An ancient Chinese saying, 'to sleep in the same bed but dream different dreams', describes the Strategic and Economic Dialogue that was held with grand pizzazz in Washington on July 27 and 28.
'We're turning to China almost like a feuding couple might turn to a marriage counsellor for mediation,' explained Orville Schell, director of the centre for US-China relations at the Asia Society in New York. Not a good prognosis for what many hope will be an intimate and co-operative relationship.
Previous US administrations berated China for its lack of open capital and foreign exchange markets, human rights record, and relations with unsavoury regimes such as North Korea, Iran and Venezuela.
US President Barack Obama's administration seems to have flipped the relationship. Today, Washington needs China's foreign exchange reserves to underwrite its own gargantuan debt and to play pivotal roles communicating with those regimes that previous administrations snubbed.
There is another ancient Chinese saying that 'two tigers cannot share one mountain'. With both US Secretary of State Hillary Rodham Clinton and Treasury Secretary Timothy Geithner vying for management of the US-China relationship, the former Strategic Economic Dialogue has been expanded and imploded to become a 'strategic and economic dialogue', covering every issue of the relationship. In practical terms this is unwieldy.
Former Treasury secretary Hank Paulson's original intention was focused on capital and foreign exchange market liberalisation. Now, with all issues thrown on the table at once, little of substance can be discussed. For China's delegation, that's a good thing, a big show of solidarity and face-giving in a relationship where both parties can find very few points of agreement.
While the meeting staged the importance of the US-China relationship, China's own observers and analysts are wary and soberly feel that no substance will come through such expanded and media-hyped dialogue. Actually, both parties have very few areas where they can find mutual co-operation and commonality.
