China's government operates with the primary objective of mobilizing national resources for technology acquisition, functioning like a giant state-backed venture capital fund. This involves massive subsidies, particularly in sectors like EVs and renewable energy, to establish a durable competitive advantage.
The deep economic interdependence between the U.S. and China makes a Cold War-style containment strategy unworkable. Unlike the Soviet Union, China is deeply integrated into the global economy as a top trading partner for most nations and a major destination for U.S. corporate investment.
China's economic model aims to dominate global manufacturing, leveraging its scale to produce a vast share of the world's goods. This strategy, while providing cheap goods globally, contributes to de-industrialization and social disruption in other countries, fueling political backlash.
Under Xi Jinping, China's focus has shifted from broad GDP growth to targeted technological development in 'hard tech' sectors. This has been accompanied by a significant re-regulation of the service, finance, and internet sectors, stifling growth in those areas and exacerbating internal economic challenges like high debt.
Keep pulling the thread on Arthur Kroeber.