Biden is framing the whole situation with China using the only concept that all Americans can easily understand: "Competition" (a zero-sum game deeply ingrained in American psyche). If roles are reversed, China would have publicly invited the U.S. (and Europe) to strive to grow more prosperous together.
Sadly since Biden has already proclaimed this 'competition' publicly and with the U.S. fixation on GDP parity in dollar-terms, the finishing line is clearly drawn and Biden has set up the U.S. to lose on its own terms when he is no longer the President. In a way, this is U.S. baiting China. If China does not respond to this 'competition', it forces U.S. to raise the rhetoric to even more absurd levels to justify further restrictions and still lose this competition that it defined and played all by itself.
I am sure China's political leadership and PBOC are much more concerned about the long-term debt sustainability than whether China will surpass U.S. GDP in dollar-terms in 2028 or 2032. IF geopolitical considerations take highest priority (as in Russia), then China should pursue a looser monetary policy for the next few years in order to maximize the growth to get to the end game earlier and more obvious to all and thus force future U.S. Presidential candidates to soften their stance as nobody wants to go down in history as the President who lost America to China. However,
I do whole-heartedly support PBOC's the more prudent debt-reduction effort. It puts China in a much stronger fiscal position in the next Five-Year period when China reaches peak oil and when all carbon-related projects kick into implementation phases. This also minimized near-term inflationary risks triggered by the U.S. and European recovery plans. The world-wide recovery in the next few years should be sufficient to carry China's economy humming along. This also means a less-than-exciting few years for the more impatient/stat-obsessed readers of this forum.
50 years down the road, historians may still muse about the Lemony Snicket series of unfortunate events befell on the U.S. (9/11, 2008, COVID-19) that allows China to supplant the U.S. at so little cost.
Sadly since Biden has already proclaimed this 'competition' publicly and with the U.S. fixation on GDP parity in dollar-terms, the finishing line is clearly drawn and Biden has set up the U.S. to lose on its own terms when he is no longer the President. In a way, this is U.S. baiting China. If China does not respond to this 'competition', it forces U.S. to raise the rhetoric to even more absurd levels to justify further restrictions and still lose this competition that it defined and played all by itself.
I am sure China's political leadership and PBOC are much more concerned about the long-term debt sustainability than whether China will surpass U.S. GDP in dollar-terms in 2028 or 2032. IF geopolitical considerations take highest priority (as in Russia), then China should pursue a looser monetary policy for the next few years in order to maximize the growth to get to the end game earlier and more obvious to all and thus force future U.S. Presidential candidates to soften their stance as nobody wants to go down in history as the President who lost America to China. However,
I do whole-heartedly support PBOC's the more prudent debt-reduction effort. It puts China in a much stronger fiscal position in the next Five-Year period when China reaches peak oil and when all carbon-related projects kick into implementation phases. This also minimized near-term inflationary risks triggered by the U.S. and European recovery plans. The world-wide recovery in the next few years should be sufficient to carry China's economy humming along. This also means a less-than-exciting few years for the more impatient/stat-obsessed readers of this forum.
50 years down the road, historians may still muse about the Lemony Snicket series of unfortunate events befell on the U.S. (9/11, 2008, COVID-19) that allows China to supplant the U.S. at so little cost.
