A container ship at the port of Haifa in 2007. Yoray Liberman/Getty Images for Bloomberg.
In his new essay for Mosaic, Arthur Herman describes the “impasse” in Israel-U.S. relations occasioned by Israel’s increasing—and, it is said, increasingly worrisome—ties with China, America’s chief geopolitical competitor. In doing so, he records as well some problematic aspects on the American side, especially a deep layer of mistrust, harbored by some U.S. officials toward their Israeli counterparts, that stems from legacy grievances against the Jewish state including the Jonathan Pollard affair in the 1980s and crises in the early and mid-2000s involving Israel’s defense exports to China.
To resolve the impasse, Herman then proposes a Defense Trade Cooperation Treaty (DTCT), an instrument less formal and all-encompassing than an actual defense treaty, aimed specifically, and remedially, at marrying the unique industrial and technological strengths of each partner in the furtherance of their shared national interests.
I agree both with Herman’s diagnosis and with his proposed approach. Here I would like to broaden the discussion by offering some additional strategic context and delineating a number of specific steps toward a more constructive path ahead.
Today’s U.S.-China-Israel “triangle” is an evolving system of relationships, taking shape in a changing environment and dominated by the bilateral dynamic between the two major powers concerned. Historically, Israel in its early decades had little to do with China, a non-aligned Communist power that formally sided with the Arabs. Then, after the Nixon administration chose to engage with Beijing in the 1970s, Israel began military exports to China with Washington’s blessing.
By the early 2000s, however, this changed as, with then-recent crises over Taiwan in mind, the U.S. started to regard China as a potential military rival and, correlatively, to see Israel’s defense exports as posing a possible risk to American forces and strategic needs. This precipitated the Phalcon and Harpy contretemps described by Herman both here and in his earlier Mosaic essay, “Israel and China Take a Leap Forward—but to Where?”
And that brings us to the current phase, defined by America’s sharp strategic transition from an era mainly defined by the global war on terrorism to an era of great-power competition in which China is now seen as the number-one rival and, in some eyes, evil enemy. The transition is occurring in two dimensions: in the strategic area of America’s conceptual, material, and military priorities, and in the emotional area of American mindsets and perceptions.
On the strategic level, the key document marking the departure from the war on terrorism, which had largely defined American priorities since September 11, 2001, is the 2017 U.S. National Security Strategy (NSS). Where the previous focus was on the Middle East, prioritizing ground and special forces and calling for counterterrorism and counterinsurgency missions, the new focus is on near-peer rivals in Asia and the Indo-Pacific and calls for stronger nuclear, naval, air, space, and cyber capabilities.
The 2017 NSS also regards American prosperity as a central pillar of national security, for which a key component is the U.S. “national-security innovation base.” Under this heading, the NSS lists a number of emerging technologies that can ensure both America’s economic leadership and, thanks to the spin-on from commercial to military applications, its future military dominance.
Not surprisingly, China has a similar technology wish-list, as expressed in “Made in China 2025” and other such future-oriented plans, and its own concept of civil-military integration. In other words, both great powers have lately adopted a dramatically expanded view of their national security and are aiming at the same high grounds of techno-strategic dominance.
As for how all this works out in the realm of policy, American thinking is still a work in progress. In some areas, as is well known, the U.S. seeks to increase its economic relations with China, if on more advantageous conditions, and for that purpose is engaged in hard-knuckle, tariff-supported negotiations that are just now nearing a first-phase trade agreement with Beijing. In other areas, however, it seeks altogether to bar Chinese access to both the American and other global economies, and to defend vigorously against Internet theft, cyber espionage, and threats to sensitive supply chains. In still other areas, U.S. thinking is less advanced, especially in the complex and dynamic fields of science and technology where more time and study will be needed before an appropriate policy response can be formulated. Similarly under development is the formation of alliances, partnerships, and coalitions with friendly nations to help in jointly addressing these various challenges.
On the emotional side, America’s awakening to the Chinese challenge was abrupt and traumatic: a sudden recognition that the decades-old policy of engaging China had failed to convert it into the responsible player envisioned by successive U.S. administrations. After having seemingly wasted decades and trillions in an effort to remake the Middle East, this sudden wakeup, accompanied by a sense of China’s betrayal and abuse of U.S. trust, lent urgency and pique to the felt need for a sharp change in course. Among experts, across multiple areas of government, and in American public opinion, a rare bipartisan consensus has formed around a negative view of China.
It is against this backdrop that the current U.S.-Israel dialogue is now taking place.
On the strategic level, Israel is of course a proven close ally of the U.S., tested and confirmed over decades of war against terror. Israel’s deep knowledge of and access to the Middle East, its world-class intelligence and cyber capabilities, its military experience and the lessons learned therefrom: all have contributed to America’s own efforts and saved countless American lives.
Transitioning this alliance to the new age of great-power competition is the duty now facing both sides, and it has presented challenges of its own in terms of expectations, mutual communication, and agreed-upon processes and policies in a still-emerging strategic framework.
An elementary step going forward is to acknowledge the current gaps in perception between the U.S. and Israel. According to a recent PEW survey, only 26 percent of Americans entertain a favorable view of China, with 60 percent holding an unfavorable view. In Israel, by contrast, the corresponding figures are almost exactly the reverse, at 66-percent favorable and only 25 percent unfavorable. This more generally positive view rests on the absence of any history of direct conflict between China and the Jewish state, or any memories of massive Chinese support to Israel’s Arab enemies; that dubious honor belonged to the Soviet Union.
As a result, however, Israel is somewhat behind the United States in adjusting to the potential security risks presented by its involvement with China. Moreover, unlike in the areas of Israel’s traditional security expertise, its overall knowledge about China is significantly limited, both in government circles and among academic experts.
True, differences in levels of “threat perception” are natural among friends and allies. Take the case of Iran, which is Israel’s top national-security threat but, on the U.S. list, only number four, behind China, Russia, and North Korea. Even Israel’s years-long insistence on the global seriousness of Iran’s terror activities and proxy warfare failed materially to affect the American focus on defeating Islamic State. To this day, while Israel has reportedly struck Iranian assets and forces in Syria and Iraq hundreds of times, U.S. Central Command has so far evidently had no authority to act against Iranian forces except in immediate self-defense.
Yet this divergence in opinions and priorities is, to repeat, natural. The U.S.-Israel dialogue about it allows each side to safeguard its respective national-security concerns while offering support to the other.
Potentially more serious are the repercussions of a second factor. For the last decade, Israel has been seeking to upgrade its ports. In this effort, it repeatedly approached Washington for help in securing the interest and participation of American companies; but to no avail. As late as 2015, when it signed a contract with China’s SIPG for a 25-year lease to manage operations of the new container wharf in Haifa, Israel encountered no objection from Washington. Nor did it encounter an objection when, in March 2017, after a decade of developing economic relations, Israel and China signed a “comprehensive innovative partnership.”
Not until later in that same year was America’s new National Security Strategy published, dramatically resetting the global power landscape and thereby also implicitly reframing Israel’s policies and conduct within it. Technological innovation was now placed at the very center of the U.S.-China competition; simultaneously, Haifa port was now evaluated in light of China’s challenge to America’s maritime and naval dominance and of China’s strategic Belt and Road Initiative.
In both cases, prior decisions by Israel were now suddenly seen in American eyes as serving the rival power. “This isn’t a technical or professional question, which we could surely solve,” an American colleague said to me, “it is an emotional one: Israel, our blood-ally for the last two decades, is suddenly on the wrong side of the road.”
The U.S. just took a U-turn in its global policy. Israel now needs to catch up.
In the last years, the U.S. has approached Israel about three aspects of its China relations: foreign investments, the Haifa port, and fifth-generation (5G) communications.
In the category of foreign investments, Arthur Herman’s essay describes well Israel’s efforts to devise an appropriate oversight mechanism that can improve security without simultaneously imposing a regulatory burden so severe as to stifle the growth of the high-tech industry—Israel’s main economic engine. These efforts have recently come to fruition in an oversight committee that will soon begin its work.
Herman worries about the committee’s weak powers, and in general about the “informal” procedures of Israel’s security agencies. But in fact, over the last years, two attempts by a Chinese buyer to acquire control of Israeli insurance and finance companies were blocked by the relevant regulator. Similarly, in the area of 5G, it is highly unlikely that, in contrast to some of America’s partners in Europe and its “Five Eyes” allies (Australia, Canada, New Zealand, the UK), Israel’s cellular networks will ever include Chinese core components.
In Israel, the operations of the new investment-oversight committee are to be reviewed and updated every six months, thus allowing for improvement and development, possibly incorporating advice from friends. Is it necessary to note in this connection that the U.S. and some other Western countries did not revamp their own procedures overnight, either? Israel’s business community, long burdened by heavy regulation, is already complaining about the additional large shadow being cast over its activities by security considerations.
Certainly there is much for Israel to improve, and certainly in some technological areas. But the first steps have not been launched from a zero baseline; all in all, Israel is under way and moving in the right direction.
In fact, it has adopted a policy approach similar to America’s: barring some areas of trade with China due to its own national-security concerns, some of which it shares with the U.S. (ranging from military, defense, and dual-use exports to sensitive national assets), permitting and developing benign areas of trade (water technology, agriculture), and studying still other fields, especially in high-tech and emerging technologies, in which no policy has yet been designed.
In general, wherever the U.S. has well-defined boundaries, Israel’s choices are made within them. Where the U.S. is still deliberating, sometimes Israel does so as well. In still other cases, Israel is an outlier, ahead of others by decades. For instance, since the late 1960s Israel was well-known for its stringent airline-security procedures, long before the world would belatedly join it after the traumatic shock of 9/11. Similarly, in its existing 3G and 4G cellular infrastructure, again in stark contrast with the situation elsewhere, no Chinese core components are to be found.
From this angle, the differences between Israel and America should be seen not just as a source of tension but also as fertile ground for synergy and joint learning. “We keep hearing from you what we should not be doing with China. Why don’t you tell us how we can be of help?” asked an Israeli speaker during a meeting with a U.S. China expert. In that question lie both the key to avoiding a crisis in the U.S.-Israel relationship and a useful pointer for taking the relationship to the next level.
As it builds its new national-security bases of innovation and technology, the U.S. knows that Israel is both a proven ally and a very serious potential partner. Indeed, as Israel has much to learn about China, the U.S. has much to teach it. Given their mainly regional priorities, Israel’s intelligence agencies will never be as knowledgeable about China as are America’s. Bringing Israel up to speed, and thus closer to the U.S. viewpoint, should entail policy and intelligence support from the U.S. Such support will help place Israel’s existing defense exports to Asia within the context of America’s interest in building partner capability in the Indo-Pacific without needlessly requiring Jerusalem to adopt an overtly hostile position toward China specifically.
Granted, a U.S.-Israel crisis over China is still possible, and one can assume it would be over technology and innovation. Despite and alongside dazzling success stories, as in joint cyber warfare against Iran’s nuclear project and joint missile-defense enterprises like Arrow and Iron Dome, Israel does continue to be regarded as a competitor to America in the area of defense export. That is why we need to do our best to prevent such a crisis from developing, to seek new ways to cooperate, and to build on the great potential for shared growth and opportunity.
For example: beyond pooling our defense technologies in a DTCT or some other format, we ought to be seeking a U.S.-Israel “strategic innovation alliance” far exceeding the defense realm. After all, why shouldn’t the U.S. and its partners be in a position to compete with China in the non-defense-related global markets of innovation and infrastructure, thereby releasing businesses and countries from the choice of “China or nothing”?
On these frontiers, as Washington knows well, Israel has a great deal to offer. Moreover, on the new watershed line between the U.S. and China, Israel’s “Silicon Wadi” more naturally flows toward Silicon Valley than to China’s Yangtze or Yellow Rivers. To critics in America demanding that “Israel has to choose,” the answer is that it long ago made that choice, and without a blink. In another Pew survey, a decisive 82 percent of Israelis see the U.S. as their country’s top ally; only one percent mention China. Between its relatively new trade partner in the East, with which it enjoys friendly relations, and its staunch strategic ally in the West, with which it shares values, family, and culture, not to mention hardship, blood, sweat, and tears, Israel has long since made its choice.
Like many in the world—and like America itself—Israel cannot and need not simply ignore China’s economic potential. Like the U.S., it needs to engage China and gain from that country’s significant wealth, markets, and other advantages. At the same time, like most small and medium nations, Israel has to protect itself against the risks that bear the signature of Chinese power politics and practices. Against that background, and in light of both our governments’ striving to adjust and align policies, there looms the opportunity to advance our strategic cooperation.
Nor is this just a bureaucratic exercise. Our publics also need to be informed. As one of America’s closest allies, and one profoundly grateful for that fraternal status, Israel often finds itself held to higher standards and burdened with higher expectations; sometimes, the latter are articulated in the form of uniquely harsh criticism. Here, Israel and its American friends might play a useful role here by subjecting such criticism to cool analysis through the exercise of fact, reason, and the yardstick of proportionality. Trading with China is not tantamount to betrayal; taking time to adjust is no breach of trust.
The goal should be to address mutual concerns, to alleviate shared anxieties, and, keeping a firm eye on the new horizon beckoning us, to complement each other’s powers and rejuvenate and strengthen our friendship, cooperation, and mutual support. Together, we can do it.