The New Economic Security State
How De-risking Will Remake Geopolitics
By Henry Farrell and Abraham Newman
This week, Chinese President Xi Jinping met with U.S. President Joe Biden and other American political and business leaders in San Francisco. Although government-to-government relations took center stage throughout the week, Xi arrived in California with another goal in mind: wooing foreign investment despite recent U.S. measures aimed at reducing American economic reliance on Beijing.
When it comes to sanctions and export controls, the United States must tread carefully, warn Henry Farrell and Abraham Newman. If Washington relies too heavily on tools of coercion in efforts to maintain economic security and decouple from China, a mix of miscalculations and overreactions could dangerously imperil the world’s economic system. “To address the new problems of economic security and avoid a downward spiral that could threaten the global economy,” Farrell and Newman write, “U.S. officials must reckon with a major task: nothing less than a transformation of the U.S. government.”