 Yeah, we have a poll question coming up with this panel. So you can get your phones out and start warming them up now. Will NATO and Russia be involved in an Article 5-related conflict in the next five years? You know how this works? Text your answers in now. We're going to ask the panelists about this question. Oh. OK, who are you rooting for? War, war. I'm Heather Hurlbert. I run the New Models of Policy Change Initiative at New America, and it's my very great pleasure to be moderating your last panel of the day. We saved a really exciting, timely, and totally non-controversial topic for the end of the day, the bear and the dragon. How will US-China-Russia relations unfold? And we're really lucky to be joined by two extraordinary experts on this topic. And I discovered a funny little secret in the green room. They were sold to us as one China and one Russia expert. But it turns out that in past and present lives, they've both worked on both countries. So we're really in for an in-depth and comparative treat. To my immediate right, we have Dr. Evelyn Farkas, who is currently a non-resident fellow at the Atlantic Council, who has a distinguished career working in Washington and overseas on Russia and Europe, including, most recently, a stint as Deputy Assistant Secretary of Defense for Russia, Ukraine, and Eurasia. Prior to that, a stint as Senior Advisor to the Supreme Allied Commander for Europe. Further to her right, we have James Mulvenin, who is Vice President Intelligence Division of Defense Group. And James has a long and distinguished career working on China, Chinese military, Chinese intel. Although he confessed backstage that in his day-to-day work, he now supervises work on Russia as well. So you can learn lots more fun details about them in their bios in the book. But because time is ticking away, we're going to get right to asking them fun and challenging questions. So my first question for you both is that we hear a lot here in Washington about various strategies for what US policy toward Russia and China should be. But what would we be hearing if we were having this conference Evelyn in Moscow? What is, how would you describe Russian strategy toward the US in the security realm at this point? OK, so first of all, I will just say quick thank you to you, Heather, and to the organizers for inviting me to participate. And for the audience, I guess, for staying awake and hanging in here with us. I would say, from the Russian perspective, they are very happy to see what is happening in the United States right now. We are essentially having an internal debate with one another about a whole host of issues, including their involvement, their meddling in our elections. The Russians would like a weak United States, a weak Democratic, liberal Western Democratic order, if you will, or gang, if you will. They want to be able to have maximum leverage and maximum freedom of action, first of all, on their geographic periphery, but also globally if they can. And so for them, they just mainly want a weak United States, a weak NATO, a weak European Union, just no institutions and strong countries to counter them. So that's kind of the most simplest terms. James, if we were sitting in Beijing right now. Well, I mean, the advantage the Chinese always have, as we know, is that you can hold two different contradictory thoughts in your head at the same time with no cognitive dissonance. And so on the one hand, a lot of Chinese are saying and writing these days that they're perfectly comfortable with a less values driven, more transactional foreign policy with the United States, where it's all about deal flow. It's all about people getting the best possible negotiated outcome that they can. But they're also deeply confused, because they're not getting the kinds of signals from the US side that allow them to actually negotiate and estimate prices rationally. And on one level, I think that they think this is really to their advantage, because more than anything, they would like to have a more carefully defined sphere of influence, where they're expanding economic interest can be accommodated, a new type of great power relationship, as they like to call it. But on the other hand, they're deeply, deeply concerned that their largest trading and investment partner seems to have developed this sort of economic nationalist hostility to them. And so they're very carefully weighing what Secretary Tillerson and other people are saying during this trip. So we've heard talk in relation to both countries of the idea of could there be grand bargains, or could there be new, as you suggest, James, formalizing of a different kind of relationship between the US and Russia, the US and China. Is that Evelyn something that Moscow even actually wants? Yes. I mean, Moscow wants to have a 19th century sphere of influence arrangement, again, as I mentioned, is not interested in seeing multilateral institutions that can counterbalance it. So what Moscow wants, and they've proposed this actually, the previous president, President Medvedev proposed it to President Obama, in essence, this carving up of spheres of influence. He didn't use those terms, but that's what they would like. That deal is one that is not appropriate for the United States, because we believe very much in the right to sovereign states to determine their political and economic futures. And so we are not going to determine for Ukraine or Georgia, for example, what type of political system they should have and what types of economic and political affiliations they should pick. Our values, frankly speaking, and our interests do not lie in going back to the 19th century sphere of influence. We built up the international order so that it would serve our interests, which are stability and peace and economic freedom of trade, freedom of action for us. And that's what we want to protect. So we're not interested in the big reset with Russia. There can be transactional, and we can talk about that later. There can be a transactional, more narrow reset, if you will, or deal, but no grand bargain. So obviously, going back to the 19th century is not as an appealing slogan in the Chinese context as it is in the Russian context. We just saw, as Evelyn mentioned, Secretary Tillerson go and give some interesting signals. What is the Chinese security bargain? Well, the Chinese, ironically, are more Westphalian than Westphalia. They're very comfortable with state-centered order. And you see this, for instance, in their international strategy for internet governance, where they want to delegitimize and disenfranchise all of the non-state actors and all of the organizations that have grown up around the sort of laissez faire US model of internet governance in favor of moving it to the UN International Telecommunications Union, where their relationships with third and fourth world countries gives them the kind of leverage that they need. And so they're very comfortable in that state-centered order. And they're not very happy about some of these new trend lines and international order ideas. And they believe that they should be able to shape them by sheer economic power in force. And so very much cutting cross grain against what the US would define as the, I don't want to sound Marxist here, like there's some sort of unidirectional direction of history, but what the US had been strategizing about is what the 21st century was going to hold. Wait, there's not a unidirectional direction of history? So I'm going to stick with you for a moment, because you've raised this question of cross-directional or trends that cut against the overwhelming power of the state. And at both today's conference and yesterday's cyber conference, of course, we've all had a lot to say about hybrid warfare. And we have focused, for obvious reasons, in the American political context, very heavily on Russia's activities in this area. But China is a player here as well. China is a player here in the elections of some of its democratic neighbors. Talk to us a little bit about China and hybrid warfare. Well, in fact, we were recently completing work looking at Chinese military writings, studying the hybrid warfare concept and looking at Ukraine and how it might be applied to scenarios that they're interested in the South China Sea, East China Sea, and Taiwan. Because the conclusion that they've drawn, and they're not wrong, is that the hybrid warfare concept appears to have stymied critical parts of the American way of war. It appears to have stayed below a threshold behind which we can't seem to figure out how to maneuver. And looking at things, could they achieve their objectives in the South China Sea with cyber alone, or in East China Sea against Japan with cyber alone? I think one of the key differences is that despite there's a big disjuncture in China between their economic and political and military power on the one hand, and some of the critical nuanced things that the Russians have shown us, the Chinese are really quite deficient in strategic communications, crisis management. Their influence operations tend to come off as very sort of ham-handed. So you don't see that level of sophistication that you see from the Russians in their active measures efforts. So I think that's probably where it will break down, because in China they have so much trouble with controlling the narrative and leadership decision-making along those lines. Can I ask a question? Would you agree that they are less risk-taking? They're more risk-averse than the Russians? I think they're much more risk-averse than the Russians. There have been many times in the last decade or so where the US government in particular tried to coax out the Chinese leadership to accept roles commensurate with their greater economic and military power, and basically we're told not right now, or as the Chinese would say, Shenzai, Bufang, and Bien Le, currently inconvenient for me to do that, such as in 2008 when we invited them to take a central role in redefining the international financial order after the financial crisis. And they said, no, no, we're happy with watching you guys thrash around in the water a little bit, but we would not like to actually help define the new order. So Evelyn, I can't remember the last time, A, anyone, the last time Vladimir Putin waited for an invitation or the last time anyone invited him to do anything, and he said, no, how does the difference that James has just sketched out affect your thinking about what the US should be doing retaliation-wise? Well, I mean, I think that I asked him the question about risk-taking because when I think of the Kremlin and I think of Putin, what has struck me is how willing Putin has been to take on some risk. Now, I think with our current president in power with the change of administration, they may be taking a pause because they may not need to do anything escalatory to achieve their objectives. They may be able to do it cooperatively. But I do worry about how willing the Kremlin is to go up the escalation ladder to do things that we would consider really alarming and that the Chinese themselves wouldn't consider doing. So I am concerned that if cooperation is not in the offing, so if that invitation from Donald Trump does not materialize and there's no deal, that the Kremlin will somehow want to try to assert itself and get its way anyway. And then we will see the beginning of maybe some sort of crisis scenario. And I also worry because of the way our president reacts when he feels that he's not being respected or he's not getting a good deal. That could also lead to some sort of crisis in our relationship with Russia. So given that something like half of our very intelligent and distinguished audience thinks that there's a reasonable chance we'll be in an Art of Five conflict in the next five years, what are the warning flares that each of you would look for as the things that would suggest to you that the pessimists in the audience are right? Well, I mean, the first thing I would look for, I mean, when you study the previous hybrid warfare examples, Estonia, Seven, Georgian-08, and Crimea, what's remarkable about it, again, referencing what I said earlier about staying below threshold, is that there's usually a cyber front end to it that's a covert influence operation that seeks to destabilize the target environment using cyber, and then also, in some cases, physically destabilize it by crashing power grids and other things, which is then followed by the little green men and the sort of paramilitaries and proxies. And that is one of the ironic things for me, is that in the post-Cold War period, it's almost as if we both had a copy of the Cold War playbook, Washington and Moscow, and we tore out and threw away all the chapters except military force and the UN. And it appears that Pooty Poot kept his copy of the chapters on covert influence operations and black propaganda and proxies and paramilitary forces. And so the, you know- And paying foreigners to work for him. And well, it's an overused word. Recruiting. But the asymmetry between what we think is cricket and how things are supposed to be done, you know, given how we used to also be mired in those similar type of activities, there's really this disconnect in our two strategies that appears to have favored them in terms of creating these feta complies like they did in Eastern Ukraine. I mean, I think the other thing that I would add that you need to look for is, first of all, what is the Kremlin saying? What are the spokespeople saying out of the Kremlin? Because they tend to actually telegraph pretty well what their concerns are. There's a lot of trial ballooning there. And then the other thing is not, I worry less about the green men crossing a border and more about the green men who may be citizens of the states where the trouble is being fomented. They may be ethnic Russians, they may not be, but they are clearly being supported and directed by the Kremlin. And that's the scenario I worry about a bit more. So nothing to worry about with Beijing? With Beijing, the next five years are gonna be fine. You can all go home. No, well, it's interesting. There are some issues with Beijing that may or may not be true in Moscow. And Evelyn and I can talk about it. But one of the things you need to know about the Chinese is that it's a remarkably powerful regime built on an enormous amount of insecurity. Despite all of the things that have happened for Beijing, the quadrupling of their GDP and being on the covers of all the magazines and in the Davos set and all the other things that go along with that, this is a regime that is still very scared of its own shadow, sees encirclement everywhere, sees subversion and conspiracy everywhere. And a perfect example of that is the group Falun Gong, which basically when it started was a bunch of grandmothers doing breathing exercises in the park. And yeah, they had some kooky ideas about aliens and wheels in your stomach and stuff like that. But they really weren't a threat to anybody. But the Chinese government so overreacted to this group because of their paranoia about internal security that they basically metastasized them into an underground organization engaged in subversive activity. And you have to keep reminding yourself about that. I can't speak to whether the Kremlin are any more confident. They appear to have. I was about to say, actually, what you described sounds exactly like the Kremlin, insecure, feeling like they're surrounded, that they're under siege. If I can add something to the China thing, the little green boats. I worry about the East China Sea and the South China Sea and what the Chinese learned from the Ukraine scenario, at least under our last president, you could do things incrementally and kind of get away with it. Yeah, I would call it the little white boats because that's what they color that they paint their maritime law enforcement ships. And so they've demilitarized the forces, the fishermen, the maritime law enforcement ships that they use so that when our gray hulls enter the scene, it looks like we're escalating because we're having a military response to what looks like a non-military move on the Chinese part. And it immediately puts us into a box in terms of international reputation and not wanting to appear to be firing first against what appear to be non-combatants when in fact we all know that it's being centrally directed by Beijing. And this just happens to be a more effective way of getting underneath our way of war. So yeah, what I hear you both saying is that both of these major powers have adapted asymmetric methods, meaning again that the great, it's very hard to make a great power comparison with a great power that won't act like a great power. Evelyn, we've talked earlier today about the announcement of a 25% cut in the Russian military budget and how do you fit that into this picture? Well, I think the first thing to remember is that the Russian military modernization so that $700 billion over 10 year plan that they have to get 70% of their armed forces modernized using modern equipment, it's always been very targeted. So they can continue to target their modernization. They're not going to upgrade all their surface ships, they haven't and they won't probably for the foreseeable future now. But they will continue to modernize at their own pace, they will continue to invest in the asymmetric means in their cyber commands, for example, which don't cost that much. They will certainly look for efficiencies and then the reality is that the oil price has gone up somewhat and any differential, anything they skim off, they'll put into their rainy day fund and they'll keep at it. Well, I was always struck when I read the announcement to say, well, isn't that convenient that they're announcing a 25% reduction three days after we announced a $54, $56 billion increase? It just seemed as much to me like a sort of strategic information operation kind of as much as an actual statement about what they were doing. I would also point out that one thing the Russians are not skimping on is modernizing all three legs of their triad. And so that really goes to the idea of how do you maintain strategic level deterrence, whether or not they have anti-submarine surface ships is really irrelevant to that. They need to bolster the areas that really provide them with the greatest bang for the buck. Yeah, and Putin did announce last December that they have reached the 60% mark in terms of modernizing the nuclear force. So we're gonna save the last five minutes for questions. I've got one or two more for you first. You referenced, James, that both of these are very confident regimes resting on a profound amount of insecurity about the society underneath. How much should the US worry about things that we do inadvertently or intentionally that inflame populations? How much are the Chinese and Russian populations a factor in whether our scenario is mostly peaceful, somewhat peaceful, or actually quite violent? Well, the Chinese leadership is intensely focused on what's going on with their population. Leaders at every level of the system are rewarded for having their secretaries and their other aides constantly taking the temperature of local populations, particularly monitoring them on social media so that they can get advanced warning of what's gonna go on. And people who fail to do that, the organization department pretty thoroughly purges them out in terms of being candidates for promotion. They're also very effective at rallying around the flag. They're very effective at othering outsiders who are preventing the realization of the China dream as President Xi Jinping would say. And so I think a lot of the sort of half-baked ideas I've heard over the years about how to drive wedges between the leadership and the population could pretty easily, based on past practice, be turned around by the leadership to be portrayed as foreign meddling, foreign interference, foreign subversion. And we're not terribly good at it. The U.S. military has only had one successful national military deception against China in the last 20 years. It's called Air Sea Battle. And it's thoroughly convinced the Chinese that we had a secret war plan for defeating them in Westpac when, for large extent, it was just PowerPoint slides, but. And I would say on Russia, I mean that the Kremlin controls the media and what the people, the general public thinks, and only the intelligentsia, the population that's educated in Moscow and St. Petersburg primarily, has access to alternative information through the internet, but they're clamping down on that as well. So I don't think Putin, and in as much as he worries, there's this weird divide between all the other rulers in Russia, all the other leaders, politicians and Putin. And so what will happen is his corrupt buddies will do something, they'll get caught, and then Putin will fly in and say, you guys are bad, knock it off, and he'll come off like the good guy. It's a very imperial kind of model that the Russians are familiar with. Is he wearing a shirt when he does that? Depends where he's going and what the weather is. Well, I don't quite know how to top that one. So folks, okay, we've got a couple of questions. While the microphone gets to the gentleman in the yellow tie here, what does the blob get wrong about Russia and China? What are the most pernicious ideas that we in Washington have about dealing with Russia and China? Well, I think to some extent it's this notion that the straight-lining and sort of a realist power framework that says they have this much economic power, they have this much military power, they have this much diplomatic power, therefore it naturally translates into this level of influence and strategic communications and everything else. Frankly, I see a fairly large chasm for the Chinese leadership being enabled in some cases to translate pure market power into soft power and things that they can actually take advantage of. And I would say the durable thing that we get wrong about Russia time and again is that you can somehow cooperate with them and ignore their perception and their interests and also related to that, this idea that somehow we've offended them over time and that's why we can't cooperate. Again, you have to understand their interests and our interests and see whether there are compatibilities there and if there aren't, then you move on. So I think and then a second thing which is not directly related is the, well, there are declining power so we can kind of ignore them. And again, we all know actually throughout history that some of the most dangerous states have been those declining or ascendant states but the declining ones can be equally dangerous. So we will take our audience question. Hi, Rob Levinson, Bloomberg government. I have a question for my friend Evelyn. Evelyn, it actually goes with what you just said. On the one hand, we've talked about Russia's strength but you mentioned the paranoia and things that it rests upon and economically I think Russia's GDP is not that of Holland. They're in demographic death spiral by some, the population continues to decline. I think I just read that the average life expectancy of a Russian male is less than that of Haiti. So does that make them actually more dangerous with this underlying severe demographic economic problems that they have and yet they wanna play this big tough guy role in the world? Yeah, probably because it's this insecurity that the regime has. They know that the fundamentals are weak. I mean, economically their structure it's this crony, mafia style capitalism. They cannot innovate. Again, you mentioned the demographics which also affect the economic situation. They've had a brain drain that has continued unabated over the last, in fact, maybe even accelerated over the last five to 10 years. And so that makes them insecure and nervous. At the same time, they're a nuclear power. They have these phenomenal asymmetric cyber and other information operation capabilities. So they can wield that to demand recognition and that gets to the fact that they're declining. They were once a great power and they still very much have an imperial mindset within the Kremlin and they want the world to know that they are global power still, that they are on par with us and all the other great powers and they won't be ignored. And so I think it's very dangerous to pretend that we can't ignore them. Do you wanna jump in on that? Well, the thing is that the Chinese actually have a different set of problems that sort of immiserate and weaken them. And that is that they're trapped into a rhetorical framework that no longer actually applies to their actual great power status. So things like the five principles of peaceful coexistence where they say, we're not gonna interfere in the internal affairs of other countries. We're not gonna have bases abroad. Well, as we all know, one of the perks of being a great power is interfering in the internal affairs of other countries. And they're doing it all the time while righteously saying that they're not doing it. And that leads to two outcomes. One group of people here in DC say, oh, this is a gigantic strategic deception and there's some guy stroking a white Persian cat in his lap and his floating volcano island headquarters outside of Beijing. And then other people say, well, they're incoherent and we just can't figure out how to reconcile their stilted public strategic communications messages with what they're actually doing on the ground. And then we struggle to sort of deal with that. And those are real challenges for us. Well, I don't think the movie that you're about to see has a guy stroking a white cat on a floating island volcano, but that might be as good a moment as any to thank the audience that toughed it out for this great panel at the end of the day and say thank you to our guests.