The standoff between China and Taiwan (and the U.S.) has heightened tensions to their highest level in decades but — so far at least — economic observers haven’t seen a worst-case scenario.

The island’s crucial semiconductor industry has dodged a direct hit and, while China currently has Taiwan effectively blockaded, that is expected to end this weekend.

But White House officials and other observers say that doesn’t mean Taiwan’s economy and world markets are getting off scot free. There are three key economic ripples — from global shipping to cyber attacks to trade wars — that may be felt across world markets in the weeks and months to come, even if tensions don’t get any worse.

“We will not seek, nor do we want, a crisis,” NSC Coordinator for Strategic Communications John Kirby told reporters Thursday, but he was clear that China’s actions “erode the Cross-Strait status quo” on both economic and military issues.

Here are some of the immediate economic effects likely to be felt even if China stops short of full scale economic (or actual) warfare following House Speaker Nancy Pelosi’s trip to the island.

Continue reading at finance.yahoo.com.

Stanford e-China has been an incredible academic experience from day one.

My journey with the program started with the interview, which was an enjoyable and memorable experience. I was greeted by a warm smile the moment I entered the Zoom room, and Ms. Carey Moncaster showed genuine interest in learning about me as a person. Rather than focusing on my experiences or achievements, she wanted to know more about my personality, interests, and dreams. Ms. Moncaster and the director of SPICE, Dr. Gary Mukai, have remained passionate advisors and generous mentors to many students even after the course, including me. Over the last year and a half, they were always there when I needed advice on how to proceed with a project or wisdom on dealing with a difficult situation.

The sense of community permeated the course itself, which was designed to be highly interactive. The expert speakers gave insightful lectures, followed by long sessions of Q&A. I can still remember my excitement at being able to ask Mr. Roy Ng, our fintech speaker, three questions after his seminar, where he explained how blockchain could help us reach the unbanked. In fact, my current obsession almost perfectly mirrors that topic—exploring how Central Bank Digital Currencies can help facilitate financial inclusion to mitigate inequality. That session made me realize that social entrepreneurship and tech-based solutions will be key players in upholding justice.

The Q&A was also a chance for my cohort to learn from each other. We bonded over our productive, collaborative, and enthusiastic discussions, and many of us stayed in touch after the course. Over the last year and a half, I have grown to be close friends with my fellow honoree, Jason Li. After meeting in person when he visited Shanghai, we decided to co-found a platform to connect students across the globe. Inspired by the diverse community of brilliant students we saw at Stanford e-China, we developed SPOT. The acronym stands for Student Projects Organized Together, and we hope to bring together an international network of passionate youth. We believe that together, we undertake global initiatives that make tangible impacts. Our website is www.spotaproject.com.

Last but not least, e-China has helped me with my work in social justice. Design Thinking has not only aided in my endeavors with SPOT but also in my other initiatives, including the Law Association for Crimes Across History (LACAH) mock trial, where we put perpetrators of atrocities on the stand (lacah.net). Dora Gan from my e-China cohort is actually a member of our Youth Council! Design Thinking’s methodical approach helped us scale up rapidly, and we were recently honored by the EARCOS Global Citizen Grant.

Throughout high school, I have learned a lot from a wide range of outstanding programs. I have also met many other fabulous peers through them. However, it is not every day that a course leaves such a significant impact, continuing to play a role in my life long after its conclusion. Stanford e-China is truly an exceptional experience. I am very thankful to have been a part of the first cohort.

This interview with Oriana Skylar Mastro was originally published by the Center for Advanced China Research.

A little over a year ago, you pointed out in an article in Foreign Affairs that there is “no quick and easy fix” for the United States to ensure Taiwan’s security. How would you assess the United States’ Taiwan policy in the time since you wrote those words? How much progress has Washington made in improving Taiwan’s security picture and our military posture in the region?

Unfortunately, I don’t think we have made much progress in those particular areas. One of the reasons I wrote that article is that I was trying to make the argument that an assessment of US capabilities right now is largely driving Chinese thinking. They are assessing US capabilities and also their own capabilities to achieve certain military goals much more than they are assessing questions of resolve, as I wrote in that article. Chinese strategists are assuming US military intervention. Unfortunately, the Biden administration seems to still be focused on this communication of resolve aspect, and they spend a lot of their time and effort doing things like signing joint declarations about how Taiwan is important or having Biden make statements that lean much more towards strategic clarity, saying they’re going to defend Taiwan. I don’t think this enhances deterrence because this is not the primary factor that Beijing is currently considering when they’re deciding whether or not to attack Taiwan. It’s really about those capabilities.

Under the Biden administration, there’s more consideration of what Taiwan needs to defend itself, but none of that has actually come to fruition to any significant degree. There’s also more consideration about the need for more funding for things like the Pacific Deterrence Initiative, but not much has actually come to fruition on that either. So I think we’re not in any better position than we were when I wrote that article.

It sounds like you feel that the communicative aspect of deterrence doesn’t matter and that it’s only capabilities that matter, but you have also argued in the New York Times that the United States would be “outgunned” in a Taiwan conflict, which you based on tabletop exercises that you’ve been a part of and other assessments. If the United States is really at a military disadvantage in a Taiwan contingency, are US capabilities really the thing that’s deterring China anymore, or is it simply the geographical challenges in conquering the island, which you also talked about? Is the US military factor not really doing the deterrence job anymore?

I see those as the same thing. I say the United States is “outgunned,” and this is more of a balance of forces type of scenario, but the most important thing to keep in mind is, I’m talking about situations under which China initiates the conflict. So if we’re in that scenario, they’re going to find a time and place that is most favorable to them and least favorable to the United States. There are many ways the war could happen that the United States wins. So it’s not the case that China wins every time, but I guess part of my argument is, China is going to try to not fight those wars that they know that they would lose and instead guide the conflict towards areas of success, and one big aspect of that is moving quickly. So the problem with the amphibious assault is, let’s just say it’s completely uncontested, you’re just talking about a couple of hours of moving ships across a narrow strait, that’s not quite so difficult. The issue is if there’s any contestation. And sure, Taiwan is a component of this, but Taiwan doesn’t really have the military means, even with the geography and difficulty of landing stuff. Taiwan has the means to impose some costs on China for the invasion but not to stop the invasion. The real question is whether or not the United States can bring the massive firepower needed in a timely manner while they're trying to conduct that invasion, and a lot of that has to do with the amount of early warning the United States gets, whether or not we can get better at more quickly deploying our assets, things of that sort. So I think the Chinese calculations about how difficult the invasion is going to be are also predicated on how quickly and with what the United States can respond once it becomes apparent that the invasion is underway.

You also talked in the New York Times article about the difficulty of responding given that we have a limited number of air bases that are within refueling range, and of course our forces are dispersed all over the globe. How dire, for lack of a better word, do you think the situation is for the US military? Is this something that we could fix with more aircraft carriers in the region, or is this something that we can only do over a longer time frame? You have mentioned trying to get more basing rights in regional partners; is this something that we really stand a decent chance of addressing in the near term, or is that something that it would just take longer to do?

It’s very dire, and it’s not even just the number of bases. As a crazy hypothetical example, let’s say that the president says tomorrow, Asia is so important that now I’m dedicating all military forces to Asia. There’s no place we could put them! These airfields, for example, can only generate so many sorties, they can only house so many aircraft. It’s not like all of a sudden you can put all these forces forward deployed in Asia.

I don’t want to say that it’s long-term because these things can happen quite quickly when there’s political will on both sides, but it really is a diplomatic problem, it really is about getting the United States more access and more flexible access to the bases we already have, because there are rules, regulations, and restrictions to what we can have certain places, what types of operations we can do. The South Koreans, for example, we have to consult ahead of time, we have all these sorts of things that slow us down, and so we do need more places from which we can operate, and we need more flexibility with our allies and partners in how we operate when the time comes. That is going to be negotiated and that is going to be paved by diplomats.

So when Secretary Blinken says he wants to lead with diplomacy, I’m all for that, but you have to actually put in that work, and I don’t see that work being put in with key countries in the region.

Given that the Biden administration has already been in office for a year and a half, do you feel that’s something that is likely to be turned around, or do you think we’re going to be stuck in neutral for the foreseeable future?

I think the Biden administration is a bit risk averse. There’s a number of very logical reasons for this. They inherited a mess domestically, just like President Obama before, having to dig our way out of economic troubles and with COVID and all these other issues. I’m not an expert on American domestic politics, but my sense is that you always need support for certain policies, and so where are you going to be pushing things forward? Is it going to be on gun reform, or is it going to be on bases in Palau? And you know that because of the hostility of our politics these days, if things aren’t easy and perfect and everything isn’t going the way it’s supposed to go, the opposing party is going to jump down your neck about it. And so I understand the reluctance, the desire to engage with countries that we already have close relationships with and that we already do things with, the easier route of less resistance, versus potentially seriously reconsidering what our force posture should look like in a Taiwan conflict, because then you’re talking about changing your relationship with countries that are not unproblematic, like Vietnam. So I get why they are reluctant. Even with diplomatic initiatives, if they put together an initiative to try to regulate military uses in outer space or in cyber for the first time, what if it failed, what if no one came along with us? Politically, that wouldn’t look good, so I understand why they’re reluctant to try and fail. But I think just in government more generally, we can’t always predict all aspects of things, and we think doing nothing is better than something. But in this competition, we can try smaller-scale stuff, see how it works out, see what happens, and then hopefully experimentation in military strategy becomes more politically viable.

What happens after a Taiwan conflict? A lot of the discussion about a war over Taiwan is predicated on the idea that it’s a vital US interest, but is there a scenario in which Taiwan gets “reunified” but the United States’ network of alliances in Asia remains intact? Or is it an all-or-nothing deal, like a lot of people assume?

It completely depends on how it happens. Let’s say China moves very quickly and the United States is not able to come to Taiwan’s aid in time. That doesn’t really call into question US capability. For example, we have US forces in Japan, we have the forces necessary to defend Japan that are already there, so that’s a different scenario than the United States, with all of its might, waging major naval battles and major air battles and losing. Then, all of a sudden, I think the alliance system is more likely to fall apart because then it becomes clear to countries in Asia that the United States military no longer has the capability to stand up to the Chinese military, so then we see a lot more bandwagoning. So it kind of depends on what the United States’ role is in the actual conflict, and then a lot of it depends on the political decisions the United States makes after the conflict. One of the things I point out, for example, about the economic ramifications of a conflict or whether or not the United States has access to semiconductors and things like that, is that a lot of that depends on the US. We’re going to sanction, we’re going to prevent ourselves from engaging with the new Taiwan as punishment to China for taking Taiwan, that’s my most likely prediction of how the United States, at least politically and economically, is going to respond. We won’t recognize it, and then we’re going to try to lead some very serious decoupling economic sanctions against Beijing, so one of the ramifications of that war could be very serious economically if all of a sudden now we have two blocs and China and the United States don’t trade at all. Alternatively, it could be very minimal, if Europe and the US are like, “well, we didn’t want that to happen, but now it did, so let’s move on,” and we continue a similar economic relationship with Taiwan and China even in spite of that use of force. So whatever the situation is, it’s worse than if we defend Taiwan and win, that much I know for sure, but then in terms of how bad it would be for the United States and our allies and partners, I think that depends on so many of those factors it’s hard to say with 100% certainty what the situation will be.

Could the fear of losing all that credibility in a direct conflict with China over Taiwan create an incentive not to fight or to accept one of the phased invasions you talked about in the Foreign Affairs piece?

Yeah. I mean, that’s actually one of my biggest fears, that China moves quickly and the United States looks at the situation and says, “well, you could send this, but we know it’s not going to be enough.” So actually I think the worst-case scenario is that the United States sends some sort of token force. This is also why I’m very much against the statements Biden is making about strategic clarity, because I think it means that people in the administration are so focused on the rhetorical aspect of credibility that they might think it’s a good idea to send a token force so you can say that you tried, but it didn't work, and in my mind, that’s the worst of both worlds, because again, it might give people the impression that the United States doesn’t have the capability to defend them anymore, and then also China gets to defeat the United States. So in my mind, if the situation is such that we know we cannot win, I’m sorry to say, but I think it’s better that we don’t do anything versus sending some sort of token force to say, oh, well, you know, at least we tried.

But doesn’t the existence of that issue, the possibility that it would be more in our interest not to fight, reinforce the notion that we should have strategic clarity if we want to deter an attack?

Well, no, because again, China is not moving with the expectation that we will not fight. When they make that decision, they have to take a look at what’s going to happen if the United States counters [them], can they still win, so whether or not we do or we don’t in the end, they’re basing it on that worst-case scenario thinking. Of course, if tomorrow the United States said, we won’t defend Taiwan under any circumstances, that would impact Beijing’s calculus. I guess my point is it’s not about not saying anything at all, it’s just that in the 1990s, it used to be the case that if the United States would intervene, China could never win, and so making those clear statements would have really significantly impacted their decision-making, but that’s no longer the case.

You spoke in both those articles about the possibility of China striking US bases at the outset of a conflict. Would that create a risk of NATO allies and other US partners being drawn into the conflict, and if so, would that even be a factor for China?

So the short answer is no, which is really disturbing. I’m here speaking to you in my civilian capacity, and my views do not represent those of the United States Air Force, the Department of Defense, or the US Government. But I was just on military orders out in NATO – and I’m a China expert, so I’m with all of our NATO partners and allies, but I’m not an expert on NATO, and of course, we start talking about Article V, and I’m very curious about this exact question that you have about mutual defense if the United States or a US European presence is attacked. [Article V] very specifically makes reference to US European forward bases, so I asked explicitly if US forces are attacked in Japan, or attacked in Korea, does Article V cover that? It seems like the specification of European bases means no. They wouldn’t give me a direct answer on that. And so then I emailed some European specialists and NATO specialists at Stanford because I thought maybe they know, and they said, no, it’s very vague, you should keep on harassing them about it. So the bottom line is that Europe wants no part of this. It seems to me that the way that the NATO treaty is written, they’re not obligated to do anything, militarily I mean, and I think they’re probably not, and I’ve never heard or seen any situation in which people are considering European military involvement. So I would say no to Europe.

Now, the situation with Asian allies is a bit different. It completely depends. I mean, I have heard people in Japan, for example, Japanese government officials have told me that attacks on US bases wouldn’t necessarily constitute an attack on Japan enough to trigger the clause that allows them self-defense. But we’ve had that understanding for quite some time, I mean, we even fought a whole war in Vietnam and the Japanese wouldn’t let us use Japanese bases for combat reasons during the Vietnam war. If China attacks the United States, you could also say that that creates a lot of disincentives for countries to allow the United States to engage in military operations from their territory if China has already demonstrated the willingness to use military force against those bases. So China will also go to countries and say, “listen, we won’t do anything to you as long as you don’t allow the Americans to operate,” and then that sort of puts the burden on them to make that decision.

When you were talking about that NATO summit, was it government officials you were talking to who weren’t giving you a straight answer about that?

I was there in uniform, so it was all military members.

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Maybe a more important question related to that – would a preemptive attack on US bases in Asia have a significant impact on the United States’ willingness to fight and try to win a longer, escalated war, a la Pearl Harbor?

So that’s the thing – just like Pearl Harbor, it’s the same calculus. The United States has significant advantages in a protracted war against China. So China’s making the same calculation that the Japanese made, right? That they can win before those advantages come into play, before the United States can reconstitute its forces, before the United States can flow more forces in the region, even if the United States has the will to do that – because even strategic clarity just says you’re willing to fight, but it doesn't tell you anything about the costs we’re willing to absorb to fight. So they’re making a very similar bet, that they’ll get to Taiwan before that happens. Because once you have Chinese forces on Taiwan, it’s my view that there’s nothing we can do to get them to leave.

So you don’t think we have the military capability to get them off the island or to take any part of the island?

No, I mean, this is – it would have to be a brute force strategy, given the difference in resolve at that point. Then I think we’re kind of toast. That’s why I feel like we have to stop them from the landing.

[On an earlier point,] China would be deterred if they felt like a coalition of all European and Asian allies were going to fight against them.

That’s really what I was asking – would the deterrent effect of that outweigh the advantages of them hitting US bases in Japan?

Oh, yeah, absolutely, so you don’t even need everyone, you just need Japan. If Japan was going to fight militarily with the United States, we win. We win that war every time.

Wow, I didn’t know that – like in the tabletops?

I would just say based on my experience of thinking about planning and forces, that with the United States’ ability for allowing to operate our forces from Japan – we have one airbase, and I forget the numbers, but Japan has thirty, forty airbases – all of a sudden, where we can operate from, our sortie rates, or ability to achieve air superiority is significantly advanced. Japan also has, second to China, the most advanced Navy in the region and one of the most advanced in the world, so if they’re projecting power with their navy into the Taiwan Strait, they can hold them off on their own for a period of time. That definitely gives us enough time to flow what we need.

So it sounds like Japan’s involvement is really the key question, almost.

Yeah, but it’s kind of one of these, like, magic unicorns. Also, if we could all of a sudden not require fuel to conduct military operations…

Is it that unlikely, though? Because Japanese officials have been talking more about how important Taiwan is to Japan’s defense since last year.

No, I mean, even when they make those strong statements and then have meetings with Japanese government officials, I asked them about those strong statements, and often I’m like, are you actually going to do something? They say, well, no, we’re still not going to do anything, but we just want to voice our unhappiness or voice our solidarity with the United States. But it’s not like operationally things are really changing in Japan, in my understanding. I’m not an expert in Japanese domestic politics, but it’s my understanding that this is a bit of a gray area of how it would go.

What are your thoughts about China signing a security cooperation agreement with the Solomon Islands? Are Western concerns about the military consequences of that agreement overblown? Does China’s subsequent attempt to secure a multilateral security agreement with ten more Pacific Island countries suggest that it wants military bases throughout the Pacific?

I think it’s too soon to tell. You know, in my own research about Chinese military strategy, I do argue that there are many aspects of the US approach which they have not emulated to date, not because of lack of capability, but because they feel like those approaches are ineffective. And one of those is a global military presence coupled with forward military intervention as a main tool of promoting your interests. A lot of aspects of how they’ve protected overseas interests to date over the past 25 years have been fundamentally different than how the United States does it. And so I was very interested when that agreement was signed about what the actual details of those [other] agreements were. Is China preparing to engage in high-intensity combat operations from these bases, or are they more logistics hubs, or [are they] for surveillance and reconnaissance against the United States? That would still not be great, but it would be a different operating concept of how a base structure would fit into overall military strategy than what it is for the United States. And so I actually think that we shouldn’t be discouraging China from having overseas bases, because we’re at such an advantage. China is at an advantage only a couple hundred miles from its coast – 2, 3, 400 if we’re generous – but if they go any farther, we destroy-- we would knock them out of the park. So if all of a sudden China wants to start contesting us militarily in other parts of the world, I recognize that that’s uncomfortable from the perspective of a lot of other countries who are there, but my perspective as a military planner is that this is the way that we maintain our military position. China is just so far behind in its ability to project power to the degree that the United States does that this would give us a significant advantage and a significant ability to impose costs on them in the short term. So I’m not particularly concerned about it. If China does start building these bases, it means that it’s significantly shifted its thinking on military strategy, and I think towards a direction in which they’re trying to directly compete with the United States, and my research shows that whenever they try to directly compete with us, we win every time. So I’m not as concerned about that as I am about how they can be pretty entrepreneurial about exploiting US weaknesses or gaps and competing with us less directly.

As populations age, societies must take into account the nuanced needs of different groups. This is the research domain of Cynthia Chen, who joined the Walter H. Shorenstein Asia-Pacific Research Center as visiting scholar with the Asia Health Policy Program during the 2022 winter and spring quarters. An Assistant Professor at the National University of Singapore (NUS), Chen’s current research focuses on the well-being of older adults, healthcare financing, and the economics of aging. 

Drawing on support from Singapore’s Ministry of Health, Ministry of Education, the U.S. National Institutes of Aging, and the Thai Health Promotion Foundation among others, Chen explores how demographic, economic and social changes affect the burden of care, financing needs, and optimal resource allocation in the future. 

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In a recent talk at APARC, Chen presented findings on gender and socioeconomic differences in aging, exploring the ways in which such society-level characteristics can have major positive and negative effects on the health and well-being of older persons. 

According to Chen, these effects are interconnected with factors including access to effective health care, support systems that enhance function and restrict dependency, and programs assuring financial security and opportunities for older persons to effectively engage in society. “We must move beyond the archaic old-age dependency ratios and metrics, such as GDP, which neglect many of the critical factors that influence societal function,” Chen argued.

Finding Better Metrics for Aging

Gender and socioeconomic differences affect a country's ability to support its older adult population. Specifically, the longevity risk associated with females' longer life expectancy entails different needs between genders in old age. Chen aims to quantify gender differences in the aging experience of Organization for Economic Co-operation and Development (OECD) countries and compare differences in projections of disability and chronic diseases among future cohorts of older adults, including disparities by educational attainment.

In order to gain a more nuanced perspective on aging data, Chen drew data from The Aging Society Index, composed of established and available social and economic measures. The Index provides a quantitative estimate of the degree to which a society is successfully adapting to demographic transformation.

Much of Chen’s time is spent focusing on how to address gender-specific needs when developing policies and programs for aging societies. Chen cites The Network on an Aging Society, which defines a successfully aging society as “one which provides for the general well-being of older adults, is cohesive with minimal tension between generations and major subgroups, productive with opportunities for engagement both within and outside the workforce, and is equitable and secure.” Such society-level characteristics are necessary to understand the difference between successful and unsuccessful policies. 

Chen identifies systemic gender differences across critical domains of successful social aging that favor males. Thus, Chen argues, for many wealth or income-based measures, such as security, equity and productivity, males experience an advantage, which suggests room for improving women’s standing in paid work, job opportunities, and retirement income. One aspect where women do have an advantage is life expectancy. However, they tend to live longer in poorer health, reflected in a lower well-being score. 

Likewise, the gender disparity in cohesion is significantly driven by differences in co-residence rates, which is attributable to women outliving their spouses. These findings suggest that gender-specific needs should be considered when engineering policies and programs for aging societies. 

Varying Rates of Functional Disabilities 

Gender is not the only society-level characteristic that Chen investigates in her resarch on aging. In a recent study, published in Asian Development Review, Chen and her co-authors, including AHPP Director and FSI Senior Fellow Karen Eggleston, shed light on the dynamic evolution of the health and functional disparities of the future elderly.

In order to understand the differences in aging and its relationship with functional disabilities across multiple societies, Chen looked at data from Korea and Singapore. While the two nations have a similar pace of aging, they differ in the rate of increase in functional disability and chronic diseases. This may be due to many factors, including diet, lifestyle, and cultural differences, Chen suggests. Most notably, older adults with high educational attainment are projected to have a lower prevalence of functional disability and chronic diseases, and consistent across gender in both Korea and Singapore. 

The study employs a new model to compare projections of functional status and disability among future cohorts of older adults, including disparities in disability prevalence by educational attainment. These changes will have important implications for social protection systems, including the financing and delivery of long-term care and health care. The study highlights potential differences in the aging experience by gender and education in each country to inform social and healthcare policy and provides a common platform for international comparison to identify and compare challenges across countries.

Studying aging and effective medical care in late adulthood, especially with an eye for society-level characteristics, is an urgent task. Chen’s research complements the existing literature on life-protection activities, further underscoring the importance of investment in healthy aging and control of chronic disease so that the future elderly may receive appropriate care.