US election casts shadow over Yellen’s visit
US Treasury Secretary Janet Yellen’s previous trip to China, nine months ago, helped break the ice that had formed in bilateral relations after the US side’s hyping up of the so-called Chinese balloon incident and raised hopes of a lasting thaw. Her latest visit has generated more modest expectations, as not only has the United States been intensifying its China containment moves since then but the upcoming US presidential election means the Democrat administration is wary of providing its Republican opponents any ammunition with which to attack it by appearing to be soft on China. Although Yellen maintains long-term sound working and personal relations with the economic policy circles of China, thanks to her commitment to stabilizing Sino-US economic relations, the US Congress’ continuous weaponization of economic policies and the politicizing of economic issues related to China have made it increasingly difficult for her to do that.
The US Treasury chief ’s packed schedule during her six-day stay in China that ended on Tuesday speaks volumes about her desire to make the most of her visit to the country. Her interactions with Chinese policymakers, businesspeople from both China and the US and people from all walks of life should have helped her gain an improved understanding of their concerns regarding Sino-US economic ties, the priorities of China’s economic policies, and “how the Chinese government views their current economic and financial situation and the steps that they have and are contemplating taking”. All these should help better inform the US administration’s own economic decision-making, as she said in a news conference in Beijing on Monday. Yet, how much that informativeness can improve the fraught Sino-US economic relations depends on the extent to which senior technocrats like Yellen holding key policymaking posts regarding economic, financial, trade, industrial and technological sectors are allowed to prescribe their solutions independent of interference from the domestic partisan struggle.
“President Biden and I are clear-eyed about the complexities of this relationship,” Yellen said. A veteran economist such as herself will know that the “complexities” do not originate from the structure of the ties themselves but the influence of the overall anti-China political climate in Washington. The series of intensifying US attacks on Chinese companies, institutes, universities, individuals, investments, industries and technology have only become more systematic since Yellen’s last visit, making Beijing more realistic about the US’ stated commitment to managing China relations “in a responsible way”. The comprehensive restrictive measures the US has taken against Chinese entities have not only affected the interests of those being targeted, but also entities of the US and other countries.
Despite saying that “the United States does not seek to decouple from China” and the two economies are “deeply integrated, and a wholesale separation would be disastrous for both of our economies”, Yellen will know that the US claims of “protecting our national security and that of our allies” are nothing but an excuse to try and replace the law of the market with the will of the US government to create “a level playing field for American workers and firms”. With that excuse, the US administration is attempting to eliminate competitive foreign companies and technologies.
However, that does not mean the US is in a position to dictate China which are the fields for bilateral cooperation, as it seems wont to do. The US has no legitimacy for trying to curtail normal Sino-Russian economic relations, for example.
Those on the US side making a meal of the founding and operation of the economic and financial working group mechanism with China as their contribution to stabilize bilateral economic ties should know that it is the US that dismantled the exchange and communication channels that had long existed between the two sides. These were not only more extensive but also functioned better than the current talk-for-talk’s-sake design.
Sino-US economic relations should be of a win-win nature. US policymakers with their eyes on votes should recognize that promoting the interests of US workers would be best served by strengthening cooperation with China in as many areas as possible.