Ambassador Huntsman indicates America seeks a positive, comprehensive and collaborative relationship with China. He believes that since cycles of disagreement and challenges have always been part of the relationship that disputes and collaboration can be compartmentalized. That is no longer true. During the global financial and economic crises America and China's trade, economic and national security confrontations and collaboration cannot be compartmentalized. Negative statements, incidents and trends that damage China or America's economic or national security also damage public opinion and thus policymaking outcomes in the world's two largest economies.

The global crises can be managed if America and China's policymakers achieve and sustain a positive, comprehensive and collaborative relationship. President Obama announced on May 24, 2009 that he was "launching a new era of partnership." But, a "new era" requires new policies. America's policies often are designed to be "win-win" only for America's economic and other interests. American policymakers often seek to confront or undermine China's vital interests while seeking China's help in protecting the United State's vital interests. Such policies are a hangover from the 20th century's Cold War. They are self-defeating and squander American and Chinese policymakers' opportunities to create effective new policies. They constrict the enormous progress that Chinese and American policymakers must quickly make in the Strategic and Economic Dialogues. Chinese policymakers can only implement and sustain policies that are beneficial to China. Trade and currency cooperation are examples.

Chinese and American policymakers were developing a collaborative relationship in managing the world financial crisis and for resolving some major global issues with effective consultation and negotiation. But, American policymakers announced tariffs on steel, tires and other goods made in China, filed 23 anti-dumping, anti-subsidy and special protectionist tariffs cases and launched six Section 337 investigations against China for alleged unfair practices in export trade. That 53 percent increase in the number of cases and involved $7.6 billion worth of Chinese exports was 800 percent more than the year before President Obama entered office. A positive trend in America and China's interdependent bilateral and multilateral relations must be recreated and then must not be upset.

President Obama pledged in his State of the Nation Address to double U.S. exports in an effort to increase America's competitiveness in the world market. America is seeking to increase its exports while setting up trade barriers for China's exports. Chinese companies' attempts to strengthen American trade with China are often blocked by the United States government and effectively resisted by the narrow interests of some powerful interest groups' negative influence on the creation and execution of U.S. policies on trade with China. To increase exports to China and stimulate America's economy President Obama's administration will need to eliminate existing American policies that have restricted trade with China, such as on dual use and other high technology, encourage Chinese companies' participation in American business opportunities and their investments and acquisitions in America, and propose new policies that are reciprocally beneficial for China and America. A breakthrough will occur when President Obama decides that it undermines America economic and national security to prepare for a war with China and that instead America must reciprocate China's peaceful coexistence policies with the America and reciprocate China's opening up to American investment in China and Chinese companies since 1978.

China is the largest importer in the world and currently America and China are each other's second largest trading partners. In the global economic crisis China and America have both suffered from shrinking exports, but their bilateral trade fared well compared to their trade with other partners. While U.S. exports fell 18.9 percent in 2009, its exports to China only decreased by 2.6 percent. China's exports to the United States fell 12.5 percent, far less than the decline in its trade with Japan and the European Union.

Policymakers within President Obama's administration seeking increased China-U.S. trade and currency exchange rate cooperation need to propose policies that align and protect China's as well as America's economic and national security. Instead, they have been getting involved in trade disputes over short-term benefits and in a politicized exchange rate confrontation that strikes at the core of America and China's interdependent economic and national security.

Recently President Obama issued a strongly worded statement that the United States needs to make a decision on listing China as an exchange rate manipulator in a soon-to-be-released Treasury Department report. His statement as America's head of state seeking China's cooperation was not what Chinese policymakers had come to expect and they deemed it entirely unacceptable. America's president publicly threatening a serious currency exchange rate confrontation with China is an example of why it is an illusion to think that disputes touching China's core economic and national security interests can be compartmentalized from impacting collaboration on America's core economic and national security interests.

Chinese policymakers know that American policymakers have managed the value of the US dollar to benefit America at the expense of other nations. The US dollar became the currency used in international trade as a result of the Bretton Woods Agreement in 1944 that required that the Federal Reserve hold gold supporting each US dollar printed. At that time America held an estimated 60 percent of all nations' gold reserves. In 1972 as America opened diplomatic relations with the People's Republic of China, it abandoned the pegging of the US dollar to gold, which enabled America, with its monopoly on printing US dollars, to unilaterally revolutionize global investment and trade. America manipulated the value of its currency to create the subsequent huge American economic growth with investment and trade advantages it unilaterally imposed.

In the 21st century the US dollar declined in value 33 percent from 2000 to 2008 while China gradually increased the US dollar exchange rate of the RMB by 21 percent from 2005 to 2008. Then America's emergency stimulus spending plans significantly increased the US debt and deficits, which make it likely that the American dollar will further decrease in value. Nonetheless, in a show of support for America, China increased its holdings of US dollars and debt while America's other major trading partners decreased their holdings. China currently remains the largest holder of United States government debt and US dollar currency reserves.

Simultaneously as the American financial crisis loomed in July 2008, China pegged the value of the RMB in order to facilitate economic stability and recovery. China will continue to move towards establishing market-oriented RMB exchange rates longer-term. But China will maintain a relatively stable RMB exchange rate needed to manage the financial crisis and to ensure its economic growth is steady rather than becoming uncontrollable, which would harm all nations.

Today, in dealing with the global financial and economic crises the positive, comprehensive and collaborative relationship that American policymakers seek with China cannot successfully compartmentalize confrontation and cooperation. Economic recovery and aligning China and America's long-term economic growth requires new American policies, which must be the new focus and result of the upcoming Strategic and Economic Dialogues.

New American policies are also required because China-US relations began a new era on September 16, 2008, when Federal Reserve Chairman Bernanke and Treasury Secretary Paulson abruptly informed world that the United States financial system would collapse unless the government stepped in to save insolvent America-based global banks, insurance companies and automakers. The emergency US$700 billion bailout revolutionized the American government's commitment to a market economy, by turning the American government into the largest shareholder subsidizing the commercial failure of formerly non-state-owned leading global American companies. The failed laissez-faire economic theory, which American policymakers still demand China adopt, has failed in the real world and been replaced by a new era of massive American government control of market forces.

John Milligan-Whyte is called the "new Edgar Snow" and the "21st century Kissinger" and is the only non-Chinese to be elected the winner of the Social Responsibility Award from the China Business Leaders Summit. John Milligan-Whyte and Dai Min are the executive producers and co-hosts of the Collaboration of Civilizations television series adapted by the eight books they wrote in the America-China Partnership Book Series published in English and Mandarin in 2009-2010 that created the "New School of America-China Relations." They founded the America-China Partnership Foundation and Forum in 2008 and the Center for America-China Partnership in 2005, which was recognized in 2009 as "the first American think tank to combine and integrate American and Chinese perspectives providing a complete answer for America and China's success in the 21st century."