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Destined for War: Can America and China Escape Thucydides's Trap? with Graham Allison

November 2, 2017

Graham Allison. CREDIT: Billy Pickett.

JOANNE MYERS: Good evening, everyone. I am Joanne Myers, and on behalf of the Carnegie Council I would like to thank you all for joining us on this very special evening as we welcome the eminent Harvard scholar Dr. Graham Allison. Tonight he will be discussing his very timely book, entitled Destined for War: Can America and China Escape Thucydides's Trap? This book is the result of a five-year research project conducted as part of the Applied History Project at the Kennedy Belfer Center. Destined for War has been noted as a New York Times Editor's Choice and an Amazon "Best History Book of 2017," and it will be available for you to purchase at the end of the hour tonight.

For some time, we have been hearing about the aggressive nature of U.S.-Chinese relations, especially now, as Donald Trump pursues his quest to make America "great again," while President Xi talks of the "great rejuvenation of the Chinese nation." This ongoing rivalry is based on the steep and threatening economic and military rise of China and a growing belief in America's decline as a "shining city on the hill" and the last hope of mankind.

While the Trump administration continues to withdraw from the world, China has become more engaged, positioning itself to be the world's other superpower, signaling that China is now an alternative, not just a rival, to the United States. One wonders if this will be the trigger that launches a major confrontation.

In Destined for War, Dr. Allison uses his impressive command of history and geopolitical and military knowledge to explore how America and China may be on a collision course, what he calls the "Thucydides's trap." This metaphor, coined by Dr. Allison, serves as a vivid reminder of the inevitable structural stress that occurs when a rapidly rising power threatens to displace a ruling one. It was described by the ancient Greek historian Thucydides to explain the Peloponnesian War, which began with the rise of Athens and the fear that this instilled in Sparta, the prevailing power, making war inevitable.

Drawing on numerous examples over the last 500 years of violent clashes between rising and established powers, Dr. Allison tells us that it is not just extraordinary, unexpected events but even ordinary flash points of foreign affairs that can trigger large-scale conflict. The question that follows is, what can be done to ensure that the current rivalry between a rapidly ascending China and the predominance of the United States does not end in catastrophic incidents—can we escape the Thucydides's trap?

To address this question, please join me in welcoming Dr. Allison as he takes us on an intellectual odyssey through history, one that will give us the tools to think more intelligently about one of the major geopolitical challenges to world order.

Dr. Allison, thank you for joining us.

GRAHAM ALLISON: Thank you very much for such a kind introduction. You are obviously a very good reader of the book but also very good at getting to the heart of the matter. So I think you've gotten a little preview there.

What I am going to do in about 30 minutes, not more, is try to introduce you to the argument of the book, and particularly the question of why I think it is of important, and even compelling, relevance for us, for thinking Americans here now, particularly folks like you at the Carnegie Council.

The book was published on Memorial Day, so it has been out for about four months. I have been very happy and gratified with the reception of the book. It has been widely reviewed in all of the relevant—the Times, the Post, the Journal, the Financial Times, and so forth—mostly favorably, including a Sunday New York Times cover page review. It jumped up to the best-seller list fairly quickly and has stayed there.

The ideas have entered the policy bloodstream very quickly. H. R. McMaster, who is Trump's national security advisor, had actually read page proofs of the book because he was reviewing it for the International Institute for Strategic Studies (IISS), but once he was appointed he thought it was probably not appropriate to be touting a book. But he and I talked about it frequently. He is thoughtful about this. Jim Mattis, who is the secretary of defense, is a big Thucydides fan. Actually, Bannon is a Thucydides reader as well. So it is more complicated than that.

If you were watching in Beijing last week, Xi Jinping was crowned the new emperor of China, but among the other things he talked about in his speech was Thucydides's trap. So the topic is certainly in the stream.

In fact, I think the book provides a takeaway for readers that, as Henry Kissinger has said about it, provides "the best lens available  for looking through the news and noise of the day to the underlying dynamic in the relationship between China and the United States."

The other thing that a number of readers have said about it that has been especially gratifying for me, because I worked rather hard on this—this is not a specialist book, it is meant for people in the policy community, but also in the intelligent reading public—a lot of people have said that it was quite readable. I hope that is right.

The book tonight does three things: first, it introduces you to a great thinker, and before you are done tonight, those of you who have not met him before will be introduced or will be reintroduced to a great thinker; it presents a big idea; and it poses a consequential question.

The great thinker is Thucydides. Probably not for this audience, but certainly for more general American audiences, I have learned that this is a mouthful. I want us to make sure we can all feel comfortable pronouncing this fellow's name. So, on three—one, two, three—Thucydides. So, if nothing else tonight, you learned how to pronounce the name of the father and founder of history.

Thucydides wrote the first ever history book, history defined as an accurate account of what happened and why, without any interference from spirits or myths or other external themes of the sort that Herodotus was given to including in his story. So, Thucydides is just trying to get the facts right, and he did so with a famous book on Classical Greece, called The History—that's why he calls that the name—of the Peloponnesian War. You can actually go download that for free, read just Book One, the first 100 pages. If it does not knock your socks off every other page, check your pulse. This is a very, very thoughtful fellow. So, Thucydides.

The big idea, this idea that I coined about six years ago, is called Thucydides's trap, a metaphor to make vivid Thucydides's insight—so this is his idea, not Graham's idea—that when a rising power threatens to displace a ruling power—like Athens impacted Sparta, which had been the dominant power in Greece for a hundred years; or Germany impacted Britain 120 years or so ago, that was the roll-up to World War I, even though Britain had been the dominant power for a century; or China is impacting the United States today—so when a rising power threatens to displace a ruling power, in general, poop happens. Thucydides's trap is the dangerous dynamic that occurs in this interaction between a rising power that is threatening to displace a ruling power.

In the book I review the last 500 years of history. I found 16 cases of this phenomenon, of which, say, the rise of Germany and its impact on Britain is a good example. In 12 of these cases the outcome was war, in four of the cases the outcome was not war. So to say that under these conditions war is inevitable would be mistaken, and this book does not say that war is inevitable. To say that under these conditions war is possible, even likely, even that the odds are against this, would be accurate. So that is Thucydides's trap.

Finally, the question is the subtitle of the book, which has already been mentioned, which is Can America and China Escape Thucydides's Trap? That is I think the question.

So why don't I take about 20 minutes left to organize my comments as answers to three questions. So I will give you three questions. For each of them I will give you the tweet-sized answer, in respect of Washington today, and then I will say a little bit more, since we have a little bit more time than a tweet.

Question one: What has been the most significant geopolitical event of the last 25 years? Second question: What will be the most significant geostrategic challenge for the United States for the next 25 years, so from this point looking forward as far as anybody can see? And third, this nagging question: Can America and China escape Thucydides's trap?

First, the tweet-sized answers: The geopolitical event of the last 25 years has been the rise of China. Never before has a country risen so far so fast on so many different dimensions. Indeed, for those of you who have not been watching, the first chapter of the book gives you a good jolt. I quote former Czech President Václav Havel's wonderful comment: "Things have happened so fast we haven't yet had time to be astonished." I would say look at the facts and be astonished.

Looking forward at the next 25 years, or as far as anybody can see, the geostrategic challenge will be—my tweet—the impact of the rise of China on the United States and on Americans' sense of our role in the world and on the international order that the United States constructed and has largely underwritten for the last seven decades. So, the impact of the rise of China on the United States and the international order.

And if I were given a few more characters for my tweet, I would say, not coincidentally seven decades without great-power war, which should not be taken for granted, because, as John Gaddis has explained in a wonderful essay—he is a historian at Yale—called "The Long Peace," these seven decades are anomalous and not accidental. They are the result of this order that the United States constructed after World War II and has maintained for these decades.

Finally, can America and China escape Thucydides's trap: the third question. There the book retreats to the professorial perch—actually that is my job most of the time—and answers decisively "no and yes." Let me explain.

So, no if we insist on business as usual in relations with China—and that is I think what we have seen for the last 20 years under both Republicans and Democrats—then you should expect history as usual, and history as usual in this case would be war, indeed, god forbid, a catastrophic war. So, no if we insist on business as usual.

But yes, we can escape Thucydides's trap if we take seriously Santayana's insight, in which he said, "Only those who refuse to study history are condemned to repeat it." So we are not obliged to make the mistakes that the kaiser made in 1914 or that Pericles made in 431 BC when Corcyra and Corinth got into a conflict. So there are plenty of mistakes that others have made that we do not necessarily have to repeat, but we will do if we just do business as usual.

So, no and yes. Let me say a few more words about each. But that is the frame.

So, to the first question, the biggest geopolitical event of the last 25 years, the rise of China. If you have not been watching, I think you will find this 20 pages of Chapter One on the rise of China a jolt.

When I do the presentation of it with slides, I would show you the slide of the bridge that goes across the Charles River in Cambridge between the Kennedy School and the business school. It is called the Anderson Bridge. I can see this bridge out of my office. The renovation of this bridge, the discussion of it began when I was dean of the Kennedy School, and I quit being dean in 1989. The construction project began in earnest in 2012 and was declared to be a two-year project. In 2014 it was declared that it was not finished. That was obvious for anybody to see, with the big traffic jams, and they said it would take one more year. In 2015 they said it was not finished and would take one more year. In 2016 they said, "We're not gonna tell you when it's gonna be finished." But it was already three times over budget. And now actually all the traffic works on it, they just still have not quite finished it.

There is a bridge in Beijing that I drove across two months ago when I was there called the Sanyuan Bridge. It has three times more lanes of traffic than the Anderson Bridge, so it is bigger. In 2015 the Chinese decided they wanted to renovate the Sanyuan Bridge. How long did it take to complete that project? Take a guess.

PARTICIPANT: Eighteen months.

GRAHAM ALLISON: Forty-three hours. You can go to YouTube and you put in "43-hour China bridge" or put in "Sanyuan Bridge," you can see the video speeded up with a timeline of this project.

Now, I know in New York the Second Avenue subway only took [laughter]—so you are not like Boston.

How many miles of high-speed rail has the United States successfully constructed that are operating today? The answer is zero. We have one project that has actually been very active, and it is from San Francisco to Los Angeles. It was started 10 years ago, and it was announced to be done in 2017. I think that was this year. It was then announced that it might be finished in 2029—that is the current estimate—and many people in California think that it will never be finished.

In the same 10-year period when we were not building the 500 miles, China built and are now operating how many miles of high-speed rail? Sixteen thousand. So you get on a train in Beijing and you are in Shanghai in an hour and 20 minutes [Editor's note: It actually takes roughly four and a half hours.] If we had high-speed rail, I would be able to go to Boston in an hour and ten minutes, and I would be able to go to Washington from Boston in an hour and 45 minutes.

Subways. Look at the airports. And on and on and on.

The course I teach at Harvard is mainly for Kennedy School students, so I have 10 undergraduates among the 60, and each year I give them a quiz. The quiz says at the top of the page, "When could China become number one?" I give a short version of this in the book. Number one, largest middle class; number one, produce the most cell phones or smartphones; most computers; largest number of billionaires; fastest supercomputer; largest national economy; and so on—26 indicators. They have to write their answers—2030, 2040, "not in my lifetime."

Then I give them a second slide. The same 26 indicators, but at the top of it says, "already." So all of those things already happened.

Most Americans, of course, have not noticed. As I say, we have not yet had time to be astonished. But look at the facts. In fact, most Americans do not know that China today has the largest national economy, bigger than the American economy. "Well, no, that can't be. I read in the paper always that China is the second-largest economy." Go to the International Monetary Fund (IMF) website, go to the Central Intelligence Agency (CIA) website, take the yardstick they regard as the single best yardstick for comparing national economies. That is called Purchasing Power Parity. You will see that China's economy is today bigger than the U.S. economy.

"Well, that shouldn't be. I don't like that. I think our economy should be the biggest economy." Well, that is good. I would like that, too. But the facts are hard to deny.

The first proposition is that what has happened literally in the 25 years—we are old enough to remember where we were 25 years ago, most of us—so while we have hardly been watching, this meteoric rise has just been in every dimension. China will be rivaling, and in many domains surpassing, the United States over this period of time, as it already has been, and for some time to come. So that is the past.

Looking to the future, the geostrategic challenge. As I said, it is the impact of this. This is really again Thucydides's idea. So, I am the ruling power—Sparta, Britain—I have been the ruling power—the United States—for a hundred years. So this is natural. This is the way things should be, they were all my life. Actually this is a good way for things to be. So this is not just the status quo, this is the international order; actually it is the international order we constructed and we have maintained.

Without this international order, you, upstart, would not even have had a chance to become an upstart. So actually the Asian order that the United States has provided for the seven decades since World War II, the economic and security order, has provided the environment that has enabled all of the Asian miracles. They would not have occurred in the absence of that.

Nobody has benefited more from this than China. When I was working in the U.S. government, I often explained to them why they should be so grateful for this, and they should, I think. Indeed, we tried to explain to them why they should help pay for it, they should share more responsibility. And they say, as Athens said to Sparta, "But you put all of this in place before we even got here. You didn't take account of our interests because we didn't even count when you established this order." As the Chinese tell us, "You wrote the rules for what is the IMF and what is the World Bank and what is the alliance structure. You didn't consult us."

In this dynamic, the rising power naturally feels, I'm bigger, I'm stronger, I deserve more say, I deserve more sway. This current situation is unfair, it doesn't really weight my interest consistent with my size and scale.

If you listened last week to what was going on in Beijing, that is precisely the subtext of Xi Jinping's message, that "We are finally now standing up to be big and strong, the way we always were until some foreigners showed up about 200 years ago, these Europeans with technology, and they humiliated us. Then the Americans came on to help. But now we're bigger, we're stronger, so we're standing up for ourselves."

And the ruling power, the United States, says,"Wait a minute. You're trying to upset the status quo. Indeed, you are trying to undo the whole international order, and what are the consequences of that going to be?"

That story is as old as history itself, and we can see how those dynamics work. I describe those in the book, and you can see the elements of it. But I think the impact of the rise of China on Americans' sense even of who we are and our role in the world you can already see in part.

This book was not written with Donald Trump in mind. Actually, it was completed before he was elected. But I have in the preface just two or three pages that note that Thucydides would not be all that surprised at the campaign that was run, and even the election of somebody like Trump, because he would say ruling powers become insecure and they become fearful. Even in the extreme they can become paranoid. Remember what in Greek comes right after fear is extreme paranoia. In the campaign, the principal obstacle to American greatness, according to Donald Trump, was China, which has been "raping our economy," he said, and so forth.

This impact I think we have not seen the end of. We have actually only seen the beginnings of it. But I think anybody who missed China's ambition to, as Xi Jinping said last week, "stand tall and be strong in the East," and as I explain in the book—and this comes from Lee Kuan Yew, who was the person who knew China the best—this leads to the question: Are these folks serious about displacing the United States as the predominant power in Asia in the foreseeable future?

Actually, I have it in the book. He says, "Of course. Why not? Who could expect them to do otherwise? How could they not want to be the dominant power in Asia?" But wait a minute. But we are the dominant power in Asia, and our dominance has provided this environment. So there's the rub.

Finally, can America and China escape Thucydides's trap?

Thucydides's idea is not—let me make sure what it is not—that because the rising power is getting bigger and stronger, it says, "I'm big and I'm strong, it's time for me to attack you." And it is not because the ruling power says, "Well, look at this upstart. He is already almost as big as I am. If I leave him alone, tomorrow he is going to be even stronger. I better fight him now." That is not what happens.

What happens is that, caught in this dangerous dynamic, third-party actions become provocations to which one or the other feels obliged to react, to which the other primary actor feels obliged to respond, which then leads to a cascade, often dragging people where they do not want to go.

So, how did the assassination of an archduke in 1914 produce a conflagration that burned out the whole of Europe, at the end of which it was so devastated that historians had to create a whole new category? That is why it is called World War I. It is a puzzle. I have a good chapter on it in the book. It is a question I have asked since I was a student at Harvard. I still cannot believe it. I cannot understand it. It does not make any sense.

After the war, every one of the principal actors had lost what he cared about most. So, the Austro-Hungarian emperor is trying to hold his empire together; the empire is dissolved, he's gone. The Russian tsar is trying to back the Serbs; his whole regime had been overthrown by the Bolsheviks, the communists. The kaiser is trying to back his only ally in Vienna; he has been tossed out. France is militarily allied with Russia; it has been bled of its youth for a whole generation, never recovers as a player in international affairs. And Britain, which had been a creditor for a hundred years, has been turned into a debtor and is on a slow slide to decline. So if you had given to people a chance for a do-over, nobody would have chosen this. But they did, and it happened.

So who is our best candidate for a provocateur in the current dynamic between the United States and China? Well, watch this week. Watch this space. Kim Jong-un.

Could Kim Jong-un drag the United States and China into war? "Never, it is impossible." I asked this at the People's Liberation Army Senior Colonels' Academy when I was there a few months ago, and this young colonel said, "Absolutely not, no way." He said, 'Nobody in China wants to have a war with the United States, not one person. Everybody knows it would be catastrophic." And he said, "I study the United States. Nobody in the United States wants a war with China. They know that would be crazy. So it can't happen."

So I said, "Well, thank you, but when I've studied it, it says Chinese study history a lot. Does anybody else have a view?"

This other senior colonel said, "Let me answer. Of course they could." And he said, "Why, of course, they could. They already did. This already happened in 1950."

The young man said, "I wasn't born then."

"That's okay. I can't help that."

In 1950 North Korea attacked South Korea. South Korea was almost overrun. The United States came to rescue at the last minute, pushed the North Koreans right back up the peninsula, right across the 38th Parallel. MacArthur thought he was going to finish all the business by Christmas and we were coming home. Korea was going to be unified. Out of the blue came 300,000 Chinese and then another half million. Beat us right back down the peninsula to the 38th Parallel, where the armistice [set the border]. Tens of thousands of Americans, hundreds of thousands of Chinese, and millions of Koreans died in this war. Most of the Americans were killed by Chinese, most of the Chinese were killed by Americans.

Did anybody want a war between the United States and China? No. Mao had only the year before barely consolidated control of China. The United States was "Superman." We had just dropped atomic bombs on Hiroshima and Nagasaki five years before to end World War II. So the idea of "You are going to attack Superman? Forget about it." But they did, and it happened.

So watch this space. In the months immediately ahead, either Kim Jong-un is going to conduct more intercontinental ballistic missile (ICBM) tests, and after the next series or the series after that, but not a year, before a year is out, he is going to have the ability to strike San Francisco and Los Angeles with a nuclear warhead. That is inconceivable, but I am telling you that is a fact. Or somebody is going to attack him to prevent this from happening. Or there is going to be a miracle. So I am praying for a miracle, but that is hard to count on.

How bad would it be if Kim Jong-un would be able to attack San Francisco or Los Angeles with a nuclear weapon? For folks in San Francisco this is a big event.

But he is not going to stop when he can only do that. He is going to continue working on his program, and pretty soon he will be able to get a nuclear weapon to New York—oh, my god—or Boston. Yikes!

Is he going to attack us? No. Because he knows we would respond and destroy his society. But if he succeeds in having the ability to attack us, what else is he going to do?

Or—and this is exactly what Donald Trump told Xi Jinping when they first met, which was in Mar-a-Lago in April—he said to him, "You can solve this problem. You're a big country. This is a little country right beside you. You can solve this problem. But if you don't solve this problem, I'm going to solve the problem, because I'm telling you there's no way in hell Kim Jong-un is going to be able to attack America with nuclear weapons." "But," he said, "if I do it, you're not going to like it." Then he served him chocolate cake—this was the opening dinner—he excused himself, went to the room next door, and announced that the United States has just launched 59 Cruise missiles against Syria, just to make the point of how we might do this.

So, will Trump attack North Korea in the months immediately ahead? He might. And, if he does, will the North Koreans attack Seoul? Almost certainly. And, if they attack Seoul, will we then destroy the artillery and the rockets that can do more damage to Seoul? Probably. And, if we do that, will we have a second Korean War? Likely. And, if we have a second Korean War, will China become a combatant? Likely.

You think, Well, this is crazy! 1950 was pretty crazy, too. Crazy things happen.

To conclude, the purpose of this book is not to be fatalistic, it is not to be pessimistic—I am inherently optimistic. It is to say that the dangerous dynamic that we find ourselves in creates extreme danger that we would not otherwise face or would not otherwise recognize, and under conditions of extreme danger one requires extreme actions, more imagination than you would normally have. So, business as usual; no, you have to stretch the imaginations, more adaptability than one would normally have.

I am hoping what the book will do is help a thinking American community and the American policy community first recognize, yes, this is extremely dangerous. There is no simple way to escape these conditions. This is going to be a chronic condition for years to come, decades probably to come, and to deal with it successfully we will have to have as much imagination and as much adaptability as, for example, the United States displayed in creating what was ultimately the Cold War strategy. So it is not like this is beyond human capacity, not even beyond American capacity, just not normal.

So, can the United States and China escape Thucydides's trap? The answer is no and yes.

I am happy to take questions.

Questions

QUESTION: My name is Larry Bridwell. I teach at Pace University. In fact, I just finished teaching about your Essence of Decision book last night. So it is a great book.

GRAHAM ALLISON: Thank you.

QUESTIONER [Larry Bridwell]: My question is that one possibility to force China to deal with North Korea is for President Trump simply to announce that six months from now there will be a complete total trade embargo against China unless they take decisive action. What would be your assessment of that option?

GRAHAM ALLISON: It is a good question. I will try to give short answers. All of these deserve long answers, but I am not trying to not take the question seriously.

I think for most of us when we think about North Korea and we think about Donald Trump, we decide to blame him. Not you. The fact is, he inherited a failing hand. North Korea had already gotten nuclear weapons, 50, had already got short-range missiles to hit South Korea, and already got medium-range missiles to hit Japan, and was on the verge of getting missiles to hit America. That is when he came, late to the party. He looked at it and he said, "This is crazy. I can't even believe this." And he had never heard of it before. It was not what he had been thinking about or working on.

He immediately, when he heard about this from President Obama in the hand-off between them, he went out just from the meeting and tweeted, "Not gonna happen. I don't know what Obama did, I don't know what Clinton did, I don't know what Bush did, but I'm telling you under Trump this is not gonna happen."

So what he has been trying to do, I think: First he wanted to threaten economics, then he decided, "Well, I don't know how that is going to work." So I think, if you were to look for what is the method in the madness at this point, it is to persuade Xi Jinping that "I really am crazy enough to attack North Korea, even though I know what all the risks are—unless you do something, so you better do something." So the strategy is to move Xi, to squeeze the oil lifeline, to get Kim Jong-un at least to stop testing. I think it is possible this will happen, and that will be part of the conversation.

Whether, if one said and could plausibly say, "In six months, the United States is going to have a total trade embargo with China," the question is whether this is credible, whether it would be sustainable, and what the consequences would be for us. Always in the cases of deterrence or coercion, it has to be believable that I will really do it and it will not hurt me more.

So if we were to have no trade with China, Walmarts would become empty. Americans do not like Walmarts to be empty, so there would be a lot of noise about that. Chinese factories, of course, would be producing for nobody, because there is nobody buying the stuff the way we do. We would have some problems probably financing our deficit, so there is that component of it, since we still borrow money every year to pay for our budget. So I am sure one could look at that, and actually the fellow who does trade in the Trump administration, Navarro, has been talking in this space. But I think people might be worried that it would impact us more and therefore it would not be credible.

Again, there are no easy answers in this space as we are dealing with North Korea.

QUESTION: I am David Pruden, and I am a Master's student at Columbia University. I bought your book the day it came out and read it. Excellent book. Thank you for it.

GRAHAM ALLISON: Thank you.

QUESTIONER [David Pruden]: As you said, China had really no role in designing the IMF and the World Bank. Could you please give your assessment of these alternative economic governance organizations that China has started to lead, such as the Brazil, Russia, India, China, and South Africa (BRICS) New Development Bank; One Belt, One Road; the Asian Infrastructure Investment Bank (AIIB); and how China is calibrating balancing those alternative institutions with the existing order that, as you pointed out, China has benefited from more than anyone else?

GRAHAM ALLISON: That is a very good question and would be worth a side discussion. I am fascinated by it.

So, here you have a rising China. The system was set up before they counted, even though, for example, they got a seat on the UN Security Council because they were a big country, even though at the time it was unsettled who was even going to rule China, and then you had Taiwan and Beijing continuing a civil war. But the Americans, setting up both the IMF and the World Bank, which were fantastic organizations for the benefit of the whole world, did set the rules. So the rules say, "The president of the World Bank will be an American, and the first deputy of the IMF will be an American, and the Americans will have enough votes in the IMF that if we want to veto something about the governance, we can."

In the World Bank case, China first sort of said, "Well, we need a little more voting shares," because voting shares are distributed in terms of your contributions to the capital.

The United States said, "Well, I don't know, I don't know." Congress said, "No, no, no."

So the Chinese said, "Well, maybe we'll start our own bank. We have the money." So currently the Chinese development banks today give away four times as many loans as the World Bank. So they already have their own—they have the Asian Development Bank (ADB), they have this infrastructure bank, they have the lending for the One Belt, One Road. So they have a series, four of five of these banks. They have an agricultural bank. Take them altogether, four times as many.

And the IMF is interesting. This now gets into the weeds. But in the IMF the question is, how do you decide which is the biggest economy? When they do their reports, they use Purchasing Power Parity and they say China is the biggest economy. But for distributing shares, if they said that, the fact that the United States has enough shares to block any changes in governance would change, and the United States has enough shares to block that, so we will not let them calculate the size of the government for the purposes of shares using the measure that they use in their statistics.

So they have made a deal where we do 60 percent market exchange rates and 40 percent Purchasing Power Parity, which just allows us to keep our 17 percent shares, which just allows us to keep our veto. Actually, if ever China became the largest shareholder in the IMF, the IMF could move. The headquarters of the IMF is in the country that has the largest number of shares, and you can be sure Washington is not interested in that happening.

So China is now looking at its options even in the financial space. The fact that the dollar is the reserve currency, and the renminbi (RMB) is having to try to make its way, and the RMB is much more controlled, makes it more difficult. But in any case they are looking at the space. If that is an area you are studying as a student, I would say look into it because it is ripe for exploration.

QUESTION: Jim Traub at ForeignPolicy.com.

First, thank you for forcing us to examine the impulse of "it can't happen because we don't want it to happen." But I just want to push back a little bit on the "yes, it may happen."

I was very struck that your two categories are war and not-war. I say that because we live in a world now where, for example, in regard to Russia, we have endemic, low-lying serious conflict, but not war. And as you say, for the last 70 years, what used to be routine, which is great powers went to war with each other, has not happened.

So, my impression from what you have said is that you think that is a far more frail dynamic than we think it is. But is it possible that there are so many things nowadays that are in between war and not-war, all sorts of forms of conflict which are really serious but do not look like massacres, because in this case the U.S.-China war would be the end of the world, that the answer may be something which is neither war nor not-war?

GRAHAM ALLISON: That is a very good question. I would have to think, and I will try to think, harder about it.

There is no question that between not-war and what I think of as war, or what is in the security studies literature—for war you have to have a thousand combatants killed annually just to get into the correlates of war charts. I am not so much even interested in—those count for me as kind of small wars. So what has gone on in Iraq and Afghanistan is horrible, but those are not "real big wars."

When Mattis testifies about what would happen if there is another war on the Korean Peninsula, he says, "Don't think of Iraq. Don't think of Afghanistan. Think of the last Korean War," and he calls it "catastrophic."

So there is something special about wars that kill hundreds of thousands or millions of people. The whole 20th century, as we know, was basically defined by these two horrible events and the risks of a third one that might have killed all of us.

I think there is something special about big wars, and big wars between big powers, that could then involve the killing of millions, or even many millions, of people, or maybe even erase a country from the map, which if the nuclear arsenals were used in full could actually happen, horrible as that is to imagine.

I think there is no question that there is a whole set of struggles going on. Even the Chinese have a version of this they call "continuous war." If you look actually in the Chinese tradition, Sun Tzu's conception of war, as he says, is "If you have to fire your weapon, this is a failure." So the Chinese conception of war is, like in the game of Go, "we surround you with so much power that you see the outcome, so we do not have to fight about it." I would say that is not inconsistent with what we are seeing.

I still worry that as this dynamic occurs something like the Korean peninsula could lead—one step, another step, another step, then we are in a war.

And even in the U.S.-Soviet Cold War competition, which you know very well, even though we knew that a nuclear war might kill hundreds of millions of people, in the Cuban Missile Crisis we came extremely close. John Kennedy thought there was a one-in-three chance of a war that would kill 100 million people. And you look at him, "Wait a minute. So to prevent the Soviet Union having nuclear-tipped missiles in Cuba, we ran a one-in-three chance of a war that could kill 100 million people? I am glad this worked out, but this is sort of frightening."

What odds will Donald Trump run to prevent a North Korea that can strike the United States with nuclear weapons? And I think, god help us, we are going to watch.

QUESTION: My name is George Bulow. I am an entrepreneur. I am also an independent historian and foreign policy activist.

My first part of the question is to have you talk about those areas in which there was no conflict, those four examples. I think there may be some interesting analogies to draw from that.

With regard to the question of China, particularly looking at Korea, I would propose something like an Austrian State Treaty, that we would talk with the Japanese and talk with the South Koreans and find a way to see Korea reunited, but would guarantee the Chinese that there would not be a lot of U.S. forces certainly above the 38th Parallel but possibly even farther south.

GRAHAM ALLISON: Both good questions and a good suggestion that is in the space of trying to be more imaginative about potential outcomes.

I would say the Austrian State Treaty or some version of that, or Belgium if you take the 19th century version, or Finland in the Cold War, would have been a great idea if we had managed to think of it about 25 years ago before the Kims had gotten the nuclear weapons. Now the challenge is a lot harder because Kim Jong-un thinks these nuclear weapons are his survival blanket, and finding a way to get him to give them up is going to be extremely difficult for anybody.

And the Chinese—actually what Xi Jinping said to Trump at Mar-a-Lago is: "Wait a minute. You guys are coming to me now, telling me this is my problem. Look and see where the situation stands. This is not reasonable. You have not been able to solve this problem. You haven't asked anything like something more—you haven't been prepared to talk about anything like security on the whole peninsula before—and now you are coming to me and telling—" So it is a little difficult, I think, even though I think we should be in that space, looking as imaginatively as we can at things that would be highly uncomfortable, very uncomfortable, but would be better than what we are otherwise going to get.

On your first question, the four cases, I could tell you all about them, but I will just give you the names and the little clues from each.

The first comes from the end of the 15th century/beginning of the 16th century, when Spain emerges to rival Portugal. Portugal was the dominant sea power at the time. Actually, we remember Christopher Columbus and all that, who could not get a loan from the successors to Prince Henry, and so he went to the Spanish, and that turned out to be the big step as they began to challenge the Portuguese. So they were about to go to conflict. The pope, who was at the time higher than they were—both of them were Catholics and he could excommunicate them—he said, "You can't go to war. No." So he took a map and he drew a line in the middle, down the page, and he said, "This side here, this is Portuguese. This side, that's Spanish." So that is why people in Brazil speak Portuguese. That is how that story came about.

In the rise of the United States to rival and then surpass Britain at the beginning of the 20th century, it is happening at the same time the Germans are rising. I have a fascinating case on that. Basically, the United States behaved about as badly as any rising power could conceivably behave. One of my heroes is Teddy Roosevelt. I have a good chapter in the book called, "Imagine China Were Just Like Us." As a government official, I have often given lectures to Chinese and everybody else about why they should be more like us, responsible and so forth.

Teddy Roosevelt arrives in Washington when he is 37 years old. He comes from New York. He goes to Washington. He is the number two person in the Department of the Navy. He has been saying for 15 years that it is an "abomination"—that is what he called it—to have these foreigners in our hemisphere, especially the Spanish, who he did not like, in Cuba.

So what happens in the next decade? I will not tell you the whole book, but basically there is a mysterious explosion of the Maine in Havana Harbor and we take it as an occasion to declare war on Spain. We defeat Spain quickly, liberate Cuba, take Puerto Rico—that is how we got Puerto Rico—and we pick up Guam as a spoil of war. Then we sponsor and support a coup or an insurrection in Colombia, create a whole new country, Panama, that the next day gives us a contract for our canal because Teddy wanted his ships to go from the Atlantic to the Pacific and the Colombians would not agree. Then we threatened war, first with Germany and then with Britain, over a territorial dispute in Venezuela, which they think they are going to settle. Teddy says, "You butt out or fight me." So they leave.

Then, the piece I like the best, is we steal the biggest part of the fat tail of Alaska. If you look at Alaska, there is this big blob, a 600-mile strip, the tail, that cuts Canada off from the sea and runs down to the United States. So how did that come to be ours? That is a long story, read about it in the book.

John Muir tells Teddy Roosevelt, "This looks like a hundred Yosemites."

Teddy Roosevelt says, "That sounds like America."

His secretary of state says to him, "No, sir, that's Canada."

He says, "That can't be Canada. That's like Yosemite. That's America."

And we steal it, fair and square.

If China should behave with the exuberance of Teddy Roosevelt, I would say there will be no end to this story. So that's Chapter Six or Chapter Five.

QUESTION: Ron Berenbeim.

That gentleman asked the question I was going to ask about the four examples, but fortunately I was given enough time to think of another question.

GRAHAM ALLISON: The other two examples are the Cold War, and the stretch case, the test case, is the rise of Germany in the period since the end of the Cold War, since 1991, to become the predominant power in Europe. That is a stretch case because it is not over yet, and it reminds us, I believe, of the importance of Germany having been wrapped in a security blanket called NATO and a political and economic set of arrangements called the European Union.

The test case for thinking about Thucydides is to say, "Imagine the European Union unravels, so Brexit is followed by Nexit, so now not-EU, and imagine NATO unravels and Trump says, 'Pay up or we go home,' and so we go home." Now how will the relations between Germany and France and Britain evolve over the next decade or two? If Thucydides is right, all of a sudden people who are best buddies are going to start looking at each other fearfully.

QUESTIONER [Ron Berenbeim]: What about India, which has a significant border with China, among other things, and will have a larger population in 2020 or 2030. And also something else that I think is off of a lot of people's radar, which is the Arctic. You can now do what Henry Hudson could not, so obviously there is going to be some kind of struggle there, too.

GRAHAM ALLISON: Good points. So basically, "History never repeats itself" is what Mark Twain said, "but it does sometimes rhyme." So basically this is not a standard pattern.

When the United States rose in the Western Hemisphere, it turned out there were no real competitors that were locals. China has a different picture: there is Japan, the third largest economy in the world and has a serious military; there is India, which could, if it got its act together, be a serious competitor to China. Now, both in India and in Japan you have very fearful countries that are more and more eager to get aligned with the United States so that they have somebody helping, on their side. The South Korean case is more complicated because of their entanglement with the Chinese economy, but I think that dynamic is a different one and one to watch.

I think you could imagine an American strategy—and I think in part this is what Trump's so-called "Asian strategy" is, which he will give a preview of when he is on this trip this week when he is in Vietnam—he will say that we are trying to align these allies with us to try to provide some counterbalance to China, but since we are fighting with them about bilateral trade balances at the same time, it makes it more complicated.

QUESTION: Since you suggested an interest in outlier solutions, I just returned from China from a month trip two days ago, so everything that you are saying is resonant. Given the nature of the autonomous regions that China controls, what would be your response to a sense of an annexation of North Korea, which would relieve some of the pressures that China is concerned about with war, putting North Korea in chaos, and all the others?

GRAHAM ALLISON: Good, good. If the call is for imagination, which it is, I would say this fits on the list to look at.

The fact that there are many cons does not mean that it may not be the best of the alternatives, because all of the alternatives are going to be very ugly. So the fact that it is ugly does not disqualify it at all.

Now, if we were to say to the Chinese, "Look, why don't you just take North Korea and you can annex it or do whatever the hell you want with it, but in any case no nuclear weapons in North Korea, you take responsibility for it," I think if they would take it, Trump would probably make that deal.

I have never talked to Xi about this. I have met him, but I have not been able to have a conversation. But I have talked to people who talk to Xi, who know him and are part of the government, and they say, "We don't want North Korea. North Korea is a pit."

QUESTIONER: "A drag on our economy."

GRAHAM ALLISON: "It is poor. Somebody is going to have to rehabilitate the whole place. It is part of the reason why the South Koreans have become more reserved. Besides, they have nuclear weapons, and we are not quite sure how to get rid of them. Besides, they have this very vicious, ruthless young man who is ruling the place, and even if we had somebody there who was supposed to be his tender—the uncle, who was very friendly to the Chinese—he became suspicious of him and put him up against the wall, took an anti-aircraft gun and blew him away. And then we had another guy under our protection, his half-brother in Macao, and they went and poisoned him. Maybe you take it." [Laughter] This is a little bit like "who wants this?"

But it is certainly worth asking. All of the things that we have said in the past that are simply vested interests have to determine what we do at this point, and I think the answer is no. So I like the idea. Thanks for that.

QUESTIONER: I think the view that he has taken on as a global leader, this might be just one of the things you have to swallow.

QUESTION: Sondra Stein.

Going back to the possibility of some negotiation, I was just reading recently that South Korea and China have reached more rapprochement.

In any deal, if it was possible, North Korea would trust us, but we would have to have China guarantee their integrity as well. But what could we give China that they would want to? What I was thinking of, from what I read, is that China does not want the United States as a military presence in Korea, and if we would offer to back down on that in order to make a deal and China would agree, do you think there is any feasibility in this?

GRAHAM ALLISON: Good question.

QUESTION: I have three very quick points. The first is, what about the concept of mutual assured destruction (MAD), which really worked, I think, to prevent war for many, many, many years?

The second point is that this big war you keep referring to could be quite archaic within a couple of years, because with the quick development of technology, today we are all talking about cyberwar, and who knows? A cyberwar could completely destroy a nation.

My third quick point is that all the years you have been referring to the leaders of the world have been men. I am not saying this to be cute or to be silly, but men are controlled to a great extent by this testosterone or this machismo thing, and if somebody seems to get bigger or more powerful, they have to strike back. Women do not respond that way, and if somehow nations were ruled by women, perhaps all of these constant wars would not exist to the same extent. Those are my three points.

GRAHAM ALLISON: Good points all.

AUDIENCE [Off-mic]: Good old Maggie Thatcher, right?

QUESTION: My question will be very easy. Do you think China is still going to outperform economically the United States for the decades to come?

QUESTION: I would like you to talk a little bit about priorities for the president's trip next week in China. What are your biggest concerns? If you were one of his handlers, what would you want to make sure that he does?

GRAHAM ALLISON: Great questions. Let me go backward on the questions, if that is okay.

The president if off on this trip now to Asia. He is going to a number of different countries, but he will be on the 7th and 8th in Beijing with Xi Jinping, which is the most important.

If I were to have my dream, it would be that they would sit down and they would say, "This young guy, Kim Jong-un, could drag us into a war that neither of us wants. That would be crazy. So why don't we each ask a couple of people who we trust to go off secretly and privately by themselves for two or three days and dream up ugly options?" And they might involve the options we are talking about here, where maybe the U.S. troops have to be adjusted on the peninsula, maybe they annex—whatever. "Do not think of any constraints. The two of you just go and think up whatever you can think up and come back with at least three solution, which we are going to hate, but they are going to be better than the alternative that we are otherwise going to be faced with."

I think if they were to do that, they would come back with some ideas. Then we would all say, "Oh, well you can't do that, you can't do that," to which the answer is, "As compared to the alternative." It is always not "is this good?" The question is always "is it better than what is worse?"

On the second question, how will the Chinese economy perform? Herb Stein, who used to be the chairman of the Council of Economic Advisors, had a famous Stein's law, which said, "If a trend cannot continue forever, it won't." For sure, China will not continue growing at miracle rates forever, and actually it has moved to now about 6.5 percent, and one would expect that it will decline a little bit, if you just were listening to the signals from the Party Congress.

But I think the question to ask is just the one put: If you were betting, in the next decade will China continue to grow at three times the rate of the United States? Well, the United States has barely been eking out 2 percent a year—the last two quarters better, but if you take all of the 21st century, we have just barely averaged 2 percent a year, and China has been growing at 6, 7, 8, 9 percent a year over this period. So, I have been long on China for the last decade, each year making my bet that this is not the year this collapses, and I still look optimistically about China growing faster than the United States, though I do not like it at all. I quote Lee Kuan Yew in the book, and his view is that this is most likely to happen.

On women and leadership, that is a whole other subject. I would be happy to talk about it. I like the idea. I think there is no question whatever that men, because we are more testosterone-driven, end up having some part of this. But if you look at the women who have made their way to the top of the greasy pole, if you take Mrs. Thatcher or Golda Meir, their behavior does not seem all that much more—they may have had to adjust, whatever. But, in any case, if we just watch their behavior.

On the big war, a big war that was a cyberwar in which you basically collapse the country, that is called a big war, and in that war many million people would be killed because hospitals would not work, there would not be electricity, there would be chaos. A big war for me has to do with the amount of victims, fatalities, not whether they are killed this way or that way. Actually, because of cyber, it is easier to escalate up the ladder once you get a conflict going than it would have been otherwise. So that is one of the lubricants in my chapter on "From Here to War," how we could get there.

Finally, on the mutual assured destruction point—I think a very good point—basically, the fact that if we have a big war, an unlimited war, with China, we can destroy China, but not so successfully that it cannot still respond by destroying us. So that makes war insane, and that is why it is called MAD. Mutual assured destruction really is madness. So that is a fact. But that did not prevent the Cuban Missile Crisis and a one-in-three chance of a war. So we should not do things like that, to which the answer is, "That's right, we shouldn't do things like that."

It is part of the bedrock that provides clarity about the fact that war is catastrophic, and it does help the fact that if anybody comes to the table and says, "I have a good idea: Why don't we just go to war with China and attack them?" Somebody else says, "That's a great idea. Why don't we just commit suicide?" If they are ready to commit suicide for our country, maybe we should think again. So that has produced a degree of caution, but not one that I think should be accepted complacently.

Herman Kahn wrote a great book a long time ago in which he had a metaphor of the so-called "Doomsday Machine." So what was the doomsday machine? It was the ultimate deterrent: I take one big bomb and I bury it deep in the Earth, and this bomb, if it goes off, will split the Earth and kill everybody on the Earth. And now I am the president and I say, "If you attack me, I am going to push this button, and then everybody gets killed." That is great, except for the fact that who is going to believe you are really going to do it because you are going to be committing suicide?

So Herman's next idea is, "Okay, we connect this bomb to a set of sensors that sense if there is an attack on the United States, and if there is an attack, then they explode the bomb." So there is no credibility problem, it is all automatic. That seems perfect. Except for one thing: Could this malfunction? Could there be an accident?

So the idea of depending on nuclear arsenals the way we do, complacently I think, is a mistake because they are subject to life, human error.

JOANNE MYERS: On behalf of all of us, you can see how grateful we were to give you so much time. Thank you so much.

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