, JMP)
In 2005, then-U.S. Deputy Secretary of State Robert Zoellick famously called on China to be a
“responsible stakeholder.” He meant that China needed not only to comply with its international
commitments, but also to provide public goods to the international community. Well, be careful what
you wish for.
Since then China has become much more active in global governance. Chinese occupy leadership
positions in a wide range of institutions. In 2013, China helped broker an interim deal in the
World Trade Organization’s Doha Round, and in November 2014, China, along with the United
States, made a new pledge to limit carbon emissions, creating momentum heading into the
United Nations meeting in Paris later this year. But the AIIB is China’s first signature contribution.
China certainly could have done a better job of selling the need for a new development bank. It is
still unclear why it would be impossible to improve the quality and quantity of development
assistance in Asia through either the Asian Development Bank (ADB) or the World Bank. The
arguments that those banks were un-fixable and not open to a greater Chinese role or that China
deserves pride of place in a new institution given how much it is contributing leave the
impression that the AIIB is a vanity piece or a disguised cash register for Chinese state-owned
enterprises.
That said, the United States has performed even worse. Although joining the AIIB was not an
option since Congress would not have allocated the funds, the U.S. could have adopted the
posture of a friendly outside voice. Instead, it discouraged others from joining in the hope the
initiative would collapse or leave China with a small coalition of the willing. They argued that the
bank would not follow international best practices, but in reality it appears the U.S. opposed the AIIB
simply because it was a Chinese initiative, full stop. Such knee-jerk antagonism gives life to arguments
that the U.S. opposes China’s rise and is bent on containing it. Even more important, American
bungling fuels the perception that China can drive a wedge between the United States and its allies
and that U.S. leadership in Asia is on the wane just when it is needed more than ever .
It’s a shame that China did not provide greater reassurances early on that the bank would not be a
tool of Chinese industrial policy and geo-strategic maneuvering, and that the U.S. did not do
more to pursue such reassurances and find a way to serve as a constructive supporter. The so-
called best practices of existing multilateral aid institutions too often have not translated into
sustained poverty alleviation and development. There are many other areas of global governance
in need of reform, and we can be sure that the AIIB will not be China’s last major initiative. Let’s hope
China and the United States learn from this experience and find ways to identify areas in need of change
where they can collaborate or at least not get in each other’s way, instead of being in opposite camps and
forcing others in the region and elsewhere to pick sides . Then both countries will be able to justly
claim they are truly acting as responsible stakeholders.
 AT: CP Reform / Boost Existing ADB & MDBs

Engaging AIIB is key --- the CP just magnifies the signal that the U.S. is unwilling to
acknowledge growing Chinese leadership
Runde, et. al, 15 --- director of the Project on Prosperity and Development and holds the
William A. Schreyer Chair in Global Analysis at CSIS (3/20/15, Daniel Runde is director of the
Project on Prosperity and Development and holds the William A. Schreyer Chair in Global
Analysis at CSIS. Matthew P. Goodman is the William E. Simon Chair in Political Economy and
senior adviser for Asian economics at CSIS. Conor Savoy, deputy director of the Project on
Prosperity and Development, and Amy J. Studdart, deputy director of the Simon Chair in
Political Economy, also contributed, “The Asian Infrastructure Investment Bank,”
http://csis.org/publication/asian-infrastructure-investment-bank, article downloaded 4/23/16,
JMP)
Q3: What is the U.S. position on the AIIB?
A3: The U.S. government’s official line is that it recognizes the need for new investment but has
concerns about the governance and lending standards of the bank. The position is illustrated most
succinctly in this statement from the National Security Council:
“Our position on the AIIB remains clear and consistent…We believe any new multilateral
institution should incorporate the high standards of the World Bank and the regional
development banks. Based on many discussions, we have concerns about whether the AIIB will
meet these high standards, particularly related to governance, and environmental and social
safeguards.”
Essentially, the United States has taken the position that it is not opposed to the bank on principle, but
concerned about the practical details.

The United States has been criticized, however, for inconsistencies between this public position and the
perception that it has been twisting the arms of its allies behind closed doors . It is widely perceived that
the United States has leaned heavily on allies to steer clear of the bank, including South Korea
and Australia. This has led to a perception that the U.S. government sees the AIIB as a challenge to U.S.
influence exercised through its preferred multinational development banks (MDBs) in the region—the
World Bank and ADB. The quotes from an anonymous White House official accusing the UK of
“constant accommodation of China” in response to London’s announcement that it would join
the bank has further reinforced this perception, despite the U.S. government’s more principled
public stance that the AIIB could undermine the norms that the Bretton Woods’ institutions have
created over the course of 70 years.
The decision whether to join the AIIB is now partially being seen as a referendum on U.S. influence.
The perception now is that the U.S. is unwilling to acknowledge greater Chinese capacity and
geopolitical inertia, and will fight the expansion of Chinese influence and prestige even at the cost of
regional and global development.
***note when prepping file --- there is more evidence to answer the net benefit in
this block “AT: AIIB Bad Turn --- International Institutions ***”

AIIB isn’t a threat to other established multilateral development banks --- joining is
better to influence governance of the bank
Kennedy, 15 --- Deputy Director of the Freeman Chair in China Studies, Center for Strategic
and International Studies (3/26/15, Scott, “Washington’s Big China Screw-up; U.S. efforts to
oppose a $50 billion China-led infrastructure bank have backfired. Experts explain why,”
http://foreignpolicy.com/2015/03/26/washingtons-big-china-screw-up-aiib-asia-infrastructure-
investment-bank-china-containment-chinafile/, article downloaded 6/9/16, JMP)
The Obama Administration has obviously made a major strategic blunder in resisting the establishment
of the AIIB. Many of America’s most loyal allies have rejected the folly of this intransigence. By opting
to join this start-up international lending institution, they will be much better positioned to shape
the governance of the AIIB as insiders, rather than voicing criticism as outsiders, as the United
States apparently prefers. Washington’s Cold-War style criticism of its allies for their “constant
accommodation” of China is a new and embarrassing low in the China debate.
It is both ironic and hypocritical that Washington’s response is to circle the wagons around the
existing Bretton Woods institutions—the International Monetary Fund (IMF) and the World Bank.
The U.S. Congress has repeatedly dragged its feet on IMF reforms. And lending programs of the
U.S.-dominated World Bank have done little to address infrastructure deficiencies in any part of the
world. The ADB estimates an Asian infrastructure void of some $8 trillion over the 2010 to 2020
period. Clearly new lending capacity is needed to meet this daunting challenge.
Nor does the AIIB pose a threat to more established and experienced international lending
institutions. Its initial capital base of $50 billion is less than a third of that which supports the ADB and
less than a quarter of that held by the World Bank. Surely, an $80 trillion global economy can afford to
support much greater lending capacity than is the case today.

But there is a more sinister aspect of Washington’s resistance to this China-sponsored initiative.
It is but the latest in an increasingly worrisome string of anti-China actions. The Obama
Administration has focused on the TPP as its signature initiative on trade liberalization;
unfortunately, it excludes China, the source of America’s largest trade imbalance. Yet another
anti-China currency manipulation bill has been introduced in the U.S. Senate. And there are
ongoing frictions over cyber issues, as well as over territorial claims in the China Sea. Suddenly,
America’s Asian pivot seems like nothing more than a thinly veiled China containment strategy .

Is the rise of China a risk or an opportunity? Washington is clearly fixated on the threat – all but
ignoring the benefits that are likely to come with the emergence of a consumer-led Chinese
economy. This shouldn’t be so surprising. History tells us that dominant powers always have
trouble with rising powers. Washington is bristling over China’s ascendancy. China, with the
baggage of 150 years of a perceived sense of deep humiliation by the West, doesn’t take kindly
to that reaction. The AIIB folly only deepens concerns over an increasingly troubled relationship. A
rethink by Washington is urgently needed.

Permutation solves best --- joining is important to steer the rules of the AIIB and
China’s additional capital is key to meet infrastructure demands
Cronin, 15 --- directs the Asia program at the Center for a New American Security, been
involved with US-Japan policy for over 20 years, going back to the “Nye Initiative” of the early
1990s (4/13/15, Patrick, “Cronin: ‘Next year might have been a better time for Prime Minister
Abe to address Congress’” http://www.dispatchjapan.com/blog/us-china-relations/, article
downloaded on 6/14/16, JMP)
DISPATCH JAPAN: In the context of the Obama administration’s initiative to rebalance our
global policies toward East Asia, how is it that Washington so poorly managed the diplomacy
surrounding China’s proposal for a regional infrastructure bank?
CRONIN: For better or worse, the United States has been heavily focused on major security
initiatives in Afghanistan and Iraq. We created an economy that went into a downward spiral and
deep recession. We are now trying to be restrained in our international security policy which, in
general, was a prudent move, but did provide others with opportunities to try to fill the gaps. We
have been cutting defense spending, especially with sequestration in place, and we have been
cutting back on foreign assistance.
So, in a declining budgetary and economic environment, we were failing to initiate more
comprehensive moves that could appeal to the Asia-Pacific region.
We put ourselves in the unwise position of telling Asian allies and friends to turn down money
very much needed for infrastructure, unless the money came from us. And we said this even
though we had no money to give them.
The US has to be on the side of progress, of problem-solving, and of rules that everyone can live
by. But other than TPP, which is a very important initiative, we have been failing to promote
additional trade, investment, and development programs. We could have been working in a
bipartisan fashion to rework the Bretton Woods institutions, such as reworking the distribution of voting
rights in the Asian Development Bank. The existing institutions need to be more innovative and creative
in tackling development issues in the region. And even if we had been doing those things, there would
still have been a shortage of capital in Asia because the area is so dynamic economically.

So China’s capital is going to be important. We should have been trying to steer China’s initiative in a
direction that is consistent with global rules that have worked so well in the region over the past 70 years.
We certainly should not have been trying to block our friends and allies from joining the AIIB. In fact,
the US ought to join. We should want a voice in the rules that will govern infrastructure investments.
We would be in a position to help shape rules and regulations on labor, the environment, and other
issues that are critical for the region.

Instead, the perception regarding China’s bank proposal is that the US is being defensive, and is trying to
stop China. In fact, China’s track record on infrastructure investments is not very good. We should be on
the inside, having influence.

That brings us back to the broader point that we have put all of our policy eggs in the TPP
basket, which is why it is so important that Congress pass it.

AIIB is good and permutation is best --- healthy competition will improve
multilateral development banks
Orr, 5/4/16 --- US ambassador to the Asian Development Bank from 2010 to 2016 and is a
member of the Pacific Forum CSIS Board (Robert M., “PacNet #39 - The Asian Development
Bank and the Asian Infrastructure Investment Bank: conditional collaboration?”
https://www.csis.org/analysis/pacnet-39-asian-development-bank-and-asian-infrastructure-
investment-bank-conditional, article downloaded 6/7/16, JMP)
Creation of the Chinese-sponsored Asian Infrastructure Investment Bank (AIIB) has won
considerable attention in many capitals, particularly in Washington and Tokyo. Some view the
establishment of the AIIB as a challenge to the supremacy of the post-World War II Bretton Woods
order. Others see it as a symbol of shifting regional power in Asia. Some have deep concerns about the
AIIB’s willingness to adhere to international safeguards and open procurement.

The Asian Development Bank (ADB)

Washington and Tokyo were less than thrilled with the creation of the AIIB to say the least.
Ironically, this is not the first time the US questioned the establishment of a Multilateral
Development Bank (MDB) in Asia. While the ADB has come to be regarded by many as a
Japanese-American bank, there were voices in Washington that opposed the ADB prior to its
creation in 1966. Treasury Secretary C. Douglas Dillon and others in the State Department feared
that a new regional MDB would act as a financial resource lamprey to a more established
institution like the World Bank.
The crunch time came at the 1965 meeting of the United Nations Economic Commission for
Asia and the Far East in Wellington. The US delegation had been instructed not to pledge any
capital for an Asian regional bank. However, at the last minute, word came from the Johnson
White House that the president was not necessarily opposed. This allayed the concerns of
policymakers who believed that White House support greatly improved the possibility of
persuading Congress to approve the ADB. With the president’s green light, the US proceeded to
become a capital contributor to the ADB. Now, years later, there is a discussion about whether
the United States might join the AIIB and, once again, one of the concerns is whether the Hill
will acquiesce.
Today, the ADB is the largest of all regional banks. Next year, its equity will triple to around $53
billion from $18 billion with the merger of the hard loan window, known as ordinary capital
resources, and the soft loan Asian Development Fund. The latter will become a 100 percent grant
operation, a reform so significant that other MDBs are considering it as a future model.
The two largest shareholders of the ADB are the US and Japan with roughly 15.7 percent each,
followed by China at 6.5 percent, and India at six percent. Roughly 70 percent of the
development portfolio is focused on five countries, including China. It has not been easy for
Capitol Hill to reconcile the fact that China is a main ADB borrower, given that China is the
second largest economy in the world with a growing rival development bank and a manned space
program.
Governance structure of the ADB
The Manila-based ADB has 67 member countries stretching from the Pacific Islands to Western
Europe. Its 24-member Board of Directors (BoD) reports to the Board of Governors. The US
governor is the Secretary of the Treasury. The BoD oversees the strategic direction of the Bank
and approves the budget, policies, and all projects. During my five-plus years as ambassador at
the ADB, I recall many discussions with regional bilateral US ambassadors to see whether we
could get the ADB to support various projects or make sure we supported certain projects at the
Board level in the countries where they represented US interests.
The Board is based at ADB Headquarters in Manila and has the feel of a legislature. Serving on
the Board often reminded me of my days as a Congressional staffer back in the 1970s. This sense
was even stronger after I became Dean of the Board, the first American in the history of the
ADB.
The “administration” of the Bank also feels a little like the US government. The president, who
has always been a Japanese national from Japan’s Ministry of Finance, is the ADB’s “POTUS.”
The six vice presidents, who are regionally determined and always include a US citizen, are
similar to Cabinet officers. Below them are directors general who are akin to assistant secretaries
and from there the bureaucracy descends in a structure not unlike that of Washington, all
answerable to the country stakeholders on the BoD. The Bank has its equivalent of “hearings”
where policies or projects can be questioned and tweaked by Board members. By the time
something goes to a formal Board meeting chaired by the ADB president, a little tweaking can
still occur but the passage of the project or policy is assured.
Three countries on the Board represent only one capital: Japan has one executive director (ED),
as does China and the US. Since 1966, the US ED is an ambassador and usually the only one on
the BoD to hold that rank. The other ADB country stakeholders represent constituencies of
between five and 10 countries from the developed and developing world.
Over the years, US priorities at the ADB have focused on promoting accountability, improving
transparency, and ensuring that ADB resources are used effectively and efficiently, as well as
encouraging support for countries important to US interests. These are goals that to various
degrees are usually consistent with other member countries.
The Asian Infrastructure Investment Bank
Chinese President Xi Jinping announced the AIIB initiative in October 2013 during a visit to
Southeast Asia. The factors behind the announcement are multi-faceted. Some suspected a
commercial rationale to push for more Chinese market opportunities. Japan encountered the
same suspicion when the ADB was created. Others speculated about geopolitical objectives and
what is perceived as tighter control of the governance structures by Beijing. An important element
was the feeling by the Chinese that, despite their rise as a great power and emergence as the second
largest economy in the world, they had not been sufficiently rewarded with capital share and voting
power rights in the World Bank and the ADB. In other words, the Chinese felt they were being denied
an opportunity to participate at their weight level.

Initially, little attention was paid to the AIIB. Some even thought that it might not get off the
ground. By the time it was apparent that the AIIB was here to stay, there wasn’t much any nation
could do about it. The main concerns about the AIIB are related to governance and safeguard
policies. Contrary to some media reports, the US position was not to discourage other countries
from joining the AIIB but to say – “if we were asked” – these are the questions we would raise
with Beijing.
The controversy surrounding the creation of the AIIB was intense, as some countries worried
about Washington’s reaction or Tokyo’s or both. In October 2014, 22 Asian countries met in
Beijing to sign a Memorandum of Understanding to establish the AIIB; rapid progress in creating
the bank ensued. The big break was when the United Kingdom announced its intention to join
the AIIB – not necessarily pleasing other European nations who felt London had jumped the gun.
However, shortly thereafter other Europeans signed up. Japan and the US have not. It is difficult
to see a near-term chance of their joining despite many voices in Tokyo and Washington
advocating just that.
To the AIIB’s credit, it seems to have heard the concerns about safeguard policy and has engaged former
officials from other MDBs to help craft practical policies – or at least deploy the right buzz words.
They have an emphasis on transparency, accountability, openness, and independence. As the new
president, former ADB Vice President Jin Liqun has said, the AIIB will be “lean, clean, and
green.” The AIIB Secretariat plans to have 700 personnel, which is substantially less than the
2,000 employees at the ADB headquarters. It is too early to tell whether the AIIB will adhere to
these precepts, as it only opened its doors in January of this year. The proof will be in the
pudding, but there are already good signs. I am encouraged by the extent to which the AIIB has
reached out even before opening to consult with other MDBs such as the ADB and World Bank. Already
AIIB officials are studying the feasibility of co-financing 18 projects proposed by the World
Bank and eight submitted by the ADB. Many of these could be approved by the AIIB Board as
early as this summer. The ADB has made it clear that there will be no co-financing with the
AIIB until ADB safeguards are accepted, and this does not seem to have given the AIIB any
pause.
The AIIB, with 57 member countries, will have a different emphasis than the ADB, with its expanded
capital base moving into new areas such as education and healthcare. This will be a small step from the
ADB’s comfort zone of infrastructure; some have said that ADB really stands for “Asian Dams and
Bridges.” That said, the AIIB looks to remain in the infrastructure and connectivity space.

One area of governance that many have viewed with discomfort is the AIIB’s insistence on a
non-resident Board of 12 members. A resident Board is viewed, apparently, as an unnecessary
cost, but it is necessary for efficient oversight. On the ADB Board when I or my staff had
concerns, arranging a face-to-face meeting with management could be done in minutes. Emails
and long distance phone calls were insufficient. Smaller MDBs like the Caribbean Development
Bank with a capital base of around $3 billion can handle this. But it’s hard to see how a mega-
bank like what the AIIB envisions will be able to sustain such fragile governance. It will be
interesting to see how nongovernmental organizations react to not having Board-level points of
contact at the AIIB headquarters year round and how that will manifest in member country
capitals. There could be calls for Board residency.
Despite frequent denials, MDBs are fundamentally political institutions. It is difficult to make
decisions for vice presidents based purely on merit at that level. It’s hard to see how political
factors could ever be totally excluded. This is true at the ADB. The AIIB got its first taste of this
when a European government assumed it would receive one of the two VP slots that Europe was
to get and it wound up going to another. That capital thought it looked like a classic bait and
switch. And already friction ensued.
I see many potentially positive outcomes with the AIIB. Infrastructure demands in developing Asia far
outstrip what the ADB and World Bank can provide so another player, governed correctly, should be a
welcome addition. Ultimately, it will have to be private capital that provides the lion’s share of the
developmental and infrastructure tools, but MDBs can send signals of stability and safer investment
returns to private investors…sort of “good housekeeping seals.”

Conditional collaboration?
Will collaboration between the ADB and AIIB be driven by governance conditionality? In the beginning,
at least, my sense is yes, as both institutions develop a better sense of how the AIIB’s governance model
will uphold adequate safeguards that are vital to the ADB and, for that matter, the World Bank. It is
critically important for all MDBs to coordinate. It won’t happen all the time as there may be
policy preferences that are different. The ADB may have a stricter code on environmental issues
than will the AIIB.
Healthy competition between the two banks is not a bad thing and can act as a catalyst for important
reforms in each institution. I think the existence of the AIIB will push the ADB to widen and deepen
reforms, which many stakeholders have advocated for years. Competition can enhance that. It can act
to improve the effectiveness of safeguard regimes and the projects themselves. In the end, we will all
benefit.
 --- XT: Permutation / AT: ADB & MDB Good Net Benefits

Permutation solves best and competition from AIIB is necessary to improve existing
MDBs
Runde, et. al, 15 --- director of the Project on Prosperity and Development and holds the
William A. Schreyer Chair in Global Analysis at CSIS (3/20/15, Daniel Runde is director of the
Project on Prosperity and Development and holds the William A. Schreyer Chair in Global
Analysis at CSIS. Matthew P. Goodman is the William E. Simon Chair in Political Economy and
senior adviser for Asian economics at CSIS. Conor Savoy, deputy director of the Project on
Prosperity and Development, and Amy J. Studdart, deputy director of the Simon Chair in
Political Economy, also contributed, “The Asian Infrastructure Investment Bank,”
http://csis.org/publication/asian-infrastructure-investment-bank, article downloaded 4/23/16,
JMP)
Q5: Will the U.S. join the bank? How do we go forward from here?
A5: U.S. engagement is needed, but is unlikely to come in the form of bank membership. U.S.
membership would need to be approved by Congress and, as has been demonstrated by the
refusal to pass IMF reform, there is little sympathy on the Hill for any move that would, or
would appear to, cede influence to China – especially at great financial cost to the United States.
The U.S. government could support the bank by sending experts and advisors to help inform
governance structures and standards. It can also work with its allies who have since joined the
bank to use their influence to ensure that the AIIB adheres to best practices.
Also critical will be improving existing institutions. MDBs rarely ever face competition, and if we frame
the formation of the AIIB in this context, it can be seen as an opportunity to push forward greater
responsiveness, flexibility, and capacity at the ADB and World Bank. Competition can be critical in
driving forward progress, and as the Bretton Woods institutions lose their global monopoly the U.S.,
Japan, and other major shareholders must consider ways to improve the quality of the services they offer.
 AT: CP TPP

TPP doesn’t solve --- not supported by allies and perceived to only benefit the U.S.
--- AND AIIB is key to meet infrastructure demand to increase trade
Maverick, 15 --- decades of experience in the investment world, spent 20 years at a major
brokerage firm (7/21/15, Tim, “TPP Versus AIIB: Obama’s Uphill Battle,”
http://www.wallstreetdaily.com/2015/07/21/china-aiib-obama-tpp/, article downloaded 6/9/16,
JMP)
It was a party that the United States urged 57 countries not to attend… But they did.

These countries included close European allies of the United Sates, such as Germany and the
United Kingdom, and Asian comrades like Australia and South Korea. Not to mention members
of the Middle East, including Israel and the Saudis.
The party in question was held in Beijing for the late-June signing of the Articles of Agreement, putting
in place the framework for the China-led Asian Infrastructure Investment Bank (AIIB).

Instead of joining the AIIB, the Obama Administration offered up another option to 11 countries in
Asia: the Trans-Pacific Partnership (TPP).
This “next generation” trade agreement has one glaring omission, though: China – the region’s
most important trading nation.
Of course, that’s only fair since China didn’t invite the United States to its version of the TPP –
the Regional Comprehensive Economic Partnership (RCEP). This trade initiative links 16
nations in Asia.
But that transgression isn’t the most important part of this tiff.
The real sticking point is that the TPP isn’t popular among our Asian friends. Allies, such as Australia
and Japan, say the TPP intrudes too much into their internal affairs.

That’s a valid point. The TPP requires more than tariff reductions. It gets into other areas,
including intellectual property rights, data protection rules, corporate governance, labor and
environmental standards, and financial regulations.
The perception in many parts of Asia is that the TPP will result in net costs to the region’s economies,
while only benefiting the United States. A high hurdle indeed for a “partnership.”

China’s Approach
This is when the differences between the Chinese and American approaches to global economics and
geopolitics become very stark.
China doesn’t bother with other countries’ internal processes. Its leadership realizes that, in today’s
world, there’s one main obstacle to increase trade between nations: poor transportation, power, water, and
communications infrastructure, which fouls up global supply chains.
This is the same conclusion reached in a 2013 study by the World Economic Forum. In fact, the study
found that removal of these supply chain barriers could increase the world’s GDP by up to six
times!
Somehow the Obama Administration missed the memo on that. But the Chinese did not.
China has the $50-billion AIIB, the $40-billion Silk Road Fund, and the $100-billion New
Development Bank. The latter was founded in cooperation with India, Russia, Brazil, and South
Africa.
And there are the individual Chinese development banks, too – the China Development Bank,
which has $100 billion in capital, and the Export Import Bank of China.
These banks already give more loans to Asia and Latin America than U.S.-dominated institutions
like the World Bank, the Asian Development Bank, and the Inter-American Development Bank.
Of course, this isn’t completely altruistic. China is hoping that a good chunk of the infrastructure
work will be done by Chinese companies, as the country faces a serious excess capacity problem
in heavy equipment manufacturing and construction.
21st Century “Marshall Plan”
Still, funds dedicated to infrastructure are sorely needed in the developing world.
According to some estimates, the U.S.-led development banks fall short by $175 billion annually
in aid for the poverty-stricken.
And the infrastructure needs are much more massive. The Asian Development Bank itself estimates that
Asia faces an infrastructure funding shortfall of about $8 trillion for 2010 to 2020 . McKinsey & Co.
estimates the global infrastructure investment requirement through 2030 to be $57 billion and
$67 billion.
And that’s exactly where China is focusing the AIIB and its other efforts – on infrastructure.

Meanwhile, the global perception is that the Obama Administration is more concerned on imposing
its vision of what’s “right” on other nations, instead of actually getting the help where it’s needed . For
example, the Administration believes any infrastructure project should pass the strictest environmental
standards before proceeding.
Tell that to the people without power and roads. That type of environmental permitting may take a decade
or more. Just ask any U.S. company involved in an infrastructure project.
And with the involvement of Europe and developed Asian countries in the AIIB, it’s likely that
environmental standards won’t be ignored.

President Obama seems to be left at the station after the train has left, and the United States’ global
influence is sure to diminish

Meanwhile, China is proceeding full steam ahead with its version of a 21st century Marshall Plan, making
friends around the world as it goes.
 AT: DA Japan

Number of differences remain with Japan --- development of U.S.-China relations

key to relations with Japan
Gang, 15 (articled updated on 6/18/15, An – op-ed contributor to Beijing Review, Who Is
America's Closest Ally Whether U.S.-Japan defense cooperation benefits them is questionable,”
http://www.bjreview.com.cn/world/txt/2015-06/15/content_692433.htm, article downloaded on
6/12/16, JMP)
For a long time, the U.S.-Japan alliance has been a cornerstone of the U.S. policy toward the Asia-Pacific
region. In 2011, then U.S. Secretary of State Hillary Clinton announced the Obama administration's
ambition to build the 21st Century as "America's Pacific Century." Under the scenario, Japan's position in
U.S. Asian partnerships would predictably be lifted to a new level.

Japan's Abe administration pursues so-called "active pacifism" in order to bring back "a strong
Japan" and change Japan into an "ordinary state" with full military independence. By making use
of the ruling status of his Liberal Democratic Party and the right-tilting of Japanese society, Abe
has attempted to modify Japan's post-war constitution, which restricts the country's military
development, and to remold Japan's development pattern and foreign policy. Abe has his own aims
in strengthening the alliance with the United States, including challenging China on territorial disputes
and regional affairs with the help of the United States.

Differencing ambitions
An enhanced U.S.-Japan military alliance, however, is by no means bound to bring them into an
inseparable relationship. The two sides have an increasing number of differences on many issues.

For example, the Obama administration agrees with Japan's abolishment of the ban on its right to
exercise collective self-defense. But the United States has expressed concerns over Abe's
attempts to deny Japanese atrocities during WWII. Abe's 2013 visit to the Yasukuni Shrine in
Tokyo, which honors war criminals, has also disappointed the U.S. side. The Obama
administration has repeatedly demanded that Abe cautiously handle historical issues and ease tensions
with neighboring countries such as China and South Korea.

During his visit to Japan on April 8, U.S. Secretary of Defense Ashton Carter said that he
welcomed Japan to take part in air patrols over the South China Sea. But Japan did not respond
positively to the advice, because the Japan Maritime Self-Defense Forces are not capable of
maintaining intensive surveillance in both the waters of the East and South China seas.
Moreover, Japan fears that its involvement in the South China Sea disputes between China and
other Asian countries will lead to further tensions with its East Asian neighbor.
There is also a deep chasm in economic and trade relations between the United States and Japan. The
Trans-Pacific Partnership (TPP) multilateral free trade agreement is a cornerstone of U.S. trade
policy and the Obama administration's Asia-Pacific rebalance strategy. The TPP negotiations
should be completed before this summer as planned. Bilateral talks between the United States
and Japan are a critical part of the TPP negotiations. But the two sides have not reached
consensus on some key issues such as Japan's import quota for U.S. rice and U.S. tariffs on
Japanese auto parts. During his visit to the United States this year, Abe did not offer any
compromise on these issues. He appeared to be more interested in signing a Japan-U.S.
Economic Partnership Agreement, which could be considered a crowning achievement for the
prime minister during his tenure.
Abe boasts that Japan is the closest U.S. ally, primarily for protecting Japan's security and rivaling with
China. But such relations won't last long.

U.S. foreign policy always puts its own interests first, while being guided by political realism.
Enhancing its alliance with Japan won't prevail over the needs of the United States to maintain stable
relations with China. In U.S. policy toward the Asia-Pacific region, China and Japan are two equally
important focuses. U.S.-Japan relations ultimately depend on the development of China-U.S. ties. As
China becomes the second largest economy in the world, the China-U.S. relations are increasingly of
global significance. In this light, Japan's role appears less important.
Some say that the two countries may never truly reach common ground, owing to unbridgeable gaps in
language and culture.
What Washington should think about is whether or not the traditional way of protecting U.S. global
interests through alliances will continue to work under the circumstances of China's development bringing
big changes to the Asia-Pacific region. The U.S.-led military alliance put the interests of certain
countries ahead of those of the international community, an approach which by its very nature will
fail to win over all countries.
 AT: DA Japan --- Japanese Participation in AIIB Good

Several benefits to Japanese participation --- counterbalance China’s influence,

protect its regional clout, improve AIIB standards
Dr. Kawai, 15 --- Professor at the University of Tokyo’s Graduate School of Public Policy (last
modified on 8/7/2015, Masahiro Kawai, ASIAN INFRASTRUCTURE INVESTMENT BANK:
CHINA AS RESPONSIBLE STAKEHOLDER?, “Asian Infrastructure Investment Bank in the
Evolving International Financial Order,” http://spfusa.org/wp-content/uploads/2015/07/AIIB-
Report_4web.pdf, downloaded 6/1/16, JMP)
(2) Pros and Cons of Japan’s Participation
Japan should decide to join AIIB based on careful consideration of the pros and cons of
participation.
Benefits of Participation
Given that AIIB is an Asian MDB focusing on Asia’s infrastructure development, with a potential for
setting its own standards, Japan as the second largest economy in the region has a natural interest in
influencing the new bank. In addition, various members of AIIB, particularly ASEAN member states,
want Japan to participate in the bank to help protect their interests by counterbalancing China’s
influence. Moreover, if Japan does not join AIIB, Tokyo’s relative weight in Asia might diminish. Japan
could also encourage China to pursue rules-based behavior in AIIB as China’s economic and financial
power continues to grow.

From an international perspective, AIIB can provide an opportunity for China to play a
leadership role in the provision of international public goods. As a rising economic and financial
power, China is expected to assume a greater burden in supporting global and regional prosperity
and stability. AIIB provides an excellent test case of China’s true intentions in helping to develop
Asia’s infrastructure and of its willingness to collaborate with the international community and
the existing international financial order.
More specifically, the benefits of Japan’s participation in AIIB would include:
• Limiting China’s voting power by coordinating with Europe, Australia, New Zealand and like-minded
developing member countries, thus prodding China toward pursuing cooperative behavior;

• Raising AIIB’s quality of governance, credit and banking culture and environmental and social
standards;
• Creating synergy with the existing major MDBs, such as the World Bank and ADB, in the form of co-
financing and joint project preparation and supervision;
• Positioning Japan as a reliable partner in Asia’s infrastructure building and economic development;
• Ensuring adequate flows of information to Japanese businesses on infrastructure projects financed by
AIIB.