China Rising: Small World, Big Stakes

The U.S. and China are intimately linked--for better or worse. Can we make room for each other?

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NELSON CHING / SIPA FOR TIME

Liu Li works at a factory in Kaiping which produces clothing for the American company Timberland.

Liu Li has never met anyone who wears the clothes she makes. For nearly two years the 20-year-old rice farmer's daughter has worked at the Chaida Garment Factory in the steamy southern Chinese city of Kaiping, stitching seams on winter jackets for such companies as Timberland. Amid the clatter of sewing machines, surrounded by mountains of down vests headed for the U.S., Liu tries to imagine the people whose wardrobes have given her a job. "They must be very tall and very rich," she muses. "But beyond that, I really can't picture what their lives are like."

Almost certainly, that feeling is mutual. Last year Americans bought clothes "Made in China" to the value of $11 billion and additional goods worth $185 billion. Yet for all the ubiquity of Chinese products in U.S. stores, to most Americans China remains a mystery. For both nations, that is unfortunate; though it does not have to, a mystery can all too easily metamorphose into a threat. Most Americans don't realize the extent to which China's future and that of the U.S. are linked. It isn't just down vests--or toys or shoes--that bind the U.S. and China together. China holds billions of dollars of U.S. debt; its companies increasingly compete with U.S. ones for vital resources like oil; its geopolitical behavior will affect the outcome of issues of key importance to U.S. policymakers, like North Korea's nuclear arms capacity. Although their political cultures are radically different, in many ways and many areas both countries essentially want the same things.

Will the U.S. come to think of China as a friend or a foe? This year, after a period of placid relations while Washington was absorbed with the war on terrorism, there have been indications aplenty that some high U.S. officials--and many ordinary Americans--find China's rise to be a source of anxiety. China, critics say, manipulates its currency to keep its goods cheap, hence destroying American jobs. China steals intellectual property from U.S. firms. China is engaged in a crash program of modernization of its armed forces.

Within the Bush Administration, there are signs of dissonance on how to deal with China. "We have the best relations [with China] that we've had in some time--perhaps ever," said Secretary of State Condoleezza Rice on her recent tour of Asia. Yet on June 4 in Singapore, Defense Secretary Donald Rumsfeld made headlines with a hawkish speech, asserting that "China's defense expenditures are much higher than Chinese officials have published." Rumsfeld continued, "Since no nation threatens China ... why these continuing large and expanding arms purchases? Why these continuing robust deployments?" The next day, Rice tried to square the circle. "I think that both happen to be true," she said. "Relations are at their best ever, and the Chinese are engaged in a major military buildup, and that buildup is concerning."

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