Opinion | In a world of rogue waves, US-China contest is really about survival

With climate change, cyberattacks and more pandemics promising greater repeated shocks, great power is about building resilience to radical change

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A flooded street along the swollen Rongjiang river after heavy rains in Rongan, in China’s southern Guangxi region, on July 2. Waves of change are to be expected, but they become unmanageable when they collide to create massive shocks. Climate change driven by economic growth is one example. Photo: AFP

Published: 4:30am, 19 Jul 2021Updated: 4:30am, 19 Jul 2021

Pundits frame US-China competition in economic, military and diplomatic terms. But it’s actually about something far more important.

US-China competition isn’t primarily economic. As China builds its consumer economy and becomes less dependent on exports for growth, its economic contest with the US will become less critical. While both countries compete for mineral and energy access, availability is generally a function of cost, not scarcity.

As China and the US age and double down on their knowledge economies, neither is likely to have enough high-skilled labour. But the growing competition for foreign minds requires carrots, not sticks. While the availability of low-skilled labour will also be an increasing challenge, it can be managed through domestic incentives and immigration. China is already offshoring its low-skilled manufacturing.

In trade, both countries have lopsided accounts, meaning neither can manage its economy without the world’s consent. Decoupling is undesirable for everyone involved. It may be impossible given international debt, non-fiat digital currencies, massive multinationals, and the accumulation of wealth across borders.

In military expansionism, US-China tensions will be dramatic. But compared to older empires, the US has gracefully shared influence over Southeast Asia, South America and Africa. Gray-area conflict will increase but no sane politician or soldier wants a repeat of the Soviet-US cat-and-mouse.

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