The China Pickle – How We Got to Where We Are and Where We’re Going

The Center for Asian Business welcomed Robert Kapp, former president of the US-China Business Council, for a timely lecture titled “The China Pickle,” a term he uses to refer to the tensions between China and the U.S. under the Trump Administration.

Kapp examined the ongoing trade war between the U.S. and China in which both countries have implemented reciprocal tariffs and taxes on one another. First initiated by Trump, these tariffs and taxes are the result of U.S. concern about China’s trade practices that could endanger the interests of American companies based in China as well as the U.S. economy. For example, intellectual property theft could lead to U.S. high-tech companies turning over advanced technology secrets to their Chinese business partners.

Kapp shared how the Chinese government is embarking on an ambitious goal is to make the country one of the most technologically advanced nations in the world by 2030. The U.S. felt threatened by this statement, and thus initiated the trade and tariff war with China. However, Kapp questions whether these actions against China are a way to stop these malpractices or if there is a bigger intent behind all of this.

Kapp provided context on China’s history and globalization efforts. After Mao Zedong died in 1976, China underwent what citizens referred to as a “Reform and Opening,” where they started to implement elements of the market economy to the Chinese public as well as other countries around the world. As a result, China began utilizing their labor resources in tech manufacturing, ultimately becoming what Kapp refers to as “the factory of the world” that we see today.

Kapp believes the biggest obstacles in the relationship between China and the U.S. are:

  • Interdependency: since China purchases a lot of American bonds, they fund the U.S. government and we owe them a lot of money
  • Political dysfunction: the U.S. Administration is starting to become unilateral and even anti-lateral due to separation from deals such as the Paris Climate Agreement

Despite this, Kapp encouraged the audience not to think about China the same way Americans did at the end of World War II since the political landscape is so complex: there is a bigger role of private sectors in the country existing alongside the communist party.

“There’s a lot for Americans to be concerned about,” Kapp noted. “And China is responsible for a lot… including in the area of economics and business behavior. But to believe that this regime at this moment is set on a path of irreversible and increasingly uncontestable authoritarianism or totalitarianism I think is, at the very least, premature.”

Reporter Celine Alvarado is a senior communication and media studies major with a minor in business administration.