Clyde Prestowitz has influenced U.S. foreign trade and investment policy for many decades, both inside and outside government.
- Clyde was on the frontlines when Japan presented the greatest trade challenge to the U.S.
- And his book on U.S.-Japan relations, Trading Places, was a bestseller.
As China replaced Japan as the focus of trade frictions, Clyde brought his experience and expertise there.
- His latest contribution to the issue is The World Turned Upside Down: America, China, and the Struggle for Global Leadership from Yale University Press.
- And it is terrific, with rave reviews in the media, such as the Financial Times, and cited numerous times in analyses.
To learn more, Clyde and I spoke on Zoom for about an hour and a half.
- Today, I want to share with you a few of the insights – laid out below - that emerged from our conversation.
When we spoke, Clyde emphasized that for four decades the U.S. has misinterpreted China. He gave five reasons for this.
- But the one that struck me as especially contrarian was the third.
‘The third is the ultimate fantasy in America: the idea that we wanted and that China wanted to become a 'responsible stakeholder' in the rules-based international order that had been established by the United States and the free world.
- ‘As a diplomat myself in the Regan administration, as one of the vice-chairman of President Clinton's Commission on Trade and Investment in Asia, I have spent a lot of time negotiating with countries around the world, but particularly with China, Japan, and Korea, in pursuit of American attempts, to persuade them to change their policies and change their objectives, and the way that they pursue building their economies.
‘And I have come to the conclusion that they're not going to change.
- ‘If they came to us and asked us to do the same thing, we wouldn't change. It's a waste of time.
‘So, all discussion of negotiations to engage with China or to persuade China to play by the rules, to play by WTO rules, this is all a waste of time.'
- ‘It only irritates the Chinese, and it doesn't do anything for us. We have got to stop.
Instead, he advocated that we ‘forget about China’ and focus on those actions that strengthen our side.
In technology, ‘We need to make sure that the United States and the free world remain the leaders and the dominant players in those technologies because those technologies are not some kind of national thing that can be separated by a nation.
- ‘They are global technologies. There are going to be global standards, and the leaders in those technologies are going to have immense global power.’
- ‘And we don't want to be under the power of a coercive system like the Chinese communist system.
- ‘Let's really build our own industry, our own technology. Make sure that we're at the top of the pole when the climbing contest is done.
In corporate relations, he noted that ‘global corporations, but particularly American global corporations are in both a power position and a vulnerable position. Let's take companies like Apple and FedEx.’
- ‘These companies are powerful. They have armies of lobbyists and lawyers. They have gazillions of dollars. They have instant entree to The White House, to any congressional office, to any senatorial office. Their staff in Washington help to write the laws.
- ‘They can defy the US government. They can take the US government to court and win.
- ‘Apple can refuse to cooperate with the FBI and get away with it.
‘In Beijing, they're on their knees. They kowtow. They have no stroke. They're hostage.
- ‘And we're in a crazy position where Beijing is in a position to direct the heads of major American global corporations to lobby for Beijing in Washington.
And, most importantly, in U.S. politics, ‘We need to have some unity in this country. We are so at the moment divided.
- ‘We need to recognize that, “Hey, wait a minute. We are all Americans. We all have common interests, and we need to focus on our common interests in order to have the cooperation, and the policies that are effective to meet this challenge from China.” ’
Get more of our conversation below.
- And be sure to get The World Turned Upside Down: America, China, and the Struggle for Global Leadership.