China’s rise as an economic and manufacturing power both "supports the American superpower and embodies some of its self-generated vulnerabilities" by supplying the US "gargantuan appetite for foreign goods and capital." The US-China trade deficit has been increasing since the 1980s and from December 2002 to November 2003 reached about $123 billion dollars (Fig. 1). As a "hyper debtor" the US has become increasingly reliant on other trading partners like China that hold a large portion of US foreign debt, potentially increasing China’s leverage over the US, especially in international policy. China holds $120 billion in US Treasury debt and probably a similar amount in Fannie Maes and other dollar-dominated securities whereas direct foreign investment by the US in China, according to the Bureau of Economic Analysis is only about $10.2 billion.

The US industrial base is also declining (14% of Gross Domestic Product or GDP) and moving to other countries like China (manufacturing, mining and related activities total 51% of GDP) in search of cheap labor. However, many computer components like the Logitech wireless mouse manufactured in China, provides low paying jobs but also captures only about $3.00 of the $40.00 retail price of this product, with most of the profit going to US-based and other multinational corporations. Migration of not only menial jobs but also possibly IBM, Intel, and Goldman Sacks white-collar jobs to China is another concern.