Jeffrey D. Sachs is a University Professor and Director of the Center for Sustainable Development at Columbia University, where he directed the Earth Institute from 2002 until 2016. He is also President of the UN Sustainable Development Solutions Network and a commissioner of the UN Broadband Commission for Development. From 2001 to 2018 he was an advisor to successive UN Secretaries General. Prior to joining Columbia, he spent over twenty years as a Professor at Harvard University, from which he holds a PhD.
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The Western press is filled with stories of foreboding about the Chinese economy. We are told regularly that China's fast growth is over, that China's data are manipulated, that a Chinese financial crisis looms, and that China will suffer the same stagnation as Japan during the past quarter century. This is not reality. Yes, the Chinese economy faces headwinds -- mainly created by the United States. Yet China can -- and I believe will -- overcome the headwinds and continue on its path of rapid economic development.
The basic fact is that China's Gross Domestic Product (GDP) grew at 5.2 percent in 2023, compared with 2.5 percent in the United States. On a per capita basis, the growth gap is even larger: 5.4 percent in China compared with 2 percent in the United States. In 2024, China will again significantly outpace the United States. There is no great growth crisis despite the fervid rhetoric in the U.S. press. Yes, China is slowing as it gets richer, but it is still growing considerably faster than in the United States and Europe.
There are problems to be sure, but the main ones come from the United States, not from inside China's economy.
First, there is the perception problem. The United States is pushing a negative narrative about China. We actually learned recently that former U.S. President Donald Trump tasked the CIA with spreading malicious propaganda about the Chinese economy on social media starting back in 2019. One specific CIA tactic was to bad-mouth China's important Belt and Road Initiative.
Second, there is the rise of U.S. protectionism. During the 20 years from 2000 to 2020, China was busy building up its new green and digital industries: mastering electric vehicles, 5G, battery supply chains, solar modules, wind turbines, fourth-generation nuclear power, long-distance power transmission, and other cutting-edge technologies. The White House and Congress, in the meantime, were in the hands of the oil, gas, and coal lobbies, and therefore without a strategy for the new energy technologies. Finally, U.S. President Joe Biden and Congress agreed to protect U.S. industries to give America time to recover some lost ground.
Third, there is the U.S. "Grand Strategy" to maintain U.S. "primacy" over China. For the U.S. security establishment, it's not good enough to compete with China on an honest basis. The U.S. government also puts obstacles in the way of China's economy. It seems incredible that the United States would go out of its way to undermine China's economy, and yet it actually does so. Such an approach was spelled out by a senior U.S. diplomat, former Ambassador Robert Blackwill, in March 2015, in an article for the Council on Foreign Relations published with co-author Ashley Tellis. The article, in my view, was the public launch of a new Washington policy towards China, one that has been followed by Presidents Obama, Trump, and Biden.
It is worth quoting Blackwill and Tellis at length to understand the U.S. game plan:
Since its founding, the United States has consistently pursued a grand strategy focused on acquiring and maintaining preeminent power over various rivals, first on the North American continent, then in the Western hemisphere, and finally globally...
Because the American effort to "integrate" China into the liberal international order has now generated new threats to U.S. primacy in Asia -- and could eventually result in a consequential challenge to American power globally -- Washington needs a new grand strategy toward China that centers on balancing the rise of Chinese power rather than continuing to assist its ascendancy.
These changes, which constitute the heart of an alternative balancing strategy, must derive from the clear recognition that preserving U.S. primacy in the global system ought to remain the central objective of the United States' grand strategy in the twenty-first century.
Sustaining this status in the face of rising Chinese power requires, among other things, revitalizing the U.S. economy to nurture those disruptive innovations that bestow on the United States asymmetric economic advantages over others; creating new preferential trading arrangements among U.S. friends and allies to increase their mutual gains through instruments that consciously exclude China; recreating a technology-control regime involving U.S. allies that prevents China from acquiring military and strategic capabilities enabling it to inflict "high-leverage strategic harm" on the United States and its partners; concertedly building up the power-political capacities of U.S. friends and allies on China's periphery; and improving the capability of U.S. military forces to effectively project power along the Asian rimlands despite any Chinese opposition -- all the while continuing to work with China in diverse ways that befit its importance to U.S. national interests.
These statements by Blackwill and Tellis are remarkable for two reasons. First, they explicitly spell out America's "Grand Strategy" in no uncertain terms: to preserve America's "primacy" in the global system, including over China. Second, they listed -- already in March 2015 -- the actual policies pursued by the United States during the past decade.
Consider the five policies recommended by Blackwill and Tellis.
First, revitalize the U.S. economy. Okay, that's fair enough. The United States needs to get its economic house in order.
Second, create new U.S. trade arrangements with Asia that "consciously exclude China." That's an absurd idea, since China is the largest economy in Asia, yet Obama tried (and failed) to create the Trans-Pacific Partnership to exclude China, while both Trump and Biden pursued protectionism against China, especially in the form of unilateral tariff increases in violation of World Trade Organization (WTO) commitments.
Third, recreate a "technology-control regime" to limit China's access to high-tech. That is currently underway, most notably with the new limits on the export of advanced semiconductor technology to China.
Fourth, build up political-military alliances on China's borders. This is the U.S. strategy with AUKUS (Australia-UK-United States), the Quad (Australia-India-Japan-United States), and the United States-Japan-Philippines Triad.
Fifth, build up the U.S. military along the Asian rimlands "despite Chinese opposition." This too is happening with Australia, Japan, the Philippines, and elsewhere.
America's aim of "primacy" is dangerously misguided. Since China has four times the U.S. population, the only way for the U.S. economy to stay larger than China's would be for China to remain stuck at less than one-fourth of the U.S. GDP per person. There is no reason for that to happen. If it did, it would mean a lot of suffering in China and a great loss of global dynamism.
Primacy should not be the U.S. goal, or China's goal, or indeed the goal of any country. The only sensible goal for the major powers is mutual prosperity, common security, and global cooperation regarding common challenges such as environmental sustainability and peace.
Part Two of ‘China’s economic success in the face of growing U.S., EU protectionism’ will be published on 19 April 2024
This syndicated column is republished with the kind permission of the author.