What US-China tensions can tell us about the global political and economic orders

November 27, 2023
computers with market figures
'No national or regional economy can survive outside of its integration into the larger global economy'. Image: Green Left

Marxist sociologist William I Robinson is the author of The Global Police State and A Theory of Global Capitalism: Transnational Production, Transnational Capitalists, and the Transnational State. Green Left’s Federico Fuentes spoke to him about how contradictions between a globally integrated economy and a nation-state-based system help explain, among other things, rising US-China tensions. This is the second in a two-part series. Read Part 1 here.

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In general terms, how would you understand the current dynamics within global capitalism?

The global political and economic orders are severely out of sync. We have a globally integrated economy that operates within a postwar international order that is anachronistic and utterly incapable of stabilising the system.

The political and economic architecture of the postwar international order was already crumbling prior to Russia’s invasion of Ukraine. That invasion, and the West’s radical political, military and economic response to it, was but its coup de grâce.

Yet as US hegemony unravels no new nation-state, at least at this time, can provide the authority or structure to stabilise the now-inextricably integrated global economy.

The growing conflict between the US and China seems to point towards the end of globalisation and a turn towards protectionism. How can we best understand this growing rivalry?

If by globalisation we are referring to the rise of truly transnational capital and the integration of every country into a globalised system of production, finance and services, we are surely not seeing an end to capitalist globalisation. Rather we are seeing its intensification, along with its geopolitical reconfiguration.

In fact, trade in intermediate goods constitutes more than half of all global trade and according to the United Nations Conference on Trade and Development, worldwide trade actually reached an all-time high in 2021. No national or regional economy can survive outside of its integration into the larger global economy.

Even if it wanted to, the transnational capitalist class (TCC) is too dependent on an open and integrated global economy for the continued accumulation of capital and power on a world scale to withdraw back into the confines of national economies.

The corporate managers of the global economy are entangled in geographic restructuring according to how political winds shape opportunities for and constraints on accumulation around the world.

Transnational capitalists (including Chinese transnational capitalists) are relocating from China to Vietnam, for instance, because of Chinese state constraints on their freedom, US state pressure or, most often, simply for cheaper labour.

Some Chinese-based transnational capitalists are also investing in the so-called industrial renaissance in the US directly or indirectly by investing in Mexico to get around tariff walls and political restrictions.

We therefore need to focus on the contradiction between a globally integrated economy and a nation-state-based system of political domination and capitalist reproduction.

This contradiction is becoming ever-more acute. It contributes to escalating international tensions and throws states around the world into spiraling crises of legitimacy.

Transnational capital has only one objective: endless accumulation. But states must deal with the fallout of global capitalism’s crisis.

They must achieve legitimacy and reproduce the national social formation of the countries over which they rule, keep the domestic order from fracturing, sustain growth, maintain stability and social control, and compete with other states to attract transnationally mobile capital.

States must keep positive trade balances, whereas transnational capital could not care less so long as it is able to freely trade and invest.

Unlike global capitalists, state and political elites reproduce their status within the nation-state and its relation to other states and the international system. In the more powerful national states, these elites seek aggrandisement.

Theoretically speaking, states and state elites, in order to reproduce themselves, must reproduce capital. While states come under pressure from capital to serve its accumulation imperative, they also come under pressure from working and popular classes, especially as class struggle and political conflict heat up as we are now seeing.

Not every national state has the same capacities to juggle such destabilising contradictions while reproducing capital. Stronger ones attempt to sublimate and externalise social and political tensions to other countries and regions.

The contradictory mandates of states may place them in conflict with one another and with transnational capital. As the global capitalist crisis intensifies, it pushes states towards nationalism, populism and protectionism, whether this refers to US protectionism or the Chinese state’s crackdown on tech billionaires.

Moreover, there are local, national and regional capitalist fractions that do not have the same capacity as transnational capitalists and compete over local policies and regional control.

The temptation here, however, is to make some inappropriate distinction between “national capital” and “imperialist capital”, which is an utter analytical and ideological confusion.

Capital has only one intention and that is to exploit labour so as to accumulate. Some capital are able to do so across multiple borders and in the global system at large. Others are more limited in their scope, yet they enter global circuits through the financial system and other mechanisms of integration.

The impulse towards nationalism, populism and protectionism comes from states facing the destabilising conditions of capitalist globalisation and crisis, yet there is no evidence that the TCC supports this protectionism.

The principal capitalist conglomerates based in the US and China have experienced an ongoing process of cross-penetration and integration in recent decades that has actually deepened even in the midst of the New Cold War.

The US and Chinese states have been taking measures to undercut this integration against the wishes of the TCC. It should come as no surprise that the US Chamber of Commerce has opposed US tariffs and other restrictions on the free movement of transnational capital. The TCC wants access to the whole world without state interference.

Protectionism is a policy of states to attract transnational investment and to appease domestic political unrest. Transnational capitalists will invest wherever they find the best conditions to make profit. State subsidies are on the rise around the world to attract transnational capital in search of investment opportunities.

Both the Trump and Biden governments have pursued subsidies, tax credits and tariffs to entice transnational investors. This has triggered subsidy and protectionist wars with the EU and China. Biden has restricted investments in Chinese entities involved in semiconductors, microelectronics and artificial intelligence systems.

But the giant tech transnationals do not support these policies. Elon Musk, Tim Cook and Bill Gates have been among a flood of high-profile business executives who have visited China in recent months to discuss their expanded presence in China.

What does all this mean for internationalism in the 21st century?

We face an empire of global capital. I do not think that anti-imperialist struggles can be separated from anti-capitalist struggles.

The US state as an institution remains the greatest threat to the world’s people. However, it is beyond me why any socialist would think that to oppose US interventionism we must turn a blind eye to capitalist exploitation and oppression in other countries around the world, or fail to support those resisting such exploitation and oppression.

Nationalism is intended to obscure transnational class interests and fuels competition among the working classes of different countries. We see hyper-nationalism on the rise around the world — in the US, China, Russia, India, and Turkey, for instance. Socialists have to combat this nationalism.

Fascism is always founded on militaristic and chauvinistic nationalism and in response to capitalist crises. We are in a tragic situation around the world in which a popular revulsion with the global capitalist status quo and mass rebellion from below is breaking out everywhere at a time when the organised socialist left is weak or nonexistent in many countries.

The lack of a clear socialist message and project opens space for authoritarian populists, fascists and warmongers to manipulate the legitimate grievances among popular sectors facing despair.

We are at an urgent historical juncture. Global capitalism is in a structural crisis of overaccumulation, a political crisis of state legitimacy, capitalist hegemony and international conflict, and an environmental crisis of the planetary ecosystem. Our survival hangs on a thread.

The biggest immediate danger we face, apart from the collapse of the biosphere, is fascism and World War III. The breakdown of hegemonic orders in earlier epochs of world capitalism were marked by political instability, intense class and social struggles, wars and ruptures in the established international system.

This time, however, the stakes are higher.

[Read an extensive version of this interview at links.org.au.]

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