US-China relations are back in the headlines after the administration announced it planned to follow though on arms sales to Taiwan and Beijing mad clear it was not happy. The most recent confrontation is reminder that the stability of US-Chinese relations cannot be taken for granted. Indeed, left unintended the relationship could well devolve into conflict. A recent report by Derek Scissors at The Heritage Foundation provides important insights into China's economy that are vital for understanding how Americans should think about China.
Scissor's paper, "10 China Myths for the New Decade" concludes the country's economic growth has been accompanied by growing misinformation about its economy. Contrary to conventional wisdom, China is not leading the world out of a recession, is no longer moving toward a market economy, is not America's banker, and may never surpass the U.S.
"Myths concerning China encourage bad U.S. policy," Scissors finds, "[e]xaggerating Chinese prowess and focusing on secondary issues leads to mistakes in general American economic and foreign policy and an incoherent strategy with respect to the PRC. A better-informed view is only the first step in meeting the real challenges, but it is a necessary first step."