US Secretary of the Treasury Jacob Lew on Tuesday urged Congress to approve an agreement to reform the IMF. The agreement, which was reached in 2010, has been passed by many countries since then except the US, as the reform plans are believed to step on the interests of some US groups.
Lew’s warning is obviously driven by the application of some European countries to join the China-led Asian Infrastructure Investment Bank (AIIB). If US lawmakers can change their way of thinking because of the competition from China, both the US and the world will benefit.
The US advantages mostly lie in its military strength and discourse power. Besides its huge nuclear arsenals, its conventional warfare systems also have strategic deterrence at the global level. As for its discourse power, the US media has the ability to infiltrate its values and concepts into the world. These media outlets are a means to maintain the influence of US values. It is hard to make political arguments with the US.
Therefore, American society has long considered itself as the global leader. The country has become unaccustomed to any challenges in key sectors.
However, the US cannot prevent diversity and innovation emerging from other parts of the world. Trying to get free from US dominance or exceed the US does not mean a confrontational scenario.
The US has to accept some competition that it feels uneasy about. Washington will see this as a challenge, but it has the ability to bear it. Although the US resists the AIIB, no sharp conflicts have occurred between China and the US. Washington seems to have a more benign tolerance toward economic competition than toward a military race.
That the AIIB breaks US containment provides an important lesson. The US cannot resist everything it dislikes but which is welcomed by most other countries. This will not challenge US military strength, and the US media cannot badmouth it too much.
It is unrealistic to wish for no rivalry between China and the US. But the rivalry can be positive and interesting. A new type of major power relations will sooner or later face a rising China, which is the foundation for both countries to adopt innovative ways to handle their competition.
China may have to wisely leverage between the two advantages of the US. China is developing its own military might, but does not aim at racing with the US. It is also engaged in developing its soft power by convincing the world with its successful experiences.
The evolution of the AIIB has landmark significance. It brings a new momentum to China’s opening-up. It also creates room for understanding China-US competition. Finally, the AIIB points to a bigger picture of what China’s “One Belt and One Road” initiative entails.