Editor's note: Trade tensions have been escalating between China and the U.S. in the past weeks, fueling concerns that a trade war could be looming in the horizon. CGTN argues that the co-dependent nature of Sino-U.S. relations acts as a buffer against such a bleak future.
From Beijing to Berlin, from Washington to Wellington, workers, traders, investors and consumers are wondering if a trade war is looming between China and the U.S., dragging the whole world towards darkness.
We don’t know. But we know it takes enemies to fight a war. Are America and China enemies now? Let us go back 40 years. In the 1970s, when China reconnected with the world, America opened its arms, providing money, technology and talents to a fragile newcomer. By 2016, the trade surplus in favor of China had jumped from zero to $347 billion. That was a big problem!
The trade imbalance is really an issue of structure. Both America and China are flawed. In Aesop’s fables, there is the story of the blind and the limp. They forge a partnership to help each other. The limp shows the direction and the blind does most of the walking. The U.S. is the limp, relying on cheap goods and credit from China to maintain the American way of life. And China is the blind, making products and saving money to keep its momentum of growth. The partnership worked well – until it didn’t. China over-made and America overspent. They both need to adapt.
Change is happening, but in different ways. The blind knows he needs to spend more and make fewer, but better, goods. China has been shifting to consumption and innovation-driven growth. That is why technology and talent are coming to its shores. You can argue whether some practices are helped by the government. But there is no denying technology will go with the flow to the most needed, and right now it is increasingly on the west side of the Pacific with a behemoth supply train, highly developed infrastructure, well-trained labor and the biggest consumer market converge.
The limp, however, has had some trouble adjusting. Economically, America needs to consume less and make more. But the limp has been relying on the blind for too long. Easy credit and cheap goods are addictive. The current trade structure benefits American companies but not American workers. This is a design invented by America and it can only be reinvented by America. It would probably take the vision and courage of a politician like FDR to remake the American economic model. Trumping foreign competitors will not re-industrialize the U.S. It would take retraining, infrastructure investment and re-energizing the can-do spirit of early immigrant forefathers. But that is the hard way. Trump chooses the easy one. Strong-arming its partners and browbeating its opponents.
Trump is not trying to win the economic game, he is simply trying to win the argument. Winning the argument means winning votes. Politics trumps economics, but what goes around comes around. Economics will reign and take its revenge. Until America is serious about changing its economic structure, the trade imbalance will remain. The limp would be better to act immediately and do something really smart.
But for now, the two flawed partners need to cool down and talk straight. Both are imperfect and both are hopeful nations. China is gaining strength, but needs better vision. America wishes to balance the feet, but must not lose focus.
For the foreseeable future, China and the U.S. will cooperate willingly or not. To reinvent Churchill’s words, cooperation is the worst form of relationship except for all the others. The Blind and the Limp can be better, but only while they still have faith in each other.
Let us end with a line written by a Chinese writer toward the end of the Great Depression:
渡尽劫波兄弟在,相逢一笑泯恩仇
A warm hand is always better than a cold shark.
Animation: Zhang Tao
Video photographer: Huang Yichang
Editing: Wu Chutian
Copyright © 2018 CGTN. Beijing ICP prepared NO.16065310-3
Copyright © 2018 CGTN. Beijing ICP prepared NO.16065310-3