Xi Jinping is the main thing holding China back
During the Biden years, a lot of us thought that the next era of world history would be defined, in large part, by economic and geostrategic competition between the U.S. and China. That’s looking a little less likely these days. Donald Trump still makes the occasional aggressive noise toward China, but his approach has become much more conciliatory. Slowly or quickly, he’s walking away from most of the policies the Biden administration was using to stand up to China — canceling export controls, canceling industrial policy, putting tariffs on key allies, defunding research, and so on.
Meanwhile, China is reaching the zenith of its power. Its share of world manufacturing 1 has rocketed up to levels similar to what the U.S. enjoyed in the mid-20th century, when it was the planet’s undisputed industrial colossus:
China’s cities feel like the future to people who go there — their infrastructure is gargantuan and newly built, they’re filled with robots and electric vehicles and futuristic payment systems, and the buildings are covered in LEDs. China’s innovation system is producing fewer world-changing breakthroughs than America did at its peak, but has nevertheless managed to put the country at the forefront of science and technology2 through an accumulation of incremental discoveries. The world’s electric cars, drones, ships, industrial machines, and robots are made in China, and — thanks in part to Trump’s surrender — its semiconductors and aircraft may soon be made there as well.
