The political tension that now exists between China and key Western nations, especially vis-à-vis the US, is unhealthy and quite possibly dangerous.
It is based on an unnecessary focus on what I call the macro interpretation of the ideological differences between East and West: It is based on the macro distinction between socialism and capitalism.
But I will discuss the simple day-to-day, eye-to-eye connections that typify much of the foundational albeit semi-unofficial links across the Pacific.
International relations lose their threatening aspects when we consider student and family travel, online retail purchases of everything from cosmetics to household appliances.
The interface under discussion, to the extent it is observed by government at all, involves low-level bureaucrats on both sides of the ocean, who are (almost) mindlessly interpreting and applying “rulebook” criteria to manage (or all too often mismanage) simple trade between ordinary buyers, sellers, investors and capital seekers, who are sometimes big guys like Apple, but lots of times ordinary trans-Pacific citizens who operate in hundreds or a few thousands of dollars.
Often the de facto policy that emerges at this low level controls the eventual messaging that afterward flows “up and down” to higher levels of government, where potentially its “macro sting” is blunted.
The issues that get in the way are endemic to just about every variety of macro-distinct society: Bureaucrats everywhere are a problem. But their influence can be put to good use.
I advance here an analysis of what trade, exchange, mutual reform and “micro diplomacy,” consisting of small-scale, friendly cooperation and compromise, reciprocal adjustments that grow out of an economic partnership that appears when players in both “macro” worlds undertake efforts to “open dialogue” that has a chance to appear once macro blinders are put away.
It is a form of free – or freer – trade, but it is among bureaucrats, at least in the first instance, rather than immediately operative between final players.
Let us allow ordinary firms and other economic players to import their business models into one another’s economic universes with a minimum of interference from macro sources.
There is a kind of synergy, a variety of familiarity between Eastern and Western internal business plans that is already extant. American firms have plenty of top-down operating rules. American delivery-truck drivers have famously uniform clothing rules: dark brown. Is it socialism?
When Chinese graduate students enroll in US universities, or when they get jobs in tech firms, and when they out-compete American students and tech workers, is this merit-based old-time competitive capitalism?
There is plenty of micro-level overlap of the Venn diagram type. Allow firms and economic entities to operate without excessive bureaucratic management, and both systems will reform.
American firms don’t have Chinese-style corruption: Suppliers do not bribe top managers so as to get contracts, but they do play big-time politics in national elections. Chinese firms don’t dare to interfere in national policymaking, but an absence of irrelevant regulation from, for example, the green cultists makes for quick and decisive action and a general “quick march of the spirits.”
As business cultures merge, mutual reforms have a chance of cleaning up and adding efficiency to one another’s ways of doing things.
Because everywhere the minions who interact with the “retail” public so vastly outnumber the elected, or selected, “masters” who think they make the rules (according to their belief that they represent the true “masters,” selected by a ruling party or perhaps, within limits, by some process said to reflect “public opinion” or “the people”), the minions work with inadequate oversight by the elected officials who struggle to message the bureaucrats, urging them to abandon self-interest (in the form of “corruption,” incompetence, or simple instinct to shirk), and instead instruct them to apply the rules.
But this loose connection gives reformers space to gradually introduce some forms of cross-Pacific merging, linked evolution, and preference for compromise rather than conflict.
There is room for a healthy trade in ideas and ideology, one not about “theft” of intellectual property, but about reduced mutual costs of production involving and fairly sharing the gains from trade.
The “gains from trade” arguments no longer have the cross-Pacific popularity they had from the early 1970s to the late 1980s, the time of Deng Xiaoping and Nixon/Reagan.
Insularity and a return to some distrust and consequent decision-making authority has moved the action away from, for example, individual farmers in China and (sometimes) small investors in the West, returning policymaking authority in both places to (in part) the micro-level governmental entities discussed here.
And so, my belief is that Deng’s and Richard Nixon’s ideas about trade gains may no longer apply if we think about quasi-private players in both places.
My hope is that the impossibility of close management over the minions will allow, will necessitate, flexibility, compromise and pragmatism of the Deng/Nixon era to enter by another door, one that cannot be locked by virtue of the passageways being too many, too porous, too tempting for the ”masters” to shut down, even when they resort to “perp walks“ (Xi Jinping) during big meetings and name-calling (Joe Biden) during tough-guy speeches that refer to “bad folks” and “ticking time bombs.”
Tom Velk is a libertarian-leaning American economist who writes and lives in Montreal, Canada. He has served as visiting professor at the Board of Governors of the US Federal Reserve system, at the US Congress and as the chairman of the North American Studies program at McGill University and a professor in that university’s Economics Department.