“The Chinese government is offering compensation in the way of wages to the factory workers affected,” said Stu Cohen, briefing the National Security Council meeting. “The one thing they don’t want is popular unrest because of the unemployment this will cause.”
“How long can they sustain that?” asked the president.
Cohen shook his head. “They’ve already said they’ll sell down their foreign currency reserves,”
“Who’s got renminbi to pay them?” said Olsen.
“No one,” replied Bob Colvin.
“So what do they do?” asked Angela Chavez. “Print money?”
Colvin shrugged. “They could if they have to. Eventually the inflationary effects would be unbearable, but they could do it for a while.”
“Stu?” said the president, “what about U.S. interests?”
“We’ve got reports of disturbances outside factories doing business with us and a number of attacks on American-owned or affiliated businesses.” Cohen consulted his handheld. “A branch of Citibank had its windows smashed, similarly a McDonald’s and some other franchises. There have also been crowds outside residential compounds that are known to house Americans in Shanghai and Guangdong.”
“Anyone hurt?” asked the president.
“Not yet. The authorities appear to be keeping it under control. It’s rent-a-crowd activity.”
Benton glanced at Olsen.
“I had Ambassador Liu in my office yesterday and issued a formal protest. I’ll have him in again today.”
“Have we had any disturbances here?” The president directed the question to Anne Montgomery, secretary of homeland security.
“Not to our knowledge, sir. Some agitation among the usual suspects. We’ve had reports of an increased level of racist abuse.”
“I want to know about that. I’m going to issue a statement condemning any kind of violence against law-abiding people in our communities.”
Montgomery nodded. “I’ve ordered additional security outside Chinese diplomatic missions and other likely targets.”
“What about American missions overseas?”
Olsen shook his head. “We’ve had some demonstrations, but those have been going on since we issued the Carbon Plan.”
Benton turned back to Cohen.
“Internally in China,” said the CIA director, “we’re seeing a full-scale crackdown, supported by the media, which are completely caught up in the fervor. Dissident activity on the web has been almost entirely absent for the past week. Activists who aren’t in jail by now are probably on the run. We’re still not sure whether the extent of the reaction is a genuine response to unrest we’ve been trying to stimulate or whether elements in the party are using the atmosphere of external crisis to take care of matters at home. Foreign Minister Chou, by the way, hasn’t been seen in public for ten days. Premier Zhai has also had a very low profile. Ding’s featuring. He’s made a number of widely covered speeches and it looks like Wen’s letting him make the running.”
Benton tried to process everything he had been told. “How much danger do we think American citizens are in?”
“My sense, Mr. President,” said Cohen, “at the moment, it’s entirely up to the authorities. They’re driving it. They’ve turned it on, they can turn it off. But that could change. Once they unleash the tiger, anything can happen. We saw that repeatedly in 2013 and fourteen. The Chengdu incident started as a rent-a-crowd demonstration, and there were twenty-eight American deaths.”
“Once this kind of thing starts, there’s always the risk that things get out of hand,” said Lou Berkowitz.
Benton was silent. “All right,” he said eventually. “Militarily, what’s the story?”
“Mr. President, we’re seeing a moderate buildup of forces in Fujian province,” replied Admiral Enderlich. “That’s the province opposite Taiwan, where they’d likely launch an attack.”
“They know we’d know about that, right?”
“Absolutely,” said Enderlich. “They want us to know it’s happening.”
“Anything else?”
“We’ve got fleet movements out of Zhejiang, Jiangsu, Hainan. Technically, they’re not yet in breach of the Manila Understanding, but it wouldn’t take much more. They’ve stepped up air patrols and are violating Taiwanese airspace, but that’s pretty normal.”
“Isn’t that a breach of the understanding?”
“It is, but it’s nothing new. They’ve never kept to the terms on air flights.”
“What are the Taiwanese doing?”
“They’re on full alert.”
“What are they doing about the air patrols?”
“Just watching them go by. Like us. We’ve increased our patrols, strictly sticking to international airspace. We haven’t made any other moves yet.” Enderlich paused. “The Pacific Fleet is about two days away. The third air wing is on standby to go out to Guam.”
“Do we know what the Taiwanese government wants?” asked the president.
“President Tan wants to talk to you,” said Olsen. “At this stage, they’re looking for a public statement of support. Something in excess of the Taiwan Relations Act.”
“You mean they’re looking for us to commit to defend them,” said Angela Chavez.
“Probably. They want something that guarantees them militarily.”
Chavez glanced at the president.
“I think I should announce a visit this week,” said Larry Olsen.
Joe Benton looked at him. “The purpose being...?”
“The purpose being to demonstrate to the Chinese government that we won’t accept illegal ultimatums about Taiwan.”
“Don’t we have a trade visit coming up in a couple of weeks?”
“We need to show more than that.”
“That’s exactly what they want us to do,” said Alan Ball.
“Right. They issue a challenge, we come right back and call their bluff.”
“So we send you,” said the president. “What do they do next?”
“I don’t know what they do next.”
“Well, that’s a problem, don’t you think?” said Ball.
“I bet they don’t know what they do next.”
“So we both step off into the unknown. That’s great.”
“There’s a principle here, Alan! It’s a principle of sovereignty. You’ve got the Chinese dictating to sovereign governments—”
“They don’t accept the Taiwanese government as sovereign, we all know that. They want Taiwan back. When they’re ready, the Manila Understanding will be out the window.”
“Unless we prevent it.”
“Then let’s not give them a pretext.”
“They don’t need us to give them a pretext. They make their own. The president takes a trip to Japan and it’s a pretext. Mr. President, the only way you stop this is if you hit back at every single stage.”
“Larry,” said Benton quietly, “I’m not escalating this thing over a visit. We’ve got a trade visit in two weeks. That’s good enough.”
Olsen shook his head. “Next they’ll be blocking Taiwan’s ports.”
“That’s enough,” said Benton. “This thing’s getting out of hand.”
“We could take the Pacific Fleet a day’s sail closer without breaching the Manila Understanding,” said Enderlich.
Benton glanced at him for a second, then turned away.
“If they sell down their dollar reserves in a hurry, there’ll be chaos,” said Bob Colvin. “It’ll kill anyone who’s holding dollars or U.S. government bonds.”
“You said before no one would buy them,” said Ball.
“Not for renminbi. No one’s holding Chinese currency. It doesn’t help them financially, but if they want to do it just to hurt us, they’ll sell the dollar for anything they can get. It’ll hurt them as well, but they might figure it’ll hurt us more. They sell down the dollar, our bonds are worthless. We’ll be paying a premium of ten, fifteen percent to finance our def
icit. Could be more. Could be we won’t be able to sell our bonds at all.”
“But they haven’t started yet?” asked the president.
Colvin shook his head. “Not as far as we’re aware.”
“Let’s park that.” Benton could deal with only so many things at a time. The markets were in panic and had been since the Chinese statement three days earlier. He had a meeting set up later in the day with Colvin and Henry Schulz, chairman of the Federal Reserve, to go through the options.
“Mr. President,” said Olsen, “everything they do is designed to make you back down. That should be clear by now. That poses a question: Why? Why do they need you to back down now? Even if we don’t have the answer, the conclusion is obvious. If they’re so desperate for us to back down, we need to keep going.”
“To where?” demanded Ball.
“To where they back down.”
“What if they don’t?”
“They will.”
“Why?” asked the president.
“Because someone always blinks. We have to show that we won’t be the one. In the Cuban Missile Crisis, who blinked? Who turned the ships around? Khrushchev. That’s the last time two superpowers really looked each other in the eye.”
“Mr. President,” said Ball, “Cuba was in our sphere of influence. Taiwan’s in theirs. There is a point to back down. And a way. Once they go too far, once their demands are too much, you then have the rest of the world on your side. That’s the point where you back away.”
“And you think we’re there now?”
“Nowhere near!” said Olsen. “Mr. President, they will back down. The key to this is their internal politics. This no longer has anything to do with us. Once they’ve achieved what they want internally, they’ll climb down.”
“You mean once they’ve achieved their crackdown?”
Olsen nodded.
“I think the secretary’s got a point, sir,” said Stuart Cohen.
Joe Benton felt ill. The idea that the Chinese government had magnified the crisis so as to launch a wave of repression against opposition to the regime, and the idea that he had to sit by and allow that to continue until it was done—even hope that it got done—filled him with revulsion.
“Let them finish that,” said Olsen. “Then they’ll be much more reasonable.”
“And they’ll sign up to the Carbon Plan?”
“We have to be hard on Taiwan.”
“Larry, it’s not about Taiwan!” Benton struggled to contain his exasperation. “It’s about the Carbon Plan.”
“They’re linked.”
“They’re not.”
“Mr. President, we have to show them there’s a line on Taiwan. In the meantime, we keep building support for the plan. The two things go together.”
They didn’t, not in Joe Benton’s mind. He closed his eyes for a moment. When he opened them again, he avoided looking in Olsen’s direction.
“Here’s what I want to do,” he said. “First, we issue a warning to all American citizens to leave the People’s Republic.”
“But Mr. President, that’s thousands of—”
“I don’t care, Stu. I want our people out. I want that weapon out of their hands. Second, I’ll talk to President Tan. I’m not going to commit to anything beyond what’s in the Taiwan Relations Act. I want that to be absolutely clear to everyone here. But I will talk to President Tan. Third, we issue a statement condemning the arrest and detention of legitimate opposition in China. And fourth, let’s see if this is starting to make a difference with anyone else. Larry, you keep saying when Wen does something dumb, that’s when we get support. Well, let’s see if you’re right. Ben for a start, try to set me up a conversation with Gorodin. Let’s see if he’s prepared to consider shutting off the lights in Beijing.”
Hoffman nodded.
“We’re not being hard enough,” muttered Olsen.
“Larry, this is as hard as it’s going to get.”
~ * ~
Sunday, October 23
Situation Room, The White House
China was now in breach of the Manila Understanding, which limited the number of troops in Fujian province to one hundred thousand and prohibited Chinese aircraft carriers from the Taiwan Strait and an exclusion zone of fifty kilometers around the island. Protests had been sent. The Taiwanese government had appealed publicly for the immediate stationing of U.S. troops on its territory. The Chinese government had publicly stated that it would regard this as an act of war.
“We can have three brigades of the 82nd Airborne in Taiwan inside of two days,” said Enderlich. The Pacific Fleet had moved closer to the island and the third air wing was in transit to Guam.
“I wasn’t asked to authorize that,” said the president.
“I did,” said Jay MacMahon. “Mr. President, if we’re considering any kind of action, we need sufficient force in place.”
“The staff has three plans, Mr. President,” said Enderlich, “and I’d like to go through them with you.”
“Plans for what?”
“Plans for defending Taiwan. First, we have a preemptive option.”
“Wait.” Benton looked at Enderlich imperatively. “The government of the United States has never committed itself to the military defense of Taiwan. That’s clear. And I made that clear again. President Tan knows it.”
“We’ve always had plans,” said MacMahon.
“This administration is not going to war over Taiwan. Period.”
“What, then, do you propose to do, Mr. President?” asked Admiral Enderlich. “Every clause of the Manila Understanding has been breached.”
The president opened his mouth to speak, then stopped, shook his head. “I’m not going to war over Taiwan. What happens if I do? Say we stop them. What do they do next?”
“There is no next,” said Larry Olsen. “Superpowers never fight each other directly. They fight by proxy.”
Alan Ball shook his head. “China’s been looking for a chance to flex its military power for years.”
“And Taiwan’s the proxy. That’s why by moving to defend it, we bring this to an end. That’s it. Nothing else they can do. They have to back down.”
“And we’ll be there for years,” said Ball. “Mr. President, Nleki has said he’s prepared to send an emissary to talks between Taipei and Beijing.”
“That gives it away right there. Once you start talking, you concede there’s something to talk about. Mr. President, Taiwan’s a crucial ally of this country. If China swallows Taiwan, it’ll leave our credibility in tatters.”
“At some stage, China has always been going to get Taiwan back,” said Ball. “Everyone knows that. Implicitly, the Manila Understanding was based on that recognition. A genuinely sovereign state doesn’t need something like the Manila Understanding to protect it.”
“Sir,” said Enderlich, “we need to do something. We’re already in a standoff. Our boys are flying alongside Chinese planes ten times a day, every day of the week. All it takes is one pilot to fly a little too close to another and we’ve got an incident.”
“The tinder’s dry,” said MacMahon. “Right now it only needs a spark.”
There was silence.
“Jay,” said Benton eventually. “Tell the government of Taiwan that we won’t be sending troops.”
“Sir,” said MacMahon, “with respect, I think that’s something you should tell President Tan yourself.”
“I will. I’ll call him this morning.”
“It’s a mistake,” said Olsen. “China won’t go to war. They’re pushing. If you don’t send the troops, then they go to war. Then they invade.”
“That’s your judgment,” said Ball.
“Of course it’s a judgment.”
“If they get Taiwan, do they come back to the table on the Carbon Plan?” said Ben Hoffman.
“Ben,” replied Olsen, “by that argument, you give them Taiwan to get them in on the plan. I take a different view. If they get Taiwan, they feel s
o confident they become even more intransigent.”
“But I might be right.”
“Are you feeling lucky? If we’re going to sacrifice Taiwan to find out, why didn’t we do that back in Oslo and save ourselves all this trouble?”
“Good question,” muttered Ball.
“I’ll tell you why. Because if we give on something, they’ll come back to us on something else. They will keep taking. True, the harder we are, the harder they’ll push, so right now it feels uncomfortable. But if we keep going, at some point they’ll stop. They will blink. If we’re still standing, if we’re still pushing back hard at that point, we win.”
Ultimatum Page 44