Laozi, shi and Chinese strategy

The Art of Not Acting: China, the Shì and the Invisible Form of Global Power

Sunzi, Guiguzi and Laozi in the face of structural power: Chinese strategy in the twenty-first century.

"视不可见,听不可闻,而得其情。"
Observe what is not seen, hear what is not heard: and thus grasp the inner truth of the other.
— Guiguzi, Probing Chapter (揣篇)

1. Personal Introduction
2. Situational Strategy and China
3. The Shì in Action: China and the Power of Structural Arrangement
4. Guiguzi in Davos: Structural Diplomacy in the Industrial Age
5. The Dao of Order: Hegemony Without Hegemony
6. Conclusion: when the void reconfigures the whole
7. References
8. Table of strategic sinograms used

Sinograms and strategy

1) Personal Introduction

兵者,诡道也
War is the way of deception. Sunzi, The Art of War, Ch. 1

My interest in Chinese strategic thinking began a few years ago, and it was the starting point for a course I taught on The Art of War at the Confucius Institute. What at first appeared as a military treatise soon revealed itself to be something much deeper: a philosophy of indirect power, of control through form, of effectiveness without violence.

That first contact with Sunzi led me to explore other fundamental texts: the Guiguzi, attributed to the ghost master of political rhetoric, and Laozi's Dao De Jing, with its radical idea of acting without acting (wú wéi 无为).

Over time, I understood that these texts were not philosophical relics or museum pieces, but instruments for reading the present. And few pieces illustrate this relevance as accurately as the recent article published in Foreign Affairs by Michael B. G. Froman, entitled:
“China Has Already Remade the International System.”

“善者因之,其次利道之,其次教诲之,其下与之争”
The wise adapt to circumstances. The one who follows, channels them. The mediocre teaches them. The fool fights them.

2) Situational Strategy and China

In his article, Froman puts forward a thesis that is as provocative as it is difficult to refute: the international order is no longer being defined by the liberal principles of the West, but by China's state and strategic logics. Contrary to the expectations that dominated Western political thought since the 1990s that integrating China into the global system would make it a liberal democracy "with Chinese characteristics" the opposite has happened: it is the West that has begun to adopt Chinese practices.

This change was not the result of an imposition. Beijing did not force Washington or Brussels to copy its model. What happened was more subtle, more profound: through massive subsidies, selective protectionism, long-term industrial planning, and a nationalist economic narrative, China redesigned the material conditions of the global system. In this way, its logics became not only visible, but inevitable.

Instead of liberalizing, China deepened its state control over key sectors: electric cars, batteries, steel, aluminum, green technologies. It did so with such efficiency that, today, it dominates more than 60% of the global electric vehicle market and more than 50% of the world's steel production. Faced with this reality, both the United States and Europe have been forced to abandon their discourse of free trade and regulatory neutrality, adopting instead industrial policies of clearly Chinese inspiration: strategic subsidies, trade restrictions, selective tariffs, and controls on foreign investment.

The effect, Froman points out, is clear: the world economic order already operates with "Chinese characteristics," even if formal hegemony remains, for now, in the hands of the United States. Power no longer resides in the rulewriter, but in the one who shapes the structural conditions under which those rules cease to matter.

Guiguzi would have recognized in this dynamic something familiar: the wise do not dispute the course of the river, they channel it. Real power does not resist circumstances: it turns them into its channel.

"善战者,致人而不致于人。"
The great strategist makes others move, without being the one who moves.
Sunzi, The Art of War, Ch. 6

3) The Shì in Action: China and the Power of Structural Arrangement

The concept of 势 (shì), commonly translated as "situational potential" or "energy of disposition", is one of the central axes of strategy in The Art of War. For Sunzi, victory is not achieved by brute force or direct confrontation, but by configuring the environment in such a way that victory becomes inevitable before the conflict begins. It's not about pushing the enemy, but about shaping the terrain so that the opponent is forced to move according to your design.

This notion finds its most precise and effective contemporary expression in China's structural behavior in the international system. The Foreign Affairs article we have been analyzing shows how, far from disputing global leadership through open confrontation, China redesigned the material and strategic conditions of the world order—forcing other powers, especially the United States, to move according to a logic set out in Beijing.

The shì of China did not manifest with tanks, but with
"审其所欲,逆而导之。"
Scrutinize what the other desires, and gently guide him to the opposite.
Guiguzi, Internal Persuasion Chapter

4) Guiguzi in Davos: Structural Diplomacy in the Industrial Age

If The Art of War is the supreme treatise on how to win without fighting, then Guiguzi is the art of getting the other to act according to your interest, believing that he is doing so on his own initiative. While Sunzi deals with the layout of terrain and armies, Guiguzi attributed to the mythical "Sage of the Valley of Demons" (鬼谷子) deploys a theory of influence based on reading desire, manipulating expectations, and modulating the discursive environment.

The epigraph that opens this section is one of its most striking elements: the strategist does not confront the desire of the other, but takes it as a starting point. He does not grant what the other wants, but uses it as bait to gently guide him toward a different, more useful goal for his own purposes. The interlocutor is not forced, but accompanied with surgical precision. Desire functions as a strategic compass.

This is precisely what happened with China's insertion into the global economy: Western powers entered the Chinese game voluntarily, driven by incentives that seemed rationalaccess to markets, growth, stability. But once inside, the framework was subtly shifted: implicit rules, soft constraints, technological dependency, and mobile regulations.

Guiguzi would have explained it like this: the fish was not caught by force, but attracted by bait made to measure. The hook was not visible; it was hidden in the form of desire.

One of Guiguzi's most potent contributions and one that no modern text on strategy can match—is his understanding that persuasion does not occur on the logical plane but on the emotional and symbolic plane. The discourse does not convince: the environment persuades.

Beijing never said: "Follow our model." Instead, it said: "Do you want development, market, stability, predictability?" and then: "Perfect, play on our court."

But that court had invisible rules:
• Covert technology transfer.
• Conditional access to sensitive sectors.
• Political neutrality as the price of entry.
• Logistic dependence as a structural by-product.

Western corporations accepted these conditions not because they were imposed, but because desire pushed them more than rational analysis. Exactly as Guiguzi taught more than two thousand years ago: the secret is not in imposing, but in having the other perceive your interest as if it were their own.

Froman highlights a monumental irony: the United States, which for decades denounced Chinese "state capitalism," has come to emulate it. Today, Washington offers:
• Massive subsidies to strategic sectors (CHIPS Act, IRA).
• Prohibitions on key technological exports.
• Industrial programs with medium-term state planning.

Imitation? Not exactly.
What Guiguzi would have said is: structural conditioning.
China did not persuade the U.S. with speeches, but with fait accompli. It did not win an argument—it made the environment speak for it. Beijing did not change the adversary's mind; it changed the conditions that made certain decisions inevitable.

"不争而善胜。"
Without contending, one wins skillfully.
Dao De Jing, Ch. 68

5) The Dao of Order: Hegemony Without Hegemony

Laozi's phrase at the top of this section, "not to contend, and yet to win", is the most elegant condensation of a profoundly counterintuitive idea: the most effective power is the one that is not exhibited as power. It is the philosophical culmination of a logic other than confrontation—a strategy of detachment, emptiness, and invisible influence.

Unlike Sunzi, who still operates in the realm of conflict and disposition, or Guiguzi, who transforms the other through the architecture of desire, Laozi proposes a form of power that does not need to resist because it does not need to impose itself. It is not a matter of not acting, but of acting without friction, without fixed form, and without leaving a trace. It is the logic of wú wéi (无为): not to do, and yet to do everything.

This paradox expresses an idea that is as political as it is ontological: truly powerful action is that which does not need to be recognized as action.

The leader who rules without governing, the sage who transforms without intervening, the strategist who influences without commanding: they all practice the Dao.

There was no "battle" for hegemony. There was only movement.
And now the world moves with it.

China did not try to defeat the West. It didn’t need to.
It simply occupied the available structural space:

Where there was a vacuum in manufacturing, it flowed.
Where there was a lack of investment in infrastructure, it was present.
Where strategic minerals were scarce, it extended networks of extraction and refinement.
And where it found ideological rigidity or institutional arrogance, it responded with usefulness, adaptability, and patience.

The result is visible, although it is rarely mentioned: the world does not depend on China for ideological affinity, nor for military force, but for structural functionality.
Not because it was convinced, but because it can no longer function without it.

That is not domination.
That's water.
That's Dao.

6) Conclusion: when the void reconfigures the whole

If there is one constant in Chinese strategic philosophy, it is the conviction that true victory is not achieved in conflict but in its prefiguration.

The battle is only the surface.
Confrontation is merely a residue.
Real war is fought first in the invisible—in the arrangement of the environment, in the formation of desire, in creating conditions that make the outcome emerge by itself.

That is what Sunzi calls shì: the slope that rolls the rock.
What Guiguzi codifies in his reading of the heart of others: desire as a guiding force.
And what Laozi turns into an ontological axiom: the soft conquers the hard, the unacted transforms the real, the empty orders the world.

The West's most persistent mistake has been to read events as a power struggle between two models. But one of them no longer struggles.
China is not seeking to replace twentieth-century-style U.S. global leadership.
You don't need to.
Its logic already structures other people's decisions: from how an electric car is subsidized in Detroit to how lithium networks are drawn in South America.

It is not domination.
It is disposition.
It is not a mandate.
It is form.
And where there is form, there is shì.

7) References

Sunzi (孙子). Sunzi Bingfa (孙子兵法) El Arte de la Guerra
Autor: Sunzi (tradicionalmente atribuido a Sun Wu)
Fecha aproximada: siglo V a.C.
• Edición consultada: Cleary, Thomas (1991). The Art of War. Shambhala Publications.

Guiguzi (鬼谷子) — El Maestro del Valle de los Demonios
Autor atribuido: Guigu Xiansheng (鬼谷先生), nombre legendario del maestro Wang Xu
Fecha estimada: siglo IV–III a.C. (período de los Reinos Combatientes)
• Edición consultada: Cleary, Thomas (2000). The Book of the Master of the Ghost Valley. Samurai Media.

Laozi (老子). Dao De Jing (道德经) — El Libro del Camino y la Virtud
Autor tradicional: Laozi (老子), también escrito como Lao Tzu
Fecha aproximada: siglo VI–IV a.C.
• Edición consultada: Henricks, Robert G. (1989). Lao-tzu: Te-Tao Ching. Ballantine.
• Froman, Michael B. G. (2025). “China Has Already Remade the International System.”
Foreign Affairs, Jan/Feb 2025 Issue. Council on Foreign Relations.

8) Table of Strategic Sinograms Used

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Source: Own elaboration