The new season of House of Cards will be out later this week in a bundle of 13 Netflix episodes. To be frank, the best part of the show are the plot lines relating to the US/China feud for us Sinologists. It’s clear that the TV script writers have obviously done their research by integrating current US/China tensions into the House of Cards world. The last season saw a Chinese cyber-theft, a trade dispute involving rare-earth minerals and escalating tensions between China and Japan in the East China Sea, all stories that could ring true with the shows Asian and American audiences.

As we left Frank Underwood at the end of season 2, he’d just become the 46th US President. Tellingly, his first action as President was to contact Beijing. An hour later, Underwood claimed that he had had a productive talk with his Chinese counterpart. Not bad for what is considered the most important bilateral relationship in the world.

Underwood’s ascension marks a critical period in the US/China relationship: fractious trade wars and an imbalance in the power structure in the Asia Pacific will likely put even the unflappable Frank on the back foot. While the show is fictitious, it bares some resemblance to real challenges facing the two countries.

Frank was growing up in North Carolina when Richard Nixon become the first US President to visit the PRC in 1972. This visit marked the first real step towards a normalization of trade relations between the two countries, unless you include the US team ping-pong tour the year before. Both sides viewed bilateral trade as another area from which mutual benefit could be derived, and agreed that economic relations based on equality and mutual benefit are in the interest of both countries. They agreed to facilitate the progressive development of trade between them.

The Nixon-Mao meetup marked an end of a period of Chinese Self Reliance in the global economy. China imported foreign technology and whole industrial plants to catch up with the globalisation trend. China’s trade liberalization accelerated as it sought membership in the World Trade Organization. It applied for membership in 1986, but in order to be considered China had to lower tariffs, ensure a fixed exchange rate and become an open state to foreign firms. China agreed to the normalization of trade, and became a member in 2001. That proved to be an important catalyst for the extraordinary growth in its export-led economy.

As of 2014, the US trade deficit to China was the largest in the world, standing at $318.4 billion and increasing by 4.1 percent year-on-year. That means that for every $4 sent to the US, China imports $1 worth of US goods and services. China exports computers, telecommunication goods and apparel, and in return imports oil seeds, waste and aircraft. The latter, though, perhaps not for long as China seeks to develop its first homegrown passenger aircraft. Furthermore, China’s investment into the US in 2014 for the first time exceeded the US investment into China. Cause for concern if the rejection of state-owned CNOOC’s planned takeover of Unocal Oil in 2006 is anything to go by.

The US has many grievances with China in its trade relations. It says China has has affected US domestic production; 29 percent of manufacturing jobs have been lost. Furthermore, China’s import duties on agricultural goods remains at a high-ish 15 percent, while the US’s is at 4 percent. China has slowed on its promise of reforms and remains more closed off than the US would like. For instance: China has imposed unlawful export restrictions on rare earths (to the dismay of Raymond Tusk). Also, China’s undervaluation of its currency functions as a de facto subsidy for its exports.

2014 also saw five Chinese PLA officials accused of engaging in state-sponsored, cyber-enabled theft of commercial property from US-based corporations. China retaliated by putting sanctions on US based software and hardware firms.

China today is the largest producer of pharmaceutical products, but the American-based Food and Drug Administration has found fault with some of their drugs, calling them sub-standard. Loopholes in China’s Intellectual Property laws allow for local drug makers to reproduce US patented drugs prematurely.

Frank Underwood also has to make tough decisions to maintain international relations within East Asia, which is fast becoming China’s sphere of influence. The US has to keep tabs on China’s military modernization, North Korea’s nuclear program and China’s influence in places like South Korea and Australia. China’s trade with Taiwan has increased 27 percent since 2008, while Hong Kong remains volatile following last year’s Umbrella Movement.

Subsequently the US Congress has recently released its 2014 report on US/China economic ties and security. The report recommends Congress:

• Fund US Navy shipbuilding to increase efforts in the Asia-Pacific to achieve a 60 percent ownership of ports by 2020.
• Find an outside company to source the Sino/America military balance, and to rectify if too inadequate.
• Investigate the economic impact of China moving to a free-floating currency.
• Review the effectiveness of US/China joint trade and question if China is honoring its commitment.
• Task the FDA with establishing a regulatory regime with China’s pharmaceuticals, allowing the producer to be made available and to make unannounced visits to manufacturers’ plants.
• Allow Hong Kong to elect the territory’s Chief Executive by universal suffrage.

Frank Underwood has crucial decisions to make. To rectify the trade deficit, the US has to seek a more balanced deal. China is still developing, (its GDP per capita is $6,000 compared to the US’ $52,000), and will therefore protect industries it feels are not ready for globalization. What steps will the US take to confront China without causing substantial friction?

I guess we’ll have to wait for Season 3.