The title is a trillion-dollar question begging for an accurate and complete answer. If we had a clear understanding of this question, the U.S. and China might be able to continue their Chimerica era with mutual benefits creating a complimentary prosperous economy for both countries and the world. However, this question is a complex one that so far no one can offer a clear answer without being influenced by ideological biases in each political system. After all, any economic development is highly dependent on the political system it operates under. The U.S. and China are two great nations with drastically different histories and cultures and more critically different political systems. However, though the question is hard to answer with a clear, logical, and systematic analysis (to put it in an economic and political model), the author believes it is possible to collect all known tidbits about understanding and answering the title question. It is critically important for us to try to answer this question so we may stop the two nations on the parting track, reversing a hostile competition to friendly cooperation. We must admit that if the U.S. and China could pursue a complementary and cooperative economy, the results will be beneficial to both American and Chinese people and the world. In the following, we will analyze the question in two parts, one, why did the U.S. and China cooperate well in the past, and second, what caused the two nations to part ways. We will list all known facts together to get a feel for the question. Depending on one’s knowledge and experience about China and the U.S., we may form an opinion on the two-part question. With that, we may then proceed to formulate an answer to the trillion-dollar question.
Here is my collection of facts:
I. Why can the two different systems (the U.S. and China) cooperate (in the past)?
- When two objectives have little conflict
- China’s strategy is to create a favorable competitive environment for the nation with an extremely flexible system to attract foreign investment to pull up its economy.
- China needs to create millions of jobs for its people. With little capital and technology, China must leverage its people, labor, and market.
- When the U.S. has both capital and technology and needs cheap labor and market
- The U.S. believes in free competition and capitalism only under favorable conditions.
II. Why do the U.S. and China part their ways?
- When China was developed gaining both capital and technology
- When the U.S. runs out of ways to exploit obsolete or other nations’ non-critical technologies and faces capital and technology competition to win investment opportunities.
- When China keeps modifying its systems and methods to face the changing world and its development rise and when the U.S. slows down in advanced technology development and has less technology to trade for markets.
- When China’s labor advanced in skills and knowledge
When China keeps modifying its systems and methods to face the changing world resulting in its development.
The U.S. was used to leading the world in technologies and setting the rules but was not accustomed to adapting and reacting to changes. This explains why the U.S. denies Huawei’s 5G internet technology and applies technology sanctions to China. But the sanctions are hurting both nations, especially with advanced technologies still led by the U.S. China’s market has been transformed rapidly to accept advanced technology products. Sanctioning advanced technology products from exporting to China essentially will suffocate the growth of U.S. advanced technologies.
After examining the above facts, we may understand the title question. This author believes that parting separate ways with China is not a solution but a copout. The smart way is to seek cooperation to find win-win development. The U.S. has far more resources than China does. China has more population which can be a burden or an asset depending on how China plots its economic development plan. Being a cooperative partner has all the advantages over being a rival parting with a rising China.