Graham Allison, the former dean of Harvard’s Kennedy School of Government, has written an insightful and thought-provoking book on the relationship between the U.S. and China. The author starts his analysis far back in history, with the Peloponnesian War, which Sparta and Athens fought around 500 BC. This war was chronicled by Thucydides, perhaps the first modern-style historian, as we have come to define that profession. In his book History of the Peloponnesian War, he details how Athens’s relentless rise created a growing sense in Sparta that this ascendency was undermining the latter’s position of predominance in Greece. A war eventually broke out between these two great city-states, lasting more than three decades and leaving Sparta as the winner in the end, but where both belligerents were so weakened that neither of them could return to their former glory. What has become known as Thucydides’s Trap is applied exactly to situations like this, namely when a relatively new, aspiring nation is rising toward pre-eminence and its rise is seen as a threat to the established, dominant power. Such a situation creates tensions and conflicts that, unfortunately, very often lead to outright war. Even though such an outcome is not inevitable, the dynamic of conflict creates an impression of inevitability, hence the word “trap”. Allison has analyzed 16 large conflicts from the late 15th century onward and found that the conflict between the ruling power and the rising power led to war in 12 of these cases, of which only four were settled peacefully. The most notorious examples are perhaps the First World War and the Second World War, where, in both cases, a rising Germany was threatening the established powers, most notably the UK.
Allison goes on to analyze how the ascendant China seems to threaten the established U.S. It is worth noticing that China’s recently published official plan, Made in China 2025, which emerged after Allison’s book, seems to have added to this sense of discomfort in the U.S.. Ten sectors are highlighted in this plan, and China’s aim is to achieve pre-eminence in each:
New-generation information technology
High-end computerized machines and robots
Space and aviation
High-tech ships and maritime equipment
Advanced railway options
Energy-saving cars, including new-energy driven
Energy equipment
Agricultural machines
New materials
Bio-pharma and high-tech medical devices (Source: P. Lennhag, “Made in China 2025 – Are you Prepared,” June 2018)
This list and this plan are formidable. And because China is often able to throw focus and human resources at a given problem, this plan might definitely lead to increased anxiety among the more established powers. Working a 9-9-6 schedule (from 9:00 AM to 9:00 PM, 6 days a week) is certainly not part of the U.S.’s or Western Europe’s common culture. However, a glimmer of hope exists. Allison offers 12 clues for peace and suggests how each might have played a role in resolving previous conflicts. The reviewer is left with the impression that there may be hope for a peaceful solution to the Sino-American impasse, although the situation seems increasingly grave to external observers.
In conclusion, this reviewer thinks that one might find parallels to Thucydides’s Trap in business, too, where emerging new firms often lead to anxiety among more established players, often resulting in competitive “wars.” Frequently, the “new kids on the block” might have an advantage in being able to quickly adapt to a new technology, i.e., a more open culture. The rise and fall of many corporations might be better understood by focusing on what might be analogous to Thucydides´s Trap in each instance. Allison’s book thus has relevance for the general reader and the business reader.
Discussion questions from the Lorange Network team
Do you view the specter of a U.S.-China trade war as a possible Thucydides´s Trap?
What are the key elements In China’s new national plan for creating dominant businesses?
Are price wars and aggressive discounting a part of your industry, and can you identify strategies to avoid such dynamics?
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