Nov. 5, 2020

The Moore School’s Folks Center for International Business hosted a virtual forum with David Firestein, the President and CEO of the George H. W. Bush Foundation for U.S.-China Relations. More than 450 people from 15 countries registered for the virtual discussion.

Focusing on the tumultuous relationship between the United States and China, the Folks Center program was sponsored by the Rachel and Jim Hodges Fund in collaboration with USC’s School of Journalism and Mass Communications.

“Any good strategy cannot begin without a careful understanding of the business environment that you are in or entering,” said Gerald McDermott, moderator of the discussion and international business professor at the Moore School. “The knowledge that Firestein brings to us essentially sets the foundation upon which one would assess future risks and opportunities in broader Asia, especially China, and also for U.S. businesses abroad.”

During his virtual visit to South Carolina, Firestein also presented a guest lecture to a joint class of international business and journalism majors. The class highlighted the declining perception of China in the United States, and how, despite years of conflict, the recent sustained decline has been an aberration in light of the long history between the U.S. and China, said Michael Murphree, a Moore School international business assistant professor who teaches the course that participated in the Firestein lecture.

Firestein emphasized that despite the sustained decline in their recent relationship, China remains the third largest U.S. trading partner and that more Americans still prefer having good economic ties with China. With the students, Firestein illustrated China’s policies on social media and the accompanying advancement of Chinese information technology multinational corporations in western markets.

Considered an expert on U.S.-China relations, Firestein has years of experience analyzing and advancing public policy between the U.S. and China and said he believes that it is a crucial partnership for both countries.

“The U.S.-China relationship is the single most consequential bilateral relationship in the world,” Firestein said in his opening of the forum.

This long-standing relationship has been one of the most significant and useful partnerships for the United States. Former President George H. W. Bush made it a priority to strengthen this relationship during his presidency from 1989-1993.

“George H. W. Bush brought with him a very deep and textured understanding of China,” Firestein said. “President Bush believed that no global challenge can be solved in the absence of constructive collaboration between the United States and China.”

However, the partnership between the U.S. and China has become fragmented over the past few years. With the closure of the Chinese Consulate General in Houston and the closure of the U.S. Consulate General in Chengdu, Sichuan Province, China, there is unresolved turmoil between the two countries.

“The U.S.-China relationship today is not what it was a few years ago,” Firestein said. “It is actually at a low point in the modern era.”

Firestein points out that this decline in the two countries’ relationship is due to many factors, including enduring frictions over COVID-19, Hong Kong, trade and technology, regional security issues and human rights, among other issues.

Since the start of the COVID-19 pandemic, the American public has viewed China in an increasingly negative light. This has strained the relationship and weakened trust between the countries.

“[COVID-19] has done more to take the U.S.- China relationship to a fundamentally different, and worse, place than any issue in the modern history of the U.S.- China relationship,” Firestein said.

Worsening this relationship is the U.S. political narrative, emanating from some in Washington, that the Chinese government purposefully created the virus to kill Americans and damage the U.S. economy and way of life, he added.

Firestein leveled strong criticism of the U.S. administration’s decision to levy tariffs on the vast majority of Chinese imports to the United States, noting that these U.S. tariffs are taxes on the American people that detrimentally impact U.S. jobs.

In support of this assertion, Firestein cited data that establishes:

• The U.S. merchandise deficit with China is higher than it has ever been,
• The U.S. merchandise deficit with the world is higher than it has ever been,
• Hundreds of thousands of U.S. manufacturing jobs have been lost in the past four years,
• The historical U.S. agricultural surplus with China has, for the first time in decades, been turned into a deficit, and
• American households are paying up to $1,500 more at stores than they were two years ago.

“China is the most formidable national competitor that our nation will ever have in the lifetime of every living and breathing American today. However, it is not our enemy,” Firestein said.

Firestein said that there are certain political actions that the U.S. needs to agree to in order to gain a better foothold in the relationship with China. These steps include:

• Doing no further harm to American citizens with “hurt America first” policy choices,
• Eliminating the job-killing tariffs,
• Having discreet, businesslike negotiations,
• Coordinating and working with the U.S.’s closest allies and partners as the U.S. engages China,
• Being more clinical and less emotional about matters of public policy.

“We must also tether policy discourse to factual reality,” Firestein said.

Following these steps and getting the U.S.-China relationship back on track and in good standing is imperative for both countries — economically and politically, Firestein said. 

“The grandest strategic blunder the U.S. could ever make would be to turn China into an enemy it didn’t have to be,” Firestein said.

Hearing Firestein discuss the U.S.-China relationship and its implications “was refreshing to hear an opinion based on facts and experience,” said Carmen Landy, USC Mass Communication Ph.D. candidate. “Firestein encouraged us to think for ourselves, and although he had a clear opinion, succeeded in providing us with a balanced presentation on the subject.”