acemoglu65_Que HureVCG via Getty Images_chinese factory

Economics

El verdadero problema de Estados Unidos con China

Nov 6, 2023 Daron Acemoglu and Simon Johnson

BOSTON – En lugar de asumir que un mayor comercio internacional siempre es bueno para los trabajadores estadounidenses y la seguridad nacional, la administración del presidente estadounidense Joe Biden quiere invertir en capacidad industrial nacional y fortalecer las relaciones de la cadena de suministro con países amigos. Pero por muy bienvenida que sea esa reformulación, es posible que la nueva política no vaya lo suficientemente lejos, especialmente cuando se trata de abordar el problema planteado por China.

El status quo de las últimas ocho décadas fue esquizofrénico. Si bien Estados Unidos siguió una política exterior agresiva (y a veces cínica) consistente en apoyar a dictadores y, en ocasiones, diseñar golpes de estado inspirados por la CIA, también abrazó la globalización, el comercio internacional y la integración económica en nombre de generar prosperidad y hacer que el mundo fuera más amigable con Estados Unidos. intereses.

Ahora que este statu quo se ha derrumbado efectivamente, las autoridades deben articular un reemplazo coherente. Con ese fin, dos nuevos principios pueden formar la base de la política estadounidense. Primero, el comercio internacional debe estructurarse de manera que fomente un orden mundial estable. Si la expansión del comercio pone más dinero en manos de extremistas religiosos o revanchistas autoritarios, la estabilidad global y los intereses estadounidenses se verán afectados. Tal como lo expresó el presidente Franklin D. Roosevelt en 1936, “la autocracia en los asuntos mundiales pone en peligro la paz”.

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Daron Acemoglu

Writing for PS since 2012
69 Commentaries

Daron Acemoglu, Institute Professor of Economics at MIT, is a co-author (with James A. Robinson) of Why Nations Fail: The Origins of Power, Prosperity and Poverty (Profile, 2019) and a co-author (with Simon Johnson) of Power and Progress: Our Thousand-Year Struggle Over Technology and Prosperity (PublicAffairs, 2023).

Simon Johnson

Writing for PS since 2007
171 Commentaries

Simon Johnson, a former chief economist at the International Monetary Fund, is a professor at the MIT Sloan School of Management, a co-chair of the COVID-19 Policy Alliance, and a co-chair of the CFA Institute Systemic Risk Council. He is the co-author (with Daron Acemoglu) of Power and Progress: Our Thousand-Year Struggle Over Technology and Prosperity (PublicAffairs, 2023).

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0 Comments on this paragraph, 14 Comments on this article

rmdgarfias Nov 18, 2023

Great article professor. Do you think Hayek and Friedman were wrong about this topic too??
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FAWAZHF1059 Nov 16, 2023

A very confusing article , a lethal mix of colonial spirit, poor / selective economics / failure to capture time scale . It reflects badly on your eralier works.
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Mad Sarmatian Nov 8, 2023

It seems silly to toss about the "democracy vs. authoritarian" line as if it isn't some warmed over half-penny political trope. Ask any conservative (and also many a liberal) and they'll be happy to tell you the US is no democracy at all, but is a republic. Ask political scientists, such as Martin Gilens and Benjamin Page, and that will show you that the US is an oligarchy. But no, here are some economists insist on their two dimensional view of politics and they can't do anything but regurgitate the Manichean world view: "we are light [democracy] and they are darkness [authoritarianism], and are at eternal war until we, the children of light, prevail."

I think people who simply cannot live peacefully with those which they disagree are at the top of the pyramid of the world's problems. And that includes everyone, including economists, who see China as a "problem" that needs solving.
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Tom Pool Nov 8, 2023

It's indeed very sad to see these two prominent economists resorting to distortion of facts to make their arguments. Have there been cases of worker abuse in China? Yes, but the workers have probably been better protected in China than many other developing countries that are categorized as democracies and in the US during the initial growth stage in the 19th and early 20th century. The authors cannot even acknowledge well-known facts and statistical data about how China initially specialized in low-end manufacturing and invested heavily in education and infrastructure (both hard and soft) to catch up with the West rapidly. China’s development can be explained very well by theories of international trade (comparative advantage and infant industry argument) and institutional economics, in which the two authors are well versed.

I have no problem with the authors arguing for policies of economic nationalism. Dani Rodrik has also made a well-justified argument for economic nationalism and suggested ways to do it right in his recent article "Doing economic nationalism the right way". Both of these authors have written insightful essays before, and I hope they will avoid such obvious distortion of facts in their future essays.
- Mad Sarmatian Nov 8, 2023
  
  Yes. Not to mention how utter ridiculous it is the blame China for US companies moving all our jobs there. I think it is very the very definition of ideological blinders.
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Godfree Roberts Nov 8, 2023

It is sad to see two such prominent economists making simple errors of fact about China. Three stand out:

1. "China owes its “comparative advantage” in manufacturing to repressive institutions. Chinese workers have few rights and often labor under dangerous conditions, and the state relies on subsidies and cheap credit to prop up its exporting firms”. None of this is true. With 72% union participation, workers have doubled their wages every decade since 1980, get three weeks paid vacation, stronger health and safety rules than many US states. Exports are not a major element of China's economy, compared to Canada or Germany.

2. "China’s trajectory does not bode well for the future. It may not be a pariah state yet, but its growing economic might threatens global stability and US interests”. Far from being a pariah, it is the world center for diplomacy and development, as the recent BRI convention illustrates.

3. "Contrary to what some social scientists and policymakers believed, economic growth has not made China any more democratic (two centuries of history show that growth based on extraction and exploitation rarely does)”. China, by the testimony of its own people and by any objective measure, is vastly more democratic than the US.
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Peter McLoughlin Nov 7, 2023

China is challenging US global hegemony in the same way America become the planet’s major superpower after 1945. The pattern of history is clear: if the US wants to maintain its position it has no choice but fight China – world war. Leaders will say the crisis will not end in conflict. But this reasoning ignores a simple historic truth: every great power has eventually faced the war it was trying to avoid – nothing has changed. And unless it is, humanity’s fate is sealed.
https://patternofhistory.wordpress.com/
- Colin Haller Nov 8, 2023
  
  This is a recipe for disaster. Hopefully, saner leadership will prevail.
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vic lai Nov 7, 2023

To me, America's real China problem is that, she currently could hardly use the same methods that she had successfully employed to fully subdue quickly-chasing-and challenging Japan in the past 3 decades, to similarly fully subdue today's quickly-chasing-and-challenging China in the foreseeable future.
Other more innovative methods have to be invented by the US's cooperating bi-partisan politicians and Congress people to fully remove their current non-disappearing "China Syndrome."
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(i) The US had succeeded in stopping then-world-leading Japan to further develop her ICT semiconductor industries starting in the 1980s, but today she has seemingly failed, at least up until today, to stop world-leading Huawei's coming further innovative 5G-et-al technological breakthroughs.
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(ii) While the US had also succeeded in cultivating nearby South Korea (think Samsung) and Taiwan (think TSMC) to almost fully replace Japan's then relatively nascent ICT-related semiconductor industries, she has yet to succeed in similarly doing the same to China, and may probably fail to do so this time around, considering say Huawei's latest seeming chips breakthrough.
This is because,
(a) unlike that of Japan, China's own vast domestic markets (which is perhaps even bigger than that of the US, and will become more so in the coming years) will still remain big enough in the future to enable China herself to further set more and more of the future global standards (think that of say 5G, 6G, and IoT) governing the world's coming ICT technological developments, and
(b) China's vast western provinces, equipped with good infrastructure facilities and cheap energies like that in the middle and eastern provinces, will be able to compete with almost all of the friend-shoring EM countries deliberately assisted by the US to help offshore, and hence de-industrialize, more and more of China's low- and middle-end industries.
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(iii) Unlike Japan which has always been relying on the US's military bases in her country to help guard against the potential military invasions from her nearby enemy countries (like Russia, North Korea, and China), today's China is fully militarily independent herself.
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(iv) Owing to China's strict capital (outflow) controls, her still-vast remaining FX reserves, and point (iii) just mentioned, today's US could hardly enact Plaza Accord II in the near future to similarly force China to revaluate her yuan en masse vis-a-vis the US dollar in a single big step.
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- vic lai Nov 7, 2023
  
  (v) Above all, unlike then Japan, starting in the early 1980s and especially in the 1990s and thereafter after "history had ended" immediately following the demise of the USSR Empire in early 1990s, who, under the influence of then US, had mostly forsaken
  (a) her good old say MITI-directed industrial policies, and
  (b) Bank of Japan's proven-to-be-highly-successful window-guidance policies (first originated in Germany) for the country's commercial banks,
  today's socialist China has mostly been immune to the now-seemingly-dying rightist and market-fundamentalist Neoclassical (and Austrian) School and Washington Consensus that had been so globally popular and dominant in the past (pre-GFC) decades.
  Those western hands-off economic views therefore could no longer fool today's China into quickly forsaking the use of her good old top-down industrial and central-banking policies to keep on developing quickly and successfully her domestic economy in the coming years.
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  - vic lai Nov 7, 2023
    
    According to Arthur Kroeber, instead of conveniently creating an external enemy country like China to blame and demonize almost every day, the US should rather spend more time and money to
    (a) reform her own domestic economic system in ways that encourage innovation and Main-Street investment;
    (b) improve education so that workers can take advantage of opportunities in the rapidly changing global economy rather than be left behind;
    (c) ensure that tax and social welfare systems create a minimum acceptable standard of living and limit inequalities of wealth and income; and
    (d) increase openness to trade, foreign investment, and the flow of ideas, with selective protection measures to safeguard critical industries and smooth out the losses of employment and income in sectors that are no longer competitive.
    -
    If the US consistently follows these prescriptions, she will manage to keep prospering in a wide range of circumstances.
    But if she spends her time blaming her ills on external forces (China, Russia, commodity and energy prices), or building protectionist walls or technology iron curtains to limit flows of goods, investment, ideas, and technologies, she may end up lagging behind her quickly-chasing enemy country one day in the future.
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    In any country the true enemies in the struggle for broad-based prosperity are not external competitors, but domestic elites and vested interests that constantly strive to preserve their own privileges at everyone else's expense.
    Just think the US's super-rich and powerful Jews who have mostly controlled the country's Wall Street, the mass media, and Hollywood, who, through the country's ongoing constant financial and military help delivered to Israel, are now violating all human rights of the unfortunate Palestinian people currently living in Gaza.
    Innovation, education, openness, a redistributive state, and above all, a truly democratic state un-polluted by vote-buying and election-money donations, are reliable weapons in this never-ending struggle.
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    - vic lai Nov 9, 2023
      
      From a much wider macroscopic point of view, America's real problem with China is perhaps that, China is trying to create another satellite solar system centered mainly on a new sun which is she herself, that seems to be becoming bigger and bigger and heavier and heavier over time, and that is trying to escape from the constant gravitational pull of the good old well-established solar system whose sun is called the United States of America.
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      From wiki,
      -
      "The Belt and Road Initiative (BRI, or B&R), known within China as the One Belt One Road or OBOR/1B1R for short, is a global infrastructure development strategy adopted by the Chinese government in 2013 to invest in more than 150 countries and international organizations.
      It is considered a centerpiece of the Chinese leader Xi Jinping's foreign policy.
      The BRI forms a central component of Xi's "Major Country Diplomacy" strategy, which calls for China to assume a greater leadership role for global affairs in accordance with its rising power and status.
      It has been compared to the American Marshall Plan.
      As of August 2023, 155 countries were listed as having signed up to the BRI.
      The participating countries include almost 75% of the world's population and account for more than half of the world's GDP. "
      ---
      "Global Village describes the phenomenon of the entire world becoming more interconnected as the result of the propagation of media technologies throughout the world.
      The term was coined by Canadian media theorist Marshall McLuhan in his books The Gutenberg Galaxy: The Making of Typographic Man (1962) and Understanding Media: The Extensions of Man (1964).
      Literary scholar Sue-Im Lee describes how the term global village has come to designate 'the dominant term for expressing a global coexistence altered by transnational commerce, migration, and culture.'
      Economic journalist Thomas Friedman's definition of the global village as a world 'tied together into a single globalized marketplace and village' is another contemporary understanding of the term."
      ---
      "The Westphalian system, also known as Westphalian sovereignty, is a principle in international law that each state has exclusive sovereignty over its territory.
      The principle developed in Europe after the Peace of Westphalia in 1648, based on the state theory of Jean Bodin and the natural law teachings of Hugo Grotius.
      It underlies the modern international system of sovereign states and is enshrined in the United Nations Charter, which states that "nothing ... shall authorize the United Nations to intervene in matters which are essentially within the domestic jurisdiction of any state.
      According to the principle, every state, no matter how large or small, has an equal right to sovereignty.
      Political scientists have traced the concept to the eponymous peace treaties which ended the Thirty Years' War (1618–1648) and Eighty Years' War (1568–1648).
      The principle of non-interference was then further developed in the 18th century.
      The Westphalian system reached its peak in the 19th and 20th centuries, but it has faced recent challenges from advocates of humanitarian intervention.
      Efforts to curtail absolute sovereignty have met with substantial resistance by sovereigntist movements in multiple countries who seek to 'take back control' from such transnational governance groups and agreements, restoring the world to pre-World War II norms of sovereignty."
      ------
      China's BRI, debuted 10 years ago in 2013, stresses the idea of establishing "a (global) community with a shared future for mankind."
      It has also been striving to
      (a) establish a genuine Global Village, situated chiefly in the Eurasian and African Continents, and
      (b) defend the Westphalian system as much as possible.
      -
      And so, for this "BRI," I think the "R" will probably end up becoming much more important for China than the "B," since China's coming possible newly re-established Land-Power Civilization (after its gradual demise ever since the 15 and 16th century) will be her major consideration, because the world's Sea-Power Civilization has already been well established and solidly defended by both the UK and the US ever since the 15th or 16th century in general, and by the world's past globalization-on-steroid decades in particular.
      -
      But the West's Sea-Power Civilization centered on the US, even with the further help of the past-decades globalization, so far seems to have failed to really enrich most of the poor and developing EM countries on this planet, and so the Sea-Power Civilization led by the US has seemingly still failed to establish a geniune Global Village on this planet as of today.
      Even worse, through the US CIA's instigated color revolutions and many other foreign interventions that we all observed in the past decades, the sacred principle of Westphalian Sovereignty under the sun has often been ruthlessly violated also.
      On the other hand, today's China has been trying hard to really help develop those lagging-behind EM countries through the capital and technology aids of the BRI, which is being financed mainly by her newly-established Asian Infrastructure Investment Bank.
      -
      Perhaps today's relatively weaker China has learnt from Chairman Mao's proven-to-be-successful policy of "using the rural areas to encircle the cities" (used by Mao's then-much-weaker CCP to fight with then-much-stronger Kuomintang in China during the 1930s and 1940s), and so she's now trying to use the same strategy to similarly cope with today's much-stronger US.
      The US's ongoing China-related de-risking policies of all kinds have de facto been reinforcing China's determination to do so.
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      Whether China can succeed in using the BRI to "surround the cities from the countryside" in the coming decades remains to be seen, but if she doesn't strive hard to do so, she'll definitely lose out in this Thucydides-Trap-like game between her and the US, and
      (i) Pax Americana will most likely remain the status quo on this planet in the rest of the 21st century,
      (ii) our world will never shift from the current uni-polar world centered on the US alone to a future bi-polar world centered on both the US and China,
      (iii) Bretton Woods II will never ever be challenged by Bretton Woods III,
      (iv) the US dollar will remain the world's unique hegemon currency under the sun in the rest of this century,
      (v) our eventual realization of a genuine Global Village on this planet will be more imagined than real, and
      (vi) the Westphalian system will face the high possibility of being trampled on time and again by the world's unique hegemon country (and her cohort countries) in the future.
      -
      That's why today's US is always standing ready to fully, quickly, and unconditionally support --- militarily, economically, and geopolitically --- all her "heeler-hitmen" situated near the Eurasian and African Continents, like Britain in Western Europe, Japan in Northern Asia, Israel in the Middle East, and perhaps also Australia in Southern Asia and India in the southern part of the Asian continent.
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Janos Nagy Nov 6, 2023

Finally someone called it in the proper name
"Trade arrangements" and not "trade agreements"
- Colin Haller Nov 8, 2023
  
  Turns out “free trade” ain’t free …
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