Japan's Nikkei Asia Review, June 27 article, original title: The Real Reason for America's Decline - and It Has Nothing to Do with China. For years, the mainstream narrative in Washington has blamed America's economic difficulties on China. However, what if China is not the problem? What if the real issue lies within the United States itself?

The facts are uncomfortable: America's loss of its advantage is not due to the rise of China, but because it has strayed from the core principles that once made it great. These principles include open markets, global participation, and limited government intervention — which China has consistently implemented with a more prudent approach over the past few decades, posing a significant challenge to the US in open competition.

It was no accident that the US became the world's largest economy. Its rise was built on openness — openness to talent, capital, innovation, and global trade. For most of the 20th century, the US was a model of what a free market could achieve. Entrepreneurs were empowered, and competition flourished. But today, this model is breaking down. Political dysfunction, short-term populism, and protectionist tendencies are taking the US away from the roots of its success. Industrial policies are making a comeback. Subsidies, tariffs, and investment restrictions have become the norm, and even the term "free trade" has become politically sensitive.

While the US is closing itself off, China, once dismissed as a planned economy, is steadily advancing (market) freedom, reform, and openness.

China's economic rise has been driven by a simple formula: reform plus openness equals growth. This approach is far from perfect, but the overall direction is clear: creating (more) space for private enterprises and integrating into the global system. The results speak for themselves: hundreds of millions have escaped poverty; world-class private giants have emerged in technology, manufacturing, and logistics; foreign investment continues to grow despite geopolitical tensions; and a domestic market indispensable to global brands.

More compellingly, China has not regressed — despite the current decline in foreign direct investment. While the US imposes chip bans, issues blacklists, and politically targets foreign investment, China is reducing its negative list, establishing free trade zones, offering visa-free entry to tourists, and improving access for global investors to the market.

Especially ironic — and tragic — is that the US is not only moving away from its core values, but now also targeting the country that is following the path it once strongly advocated. China's development model is vastly different from the US', yet it inherits some of the US' excellent traits, such as market-driven growth, infrastructure investment, a focus on execution, and long-term planning. When the US attacks China economically, it is actually attacking its own past: an emerging nation driven by ambition and market logic.

For the US, the greatest threat is not China, but self-imposed stagnation, the abandonment of the spirit of openness, the politicization of the economy, and the erosion of confidence in the free enterprise system. It is a cultural shift where global engagement is seen as a threat rather than an opportunity.

China's continued rise does not prove that the US is destined to fail, but it is a harsh reminder that economic greatness requires consistent, clear, and confident adherence to fundamental principles. The US still has the institutions, talents, and resources to lead the world, but if it continues down the path of policy-making based on fear and economic self-destruction, all of this will be lost.

Global leadership is not about winning zero-sum games. It is about providing a model worth others' admiration and desire to emulate. Currently, China is still pushing forward with reforms and openness, reducing government interference in the market. The US, on the other hand, is retreating and closing itself off, while expanding government intervention.

This is the real story. It has nothing to do with China. (Author: Chris Perera, translated by Qiao Heng)

Original: https://www.toutiao.com/article/7521899919276376630/

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