A new cold war: Trump, Xi and the escalating US-China confrontation

In the first of a series, Gideon Rachman explores how the rivalry between the two superpowers is starting to feel eerily familiar

Gideon Rachman in London

“From Stettin in the Baltic to Trieste in the Adriatic, an ‘iron curtain’ has descended across the continent.” Winston Churchill’s speech in Fulton, Missouri, in March 1946 is remembered as a key moment in the outbreak of the cold war.

If future historians are ever looking for a speech that marked the beginning of a second cold war — this time between America and China — they may point to an address by Mike Pence delivered at Washington’s Hudson Institute in October 2018. “China wants nothing less than to push the United States of America from the western Pacific . . . But they will fail,” the vice-president declared. “We will not be intimidated and we will not stand down.” Pointing to China’s political system, Mr Pence argued: “A country that oppresses its own people rarely stops there.”

For students of the first cold war between the US and the USSR, some of this sounded eerily and worryingly familiar. Once again, the US is facing off against a rival superpower. Once again, a military rivalry is taking shape — although this time, the main theatre is the western Pacific rather than central Europe. And once again, the conflict is being framed as one between the free world and a dictatorship. To add to the sense of symmetry, the People’s Republic of China, like the Soviet Union, is run by a Communist party.

Even in the past few months, the deterioration in relations between the US and China has rapidly gathered pace, against the backdrop of a feverish election campaign in the US. Military tensions in the Pacific are rising. Taiwanese officials say the September exercises by the Chinese military within its air defence buffer zone were the most significant threat to its security since Beijing launched missiles into the seas around the island in 1996. The US has a commitment to help the country defend itself.

The US has moved aggressively to block Chinese technology firms, such as TikTok and Huawei — from expanding their international operations, or buying US-made computer chips. China and America are even indulging in tit-for-tat expulsions of journalists.

And coronavirus, which originated in China, has devastated the global economy and led to more than 200,000 deaths in America. President Donald Trump, who is currently in hospital after testing positive for the virus, has made it clear that he holds the government of China directly responsible for the pandemic.

In another confrontational speech that will probably be remembered by historians, secretary of state Mike Pompeo warned in July that five decades of engagement with China had been a failure.

“If we don’t act now, ultimately, the [Chinese Communist party] will erode our freedoms and subvert the rules-based order that our free societies have worked so hard to build,” he said, speaking at the Californian library of Richard Nixon, the president who reopened ties with Beijing during the cold war. “The old paradigm of blind engagement with China simply won’t get it done. We must not continue it. We must not return to it.”

New uncertainty

For Joseph Nye, a professor at Harvard University and former senior Pentagon official, US-China relations are now “at their lowest point in 50 years”.

There is even a fear that, as in the cold war, the world could increasingly divide into two blocs — one that looks to Washington and one that looks to Beijing. That may sound implausible in a world of globalised supply chains. But, especially in the tech sector, there are signs that this is already starting to happen.

As the Huawei case illustrates, the US is now clearly leaning on its allies to cut tech ties with China — and, in some cases, such as in Britain and, to an extent, Germany, the pressure is working. China, however, is also building its own global network of influence through trade and its Belt and Road Initiative — which could involve loans and investment of up to $1tn in infrastructure development outside China.

Henry Kissinger, the former US secretary of state who helped bring about the rapprochement between the US and China in the 1970s, said last year that Beijing and Washington were now in the “foothills of a cold war”.

If China’s growing technological prowess has captured US attention this year, its defence capabilities are also driving the growing anxiety. China’s rapid military build-up has altered the balance of power between Beijing and Washington. The Chinese navy now has more ships than the US navy — and they can all be concentrated in the western Pacific. China has also developed a formidable range of missile and satellite weaponry that could threaten American aircraft carriers and disrupt the US military’s communications.

In a recent article, Michèle Flournoy, who is tipped as a possible US defence secretary if Joe Biden wins the presidential election, worried that “dangerous new uncertainty about the US ability to check various Chinese moves . . . could invite risk-taking by Chinese leaders”, adding: “They could conclude that they should move on Taiwan sooner rather than later.”

Ms Flournoy’s recommendation is that America should strengthen its military capacity, so as to restore deterrence. The fact that a prominent Democrat is taking this position points to an important aspect of the new US-China rivalry: it will not disappear if Mr Trump loses the White House in the presidential election.

There is no doubt that the current US president uses much more confrontational language with China (and indeed most countries) than any of his predecessors. Mr Trump’s single-minded focus on the US trade deficit with China and his protectionist policies are also distinctive. 

But Mr Trump may have helped to bring about a permanent shift in orthodox opinion in Washington. Daniel Yergin, an economic historian, notes that “while Democrats and Republicans hardly agree on anything today in Washington, one thing they do agree on is that China is a global competitor and that the two countries are in a technology race”.

A Biden approach to China would place more emphasis on American alliances than the Trump administration, and would probably make less use of tariffs. The Democrats would also look to work with China on climate change. But a Biden administration would not alter the basic premise of the Trump policy — which is that China is now an adversary.

In Beijing, this move towards a “cold war mentality” is decried — and is often attributed solely to America’s supposed refusal to accept a multipolar world. It probably is the case that there is a bipartisan determination in Washington to retain America’s status as “number one”. But the Chinese view skates over the extent to which Beijing itself has contributed to the emergence of a second cold war.

Since President Xi Jinping came to power in 2012, China has become more assertive overseas and more authoritarian at home. Beijing’s construction of military bases across the South China Sea has been perceived in Washington as a direct challenge to American power in the Pacific. 

Constitutional changes that would allow Mr Xi to rule for life, the crackdown in Hong Kong and the mass imprisonment of the Uighur minority have all driven home the message that China is becoming more dictatorial — dashing any remaining hopes in Washington that economic modernisation in China would lead to political liberalisation.

An increasingly wealthy, illiberal and aggressive China is much easier to see as a dangerous rival that needs to be confronted. In public the Chinese leadership continues to decry the “zero-sum thinking” of the Americans. 

In private, however, the Xi leadership seems to regard the US as a dangerous rival, intent on overthrowing Communist party rule. As long ago as 2014, Wang Jisi, a well-connected Beijing academic, wrote that China’s leadership was preoccupied by “alleged US schemes to subvert the Chinese government”.

If continuing rivalry between the US and China is inevitable, how do the two sides match up?

It is generally acknowledged that the military gap between Washington and Beijing has narrowed considerably. But the US has a network of allies that China cannot replicate. There is no “Beijing Pact” to rival the Warsaw Pact that once bolstered the Soviet Union. 

On the contrary, other key powers in the Indo-Pacific region are treaty allies of the US, including Japan, South Korea and Australia. And India, while it is not a formal ally of the US, is likely to tilt towards Washington following the recent deadly confrontations between Indian and Chinese troops on the two nations’ disputed border.

However, if America stood aside in the event of a Chinese assault on Taiwan, then the US alliance system might not survive the shock. Conversely, if the rivalry between Beijing and Washington never escalates into military confrontation, then China has other assets it can deploy. It is the largest trading partner for more than 100 nations; compared with 57 nations for America.

China is also a plausible rival to the US in a tech race. It is clear that some Chinese tech firms are vulnerable to cut-offs of key American components — in particular computer chips and semiconductors. On the other hand, China is ahead in certain technologies, such as mobile payments, and it is a formidable competitor in other areas such as artificial intelligence and medicine.

A scientific rivalry between America and China is certainly reminiscent of the US-Soviet rivalry, which was driven by a space race.

Integrated rivals

But while the parallels between the current US-China rivalry and the start of the cold war are striking, there are also some important differences. The most obvious is that the economies of the US and China are deeply integrated with each other. Trade between China and the US amounts to more than half a trillion dollars a year. 

China owns more than $1tn of US debt. Important American companies rely on making and selling their products in China. Manufacture of the Apple iPhone is built around a supply chain based in southern China. There are more Kentucky Fried Chicken restaurants in the PRC than in the US.

This economic intertwining has also created a degree of social convergence. China may be run by a Communist party, but its major cities are throbbing with commercial life, private enterprise and western brands, and could never be mistaken for the grey uniformity of Soviet Russia. 

“Chinese society is more similar to American society than Soviet society ever was,” Yale University historian Odd Arne Westad noted in Foreign Affairs magazine.

There are also strong scientific and educational ties between China and the US. Mr Xi’s daughter was educated at Harvard. Stalin’s daughter was not sent to Yale.

China is also a plausible competitor to the US in a tech race, reminiscent of the US-Soviet rivalry driven by a space race © Aleksandar plaveski/EPA-EFE

Given the levels of economic and social integration between the US and China, some scholars argue that the cold war may not be the best historical analogy — although some of the other potential comparisons are no less alarming. 

Margaret Macmillan, who has written a history of the origins of the first world war, thinks the “more important parallel is the UK and Germany before 1914”. 

This was a classic great power rivalry between an established and a rising power. At the time, some argued that the extent of economic integration between Germany and Britain made war both irrational and unlikely. But that did not prevent the two nations sliding into hostilities.

Mr Westad, an expert both on China and the cold war, points out that, unlike the Soviet people in 1946, the Chinese have enjoyed 40 years of peace and prosperity. 

Therefore, “in a crisis, the Chinese are more likely to resemble the Germans in 1914 than the Russians after the second world war — excitable, rather than exhausted,” he says.

A yearning to test and demonstrate national strength is certainly visible in nationalist circles in China. Hu Xijin, editor of the Global Times newspaper, tweeted in July that China “is fully capable of destroying all of Taiwan’s military installations within a few hours, before seizing the island shortly after. Chinese army & people have such self-confidence.”

The Chinese navy now has more ships than the US navy, and they can all be concentrated in the western Pacific © Reuters

Another historical analogy, less discussed in the west but often heard in Tokyo, is the clash between Imperial Japan and the US that reached an endpoint in the second world war. As a senior Japanese diplomat sees it: “The Chinese are making the same mistake we made, which is to challenge American hegemony in the Pacific.” 

But at the time of Pearl Harbor, the Japanese economy was just 10 per cent the size of America’s. China, by contrast, now has an economy that is two-thirds the size of America’s — and larger when measured by purchasing power.

There is one further aspect in which the comparison between modern China and the Japan of the 1930s is suggestive. Imperial Japan argued that it was liberating Asia from western imperialism (countries invaded by the Japanese, such as China and Korea, did not see it that way). 

There is a similar hint of a “clash of civilisations” in some Chinese nationalist discourse — in which the rise of China is portrayed as ending centuries of domination of the global order by white, western nations.

The Anglo-German rivalry and the US-Japanese confrontation culminated in war. But they broke out in an age before nuclear weapons. By contrast, the threat of nuclear annihilation defined the cold war. 

Perhaps as a result, US and Soviet forces never clashed directly during the cold war, although they often battled through proxies. Yan Xuetong, a prominent scholar at Tsinghua University in Beijing, has argued that fear of nuclear conflict makes it unlikely that China and America will ever go to war — which would make the current US-Chinese confrontation more like the cold war, than the run-up to the two world wars.

Strength of systems

But perhaps the most intriguing comparison is about how the cold war ended, rather than how it began. The contest was not settled on the battlefield or in space. In the end, it was determined by the relative resilience and success of the two societies — the US and the USSR.

Ultimately, the Soviet system simply collapsed under the weight of its own internal problems. (Ironically, this was the fate that Communists had long predicted for the capitalist system). The USSR’s fate vindicated the strategy first sketched out by the American diplomat George Kennan, who in 1946 had advocated the patient containment of Soviet power while awaiting the system’s ultimate demise. Kennan also argued that the vitality of America’s own system would be crucial in any contest with the USSR.

It is this last comparison which should disquiet the Americans and their allies most. 

The current presidential election threatens to provoke a crisis in the American democratic system of a sort that has not been seen since the 19th century. 

Even if the US achieves the peaceful transition of power that Mr Trump has failed to guarantee, the Trump era has revealed social and economic divisions that have turned America inwards and damaged the country’s international prestige.

A yearning to test and demonstrate national strength is certainly visible in nationalist circles in China © Thomas Peter/Reuters

The spectacle of the Trump-Biden contest has strengthened the sense in China that the US is in decline. Eric Li, a trustee of the China Institute at Shanghai’s Fudan University, inverts the cold war analogy — by casting the US as the USSR, in the grip of an “existential brawl between two near octogenarians”, referring to Mr Trump and Mr Biden. 

“Remember [former Soviet rulers] Brezhnev, Andropov and Chernenko?” By contrast, according to Mr Li, “China today is the opposite of what the USSR was decades ago. It is practical, ascendant and globally connected.”

For all the confidence of pro-government intellectuals in China, like Mr Li, there is no doubt that Mr Xi’s China also has significant internal problems. As Mr Westad notes, it is “a de facto empire that tries to behave as if it were a nation-state” and the strains are showing from Hong Kong to Tibet to Xinjiang. But the PRC has also demonstrated an economic prowess that the USSR never possessed.

If the US and China are indeed embarking on a new cold war to determine which country will dominate the 21st century, the vitality of their domestic systems may ultimately determine who prevails.

The three pillars

Why, despite the coronavirus pandemic, house prices continue to rise

Monetary policy, fiscal measures and buyers’ preferences explain the unlikely boom

During the global recession a decade ago, real house prices fell by an average of 10%, wiping trillions of dollars off the world’s largest asset class. Though the housing market has not been the trigger of economic woes this time, investors and homeowners still braced for the worst as it became clear that covid-19 would push the world economy into its deepest downturn since the Depression of the 1930s.

That pessimism now looks misplaced. House prices picked up in most middle- and high-income countries in the second quarter. In the rich world they rose at an annual rate of 5% (see chart 1). Share prices of developers and property-traders fell by a quarter in the early phase of the pandemic, but have recovered much of the fall.

Some markets are fizzing. In August house prices in Germany were 11% higher than the year before; rapid growth in South Korea and parts of China has prompted the authorities to tighten restrictions on buyers. 

In America growth in the median price per square foot accelerated more quickly in the second quarter of 2020 than in any three-month period in the lead-up to the financial crisis of 2007-09. Three factors explain this strength: monetary policy, fiscal policy and buyers’ changing preferences.

Consider monetary policy first. Central bankers around the world have cut policy rates by two percentage points on average this year, reducing the cost of mortgage borrowing. Americans can take out a 30-year fixed-rate mortgage at an annual interest rate of just 2.9%, down from 3.7% at the beginning of the year. 

Studies suggest a strong link between falling real interest rates and higher house prices. Some borrowers can afford to take out bigger mortgages; others find it easier to manage their existing loans. 

Landlords are willing to pay more for property, because yields on other assets have dropped. In both America and Britain, mortgage lending is running at post-financial-crisis highs.

That is not to say that it has become easier for everyone to borrow. In fact, obtaining a mortgage has become harder for many. Brokers, fearful of the long-term economic impact of covid-19, have pulled back on riskier lending. British banks, for instance, are offering fewer high-loan-to-income mortgages. 

In America few loan officers at banks said they were tightening lending standards before the pandemic; now 60% do. In contrast with previous periods of strong house-price growth, there is little evidence of lax lending standards.

Fiscal policy, the second factor, may therefore be more important in explaining buoyant prices. In a normal recession, as people lose jobs and their incomes fall, foreclosures drag house prices down—not only by adding to the supply of houses on the market, but also by leaving ex-homeowners with a blemish on their credit history, making it harder for them to borrow again. 

But this time governments in rich countries have preserved households’ incomes. 

Handouts through wage subsidies, furlough schemes and expanded welfare benefits amount to 5% of gdp. In the second quarter of the year households’ disposable incomes in the g7 group of large economies were about $100bn higher than they were before the pandemic, even as jobs disappeared by the millions.

Other measures directly support the housing market. Spain, for instance, has allowed borrowers to suspend their mortgage repayments. Japan’s regulators have asked banks to defer principal repayments on mortgages, and the Netherlands temporarily banned foreclosures. 

In the second quarter the number of owner-occupied mortgaged properties that were repossessed in Britain was 93% lower than in the same period in 2019, the result of policies that dissuade repossessions. In America foreclosures, as a share of all mortgages, are at their lowest level since 1984.

The third factor behind the unlikely global housing boom relates to changing consumer preferences. In 2019 households in the median oecd country devoted 19% of spending to housing costs. 

With a fifth of office workers continuing to work from home, many potential buyers may want to spend more on a nicer place to live. Already there is evidence that people are upgrading their household appliances.

People also seem to be looking for more space—which, all else being equal, raises house prices. Though the New York and San Francisco housing markets look weak, there is little wider evidence to support the idea that people are fleeing cities for the suburbs, at least in America. 

Data from Zillow, a housing marketplace, suggest urban and suburban property prices are rising at roughly the same pace; price growth in the truly get-away-from-it-all areas is actually slowing (see chart 2). 

It seems more likely that people are looking for bigger houses near where they already live. 

In Britain prices of detached houses are rising at an annual rate of 4%, compared with 0.9% for flats, and the market for homes with gardens is livelier than for those without.

Can house prices continue their upward march? Governments are slowly winding down their economic-rescue plans, and no one knows what will happen once support ends. But lower demand for housing may run up against lower supply. High levels of economic uncertainty deter investment: in America housebuilding has fallen by 17% since covid-19 struck. 

The experience of the last recession suggests that even when the economy recovers, construction lags behind. 

It may take more than the deepest downturn since the Depression to shake the housing market’s foundations.

Chile’s pension funds join global gold ETP rush

Rule change adds the products to the list of permitted alternative assets

Steve Johnson

Chilean pension funds have been given the go-ahead by the country’s financial regulator to invest in gold exchange traded products for the first time.

The relaxation is part of a brace of reforms in Latin America, alongside Brazil’s decision to allow cross listings of overseas exchange traded funds in the form of depositary receipts, that could help breathe new life into the region’s stuttering ETF industry.

Felipe Cousiño, a partner at Alessandri, a Chilean law firm, said the move was part of an ongoing relaxation of the rules around the pension industry, the most developed in the region with about $200bn of assets, two-thirds of Chile’s gross domestic product.

Once restricted to liquid assets, a 2018 reform allowed pension funds to invest in alternative assets, such as private equity, private debt and infrastructure and real estate funds, for the first time. Gold ETPs have now been added to the list, provided they meet various standards around size, manager experience and ratings.

In the past “the legislature saw commodities, or anything exposed to commodities, as unnecessarily risky for Chilean pension funds”, Mr Cousiño said, amid concerns over the potential for high levels of volatility.

Chile’s pension fund industry has often been viewed outside the country as a model for other emerging markets to follow, even being described as the “Mercedes-Benz” of retirement provision.

Introduced in 1981 as part of the free-market reforms of the Augusto Pinochet dictatorship, the system sees those in formal employment pay a mandatory 10 per cent of their wages, up to certain limits, into a defined contribution pension fund.

It has been copied by more than 30 countries across Latin America, south-east Asia and eastern Europe.

However many Chilean workers are now retiring on far less than they expected. Anger over the size of the payouts, as well as the fees taken by private pension fund managers, known as AFPs, was one of the drivers of a series of violent street protests that engulfed the country last year and left at least 19 people dead.

The problem of low retirement income is likely to be further exacerbated by a ruling earlier this year that allowed workers to withdraw up to 10 per cent of their accumulated savings in order to cope with the dislocations caused by the coronavirus pandemic, an option that most have taken up, Mr Cousiño said.

“In view of the relatively low returns that have been obtained by traditional investment products, the legislature and regulator have realised that it has become necessary to broaden the scope of eligible instruments for Chilean pension funds in order that they have exposure to other types of assets,” he added.

Given that the relaxation could increase diversification and add stability to pension funds’ net asset value, Mr Cousiño argued it was “a welcome development for the industry, seen as providing another element in its toolbox”.

AFPs, each of which can run up to five funds, structured to match different investment profiles, will now decide whether or not to embed gold ETPs in their portfolios.

Deborah Fuhr, founder of ETFGI, a consultancy, said she saw scope for the funds to take up this option. “This year the net inflows to gold have been very high. It’s seen as an inflation hedge and a safe haven. For a lot of investors in Latam, investing in gold has been something they want to do,” she said.

Globally, gold-backed ETPs saw net inflows of $55.7bn in the first nine months of 2020, up from $19.2bn during the whole of 2019 and shattering the prior record of $24bn in 2016, according to data from Bloomberg and the World Gold Council.

This helped pushed the gold price to an all-time high of more than $2,000 an ounce in early August, although it has since retreated a fraction to $1,916. 

Four ETPs have so far been approved by Chile’s pension regulator, Mr Cousiño said, three London-listed WisdomTree funds and State Street Global Advisors’ New York-listed SPDR Gold Shares (GLD).

Conflict in the Caucasus and the New American Strategy

By: George Friedman

During the Cold War, the United States opposed the Soviet Union wherever the Soviet Union sought to make inroads. Some interventions were necessary and therefore took place in obvious locales: in Germany to shield Europe, in Turkey to limit Soviet naval movement into the Mediterranean, and in Japan to block the Soviet port of Vladivostok and the Pacific. Others such as Angola and Afghanistan were less so.

The United States was in a global competition with the Soviets, and they both used the tools they had available to counter each other. Washington’s primary tool was its military, particularly its massive navy. Moscow’s was what were called “wars of national liberation.” 

They involved covert support to insurgents in countries throughout the world, most notably in former colonies of European imperialists. The United States usually had little interest in the battleground country. It had an overriding interest in blocking Soviet success in these countries, since success might create the perception of greater Soviet power. The U.S. tended to use covert forces to wage a covert war against Soviet proxies, though some such as Vietnam are notable exceptions.

During the Cold War, everything mattered to the United States, because the Soviets could and would exploit any opening. The Soviet Union was a global power, with a military second only to the United States' and a covert capability that frequently put Washington in difficult situations.

But there is no threat from the Soviet Union today. Only some things now matter to Washington. This is a shock to a world that expects the U.S. to take a leadership role, indifferent to the price the U.S. paid in the Cold War for taking the reins. Engaging globally carries with it a high price that can be paid when necessary but should be avoided when possible.

Between then and now, in late 2008, Russia went to war in Georgia. The United States was deeply enmeshed in Iraq and Afghanistan, and it made clear it had no intention of intervening. Limited by its commitment elsewhere, it was not in a position to rush troops there, though it did bring other forces such as sanctions to bear. After the war, the United States sent troops to Georgia, primarily to train the Georgian army, and its presence and commitment have lasted to this day.

It was a far slower response than it would have been during the Cold War, but it was no less significant. The question of why Russia's actions should cause the U.S. to take risks and spend resources was still not challenged. 

A Russian threat to Georgia triggered a visceral reaction: Russian expansion must be blocked wherever it emerges, especially when the victim is America’s ally. The question of whether this even interests the United States was overridden by the assumption from the Cold War: The U.S. has a responsibility to stabilize the world.

The current dispute over Nagorno-Karabakh, a territory that like Georgia is located in the Caucasus, represents a fundamental shift in U.S. policy. Azerbaijan lost the territory to Armenia in the early 1990s. Since then, its recovery was a fundamental wish of Azerbaijan, but other internal issues preoccupied its time. 

But last week, the Azerbaijani military began an artillery attack that lasted for days. 

Armenia has refused to cede the territory. Turkey has sided with Azerbaijan, both because of historical affinity for Azerbaijan and because of long-standing hostility to Armenia. 

The Russians are allied with Armenia but also had close relations with Azerbaijan. The Iranians gave lukewarm support to Azerbaijan but overall made it clear that they wished to remain out of the conflict.

If there was an automatic assumption that the U.S. had to “manage” a crisis such as this in 2008, in 2020 it is apparent that the crisis is unmanageable. For one thing, who owns Nagorno-Karabakh is not a matter that concerns the U.S. 

For another, the outcome of a war – if it comes to that – would have minimal effect on the U.S. Last, U.S. relations with Turkey and Russia are already frayed, and the risks of navigating a war in the Caucasus would outweigh the benefits. Hence why Washington has offered only expected platitudes since last week.

The shift of U.S. strategy was inevitable and predictable. During the Cold War, it took the (not unreasonable) view that the world was of a single fabric such that it couldn’t stand by if it was being tugged far afield. In time, the Cold War ended but the strategy did not, as evidenced by bombing campaigns in Serbia and Libya. 

During this transitional period, it became much more difficult to define U.S. goals, and more difficult still to explain how military action would achieve the goal. The U.S. had spent half a century built around the principle of constant and urgent global involvement. Strategic principles die hard.

The United States is still singularly powerful, but the experience of war and hostile diplomacy can be painful even for the strong. There was a connection between U.S. power and risk in the Cold War. There is precious little connection between this and the future of Azerbaijani-Armenian relations. 

It’s the recognition that there is no global war underway, and that some things simply mean more to the U.S. than others. In a tiny place that few outside the region have heard of, the new necessity and logic of U.S. foreign policy are being carried out. 

In a way, that makes the U.S. more like other powers, accumulating political capital and spending it after calculating the risks of and rewards for acting.

Herd Immunity Will Not Defeat COVID-19

Although White House officials deny that US President Donald Trump's administration has adopted herd immunity as a strategy for combating COVID-19, Trump's words and actions tell a different story. But with coronaviruses, such an approach is not and should never be an option.

William A. Haseltine

NEW YORK – During a September 15 ABC News “town hall”-style event, US President Donald Trump told host George Stephanopoulos that without a vaccine, COVID-19 would still “go away.” 

Over time, Trump said, “You’ll develop herd – like a herd mentality. It’s going to be – it’s going to be herd-developed, and that’s going to happen.”

What Trump was referring to, and misnamed, is herd immunity, which a population develops when so many of its members are infected by or vaccinated against a given contagion that a bulwark of resistance counters the contagion’s spread. 

But to base a pandemic-response strategy on the assumption that herd immunity is inevitable – vaccine or no vaccine – is to afford a virus a path of least resistance. 

That was the case in Sweden, where policymakers decided to forego lockdowns and business closures in favor of more lenient advisories on mask-wearing and social distancing.

Unsurprisingly, Sweden’s subsequent COVID-19 infection and fatality rates were among the world’s highest. Moreover, the Swedish economy contracted by 8.6% in the second quarter of 2020 compared to the previous three months – an important outcome to note given the emphasis that many proponents of herd immunity place on reviving economic growth. One such supporter is Scott Atlas, a recently appointed pandemic adviser to Trump who has advocated for the so-called Swedish model on Fox News.

“We like the fact that there’s a lot of cases,” Atlas said in one interview. “That’s exactly how we’re going to get herd immunity, population immunity.” Although Atlas has no epidemiological credentials or experience, he does seem to have the ear of the president – as evidenced by the latter’s remarks on “herd mentality.” On August 31, Trump made similarly pointed – yet evasive – comments to Fox News’s Laura Ingraham. 

“Once you get to a certain number, we use the word herd, right?” he said. “Once you get to a certain number, it’s going to go away.”

There’s just one problem: When it comes to coronaviruses, that “certain number” doesn’t exist. Research in recent decades has established time and time again that certain cold-causing coronaviruses can infect a person more than once – and even as many as three or four times, according to a six-year study conducted in Kenya.2

With SARS-CoV and MERS-CoV, the culprits of the last two lethal coronavirus epidemics, long-term research was too sparse and underfunded to verify their capacity for reinfection. But two scientific case studies – one on a patient in Hong Kong, and another (still undergoing peer review) on a patient in Nevada – have already confirmed that the SARS-CoV-2 virus that causes COVID-19 can reinfect an individual.

These studies show that our immunity to coronaviruses is alarmingly short-lived and quick to fade – a disappearing act that makes building protection to SARS-CoV-2 difficult enough for an individual, much less an entire population.

The day after Trump’s ABC News town hall, MSNBC’s Rachel Maddow ran the numbers on how herd immunity would play out in the United States, which has a population of roughly 330 million. 

If reaching herd immunity requires a minimum of 65% of people to be infected, as the World Health Organization’s chief scientist, Soumya Swaminathan, has said, that would mean 215 million cases of COVID-19 countrywide. 

If the US fatality rate remained what it is now – close to 3% – it would also mean 6,385,500 deaths. I have previously called herd immunity a “reckless and ineffective strategy.” Now that COVID-19 reinfections are not just a possibility, but a reality, I would add “lethal” to my description.

“The White House is no longer even recommending that states do things to stop the spread of this virus – things that just weeks ago they were telling the states they needed to do,” Maddow said. “When it’s not just what [Trump] is saying, but what he’s doing, we have to recognize this as a huge deal.”

White House Press Secretary Kayleigh McEnany and Atlas himself have both categorically denied that the Trump administration has adopted herd immunity as a strategy. 

But the words and actions of their boss, who continued to eschew and mock preventive measures as basic as wearing a face mask – and who tested positive for COVID-19 this week – tell a different story. 

Whether you call it herd immunity or “herd mentality,” the science remains the same. 

With coronaviruses, such an approach is not and never should be an option.

William A. Haseltine, a scientist, biotech entrepreneur, and infectious disease expert, is Chair and President of the global health think tank ACCESS Health International.