China vs. USA: Who will win the 21st Century?
July 14th, 2011
07:00 PM ET

China vs. USA: Who will win the 21st Century?

Editor's Note: The following is an edited excerpt from a transcript of Fareed Zakaria answering viewer questions online. Read more from Fareed Zakaria at TIME: China's New Parochialism

By Fareed Zakaria, CNN

We’re clearly moving to a Post-American world. This is a world that is not dominated by the United States but not dominated by anyone else yet either.

The 21st Century is up for grabs and how the United States does depends on how well it can marshal the key ingredients of economic and societal success.

In the 20th Century, the key ingredients were labor and capital.

In the 21st Century, the key ingredients will be ideas and energy.

Ideas will be critical because manufacturing has been commoditized. That means that anyone can make anything. The only thing that distinguishes someone today is if that person or organization has new ideas and innovations. We need to create a better mousetrap every week. We need to do something different and unique.

Energy will be critical simply because everybody is growing quickly and everyone needs a supply of energy. Countries that have figured out the energy puzzle are going to do better and better.

So who’s better suited for this new world?

In an odd way, China is best suited for the 20th Century. They have cheap labor and huge amounts of capital coming in. They can make whatever you want them to make. But they haven’t yet been able to move up the value chain. They haven’t been able to generate the big, new ideas.

Like the U.S., China also struggles with the issue of energy. China is a consumer, not a producer of energy.

But they are quickly getting very smart on the energy front. They are becoming the global leaders of clean tech - whether it is solar or wind.

They are also aggressively trying to move up the value chain. They are laying the foundations to compete in the 21st Century. They are building a great university system and they are working to get research labs in place.

In America’s case, we have all the ingredients to succeed in the 21st Century. We have the most innovative companies in the world such as Facebook, Apple and Google. We have the best universities in the world. We have a nexus between universities and research-oriented companies. We have the most dynamic capital markets in the world. We have an incredibly flexible, diverse society, which is also very much a part of our inherent societal innovation and dynamism.

But what we don’t have is a political system that can harness all of this and execute.

You see this with regard to energy policy. America has no energy policy and hasn’t had one for thirty years. It’s not just that. We also don’t have an immigration policy. We don’t have a policy toward jobs and growth. We don’t have a policy toward the budget deficit.

Instead, we have an absurd political paralysis in Washington where everyone is more concerned with scoring points and maintaining their viability with their most extreme members rather than just coming together and solving problems.

There used to be a model in which you became famous as a lawmaker by making deals - by reaching out to the other side and doing some compromising, which you have to do because not everyone agrees with you, and moving the issue forward. Now the way you get famous and powerful in Congress is by not making a deal, by being a deal breaker rather than a deal maker.

You can see this in the Republican Party right now where the energy is all in saying “No, there’s no deal we could possibly accept.”

If “No” is where we end up as a country, we could have all the innovation and ideas and dynamism in the world and we’d still will have a society that is crumbling.

Look at California as an example. California has Silicon Valley and Hollywood. It has incredible private sector talent and creativity.

But after a while if every road is crumbling, every state university collapsing and every educational institution under-funded, people will no longer want to come there. They will no longer think that it is the place where they can make their American dream come true. In this case, having Steve Jobs and Mark Zuckerberg there will probably not be enough.

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Topics: China • From Fareed • Ideas • United States

soundoff (831 Responses)
  1. Tracy

    I thought this article was interesting until they finished it off with Zuckerberg and Jobs, as if they are the backbone of America right now, which is absurd.
    I also find it sad that China thrives on its cheap labor. That "cheap labor" are people who deserve a better quality of life.

    July 28, 2011 at 7:23 pm | Reply
  2. Maersk

    The 21 st century shall be won by China and India, forget the US they are not even in the race, let them focus on how to pull off all their troops out, bring back some of their industries, get back all their jobs, otherwise there shall be no way out, China does not even think that lending the US more money is worth it anymore.

    I'd say let the US pull off all their troops, ask Americans to work jobs at every level so that no immigrant/ illegal immigrant can get a job and slowly try to bring up their economy. At the same time let them change their gun laws, and bring back some sanity among the Americans by giving them a good culture.

    Poor leadership in the past has brought the nation to this level.

    August 7, 2011 at 4:14 pm | Reply
  3. jamesreznor

    CHINA will need to innovate and modernize in order to have the status American enjoy at this time. I don't think their government system does support the free thinking, that's where talent comes, new ideas flow, but there is a lot of censoring in CHINA, let the government of CHINA see the world. The USA has many problems, people here live beyond their means that it has become an addiction, that is something that needs to be controlled. Something needs to happen soon if not, we dont know where this is going to go.

    November 20, 2011 at 2:47 pm | Reply
  4. The Person

    People china wont win. And if half of america is stupid, than how does that impact. Of course it makes us look bad, but who cares. And all the people that have been telling you that america will go down are dumb. They obvisouly dont know the facts. Any smart person would look at the facts and agree with me. Oh and for the military thing/issue. Americans are too racsict to let another race come in and take over. They will build rebel armies and make the chinesse tired.For the record, go look at the u.s planes and navy. P.S china has the same problem. If we go down , they definetly go down. This is why some of the chineese leaders are resistant to dump the debt. Also they only hold a little bit of our debt. So before you start saying were going to bow down to different people, make sure you look at the facts. Hey im 12 years old and i can definatly tell you that this whole thing is wrong. USA will very so win the war because if we cant pay them back, they cant rush over here and take it in our property. and when another country declares war, all debts are off smart ones. They could go ahead and dump the debt, but that would be the last thing they think about..........................(oh and of course theres going to be a chinesse nationalist that says my spelling is bad and im uneducated)

    November 26, 2011 at 2:42 am | Reply
  5. Teacher

    Well while US have Lady Gaga, there is no crises at all.

    January 3, 2012 at 3:35 pm | Reply
  6. Jace

    Definitely China will win the 21st Century,

    America continue borrowing money these days and by the end of 21st Century it will be a tremendous loan, America will be so poor not even have money to buy petrol to run their war machine 😀

    January 5, 2012 at 2:54 pm | Reply
  7. War

    Power?Economy? hahahaha.. You fools do you think
    Fareed Zakaria stupid.. What if we stop all export to china??? china has no natural resources?? there just cheap labors..? they dont believe in liberty nor equality for there people.. Gorverment is for the people not Vice versa.. Longlive the liberty..

    January 10, 2012 at 10:37 pm | Reply
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    many americans are stupid redneck, americans have big dick,i believe; americans are smart,lie

    February 18, 2012 at 7:51 am | Reply
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    America's biggest problem is that it sees it much to important to be the world leader. In the roughly 90 year which can be seen as American dominance it has been the focus of a whole nation. But clearly, on may fronts we are not leading at all. Just look around. Dominance thinking has brought so much suffering to the world. Get a grip. Who cares who is number one....

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