How will the long-term economic battle between the US and China play out?

It will be a struggle for superiority, and this will shape much of this century, writes Hamish McRae. But anyone who thinks that China will inevitably dominate should be aware of a number of things

Sunday 04 July 2021 21:30
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<p>We don’t yet know whether China will be able to develop the frontier industries that the US has been able to do</p>

We don’t yet know whether China will be able to develop the frontier industries that the US has been able to do

Celebrations across the US for Independence Day are marred by two dark clouds. One is immediate: the difficulties that the US is having in coping with tensions within itself. These include issues of race, inequality, the climate crisis and political identity. The other lies ahead: the gradual awareness that US global leadership is challenged by the rising economic power of China.

Some perspective on each. The challenges that US society faces are indeed huge – and divisions are particularly wide at the moment. But if you stand back and compare this period with those of the past, it is surely right to question whether they are comparable to previous experience. Is inequality greater than in the Roaring Twenties? Are underlying racial tensions now greater than in, say, the 1950s? Or the dissent among young people greater than during the student riots of the 1960s? Or crime higher than in the 1970s?

As for general economic wellbeing, nothing happening now is anywhere near as bad as it was during the Great Depression. And the US has risen to the current challenge of the Covid-19 pandemic in rolling out a successful vaccination programme.

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