For Washington, it is important to set realistic goals when dealing with China. Trying to remake China into a liberal democracy is unrealistic. It must deal with China as it is rather than trying to transform it according to its own ideologies. Also, Washington really needs to rebuild its domestic infrastructure (crumbling freeways, airline oligopolies with terrible services, overpriced and obsolete passenger rail services, failing grids, etc.) and political economy (extreme wealth gap, minorities living in drug/gang-infested ghettos, systemic racism, supply chain security, unconstrained corporations operating with little oversight from federal regulators, etc.) before it could gain additional leverage over Beijing. Negotiating with Beijing from the position of strength requires fixing domestic political economic issues first. Ultimately there is nothing right or wrong. It is President Biden and his team's duty to preserve America's primacy, and such primacy involve maintaining significant edges in the high-tech sector over those of competitors.
For Beijing, CCP leaders need to remember that hegemons never give up their positions without a fierce struggle, be it in the high-tech sector or geopolitics. CCP leaders needs to be very patient, as the next 5-10 years could be the most ideal time frame for Washington to wage more "hegemonic wars" in order to preserve its leadership because Chinese military and economic power is unlike to surpass those of the U.S. and Allies until after 2030. Therefore, Washington and its Allies would be incentivized to hammer China hard before China becomes too powerful, so Beijing should expect more U.S.-led sabotages of China's high-tech sector through sanctions, critical components denials, outright cyber attacks, etc. Such "hegemonic war" has arguably already started with Trump's tech war and economic sanctions. We can only hope such "hegemonic war" does not escalate into kinetic strikes that lead to massive casualties on both sides. On the other hand, thank God we have nuclear weapons today. Nuclear weapons really deters both the rising and the status quo power from waging kinetic wars.