A shared path requires sacrifices
Economic logic suggests that US-China cooperation good for the two sides as well as the whole world
After relentless partisan campaigning that deeply divided the United States and, by default, fractured the world order into disorder, a record voter turnout in the presidential election ensured that decency prevails.
The division along entangled racial, religious and ideological lines is raw. About 80 percent of Donald Trump supporters think that the pandemic is under control, while 80 percent of Democrats think otherwise. But they agree on something — 90 percent of both Democrats and Republicans think that if the other side wins, things will get worse.
The first task for the new administration will be controlling the pandemic, because without that, the US will not be able to secure its economic recovery. Since the Trump administration will remove Obamacare by year-end, millions of people will be without medical aid or jobs in the midst of the raging pandemic. If violence erupts in the streets, the economy and social stability could spiral out of control.
The good news is that Joe Biden understands the magnitude of the task of healing and uniting the nation and moving forward.
But it is easier said than done. Irrespective of political persuasion, ultimately the decision to heal or unite is a moral one. If both sides put the community’s interests at heart, unity to act is possible. But if one side decides to block such unity, it will be not just the US that loses, it will be the whole world.
The world economy cannot recover unless the US recovers. In essence, unity and cooperation comes from believing and acting on win-win; conflict and disaster will ensue from believing that all politics is zero-sum — you win, I lose.
The latest Institute of Health Metrics and Evaluation model suggests that by Feb 1, 2021, the pandemic will result in 2.5 million deaths worldwide.
China is expected to be the only major economy to grow this year, with the world GDP predicted to decline by 4.9 percent.
These numbers disguise the fact that unemployment, poverty and despair will only rise for the poorest half of society, provoking fear and anger.
Objectively, the emotional divide between the US and China will take time to heal. With the US internally divided, the easiest way to forge unity is to bring people together and to rally them to the flag by blaming external threats, real or imagined.
To address the US-China relationship, the White House must deal first and foremost with the domestic agenda. Trump was elected in 2016 to “drain the swamp”. The 2020 election showed that his supporters backed him because they felt that the West and East Coast elites had betrayed Middle American prosperity, producing a corrupt plutocracy that promised equality but delivered bad jobs and lower standards of living.
Unfortunately, instead of draining the swamp, Trump expanded it. He abandoned the Paris Agreement on climate change, overturned the Trans-Pacific Partnership, removed Obamacare, cut taxes for the rich, and imposed tariffs on China exports.
Those who think that he was good for the economy are deluded by the stock market, which is up not only because of the US tech and health companies, but because it has been buoyed by the US Federal
Reserve’s unprecedented injection of $3 trillion liquidity. Trump’s economic prosperity is optically strong but really nothing more than a facade.
Just to get the US economy on an even keel will require the new US administration to reverse many of the current administration’s inconsistent policies. To kick-start recovery, major legislations have to be delivered to provide widespread healthcare, job creation, infrastructure construction, greater exports and inward investments.
The solution to all this is obvious — get your rivals to cooperate to recover first, because without recovery there is no possibility to compete.
This is where economic logic, despite the emotional divide, suggests that US-China cooperation is not only good for the US, but for the whole world.
Leadership is about moral vision — it involves inspiration, aspiration and delivery.
Talk is cheap, action is tough, and delivery will cost huge political capital. Politics will never satisfy everyone, but a shared path to peace, health and happiness requires huge sacrifices from all.
That is why the US-China partnership or rivalry will take great wisdom and patience to manage.
History will judge whether greatness awaits, or otherwise. The author is a distinguished fellow at the Asia Global Institute and a former central banker and financial regulator in Asia. The author contributed this article to China Watch, a think tank powered by China Daily. The views do not necessarily reflect those of China Daily.