Steve Roach will discuss the evolving relationship between the United States and the Peoples Republic of China. He is a senior fellow at Yale’s Jackson Institute of Global Affairs and has authored the recently published book entitled Accidental Conflict – America, China and the Class of False Narratives.
Steve formerly was chairman of Morgan Stanley Asia and the firm’s chief economist for the bulk of his 30-year career at Morgan Stanley, heading up a highly regarded team of economists around the world and focusing on the impact of Asia on the broader global economy. Steve has also served on the research staff of the Federal Reserve Board and was a research fellow at the Brookings Institution. He holds a Ph.D. in economics from New York University.
Steve is a member of the Council on Foreign Relations, the Investment Committee of the Metropolitan Museum of Art, the China Advisory Board of the Environmental Defense Fund and the Economics Advisory Board of the University of Wisconsin.
In his new book, Accidental Conflict, Steve finds the two largest world economies in a clash of dueling and incorrect narratives that each holds about the other. Not so long ago, the U.S. and China needed each other to prop up their own flagging economies—China required external demand to support its “export-led” development strategy, while Americans relied on low-cost goods from China—but in recent years, they have undergone a trade war and a tech war. Now they face a new cold war. Both countries constantly seek economic growth, but they both have a savings problem: the Chinese have excessively high savings and low internal consumption, while Americans have little savings and high debt. In illustrating his theme of codependency, Steve breaks down the reasons behind this disparity, fed by the different “national dreams” of the two countries and the persistent “false narratives” they entertain about each other. Harkening back to the mid-1980s, U.S. officials have, for purposes of “political expediency,” often blamed China for many economic problems in the form of intellectual theft, predatory tech practices, and cyber-hacking.
The author stresses that many of these issues are overblown, and he suggests three areas of focus for conflict resolution: climate change, global health, and cybersecurity. He also suggests “re-opening foreign consulates in both countries…loosening visa restrictions for students and journalists, and restarting educational exchanges like the U.S. Fulbright Program.”
Finally, Steve delivers a thoughtful framework for moving from codependency to interdependency, involving a bilateral investment treaty and the establishment of a U.S. – China Secretariat. He concludes that “there is ample opportunity to exercise good faith.”