- The top two economies in the world hold the largest sway over the future of the world
- We are currently on the cusp of witnessing, shaping or making two futures of the world: One driven by the two complementing each other; another driven by one trying to substitute the other
- In economics, complementing means goods and services will be utilized jointly (e.g., printers and cartridges, iPhones and iPhone cases or skins) while substituting means goods and services for the same demand or purpose (e.g., iPhone and Samsung Galaxy) and one can take over another. In my own words, complementary goods are mutually beneficial, while substitutes are mutually exclusive
- Similar goods tend to substitute each other, while different goods can be arranged for complementing. But countries are unlike goods: Each country tends to work with similar countries to complement each other, but tries to substitute those unlike themselves. Given the differences between US and China it’s much easier to take the substitute approach than complementing
- Without a doubt and without exaggeration, the complementary future will beat the substituted future hands down, because it can bring prosperity, growth, liberty, safety, sustainability, human power, technologies, happiness, or simply anything or everything deemed positive by humans in this world
- What is best for the world is also the best for US, which needs the Chinese competition and Chinese cooperation to lead the world more efficiently
- What is the best for the world is also the best for China, which needs the guidance, experiences, leadership in innovations, criticism and monitoring of the US to stay competitive in the long run.
- Here is a perfect case in point why complementing is good for the world: Covid-19 vaccine development. Pfizer said their vaccine has to be kept ultracold — –70°C to be accurate, while the one for Moderna is –20°C. This “poses challenges in developing countries, where electricity for freezers can be unreliable and dry ice scarce.” Now look at China, CoronaVac has developed a vaccine that “induce lower antibody levels than what we’ve seen with other vaccines” but “it’s cheap and fast to make in comparison to the mRNA vaccines” Even more importantly, it does not require ultra-cold temperature to store and to transport. Clearly vaccines like this would serve the developing countries much better.
- Another example is the California High-Speed Rail. This morning I was listening to the Google News and there was a reporter talking about nowhere near completion of that rail. I then looked at the Wikipedia, and found that Governor Gavin Newsom had formally announced in his State of the State address in 2019 that “while work would continue on the 171-mile (275 km)[9] Central Valley segment from Bakersfield to Merced, the rest of the system would be indefinitely postponed,” due to the cost overrun and delays. “Project costs have escalated significantly from an initial estimate of $33.6 billion in 2008” all the way “to between $63.2 billion and $98.1 billion (YOE) and delayed initial service to 2029.” I can’t help but think how much the same project would have cost by Chinese. Perhaps half the initial budget to the tune of $20 billion and to finish it by 2018? It is political impossibility to hire the Chinese workers to get the job done in California, but there should be some way for the US to leverage the low costs and manpower in China
- The pandemic this time also taught us a big lesson: Each country has its pros and cons, strengthens and weaknesses. When it comes to stopping the virus from spreading, the US simply does not have what is required to get the job done as efficiently as China. Complementing again would do everyone good if the political willingness is there.