Here’s a video review of some of the major themes from my book “China, China, Chyyna! — Greatest Disruption to American Century.” It’s a long book — about 660 pages long, so the video examines just the crucial topics. In about 12 minutes, the video covers the six pillars of the American Century and demonstrates how China is shaking four of them. The tectonic geopolitical changes herald a multipolar world. Can the United States adapt to and embrace multilateralism? Or, are we doomed for a catastrophic war and global economic crisis?
Shocking 45% of Americans say that China is our greatest enemy. Why? The media and the political establishment have been manufacturing consent over the last few years by playing up the China threat and demonizing China.
The China-bashing rhetoric was worse during the Trump administration, when China was called a “central threat of our times”, “greatest enemy to freedom” and even an “existential threat to America.” However, such emotional language only reflects the inability of politicians to discuss complex geopolitical issues in an intelligent and factual manner. And that’s the goal of this book.
There are three reasons why everyone – whether you’re Chinese, American or anyone else – should be curious and concerned about the great power rivalry between China and the US. FIRST, we are witnessing a historic transition that occurs once every 100 years or so. That is, a rising power is about to surpass an established power as the world’s largest economy. Remember that America has been the #1 economy for the last 130 years. Now, China is on the cusp of becoming #1 within five years.
Furthermore, based on GDP measured by purchasing power parity, China already overtook the US in 2014.
SECOND, the rise of China and a multipolar world will have two dramatic consequences: (1) End of the so-called American Century, and (2) Decline of US dollar’s primacy. Of course, this doesn’t mean that America or the dollar is going to collapse, but their relative power will shrink significantly
THIRD is a scary scenario. If diplomacy fails, the US-China competition can lead to catastrophic wars. Maybe not a full-blown nuclear war, but enough to cause devastating loss of lives and tremendous damage to the global economy. Both countries will be losers.
This chart answers the question, “Why is the US obsessed with China?” Because China is the only one capable of catching up with the US. Remove China from this chart, and the US will enjoy another century of preeminence.
Can China surpass the USA? Well, just 30 years ago, the US economy was 16 times larger than China. By 2020, that ratio had shrunk to 1.3
As I detail in my book, China can very well surpass America by the end of 2023 – less than three years from now. This can be achieved by moderate appreciation of Yuan against the US dollar. The confluence of two factors can bring this to fruition: (1) explosion of US debt and (2) the transformation of Chinese economy through the dual-circulation strategy.
What sustained the American century? The answer is “America’s full-spectrum dominance in 6 critical areas.” They are the pillars of American leadership or hegemony. They are: economy, technology, currency, military, media, and soft power
We already talked about how China is challenging the American Century’s first pillar – Economy. But there’s more to it than just GDP. China already has the world’s largest middle class. There are five million millionaires and perhaps 1000 billionaires in China. In the Top 10% of the richest individuals in the world, there are more Chinese than Americans! Similarly, China has eclipsed the US in the Global Fortune 500 list.
I was in China in late 2019 — yes, during the coronavirus outbreak. Many people outside China have no clue how developed and rich parts of China are. I saw more Porsches and BMWs in Beijing and Shanghai than in San Francisco Bay Area. Malls in China were fancy and had myriad luxury stores – Gucci, Versace, Prada, Louis Vuitton, you-name-it.
The second pillar of American Century is Technology. This chart shows the meteoric rise of China’s international patents over the last two decades. The US was #1 for 40 years when WIPO was founded. Then it lost the crown to China two years ago. China is no longer just a copycat. Now, Facebook is copying TikTok. And the US has placed sanctions on 100+ Chinese tech firms. There’s no free market in geopolitics.
The third pillar is the dollar. Specifically, the status of US dollar as the global reserve currency since WW2. This allows the US to borrow trillions of dollars. Furthermore, this extraordinary privilege allows the US to place sanctions and crush its geopolitical rivals. However, China is starting to challenge this monopoly power. China is the first major country to introduce a digital currency from the central bank. The digital Yuan will revolutionize global trade and payments. Look at the map to the right. 25 years ago, the US dominated world trade. Now, China is the #1 trade partner for 135 countries. Soon, many of them will bypass US dollar and US banks to trade in Yuan.
China’s military strategy is based on two D’s — defend and deter. China doesn’t want endless wars or military bases all over the world like the US. Instead, China’s focus is to defend its borders and South China Sea. Then create a deterrence through hypersonic missiles with nuclear warheads. Beijing’s message to the US is “If you bomb Shanghai, we can bomb New York City within 45 minutes.” Mutually Assured Destruction from the Cold War era.
China’s Empire is based on The Belt and Road Initiative, which has 130 member countries. China doesn’t spread its influence through bullying and bombing. Instead, China tells developing nations: “Hey, we will come and build highways, railways, seaports, airports, dams, 5G infrastructure in your country. Let’s trade more.” Who’s going to say no to that? This is a win-win, long-term, and sustainable strategic thinking.
So, what’s the future for America? It’s not all doom-and-gloom. America will stay as a powerful country … but not as the sole superpower. The new reality requires a new geopolitical framework.
The US has to accept the inevitable multipolar world where the US has to coexist with other countries as partners. America has to reimagine its foreign policy to get along with China, Russia, Venezuela etc.
The US also can also learn a few things from China. For example, how to create successful industrial policies, eradicate poverty and expand the middle class. The US must also move away from financial capitalism, which is predatory and unproductive. I explore this topic in depth in the book.
Well, that’s the end. Hope you enjoyed it. Leave your comments below and let me know if you would like more such videos on different topics from the book. The book is available on Amazon and the link is below in the description. Cheers.