An Economic Perspective on the US Election and the Prospects of Sino-US Relations

Author: Ma Xiaoye, Source: FT Chinese Network

The largest and most intense presidential election in the United States in sixty years has come to an end. Although the political appointment candidates who join the cabinet will also bring about certain policy concepts to be adjusted and revised, the new government will also experience the "persuasion" or "taming" of professional bureaucrats in various government departments in the early stages of operation. There is also a deep political operation system (deep state) that interacts with the Trump administration on a series of major transformative issues. However, it is now possible to analyze and observe based on relevant information and combined with historical circumstances.

Due to the long-term confrontation between China and the United States across the sea after the Korean War, articles that further study the relationship between the two countries are more influential by starting with military operational deductions and related logic. It is also a mainstream research method to deduce the evolution of the future relationship between the two countries based on various international relations theories. These two types of research influence and complement each other and have a wide influence on the general public. The knowledge, views and positions learned by the media from them are expanded in society through dissemination. Although the feedback of mass media and public opinion is not elegant, it has some influence on the public and even the intellectual community's cognition of Sino-US relations.

Sino-US relations are the most important bilateral relations in the world. The stability of the world depends on many factors, among which Sino-US relations are particularly important. This article is about how to further supplement the shortcomings of popular research by observing Sino-US relations from an economic perspective. One more clue of systematic observation in the economic field can make our overall cognitive framework more complete.

I. Economic logic in international relations

Over the past eight years, Sino-US relations have shown serious incompatibility and even opposition in various important areas. As things have developed to this day, both China and the United States, as well as the Democratic and Republican parties in the United States, have clearly stated, acknowledged, or acquiesced that the conflicts behind the apparent contradictions are conflicts of values, ideology, and worldview. These conflicts cannot be reconciled through diplomatic skills and means, but can only be managed.

Since the Second World War, from social ideology leading international relations to viewing the world with relatively broad civilizational differences, recognizing that a diverse world should be able to accommodate various worldviews, and then the two major powers re-identified that the worldview and ideology in their relationship were the "elephant in the room". After the illusion ended, looking back at the changes over the past few decades, a curved line was drawn.

Looking back at the US presidential elections since the 1980s, the campaign has always been a topic of competition between the two sides, competing to criticize China and attacking each other's China policies as a quick answer plus point. China's domestic and foreign affairs have been put under the microscope of American political debates, and the reason why China did not accept it was that the United States was wearing "tinted glasses". Even at that time, the US negotiating officials in charge of economic relations said confidently in private exchanges: Two lovers quarrel because they really want to live under the same roof. When Clinton, Bush Jr. and later Obama ran for election, the China issue began to gradually fade. The situation in this election is different again. Objectively speaking, after two four-year governments took turns in power, especially with the escalation of trade frictions, bilateral relations have lost the multi-purpose buffer and brake of economic trade. Coupled with the subsequent precipitation of the epidemic, the only highly consistent aspect of the two parties' platforms in this election, which are seriously opposed, is the policy toward China.

Since China and the United States concluded a bilateral economic and trade agreement in 1980 and China began to fully interact with the United States, the ruling and opposition parties have gone from controversy to rushing to shirk the blame on the China issue, and then to unprecedented consensus. Many events have occurred in the meantime. In order to sort out the full picture of the problem from this process of change, it is necessary to deeply and completely sort out the basic influence of economic factors in addition to the two strong research discourse systems of military and diplomacy mentioned above, so as to correct the above established ideas. Because, once you think, worry, are unwilling, and are unwilling to discuss publicly, and agree and consciously or unconsciously think, discuss, and plan according to the setting that the Sino-US dispute is a life-and-death struggle, other important elements will become details, so there is no need to further understand what this election means for Sino-US relations.

The established cognitive model for observing Sino-US relations is already well known to people who are exposed to related fields. It is also due to historical reasons that this cognitive model has been deeply rooted in the international relations community and has formed a fixed thinking pattern. Although the observation content of international relations historians has slightly expanded in the economic field, most international relations historians are confined to comparing the numbers of time series in their observation of the economy, and neglect to explore the basic influence of economic principles, economic operation laws, economic demands on the outside world, and externalities and spillover effects on international relations. The economic perspective has not formed a logical continuum. The fragmented observation, description and discussion of economic relations are not conducive to establishing a solid cognitive framework. It may be beneficial to try to stand back and expand your horizons to observe and think about bilateral relations.

In order to start the discussion below, I will first introduce several important basic facts that should not be ignored as the starting point for discussing the issue. First, human social activities revolve around the core of the economy. Second, the international relations between nation-states began with colonial development, first led by trade, then developed to the acquisition of materials, and then to the acquisition of economic elements such as natural resources and population. In other words, the economy has always been the core demand of the monarchy and nation-states to the outside world. It is very important for us to adjust our observation perspective to understand this basic logic.

After the world got rid of the religious wars in the Middle Ages, the Westphalian system was established. Under this system, the first premise of the basic norms of international relations recognized by all countries is that fighting for faith is no longer allowed. Countries should only fight for interests, and even resort to war. The wars for promoting faith have been abandoned, and the cruelty of wars for interests has been greatly reduced, which has left the development of modern diplomacy in which countries fight peacefully for the economy and even resort to force. This is an advancement of human civilization compared to the Middle Ages when theocracy was supreme, and it is a transcendence of the past by the foundation of international relations civilization. This division is so important, but the domestic public opinion field and some scholars seem to be unaware of it. Here I will try to give two examples to deepen the impression. In the past few years, ISIS (Islamic State) actually launched a religious war across ethnic countries. The United States, Russia and other countries joined forces, temporarily shelved other differences on the Middle East issue, and sent troops to defeat ISIS separately. This action is in fact a joint maintenance of the most important basic principle of modern international relations, which is not to fight for beliefs. In a long speech at the Valdai Club meeting a few days ago, Russian President Vladimir Putin said that he would digress to talk about philosophical issues. His important statement was that Russia and other Western countries have the same values. After three years of the Russian-Ukrainian war, facing further escalation, Russia's cautious statement is conducive to preventing Western countries from recalling the international strategy of the former Soviet Union, embedding the Russian-Ukrainian war into the template of fighting for beliefs, and conducting more powerful war mobilization. Putin's statement on values ​​is different from the wishful psychological default of some domestic research institutions and general readers. Weakening the value factor, today when the economies of various countries are deeply integrated, the economic factors in international relations are more important.

The author's superficial non-professional view is that the main observation basis of geopolitical theory is strength, and the discussion is about strategic alliances under the constraints of strength. The indispensable underlying element of geopolitical thinking is a country's economic foundation and its economic and trade demands on the outside world (market). In the early days of international expansion, these economic demands first obtained some visible wealth, such as gold, silver, and rare items, due to limited transportation conditions. Then, with the advancement of modern industrial production organization and technology, the early non-visible economic factors such as population, resources, trade sphere of influence, and sea and land transportation channels quickly became the main targets pursued by various countries, and they often resorted to war for this. A prominent example is that the US oil embargo on Japan in the 1940s forced Japan to launch a desperate Pacific War against the United States in order to maintain access to economic resources. There were many considerations for Japan to launch foreign wars during World War II, but the economic motivation for launching the Pacific War was relatively simple and clear.

After World War II, international relations dominated by the two major groups of the United States and the Soviet Union tilted in all directions towards the side with ideological confrontation as the top priority, and traditional geopolitical game theory also developed in this context. Although the underlying economic logic of countries competing for and controlling economic factors in the international arena in the form of groups was once obscured by the threat of nuclear war, once the "peaceful competition" between the two major camps began, the world began a new stage of international relations in which economic resources were competed for by non-war means for a long time. Starting with "détente" (Détente), and then developing into nuclear arms control and nuclear disarmament, these important developments made it possible for international relations to return to the center of economic demands of the outside world, creating a good time for the world to pursue economic and peaceful development. As a result, a large number of important new norms for international economic relations and systematic international economic and trade legal system arrangements were implemented through negotiations. The unprecedented development of international economic trade in this stage led to the explosive growth of world wealth in the same period. More importantly, both poor and rich countries benefited from it.

In this stage of human social development, the use of force to protect important resources such as oil and the use of force to obtain other economic resources always exist. However, the more important new economic development factors: scientific and technological development, and various innovative models such as transnational operations that regard the world market as an operational space, have changed the traditional manufacturing industry with unparalleled influence. The transnational development of manufacturing has changed the economic logic of a country and the world. The entire international relationship, together with the basis of the economic game behind it, has also been adjusted accordingly. Obtaining advanced technology and controlling high-tech exports have become the key parts of the international relations game. Here, military and security factors are intertwined with substantive economic interests, and it is difficult to handle them properly.

After we have supplemented the above-mentioned economic-related deficiencies in the existing international relations cognitive framework, or made the underlying economic logic obscured by military technology and international political research appear, we can then observe the economic logic of the US election and make further reflections.

Second, the economic logic of the US election and Sino-US economic and trade relations

The US election is a comprehensive competition between two different national development visions. The China policies in the two visions stem from the problems that need to be solved in their own economic development. We must get rid of the adverse effects of the stimulus-response interaction that focuses on specific actions in recent years on our way of thinking, deconstruct the relevant underlying economic logic, and not simply "project" Sino-US relations based on our own feelings after being affected.

The reason why this election is called the most important election in 60 years and the most intense confrontation in 24 years is that the two sides have fully engaged in a confrontation over the American vision. After competition and comparison, the election campaign mobilized a large number of voters who never voted to participate in the voting, and the election results fully reflected the mainstream public opinion. This is a fact that cannot be ignored. The results of the Republican election show that its political platform is recognized by the blue-collar and middle classes. One observation is that the exit polls in Florida and Texas, two major voting bases, show that Latino men are actually an important force for the Republican Party to win over the Democratic Party and widen the substantial gap. Whether from the perspective of the class analysis method we naturally accept, directional propaganda, or the object of empathy appeal, this group should be a typical group among the various ethnic groups in the United States with workers, wage earners, and self-employed people as the main body. In this election where the Republican Party competed with real swords and guns, it was not possible to do so by using flowery words or the tragedy of being shot, but by relying on its vision to mobilize the empathy of most voters.

The Democratic Party pursues a progressive identity politics collection strategy, integrating as many complex propositions as possible. In terms of economic propositions, although Obama, who has all kinds of political reputations, was used in the sprint stage, he repeatedly counted Harris's economic checks and told voters several times in his speeches that there is not much the president can do and that everyone's life needs to be improved step by step.

In contrast, the Republican Party focuses on supporting industries and enterprises in its economic policy vision, which can better stimulate the enthusiasm of workers and the middle class than the Democratic Party's killing the rich to help the poor, raising taxes and then giving sugar to the low-income class. Perhaps we can say that the middle class, who are not satisfied with Trump's personal characteristics, voted for Trump for the "decent" job opportunities they hoped for (Lighthizer's words). This proposition conforms to the wishes of the voters and has a mobilization effect.

To think about the relationship between China and the United States, we must first know ourselves and the other side, and deeply analyze the American public opinion reflected in this election, and then put the Sino-US relationship in it. Faced with the grim reality, we can no longer simply project our unexamined and imprecise wishful thinking on the other side. We need to rethink the "rebellious behavior" of the middle class and working class voting for the Republican Party. These people rejected the benefits of the Democratic Party, and they did not vote for Trump because they were excited by the abstract slogan of "Make America Great Again". What they care about is their personal opportunities in the vision of American economic development.

Among the many international economic problems facing the United States, the trade deficit is not a particularly urgent problem. Long-term trade deficits are unhealthy, but now and in the foreseeable future, the United States will not be unable to pay for imports due to trade deficits and need to rely on the support system of the International Monetary Fund. The pressure on the US dollar exchange rate caused by the trade deficit can be eliminated through the capital market and other macro-financial means. Using the deficit phenomenon to reflect on the loss of "decent and dignified jobs" in the manufacturing industry and review the role of trade and employment shocks in the negative decline trend of American communities and even the entire society are the touching parts of Trump's campaign philosophy.

Analyzing the problems of various economic aspects of the United States' international relations, and then analyzing and refining the various concerns of mainstream public opinion in this biggest political showdown in 60 years, is a long-term research topic left to scholars. By observing the economic issues related to relations with China through the election, we should understand that when dealing with the pain points in economic relations, it is impossible to limit ourselves to the obvious issues such as commodities and foreign exchange without thinking about the deep-seated social problems. We must correct our thinking inertia and improve our cognitive framework. Only by identifying the problems correctly can we make fewer mistakes and waste less time when dealing with them.

In order to get a complete concept, here is a brief review of several important background facts about international economic trade.

First, at the beginning of the reconstruction of the world economic system after World War II, one of the purposes of negotiating the reconstruction of a new trade system was to increase employment through international trade. The founding meeting of the International Trade Organization, the "United Nations Conference on Trade and Employment" in San Francisco, is in line with its name and should not be misinterpreted.

Second, while the multilateral trading system is rapidly promoting free trade, it has a clear accompanying constraint that it must provide necessary protection for industries harmed by free trade. The operation of relevant enterprises and social employment data are observation indicators. Historically, under fair trade, when the impact of industrial upgrading brought about by technological progress is too great, such as when the large-scale transnational transfer of textile trade occurs, the multilateral free trade system also arranges trade quotas that completely violate the principle of free trade to limit the export volume, so that the importing country can prepare new jobs.

Third, the US dollar exchange rate is freely floating, while the regulation of interest rates is operated by targeting inflation and employment. The exchange rate and trade balance are the sacrificial parts of interest rate adjustment. From the past practice of US policy choices, it is obvious that the latter has always been less important than the former.

With these concepts, let's review the process of interaction between China-US economic and trade relations.

Eight years ago, when Trump was elected, China gave a huge import order of the 100-day action plan. The US accepted China's goodwill, but emphasized that it hoped to seek an institutional solution. After that, the US still launched a 301 investigation, and after completing the investigation four months later, it announced a list of products to be subject to additional tariffs. China did not negotiate with the United States to reach other alternative solutions before actually imposing special tariffs. Regarding the negotiation price proposed by important U.S. cabinet members during their collective visit to China, China initially believed that one-third of the price could be negotiated, one-third would never be negotiated, and the other one-third China was prepared to adjust on its own without negotiation (this was both an expression of willingness to deal with the other party's concerns and a refusal to include these proposed concessions within the scope of bilateral legal obligations). Within the U.S. statutory time frame, the two sides were unable to remove some product categories from the tariff list through negotiations, nor were they able to sit down and discuss whether the level of the proposed tariff-added goods was appropriate.

At this point, trade issues had already shown signs of being tied to other issues in bilateral relations, and trade frictions became the symbolic first battle of a series of issues and contradictions between China and the United States.

Former U.S. trade negotiator Lighthizer began to turn the employment side of the coin of "trade and employment", the basic focus of the international trade system, to the surface through a series of speeches and articles, combined with the current situation of American society. By the time of this election, after eight years, both governments had adhered to this concept of dealing with international economic and trade relations. It can be predicted that the United States, which is in the process of continuously upgrading its industrial structure, will continue the focus on foreign economic and trade formed in the past eight years. When dealing with foreign economic and trade relations, it will focus on improving the domestic employment level and take into account other economic demands.

3. Imposing a 60% tariff and its impact

Observing this US election and paying attention to the future direction of Sino-US relations, we should fill in the development path of these economic and trade relations that have been ignored in the past eight years. This will help us objectively analyze the current situation and think about the future.

Thinking about the future, the first thing we have to study is what it means if the new presidential team takes over the government on January 20, 2025 and decides to impose a 60% tariff on Chinese products.

The concept of a 60% tariff is roughly equivalent to the unprecedented overall tariff level of the Smoot-Hawley Tariff Act during the Great Depression in American history (the specific goods and tax rates will be very different, and the comparison here is just to give you a general idea). According to some data, the weighted average tariff rate reached 59.6% at that time (weighted average is the result of calculating the trade volume as the weight, which is different from the simple average result). If the United States decides to impose import tariffs on Chinese products at the level of 60%, it is roughly equivalent to imposing import tariffs on Chinese products at the highest tariff rate of the US "Mutt-Hawley Tariff Act" in the early 1930s. This level is the tariff level applied to Chinese products when the United States first began to contact China and lifted the trade embargo. However, it is no longer applicable after the signing of the bilateral trade agreement between China and the United States in 1980. According to the provisions of the bilateral trade agreement, Chinese products began to enjoy the most-favored-nation tariff. From this point of view, the concept of 60% tariff proposed by the United States has its source and basis.

Once it is decided to impose a 60% tariff on Chinese products, what legal difficulties and economic consequences will there be? From a legal point of view, the United States is still relatively "convenient". Because the trade agreement signed by the two sides in 1980 used the "most-favored-nation treatment" clause. Later, during the Clinton administration, in order to avoid the annual review of immigration issues in communist countries under the Jackson-Vanik Amendment and to avoid the conflict between the review mechanism and the general provisions of the World Trade Organization (WTO) after China joined the WTO, the United States passed the Permanent Normal Trade Relations (PNTR) Act for China. The cancellation of the low-tariff treatment for imports from China can just take advantage of the historical changes in this law to go back. It can be said that there are not many domestic legal obstacles for the United States to do so. This situation is not favorable to China.

The legal motion proposed by US congressmen, that is, to cancel the permanent normal trade relations with China through legislation, is an even more unfavorable situation. Because once the economic and trade relations between China and the United States turn around in the future, it will be difficult to overcome this newly established legal obstacle.

What kind of multilateral legal issues will this encounter in the WTO? The common expression in the domestic public opinion field cannot distinguish between the statutory rights and obligations of international treaties and the spirit and principles advocated by international arrangements. It is unprofessional to say that a certain practice violates WTO regulations in general. It is wrong to make no distinction between the legal rights and obligations of institutional arrangements and the spirit and principles that are not strongly binding. If China and the United States, two WTO members, enter the WTO dispute settlement procedure over the issue of imposing a 60% tariff, the spirit and principles are just background and cannot be used as the basis for specific judgment.

According to the provisions of the protocol that China joined at the time and the specific provisions of the 15-year transition period for promoting market-oriented reforms, China can appeal and express dissatisfaction, but it is difficult to obtain a favorable ruling. Of course, the unique feature of the WTO dispute settlement is that in the whole process of resolving disputes, various opportunity windows are provided, supplemented by arbitration or mediation, to encourage both parties to resolve issues through negotiation and consultation. As long as both parties reach an agreement and withdraw the lawsuit, the dispute settlement of this case is considered successful. Bilateral and multilateral negotiations in turn are a positive procedural arrangement to increase the chances of resolving problems. It is important to explain that, contrary to the impression of most non-professionals, the multilateral economic and trade system is more of an occasion for reasoning and a place to negotiate and resolve conflicts, rather than an institution for adjudicating right and wrong. The reason is simple. On issues involving interest groups within member countries, if one party is judged to be wrong and there is no multilateral enforcement measures to follow up, the judgment will not solve the problem.

What economic impact will the 60% tariff have? Although it was mentioned earlier that 60% basically returns to the high-end tariff level before 1980. Considering that China does not have a monopoly on technology or raw materials for most products, and there are many competitors for similar products in the world, once tariffs change the price advantage of Chinese products, it is likely that they will be squeezed out of the US market by competitors. In the long run, even if the discriminatory high tariffs can be reduced in the future, if Chinese products want to return to the US market, it is not possible to achieve it by returning to the tariff level. They will also have to compete with other countries' products or local products that have replaced them and established themselves in the US market.

Some people may have an unrealistic idea that "the East is not bright, the West is bright", and they can open up new international markets. Past lessons are that once the largest market is closed, the resulting trade diversion will have an impact on other markets. Force other affected markets to also take safeguard measures. In history, it has happened that a Chinese export product was judged to be disruptive to the market and was subject to additional tariffs. A series of markets were successively closed due to the impact of the trade diversion, causing the Chinese product to withdraw from the international market completely.

The above is the expected impact of the 60% tariff. The good news is that according to the US Customs origin rules, there are legal criteria for determining the country of origin of products. Generally, the value-added standard for determining the origin is 40%. According to this standard, the value-added percentage of many large multinational companies in processing trade in China is relatively low. There are some relatively solid research or monographs in this regard for reference, which will not be repeated here. In other words, this large number of Chinese export products may not be subject to taxation according to the US Customs origin rules. What needs to be paid attention to is how China will deal with this complex phenomenon if a large number of Chinese-origin products are blocked from export, and a large number of foreign-funded processing trade products can continue to enjoy low tax rates and export to the United States according to law. If opinion leaders who lack certain knowledge of economic and trade policies and are filled with righteous indignation take advantage of the situation to direct their indignation of "unequal treatment" to foreign-invested enterprises in China and then use them as targets for retaliation, the trade and other collateral losses that may be caused will be huge.

After hearing that the new US government was going to impose a 60% tariff on Chinese products, a group of opinion leaders began to study several "clever tricks" to set up factories or set ambushes in other countries to enter the United States. The motives of these enthusiastic people are good, and the direction of their thinking is not too outrageous, but these must be implemented in accordance with laws and regulations on the basis of carefully studying various preferential arrangements between third countries and the United States and the rules of origin in free trade agreements. Taking the lead in inciting public opinion will not help companies, but will also trigger early warnings and cause trouble.

Before the United States officially introduced the tariff increase measures, various plans were under consideration. Trump proposed to impose a 10% tariff on Chinese products to force China to increase its cooperation in controlling the export of fentanyl precursors. It also proposed to impose higher tariffs on Canada and Mexico. From these changes, it can be seen that Trump is also changing his thinking angle. Perhaps he has realized that raising tariffs by 60% on top of the tariffs imposed on 2,000 Chinese products in 2018 is a prohibitive tariff. If trade is banned, taxes cannot be collected. It is better to weaponize tariffs to solve the problem of fentanyl smuggling. This leaves room for China and the United States to resolve the problem through negotiations.

Fourth, concluding remarks: key points for future observations on China-US bilateral relations

In the past eight years, China-US economic and trade relations have almost become a "stone dagger" for friction and struggle in other relations, and unfortunately have become a residual item outside of the core interests in the formula of bilateral relations. Now it is more certain to accept the next new test.

China-US relations are the most important bilateral relations in the world. The two countries were once each other's largest trading partners. In this American national experiment of reforming the existing deep political system in the United States, focusing more on providing more decent and dignified job opportunities for blue-collar workers and the middle class, changing the downward social decline and opening up opportunities for upward mobility, what are the logical and continuous observation points in bilateral relations?

First, in terms of economics and trade, the trade policy that Trump began in his first term and was implemented by Lighthizer-Tai, which aims to increase decent employment opportunities in the United States, has been responsible for curbing the downward decline of American society. It has also "tragically" occupied a place in the Republican vision competition in this election and has been supported by the majority of voters. We must understand this new development and make the original cognitive framework of bilateral relations more complete.

Second, in terms of the scenario setting of bilateral relations, several governments of the two countries have stated that the two countries are not enemies, do not seek to treat each other as enemies, and do not seek ideological confrontation. Both sides have expressed respect for each other's core interests. Both countries have stated that they will cooperate on some challenges faced by mankind. In recent years, leaders of both sides have made positive efforts, and both sides have made clear statements on their core positions, and have received serious positive feedback from the other side, preventing the further decline of bilateral relations. But what is frustrating is that the public opinion orientation of both sides is not in the same direction. As far as domestic media are concerned, in recent years, constantly comparing the rise and fall of the two sides' strength in key areas has become a popular method of leading public opinion. Considering that in addition to military technical thinking and international relations theory schools mentioned at the beginning of this article, there is also the influence of media and public opinion on policies. Judging from the current situation of the two countries, public opinion is obviously strengthening the confrontation and confrontation mentality in various fields of Sino-US relations. There is a famous saying in the international relations community: "If you treat the other party as an enemy, the other party will become an enemy." Similarly, when economics prompts changes, there is a similar saying that "prophecies will be self-fulfilling." We need to observe this tendency carefully and take it seriously.

For the few official formal exchanges, reports are more often described as a serious confrontation of attacking as defense and verbal battles. Based on such reports, researchers will ask: Is this a technical game in normal state relations, or a diplomatic strategy for relations between opposing states? This involves another serious question: Have the two sides reached an informal consensus on the issue of the antagonistic relationship? Or is it just a fireworks effect created by the report?

The decision-making level of a country's foreign relations is very high, and people in the game or bystanders should be cautious when studying issues and expressing opinions. Caution does not mean not saying or not reporting to increase transparency, nor does it mean blocking the way of speech, but it means that there should be evidence to say something, and no arbitrary assumptions should be made, let alone using words out of loyalty.

Although it is convenient to put new figures and facts into it to measure changes by simply and formulaically listing the various aspects of bilateral relations, such a method of observation and thinking also limits people's thinking. Because this formula is too simple, the template generated by it fundamentally hides the basic fact that human social activities revolve around the economy as the center, and it is also inconsistent with the Marxist assertion that the economy is the foundation, and some other fields belong to the superstructure and are restricted by the foundation. The tension of China's own economy is the basis for studying foreign relations, and the demands of China's economic development on the outside world are the starting point for studying foreign relations, not the other way around. In the past eight years, especially during the epidemic, Sino-US relations have spiraled downward in various fields. The prominent changes in the export policy of dual-use high-tech military and civilian products related to national security have highlighted the tendency to prioritize national security issues over economic considerations. The security concerns caused by the Sino-US game have become the "king bomb" that overwhelms other issues.

Third, in terms of the thinking mode of bilateral relations, representatives of official think tanks began to publicly talk about the complex relationship between security and economy at the recent World Political and Economic Conference. They believed that if the economic cost is not spared for security considerations, the economy may eventually become less secure. It was rare to think about problems in this way in the past. Now that the American vision advocated by the Trump administration is about to be transformed into implemented policies, we should judge the situation and see the changes and the increasingly severe situation. We should also reflect on whether our understanding of Sino-US relations is no longer sufficient.

We should realize that the economic base and the superstructure (that is, other related areas of Sino-US relations) interact with each other. Simple elementary mathematical forms of two-sided parallelism and linear thinking are unsuitable templates. This template corresponds to linear thinking, which is rigid and single, and does not help to think about and explore solutions to problems.

If there are contradictions and conflicts between two major countries with fundamentally different ideologies in various fields of communication, but if both sides believe that the limited world resources will be barely enough in the future with the help of scientific and technological progress in terms of economy, then the coexistence of the two major countries of China and the United States is possible.

Thinking and studying Sino-US relations under this premise is to strive to find solutions or compromises. We should iterate the arithmetic template thinking of elementary mathematical forms (parallel on both sides of the equal sign) and use higher mathematical thinking to examine and understand the relationship between the two countries. We need to find and understand the functional relationship between various bilateral relations and clarify the interaction between related fields, that is, which field’s changes are the function of changes in another field. We can further consider whether there is a possibility of second-order or higher-order solutions (exchanging the interests of some other related fields), which can further open up our thinking. It is worth mentioning here that the foundation of the economic and trade relations between China and the United States is not only broad, but also "thick" and deep, which is due to the complexity of the economic process itself. To borrow the image of the derivation of multiple derivatives of a function formula, negotiations on economic issues are difficult and complicated, but because economic exchanges have depth, many problems can be solved in a cross-cutting manner, and are not necessarily unsolvable.

Starting from functional thinking, reviewing and comparing the changes in the past from the perspective of linear thinking will be inspiring for us to deal with the current problems facing Sino-US relations, cope with the changing situation, and find ways to improve and solve them. If, after deduction, the expression of the functional relationship and the expression of the relationship between the economic base and the superstructure can support and verify each other. We should avoid using economic trade as a bargaining chip for issues in other fields, and try to separate them from other issues as much as possible. In other words, if the problems of foreign economic and trade relations are not handled well, it will be more difficult to improve the domestic economy, and weak economic performance will also drag down international security issues. Using the economy as a bargaining chip for other issues may not necessarily achieve the expectation of gaining greater security in the end.

In short, we hope that the Sino-US economic and trade relations, which were once highly integrated and symbiotic, can return to the center of bilateral exchanges through the joint efforts of both sides, so as to enhance our ability to distinguish and deal with various issues in Sino-US relations and rebuild mutual trust from the bottom up through negotiations.