Living Beyond Borders Articles

A steady stream of headlines today suggests that a metastasizing confrontation between China and the United States has put an end to what we’ve known as globalization, the flow of goods, services, and money across international borders at unprecedented speed and scale.

It’s true that US-China relations have become more contentious than at any time since (at least) the Tiananmen Square massacre in 1989, and every time it appears things might improve, some new revelation or provocation has officials in Washington and Beijing threatening some new action. High tariffs between the two countries for all kinds of goods have remained in place for the past five years.

It’s also true that the US and China are fragmenting the flow of the globalized economy by remaking supply chains to reduce dependence on the other side for critical resources and products where they believe a shortage might threaten their national security. Yes, competition in the tech sector, especially for products like computer chips, has created an increasingly disruptive rivalry.

We also cannot ignore the reality that China’s President Xi Jinping has expressed some limited support for Russia and its president at a time when Russian forces occupy territory inside NATO-backed Ukraine and are killing Ukrainian civilians.

Washington and Beijing clearly have an increasingly contentious relationship that’s getting worse, and the globalization we’ve known over the past three decades is fragmenting in some ways.

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The best fallacies stem from kernels of truth. In the case of what is being framed by some as the US-China “Cold War,” that kernel lies in the tech sector, where competition between the world’s two largest economies is fierce. The Biden administration has been increasingly clear that it is intent on slowing down China’s technological rise, and has centered its efforts toward decoupling — a low-grade form of economic warfare.

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Whether the US and China are in fact slouching towards a new “Cold War” or not, one thing is certain: commerce between them is still hotter than ever.
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As the US-China rivalry deepens, many countries – including close US allies – have made it clear that they don’t want to be forced to choose between the world’s two largest economies. They are engaging in an increasingly delicate dance to try and maintain constructive relations with both.

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The US and China may not be in a Cold War — but they could end up fighting a hot war over Taiwan.

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