Leaders Not Scared of China

This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.

The New York Sun

Global business leaders yesterday told a Midtown audience that the emergence of Asia as a powerful world player shouldn’t — and won’t — threaten established world economies.

The CEO and co-founder of the Blackstone Group, Stephen Schwarzman, said he would downplay the threat of upheaval by China. “It’s pretty self-absorbed [and] … not necessarily expansionist,” he said.

The presentation, “Big Markets and Big Cultures,” was part of the Global Creative Leadership Summit hosted by the Louise T. Blouin Foundation. Among the distinguished attendees at the three-day event held at the Council on Foreign Relations headquarters in Manhattan are four Nobel laureates, as well as an international cast of business, government, arts, science, and technology leaders.

Mr. Schwarzman said that in stockpiling American dollars and bonds, developing economies like China have become “inextricably linked to America’s economy” and therefore are satisfying “preconditions for a pretty stable environment for the foreseeable future.”

Several speakers estimated that America’s current dependence on oil was sustainable for 40 years. The vice chairman of Goldman Sachs, Robert Hormats, urged cooperation with China, describing a “ready partnership to help them with clean coal.”

“The stars are properly aligned for a much bolder energy policy as a result of the convergence of interests between environmentalists and evangelicals,” Mr. Hormats said. “The war bonds effort of World War II was a patriotic motivation to solve a problem — we need that same type of effort today. We must mobilize with a crisis or mobilize with leadership.”

Foreign ownership of American companies, an emotionally charged topic, popped into the spotlight recently by the scuttled Dubai Ports deal and the failed Chinese bid for Unocal. The panelists downplayed the practical effects of such deals.

“A great deal of the hostility to these ‘takeovers’ is the carryover of obsolete perceptions about the nations of potential buyers,” Mr. Schwarzman said.

Mr. Hormats criticized the American aversion to the “natural inevitability” of foreign ownership. “How we can rationally say we want you to buy our bonds but we don’t want you to buy our companies?”

The founding partner of Wachtel, Lipton, Rosen & Katz, Martin Lipton, said he would propse a maxim to the much-publicized American savings glut: “The economy that is saving and reinvesting is the one that becomes the dominant economy.”


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