Sat, Apr 18, 2015 - Page 9 News List

The mutual misunderstandings at the heart of US-China ties

While Beijing has its work cut out battling free speech, dissent and corruption, the US is focusing on innovation to once again become the workshop of the world

By Thomas Friedman  /  NY Times News Service, New York

While US-Iran relations are taking up all the oxygen in the room these days, and they are vitally important for the future of the Middle East, US-China relations are vitally important for the world — and there is more going on there than meets the eye. The concept of “one country, two systems” was invented to describe the relationship between Hong Kong and China.

However here is the truth: The US and Chinese economies and futures today are now totally intertwined, so much so that they are the real “one country-two systems” to watch. After recently attending the Boao Forum for Asia on China’s southern Hainan Island, and hearing Chinese President Xi Jinping (習近平) speak, what is striking is how much each side in this relationship currently seems to be asking the other, “What’s up with you?”

Both countries almost take for granted the ties that bind them today: the US$600 billion in annual bilateral trade; the 275,000 Chinese studying in the US and the 25,000 US citizens studying in China; the fact that China is now the US’ largest agricultural market and the largest foreign holder of US debt; and the fact that last year Chinese investment in the US for the first time exceeded US investment in China.

However, dig underneath and you find these two systems increasingly baffled by the other. Chinese officials still have not gotten over their profound shock at how the US — a country they took as an economic model and the place where many of them learned capitalism — could have become so reckless as to trigger the 2008 global subprime mortgage crisis, which started the trope in China that the US is a superpower in decline.

Chinese officials were also baffled by an effort by US President Barack Obama’s administration to resist China’s establishment of the Asian Infrastructure Investment Bank, by lobbying the US’ biggest economic allies — South Korea, Australia, France, Germany, Italy and Britain — not to join. While US Secretary of the Treasury Jack Lew kept saying publicly, and responsibly, that the only concern of the US was that the bank operate by international standards, other Obama officials actively pressed US allies to stay out.

Except for Japan, they all snubbed Washington and joined the Chinese-led bank. The whole episode only empowered Beijing hardliners who argue that the US just wants to keep China down and cannot really accommodate it as a stakeholder.

Americans, though, are asking of Xi: “What’s up with you?”

Xi’s anti-corruption campaign is clearly aimed at stifling the biggest threat to any one-party system: Losing its legitimacy because of rampant corruption. However, he also seems to be taking out potential political rivals as well. Xi has taken more control over the military, economic and political levers of power in China than any leader since Mao, but to what end — to reform or to stay the same?

Xi is “amassing power to maintain the [Chinese] Communist Party’s supremacy,” said Willy Wo-Lap Lam (林和立), the author of Chinese Politics in the Era of Xi Jinping: Renaissance, Reform or Retrogression? Xi “believes one reason behind the Soviet Union’s collapse is that the party lost control of the army and the economy.”

However, Xi seems to be more focused on how the Soviet Union collapsed than how the US succeeded, and that is not good. His crackdown has not only been on corruption, which is freezing a lot of officials from making any big decisions, but on even the mildest forms of dissent. Foreign textbooks used by universities are being censored, and blogging and searching on China’s main Internet sites have never been more controlled. Do not even think about using Google in China or reading Western newspapers online.

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