Submitted by: Jason Larocco

This article brings to mind what Fareed Zakaria referred to as “the rise of the rest” in his book The Post American World. Solutions to improve the world economy are as dependent, if not more, on China as they are of U.S., Europe, and Japan. Both the U.S. and China are well aware of their economic interdependence and how the relationship of the largest developed and the largest developing countries affect the world economy. What is interesting is that the Chinese government has gained enough confidence in their economic policies to start voicing their opinions on the world stage. Andrew Batson, the author of this article, states “The Strategic Economic Dialogue, twice-yearly talks held since 2006, has long been dominated by U.S. complaints about Chinese trade practices… The latest talks showed signs of becoming a more equal exchange of views, with the Chinese side more assertive about voicing its concerns…” Later on in the article China also suggests that the U.S. look to reform some of its own economic policies in order to curb the negative effects of excess consumption and debt.

The assertiveness of the Chinese shows their readiness to lead and it was a very interesting component of this article. However, China’s suggestion of economic reform to curb excess consumption and debt in the U.S. also grabbed my attention. The fast growth in China over the last twenty years has depended in large part on U.S. consumer spending. So why would China want to curb our tendencies toward excessive consumption? I think China is well aware that although there may be short term gains from this behavior, it is not a good long term strategy for either country. Over the past five years the word sustainability has been a part of every major corporation’s agenda (whether in heart or only on paper can be debated). Environmental sustainability is what typically comes to mind, but economic sustainability is also a topic that deserves a lot of attention right now. Increases in commercial trade have helped create a bridge over the Pacific Ocean between our two countries. But, if we continue to finance any country’s growth by over extending our own budgets and living outside our means, how economically sustainable are we?

Fearing China’s rise as world leader will in no way help us to create a strong position for the U.S. amongst the new world powers. However, if we continue to grow our debt with China how strategic of a position are we leaving for ourselves? Hopefully the current world economic situation has humbled us all, including China, and it will give way to a change of our current habits. As consumers we need to take charge of our own fiscal responsibilities, and as future business leaders we need find new ways to build bridges without eroding our own foundation.