Trump’s tariffs come from long-term ruling-class concerns about the relative decline of the US and its hegemony, but are unlikely to work while ushering in grave dangers, argues John Clarke 

In 2022, when he was still a US senator, Trump’s secretary of state, Marco Rubio, wrote an article in the Washington Examiner on the threat to US interests posed by China. He set a thoroughly hawkish tone and left no room for doubt that, as far as he was concerned, containing the rising power of China should be the first priority of US foreign policy. 

Rubio was ready to accept that Russia was a significant rival but he argued that if ‘we acknowledge that Moscow poses a serious threat to American interests, then we also have to acknowledge that Beijing poses a greater and more systematic threat than the Soviet Union ever did.’ He added bitterly that for ‘nearly two decades, the Chinese Communist Party has undermined the United States’s economic strength and cultural cohesion by stealing critical technologies and sapping our productive capacity.’ 

Rubio also made it very clear that the contest with China was largely focused on the increasing economic strength of the rival power. As he put it, if ‘we are going to prevail against the CCP, we will also need to revitalize our industrial capacity. A nation dependent on hostile regimes for basic goods is not going to last long … It should be obvious that our economic reliance on China is a vulnerability we can no longer tolerate.’ 

It’s obvious from this article that the present trade war with China can’t be attributed simply to the whims or personal quirks of Donald Trump. A particular strategy aimed at containing China and regaining lost economic ground for the US was in the works several years ago and the present Trump administration is now seeking to put this into effect. 

The tariff weapon 

It is clear that, for all his bluster, Trump is sailing without a compass through some very dangerous waters as he conducts his global trade war. So far, he has had to change course repeatedly and the future of his initiative is enormously uncertain. This volatility is likely to increase and Trump’s erratic qualities can only compound this. 

Faced with a disastrous reaction by the markets, Trump has paused his complete global round of reciprocal tariffs for a three-month period but China was not included in this measure. Indeed, according to CNN, Trump posted on social media that based ‘on the lack of respect that China has shown to the World’s Markets, I am hereby raising the Tariff charged to China by the United States of America to 125%, effective immediately.’ 

On 12 April, Trump declared that smartphones, computers and some other electronic devices would be exempted from the reciprocal tariffs on China. However, he followed this up the next day with a warning that no one is ‘getting off the hook’ and that ‘the reprieve for high-tech products, many of which are manufactured in China, would be temporary and that semiconductor tariffs would be in place within weeks.’ Echoing the sentiments expressed in the above-mentioned article by Marco Rubio, Trump also posted that ‘we will not be held hostage by other Countries, especially hostile trading Nations like China.’ 

Despite the considerable missteps in the execution of Trump’s trade war with China, the desire for a decisive reckoning with the main rival of the US is unmistakable. This desperate mood, moreover, reflects a shifting balance of power that is very real and to which those within the US ruling establishment have given considerable thought. 

In January of this year, the Center for Strategic and International Studies noted that both ‘the United States and China are engaged in a sprawling competition that spans military, economic, technological, diplomatic, and ideational realms, including global governance.’ It added that the ‘intensification of the U.S.-China rivalry is occurring against the backdrop of the eroding efficacy of the post–World War II international order.’ 

Last March, the Journal of Policy and Strategy interviewed Nadia Schadlow, a national-security advisor during the first Trump administration. Her comments showed how pervasive the sense of declining US power is within ruling circles and she argued that over ‘the past few decades, the international strategic environment has shifted – to the detriment of the United States. U.S. relative power has declined, and some of the key “foundations” of American strength have eroded … I am not sure that there is a great deal of disagreement over this observation of relative U.S. decline.’ 

It is the awareness of this relative decline in the face of growing Chinese power and influence, that underlies the turn to the America First strategy. In an article I wrote for Canadian Dimension last month, I argued that ‘the hegemonic position of the US has been declining and its ability to operate as the cornerstone of a “rules-based” world order has been sapped.’  

In this situation, whether ‘the US seeks to contain its rivals, intensify its stranglehold on the Global South or obtain better terms from its junior partners, the new approach focuses on immediate gains with scant regard for global stability or long-term consequences.’ It is this approach that informs Trump’s turn to an international trade war, with China as the most critical target within that broad conflict. 

China retaliates 

In a recent blog post, Michael Roberts demonstrated that Trump’s protectionist onslaught against China is a risky proposition that will have to overcome some formidable obstacles if it is to produce the desired results. He notes that according ‘to the US National Association of Manufacturers, 56% of goods imported to the US are actually manufacturing inputs with a lot of that coming from China. Price rises there will feed through to many final products.’ 

Roberts went on to point out that the ‘US imports a lot of basic goods from China: 24 per cent of its textile and apparels imports ($45bn worth), 28 per cent of furniture imports ($19bn) and 21 per cent of electronics and machinery imports ($206bn) in 2024. A 100 percentage-point increase in tariffs seems certain to show up in higher prices for businesses and consumers. So instead of hurting China, Trump’s tariffs will hit the US economy even harder.’ 

China has retaliated with counter tariffs of 84% on US goods and Reuters reports that Chinese officials have been placed on a ‘wartime footing’ with extensive efforts ‘aimed at encouraging other countries to push back against U.S. President Donald Trump’s tariffs.’ The US economy is still larger than that of China’s but, as Trump fights his trade war on multiple fronts, it is highly questionable whether the US would emerge victorious from a prolonged contest able to impose terms on its rivals. 

Trump has already faced major problems as he attempts to put his plans into effect. NBC reported that the pause in the global reciprocal tariffs was prompted by the adverse reaction of the vital bond markets. The news network claimed ‘that there was deep concern — “bordering on panic” — among top White House officials about the bond markets.’ The way forward for Trump is highly uncertain and there is great concern in ruling circles about the viability of the course he has set. 

There is also little doubt that virulent protectionism will mean major job losses for US workers, along with a new cost-of-living crisis. Michael Roberts has concluded that ‘inflation will turn up in the second half of this year while the economy slips further. Stagflation to slumpflation.’ 

In this situation, we may expect the movement against Trump to grow. The ‘Hands Off’ protests earlier this month were only an indication of what is to come but already we have seen very large numbers of people taking to the streets right across the US. Labor Notes has reported that ten national unions in the US have signed a joint statement ‘demanding the release of immigrant workers recently snatched by Immigration and Customs Enforcement.’ On a range of fronts, opposition to Trump is growing and powerful and explosive movements of social resistance are to be expected. 

Trump’s protectionist approach and the whole America First strategy reflect deep contradictions within US capitalism and the imperialist world order. Trump wants to reorder US relations with other countries on a global scale but the effort to contain the growing threat posed by China is the centrepiece of his political agenda. 

An 8 April report in the Military Times noted that the Trump has committed to a trillion-dollar military budget next year, ‘a massive increase that he claimed will provide the country with unmatched military strength for years to come.’ This development should serve as a reminder that economic rivalry may well lead to something far more dreadful. Whatever tactical manoeuvres or retreats come from the Trump administration, the doggedly protectionist shift it has undertaken is ushering in a period that is uncertain and dangerous to the greatest degree imaginable.