In an interview ahead of a trip to China, Mr. Paulson observed that to those who fear competition, China has become "a symbol of a threat posed by globalization." But, he said, "if China doesn't do well, that hurts us rather than helping us."

At a time when China often draws blame in the U.S. for factory closings and low U.S. wages, the new Treasury chief's gradual, diplomatic approach to Beijing could test the patience of China's critics in both major American political parties during an election year.

He insists that a long-term approach will achieve more than will confrontational rhetoric and punitive trade sanctions. "Both in China and in the United States we must not allow ourselves to be captured by harmful political rhetoric or those who engage in demagoguery," Mr. Paulson said. "Instead, we must realize that the U.S.-Chinese relationship is truly generational and demands a long-term strategic economic engagement."

As did his predecessor, John Snow, Mr. Paulson is urging China to allow its currency, the yuan, to rise against the U.S. dollar, but he views this as part of a broader agenda with the Asian giant, an agenda that includes pushing Beijing to allow more foreign investment, to loosen restrictions on foreign financial-service companies doing business in China and to move away from its traditional reliance on exports.

"I am not looking for any short-term quick fix," he said. "What I'm hoping is that when I leave this position in 2½ years that the China and U.S. economic relationship will be, I think, stronger. . . . Hopefully there will be a number of tangible steps, even though they may be small things, that are signs of economic cooperation."

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