The US insists its security-related spying is more extensive and successful than anyone else's merely because it has better technology and more resources.

And while the US government does steal economic information, it vows that nothing is passed on to American corporations. By themselves, American actions are already a global irritant that probably enhance US security, but certainly reduce US prestige.

When combined with criticism of China for commercial espionage, the American position becomes a bit silly, especially when the US justifies its actions by saying that countries have always spied on each other for security reasons, not commercial ones.

In other words, the US is right because it's always been this way. This sounds more like an elderly bureaucrat's answer to a new boss than responsible international behaviour.

A more thoughtful perspective reveals flaws in American logic. Remember that the US has repeatedly and correctly acknowledged that it must adjust in some fashion to China's rise. So if China practises espionage differently than America does, it implies that the US must adjust to this.

It does not mean the US must accept Chinese practice, but simply asserting that espionage can only be practised a certain way clashes with US statements that China is an important stakeholder in the global system.

New stakeholders, after all, have their rights as well as their responsibilities.

None of this is to excuse Beijing. The Chinese government's public position on most cyber issues sometimes verges on astonishing, featuring blanket and outraged denials of any such behaviour.

In fact, evidence that the People's Liberation Army engages in economic and other espionage is documented over an extended period.

Also documented over an extended period is evidence that centrally and locally controlled state enterprises benefit enormously from cyber and other forms of economic espionage.

Official denials of are often very specific - the Chinese government itself did not do this one particular thing.

Meanwhile, other, very similar activities go unaddressed by spokespeople. Hiding behind technicalities is unseemly and unconvincing.

As with American positions on cyber spying that clash with other American positions, China's denials of commercial espionage are coloured by its forthright admissions that theft of intellectual property (IP) is a continuing and long-term problem.

It strains belief that the Chinese government has tolerated - and will continue to tolerate - mass IP theft within its borders, but would never tolerate perpetration of international economic espionage.

Of course, the main Chinese response to accusations of cyber espionage is to point immediately back at the US. This may be justified, but it is entirely unproductive.

It does not reassure China's other partners in the slightest to know that China may only be the second-worst cyber actor in the world. It does not benefit the Chinese people to be no worse than the US in this area.

And here lies a vital, missing element in the international dispute. This is not just another pointless China-US tiff - the two governments are harming their own countries.

At home in the US, pervasive surveillance extends to its own citizens. America's internal political problems are due in no small part to distrust of government, distrust which is intensified by cyber activities.

Overseas, American leadership has been based in part on not exercising the country's full capabilities against others. But cyber policy often seems to be to conduct extensive spying simply because the US can. This undermines America's moral standing in the world.

For its part, China will need large amounts of the world's energy, food, and other resources for decades to come. Will other countries welcome Chinese partners when some Chinese companies have stolen information in the past and others are a threat to do so in future?

Perhaps the biggest issue is within China.

Hu Jintao and Xi Jinping have emphasised innovation. Evidence and logic clearly say that IP theft discourages innovation - why create when you can steal, why create when your work can easily be stolen?

Having reached a higher stage of development, China is supposed to protect IP better. Instead, it now hacks foreign networks and siphons huge amounts of information.

Theft of foreign advances may seem to benefit the country, but if it perpetuates dependence on others' research, China will be unable to develop local technology, harming its economic future.

Strangely, the two governments failing their own people is also how this problem will be solved. No one should expect the finger-pointing between Beijing and Washington to lead either side to improve its behaviour. But their own self-interest will eventually do the trick.