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PacNet #56A – Shaping the New Consensus

Having ceded the global rebalancing effort to an ineffectual Congress and lost the Group of 20 to concerns over “quantitative easing” (QE2), the Obama administration must now find other methods to influence the China-US economic relationship. The administration should seek to shape the domestic debate, collaboratively formalize an international solution within the G20, and overtly demonstrate the option of increasing either economic incentives or pressure on China.