As the United States racks up ever higher budget deficits, China has bought ever greater quantities of American debt. Now many observers—including the U.S. and Chinese governments—are concerned about imbalances in the relationship between the two countries. Author Zachary Karabell says that conventional wisdom may be wrong. In his book Superfusion: How China and America Became One Economy and Why the World’s Prosperity Depends on It, he argues that the Chinese and American economies have become a unified system that can benefit both parties—but can't be undone.
A podcast of Karabell’s conversation with NEWSWEEK’s Daniel Gross can be heard here. Listeners can also subscribe to Gross’s Every Day I Read the Book podcast on iTunes.
Your book is an argument that the U.S. and Chinese economies are essentially one integrated system. Most people see it as the Chinese making cheap stuff out of plastic for us and then buying our debt.In my view that's only one aspect of a much more complicated relationship that has seen many many large U.S. companies finding their most robust and dynamic growth in the last 10 to 20 years in China—some of which, granted, doesn't go directly into the U.S. economy, but a lot of which does. A Caterpillar plant in Mississippi is kept open because it provides couplings for equipment that's made in China and used in China. It's also a relationship that sees China depending very heavily on U.S. intellectual know-how on setting up business systems and frameworks. That doesn't show up in trade statistics, but so much of China's growth over the past 20 years has been a product of utilizing and adapting American intelligence to fuel that economy.
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