Henry Kissinger, in his recent book, “On China,” wrote that Chinese Premier Zhou Enlai said in 1971 of the U.S.-China relationship: “This will shake the world.”

Kissinger responded to Zhou’s statement by asking “whether the U.S. and China could merge their efforts not to shake the world, but to build it.”

Kissinger, a pre-eminent authority on the Sino-American relationship, describes the current association of the world’s two biggest economies and the largest reciprocal trading partners as something less than a partnership. He called it a “co-evolution,” in which both countries pursue their domestic imperatives, cooperating where possible and adjusting their policies to minimize conflicts. Neither side endorses all the aims of the other, instead seeking to identify and develop complementary interests. In other words, the United States and the People’s Republic of China are usually neither allies nor enemies.

However you describe it, the relationship has evolved into the most important bilateral relationship of the 21st century.

Unfortunately, this relationship is unsustainable as it currently exists, because America’s trade deficit with China is the biggest in history. In 2010, we sustained a $252 billion deficit with Beijing. According to the U.S. Census, the U.S. exported $82 billion in goods and services to China while it imported more than $334 billion from it.

At the same time, we cannot expect China to continue holding $1 trillion in low-interest-bearing U.S. government debt.

The lopsided relationship emanates from the following:

China’s wages are far below America’s.

China keeps its currency at unrealistically low levels compared with the U.S. dollar.

Chinese entrepreneurs blatantly pirate America’s intellectual property rights and counterfeit U.S. goods. As an example, some 90 percent of China’s users of Microsoft’s Windows software do not pay for it, according to Microsoft CEO Steven Ballmer.

How does the U.S. trade deficit with China affect the U.S.?

China has enormous political leverage over America, because Beijing could abruptly redeem its $900 billion in loans to us. We cannot easily obtain alternative financing sources, and if China stopped buying U.S. Treasuries, it would increase interest rates precipitously and hinder our fledgling recovery.

And in order to compete with China economically, U.S. companies have outsourced manufacturing jobs, which declined 34 percent between 1998 and 2010, according to the U.S. Bureau of Labor Statistics.

America is trying to ameliorate our trade deficit with China by:

Pressuring China to allow its currency to fluctuate, thereby making American goods more competitive.

Encouraging the Chinese to open their domestic market of 1.3 billion people to U.S. goods.

The Sino-American relationship has evolved beyond Kissinger’s wildest hopes when he laid the groundwork for Nixon’s 1972 Beijing Summit.

Kissinger advocates a close collaboration of the two countries, sometimes referred to as Chimerica, a term coined by professors Niall Ferguson and Moritz Schularick in 2006.

But successful collaboration will require drastically reducing America’s deficits with China.

Fortunately, the balance-of-trade pendulum might swing in America’s favor. Some economists predict that Chinese wage increases by 2015 will help create cost parity between American and Chinese manufacturing, leading to a revival of our industrial capacity. Higher Chinese wages also could enable workers there to buy more American goods and services.

How wisely this lop-sided geo-political relationship is handled most assuredly will shape our new century.

Originally published in the Sarasota Herald-Tribune