On August 4, 1945, the Soviet Union announced the establishment of the German Democratic Republic in the German territories under its control.

The news sent a shockwave through Europe. The nations of the East—Hungary, Bulgaria, and Yugoslavia—beheld the Soviet Union’s blatant attempt to challenge China for dominance on the continent and felt a wave of relief. Had Hungary not succeeded in drawing Chinese power into Eastern Europe before the Soviet occupation, these three nations would likely never have escaped being playthings of the Kremlin.

In Western Europe, the reaction was a mix of shock and delight. The prospect of a direct Sino-Soviet confrontation offered the West a chance for greater strategic breathing space. Yet they also realized that the Soviet offensive posture threatened to turn the continent into a battlefield once more. At the thought of Chinese and Soviet armored divisions clashing on Western European soil, a chill ran down many a spine.

The Soviet move also triggered alarm among the mid-to-high-level Chinese cadres who monitored the USSR. Amidst the surprise, Li Runshi published an article in the National Daily titled *The Difference Between Advance and Retreat in Eastern and Western Cultures*.

In the piece, he argued that in Western culture, taking a defensive posture is regarded as a retreat—and retreat is largely synonymous with failure. In Chinese culture, however, taking a defensive stance signifies "stability." And stability, in the Chinese context, often implies initiative and victory.

Following this analysis, Li wrote: "...In summary, it is likely that the Soviet leadership regards security as its highest-priority issue at present.

"In reality, the nations of Africa, Asia, and Latin America are secure. The former threats of war have been eliminated. Most of the world’s nations are concentrating their primary energy on domestic economic construction.

"From the perspective of Western culture, the Soviet actions are entirely unproblematic. Yet this view deviates significantly from the mainstream trend of global peace and development. Peace can achieve the greatest security, but the pursuit of security does not necessarily promote peace.

"China will devote every effort to the maintenance of world peace. This is our ideal, and it is the path most beneficial to our nation."

Stalin was incensed as he read the article. He finished it and immediately hurled the translation aside. He was consumed by displeasure; he knew He Rui had regarded Russia as too backward to even comprehend a higher level of civilization. Now He Rui was finally dead, yet his successor, Li Runshi, was singing the same tune—viewing the Soviet Union with the same condescension.

But despite his anger, Stalin had to admit that Li's mockery of Western civilization contained more than a few kernels of truth. The Soviet Union was indeed preoccupied with security once more. China was immensely powerful; not only did it possess its own ten-million-man army that had hammered the Great Powers into submission, but it also commanded nearly ten million allied troops tempered by the fires of war.

As the global situation stood, the combined strength of the West and the USSR was no match for the Chinese bloc.

Stalin pondered over his pipe for a moment. He felt he might have to continue applying pressure to Beijing. He loathed Li Runshi’s attitude, yet he knew the man spoke the truth: in a position of superiority, China was unlikely to initiate an offensive.

In Stalin’s view, as long as the USSR did not attack China directly, Li Runshi would not launch a military strike against them. There was vast room for maneuver between open conflict and their current relationship. So long as he didn't cross the line, the USSR could continue to stir up trouble.

Having settled on a direction, Stalin issued a requirement at the next day’s Politburo meeting: rapidly arm Romania and have them apply pressure along the line of control with Hungary.

During the war, Hungary had retaken much of the territory it had lost after the first war. However, under Chinese pressure, they had limited themselves to areas where Hungarians formed the majority of the population.

This state of affairs left Romania profoundly uneasy. The Soviets informed the current Romanian administration that if China were allowed to dominate the situation, Romania would likely lose even more territory. This was Romania’s greatest fear. The Hungarian lands they held had not been won by their own strength but had been gift-wrapped by the Allies.

With the lessons of history fresh in their minds, the Romanians believed that a single line drawn by the Chinese on a map of Europe could strip them of vast swaths of land—territory far more extensive than what they had taken from Hungary.

The leadership in Beijing was displeased to hear of the outbreak of conflict between Hungary and Romania. They understood the Soviet hand behind the scenes, but that a small nation like Romania would be foolish enough to act as a pawn was a nuisance for China.

They looked to Li Runshi, who appeared remarkably composed. "Comrades," he smiled, "struggle never ceases. Even if it does not erupt in the form of war, it persists in other modes. And the more sufficient the struggle, the more thorough the eventual solution.

"The Soviet Union’s current understanding of the world is flawed. Only through constant struggle will they have the chance to truly progress to a comprehension of a higher level of civilization."

While the leadership found his assessment satisfying, they waited for a more actionable plan.

Li was not a man for hollow talk. Having laid the theoretical groundwork, he continued: "In the Nuremberg trials, the verdict for Italy is nearing completion. Once it is delivered, we shall provide Italy with a series of industrial orders."

The remark triggered a diverse set of reactions among the economic cadres. Those focused on the domestic economy looked concerned; after all, giving orders to Italy meant fewer for Chinese factories. Instinctively, they saw it as bad news for local industry.

However, the comrades tasked with building the international economic order were thrilled. America, the USSR, and Europe were vital components of the global economy. An order that excluded them would be an incomplete system.

Hungary, Bulgaria, and Yugoslavia had already signed economic cooperation agreements with China, cooperating fully with investigations into their domestic industrial enterprises. China had already begun placing orders with them.

China currently controlled the economies of Asia and Africa and could satisfy their demands. It also met a significant portion of the trade needs of South and Central America. But Hungary, Bulgaria, and Yugoslavia were far closer to North Africa than China was. If they produced goods to Chinese standards, their transport costs to Africa would be significantly lower than China’s.

If a scientific economics existed, the most efficient utilization of productivity should be its primary pursuit.

Furthermore, drawing more nations into the Chinese-led system would only make that system more robust. While Hungary, Bulgaria, and Yugoslavia were not major European powers, they collectively possessed a population of some thirty million. Such a market and labor pool held significant value.

The officials handling the international order had no wish for war with the Soviets, yet they would never compromise on the principles of that order.

The Minister of Commerce asked, "Chairman, should we exclude the Soviet Union from the GATT system we are establishing?"

Li Runshi shook his head. "Do you think the Soviet Union would choose to join GATT according to the model we have established?"

GATT was not an unequal treaty intended to force weak nations to open their markets; it was the foundation of the entire international trade system. Li's words left many of his comrades confused.

But Li was certain, based on his discussions with He Rui. High-level struggle was his forte; the lower the stakes, the less he felt motivated to excel. He loathed the levels of discourse filled with human malice. He simply lacked the internal drive to "kill in all four directions" in such a base arena.

In a world where many were happy to wallow in the muck, Li might have the capability, but he was not that kind of man.

Back in the realm of high-level struggle, however, he was in his element. He explained to his comrades: "The Soviet Union, like us, seeks to remain autonomous and self-centered. Their natural resources support such a desire. But their population is insufficient, and their climate dictates that their light industry cannot compete with nations in temperate zones. Their inherent refusal to be subject to others means they cannot accept a global division of labor they do not lead.

"So long as Stalin remains in power, the USSR will not join GATT. Instead, they will attempt to create a Soviet-led equivalent. We would prefer they join us, but we lack the capability to force them into a system we dominate."

The final sentence brought a knowing smile to many faces. Indeed, the USSR was a Great Power, and China had no intention of a military conflict. As a sovereign state, the Soviet Union was free to determine its own economic policies.

Leadership made the decision, and the task fell to those skilled in execution. Many of these officials had risen to their positions through excellence in their specific fields. In private, they might be elegant or even kind, but in the performance of their duties, many were ruthless and would not stop until their objectives were met.

The working levels of several departments coordinated. First, the Foreign Ministry expressed to the USSR its "displeasure" regarding the conflict between Romania and Hungary.

Before the Soviets could respond, the Ministry of Commerce followed up with a suggestion that the USSR join the World Trade Organization (GATT).

In the highest levels of Chinese strategic thought, these two matters were related, but in execution, they were handled as distinct issues. China played a "single game of chess" but dealt with matters one by one.

The Soviet Party, however, did not see it that way. To them, receiving two such communications in short order—one minor, the second concerning the entire direction of the Soviet economy—implied a profound link.

The matter was discussed within the Party, yet no one dared reach a conclusion. Since 1921, foreign trade had been Stalin’s personal domain. His "Socialism in One Country" policy had leveraged Sino-Soviet trade to obtain the technology and equipment required for the Soviet Union’s meteoric rise.

Consequently, this field was a source of his personal prestige. To execute Comrade Stalin’s correct leadership in trade was expected; to decide trade policy was something even Kirov dared not do.

After much deliberation, Stalin finally decided: they would not join the Chinese-led GATT for the time being.

When Li Runshi’s prediction was verified, the respect his comrades held for him grew another notch. A National Chairman’s role was to point the direction, and Li’s judgment had proven superior to their own.

Li, however, had already set the matter aside. His attention had moved to the establishment of European blocs. At this stage, a "European Union" was neither feasible nor necessary. He hoped to see a Western Europe that took the initiative to form a Coal and Steel Community, while Eastern Europe formed a security cooperation system.

This would create a "European Triangle": the West, the East, and the USSR. China would only need to exert minimal force to keep this triangle from collapsing.

The level of European civilization was not high, yet in the arena of struggle, they were well-versed. So long as China genuinely desired peace on the continent, the European nations would be eager to invite this extra-regional power to participate in their affairs.

He Rui had once remarked on this phenomenon: "This is Europe’s new slave thinking."

The comment was biting, yet accurate. In his heart, Li Runshi was intensely curious to see just how far Europe would develop under such conditions.