Industry giants believe that the current approach of the U.S. will not be sufficient to keep the country at the lead in the current economic warfare context with China. Matt Cronin, senior national security advisor at A16z (Andreessen Horowitz), has recently proposed to relaunch the current capitalist system to overcome what he calls a Chinese “existential threat.”

Cronin alleges that, under the current system, the U.S. is being significantly surpassed by China, which has tools that the U.S. cannot leverage, including centralized controls and subsidies that make Chinese companies hard to beat.

To fight this existential threat, “free enterprise and government must function symbiotically.” This means the U.S. must come back to the drawing board to align its capitalistic system with industry policies designed to aid the country in this economic fight.

To this end, the state might have to resort to tools of statecraft that might be considered separate from the capitalist system, including grants, tax breaks, and regulatory relief measures to industries considered crucial to win this metaphorical standoff.

In the same way, the U.S. must apply controls against Chinese companies to protect its national markets. For this, Cronin proposes applying measures to enact relevant restrictions to “any state-backed national champion operating in strategic sectors and benefiting from intellectual property theft, lawfare, or covert state support.”

A third element for recovering U.S. leadership includes reintroducing market principles into its defense industrial base, dynamizing its defense procurement systems. Also, Cronin calls for rebuilding an international coalition based on the values of capitalism and democracy, offering expedited access to U.S. markets and exports to these allies.

He is optimistic about the future, recognizing that this objective can be achieved if incentives align. “Our history shows that when capitalism and democracy work in concert, America achieves extraordinary feats. It is time to do so again, summoning the full strength of a united republic to meet the defining challenges of our time,” he concluded.

Read more: Yuan vs. Greenback: China’s Quiet Campaign for Financial Supremacy

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