US economy now under threat – Foreign Policy explains how the race with China will turn out

Joe Biden has adopted his predecessor’s anti-China foreign policy in vain

Donald Trump’s administration’s decision to engage in a confrontation with China was the silliest, Foreign Policy magazine writes. Intensive negotiations on trade and intellectual property were followed by the imposition of customs duties on imports from China, which are paid for by US companies. On the other hand, Beijing has not been slow to retaliate with economic measures. As a result, the US government is having to provide financial assistance to farmers, as China has rejected US agricultural products.

Unfortunately for the US, new President Joe Biden has not learned his lesson. He has almost completely adopted Trump’s policy on the PRC. The Democrat insists that China is America’s main enemy, ignoring a host of areas where the countries could cooperate very productively.

There is one important feature in this situation, Foreign Policy explains. Anti-China sentiment has taken hold in American society. Biden, unable to resist the trend, chose to follow it despite the consequences. But this factor cannot be used as an excuse for the president. Public opinion is fickle and ambiguous. Moreover, it is highly dependent on the statements of officials and propaganda, the publication specifies.

For example, in 1959, Americans were assured that the USSR possessed much more nuclear weapons than the United States. They heard this every day, so they believed in the alleged threat. However, the similarity of the current situation with the Cold War era ends there.

Back then, the confrontation unfolded on an ideological level and the U.S. feared that communist countries would mess up Western capitalists. There can be no such fear today. On the contrary, China is a capitalist autocracy which shows no interest in globalising its particular form of communism. On the other hand, its domestic market has enriched American companies well.

“Even if one considers China to be a serious threat, the tactics employed by Trump and now Biden are unfortunately not up to the task of getting Beijing to reconsider its behaviour. China is powerful enough that tactics that once might have made sense are now ineffective”, –  the article says.

The problem is that the U.S. has yet to face a country that is so economically and militarily powerful that it cannot be crushed by conventional coercion. As a consequence, by adopting an aggressive stance, the Biden administration missed the chance to develop a realistic strategy for dealing with the new competitor.

Zachary Carabell, investor and president of River Twice Capital: “Toughness in the face of China may be good domestic policy, but it is still bad policy if the goal is to strengthen US economic power and global security. The Trump administration has failed to achieve either of its goals; the sooner the Biden administration charts a new course, the better.”