ECONOMIC STATECRAFT, DOMESTIC POLICIES, AND A PATH TOWARD STABLE COMPETITIVE INTERDEPENDENCE BETWEEN THE U.S. AND CHINA

The United States, formerly an uncontested world power, is experiencing a churning international political and economic landscape as China’s growth challenges U.S. economic primacy, alliances, and prosperity. This paper finds that the U.S. has become overly reliant on coercion and should instead increase its focus on partnerships and cooperative international action to secure its national interests. The U.S. can achieve this by adopting domestic policies that make it a more attractive partner than China. The U.S. can further signal its attractiveness compared to China by strengthening and expanding its current alliances and economic agreements. This paper will examine the instruments of economic statecraft and domestic policy available to the U.S. that are able to affect these changes. These include greater emphasis on renewable energy, multilateral trade agreements, investments in its infrastructure and citizens, addressing its national debt, and decreasing the use of financial freezes. International relations theories and economic literature will serve as lenses to evaluate the effectiveness of economic statecraft instruments and the global repercussions of domestic policy. Only through careful use of economic statecraft and domestic policy can the U.S. simultaneously increase economic power and positively impact alliance behavior to sustain the liberal world order that the U.S. has benefited from for nearly a century.Captain, United States Marine CorpsApproved for public release. Distribution is unlimited