Trump’s strategy to reassert U.S. dominance

The Trump administration has taken a sledgehammer to the existing domestic and international order. All the damage it has done can appear to be just a cynical smash and grab operation for Donald Trump and his fellow lumpen capitalist cronies. It is that, but it is not just that.

The rational core of Trump’s project is laid out by the Heritage Foundation in its Mandate for Leadership and The Prioritization Imperative: A Strategy to Defend America’s Interests in a More Dangerous World. These have provided him with a blueprint to implement an authoritarian nationalist strategy to reassert U.S. dominance in global capitalism.

Trump is abandoning Washington’s post–Cold War project of superintending a neoliberal order of free trade globalization. Instead, he is trying to accomplish his oft-repeated goal of “Making America Great Again” by putting “America First” against both friends and foes. He is downgrading or abandoning multilateral institutions, imposing tariffs on scores of countries, and threatening to annex Greenland, Panama, and even Canada.

While far more coherent than Trump 1.0, Trump 2.0 is an administration still riven by conflicts best exemplified by the apocalyptic breakup of the president’s bad bromance with Elon Musk over the so-called Big Beautiful Bill. It is one of many splits, including Trump’s battle with the Federalist Society, which helped stack the courts with friendly judges, over its support of the Court of International Trade’s ruling against his ability to impose tariffs. Another is the enormous one between Trump and his MAGA base over releasing Jeffrey Epstein’s client list of people with whom he trafficked women and girls.

Despite all the chaos, confusion, and faction fights, Trump’s administration is united behind one project—escalating Washington’s imperial rivalry with China.

Mandate for Leadership identifies China as “a totalitarian enemy of the United States, not a strategic partner or fair competitor.” The administration is trying to extricate itself from wars in Ukraine and Gaza, compel allies to take up the burden of their own security, and thereby free itself up to prioritize its great power rivalry with Beijing.

In response, China has made clear its determination to go toe to toe against the U.S. trade war, as well as its geopolitical threats and military buildup in Asia. Faced with such opposition from Beijing, Trump has backed off his most extreme measures, relaxing, for example, restrictions on exports of Nvidia’s computer chips and dialing down the unprecedented tariffs he initially imposed.

But the growing competition between the two powers will disrupt such temporary measures. With their interimperial rivalry in danger of superheating, the Left must do everything in our power to build international solidarity to stop this conflict triggering a catastrophic war between nuclear powers.

The capitalist roots of imperial rivalry

To be clear, this rivalry is not the result of the policies of the Trump or Biden administrations nor that of Xi Jinping’s regime in China. It is the product of capitalism’s laws of uneven and combined development, crises, and competition between states over the division and redivision of the world market for their corporations.

This economic competition drives states toward geopolitical rivalry and war. The result of those conflicts creates a dynamic hierarchy of states—with the imperialist powers at the top, regional powers in the middle, and oppressed nations and peoples at the bottom. All these capitalist states are riven by internal class and social divisions.

No order of states is permanent. The system’s booms, busts, rivalries, wars, and domestic struggles upset and reshuffle the state system, with established powers declining and new ones rising. We have witnessed a sequence of imperialist orders over the last century—the multipolar colonial period of the 19th century through World Wars I and II, the bipolar Cold War, and Washington’s unrivalled hegemony after the collapse of the Soviet Union.

The United States hoped to maintain that unipolar order by integrating all states into its so-called “rules based order” of free trade globalization. It tried to block the rise of any potential peer competitor, to demolish any “rogue state” like Iraq, and to police states destabilized by Washington’s neoliberal policies and interventions like Haiti.

The relative decline of U.S. Imperialism

Four developments led to the relative decline of the United States and the end of the unipolar order. First and foremost, the neoliberal boom from the early 1980s up through the 2008 Great Recession led to the rise of new centers of capital accumulation, most importantly China, but also Russia, Brazil, Saudi Arabia, and many others.

Second, Washington’s attempt to lock in its hegemony over the Middle East and its energy reserves through its wars in Afghanistan and Iraq ended in disastrous defeat, preoccupying it in brutal occupations and counter-insurgencies. With Washington bogged down, China, Russia, and various regional powers became increasingly assertive in the state system.

Third, the Great Recession brought an end to the neoliberal boom, ushering a global slump of alternating recessions and weak recoveries. Sluggish growth and declining rates of profit have driven states to protect their own corporations, slowing global trade and exacerbating geopolitical rivalry.

Finally, the pandemic, its disruption of global supply chains, and the accompanying recession exposed Washington’s relative decline, as well as its dependence on China. Together these developments ushered in today’s asymmetric multipolar order.

The United States still stands atop the system with the largest economy and military, as well as unparalleled geopolitical influence, but it now faces imperialist rivals; most importantly China, but also Russia. In addition to these, there are a host of regional powers that jockey for position between the biggest powers over oppressed nations and peoples.

With none of the imperialist powers able to overcome the global slump, the ruling elites of each have turned to austerity and authoritarian repression of resistance at home and beggar thy neighbor policies like dumping and protectionism abroad.

In this new order, the key rivalry is between the United States and China. They had been strategic partners with increasingly integrated economies in the heyday of neoliberal globalization under Bill Clinton’s administration. But no longer.

Today, China is the world’s largest capitalist manufacturer, exercises growing geopolitical influence, and has the ability to enforce its will with the second largest military. Washington now views China as a potential peer competitor it must contain. As a result, the two powers are at loggerheads on everything from economics to geopolitics and military expansion, particularly in the Asia Pacific region.

The new Washington Consensus

In this asymmetric multipolar world order, successive U.S. administrations abandoned the old strategy of superintending global capitalism to adopt the new Washington Consensus of great power conflict with China. Up until the last decade, the United States had pursued a strategy of “con-gagement” with Beijing, a combination of containment and engagement. The Obama administration’s Pivot to Asia was its last gasp.

The first Trump administration decisively shifted U.S. grand strategy to rivalry with China and Russia. It aimed to downgrade multilateral alliances in favor of unilateral assertions of U.S. power, banning high tech exports to China, imposing tariffs to reindustrialize the United States, boosting the U.S. military budget, and reorienting U.S. armed forces towards Asia.

But Trump’s erratic swings, his administration’s deep internal divisions, and opposition from the state bureaucracy hampered the implementation of the new approach. In the end, he accelerated Washington’s relative decline and, in the words of two Obama administration officials, managed to “embolden China, distress Europe and leave all American allies and foes wondering about the durability of our commitments and the credibility of our threats.”

The Biden administration retained Trump’s focus on great power rivalry with China and Russia but replaced its predecessor’s America First approach with muscular multilateralism. It aimed to refurbish U.S. capitalism by implementing a new industrial policy in high tech, to maintain Trump’s tariff regime with a high fence around a small yard of strategic technology to block China’s progress, especially in advanced microchips, and to rebuild and expand Washington’s alliances, turning them against Beijing and Moscow.

After a shambolic U.S. withdrawal from Afghanistan, the Biden administration exploited Russia’s imperialist invasion of Ukraine to rally its allies, not only against Moscow, but also against Beijing. It convinced NATO to declare China a global security challenge.

But Biden fundamentally undermined his moralistic claims that the United States was defending its so-called rules-based international order with his support for Israel’s genocidal war on Gaza. That enabled China and Russia to expose Washington’s hypocrisy and rally other states around them under the banner of “multipolarity.”

Nonetheless, no one should be under any illusions that Beijing or Moscow are allies of Palestinian liberation. In the case of China, despite its rhetorical opposition to Israel’s genocide, it is the second largest trade partner with Israel, its state-owned Shanghai International Port Group built and operates Haifa’s $1.7 billion port, one of its other companies is building Tel Aviv’s light rail system, and another, Hikvision, sells surveillance technology to Israel to police Palestinians in the West Bank.

Xi makes China great again

Faced with Washington’s new great power strategy to contain China’s rise, Beijing had no choice but to respond with aggressive countermeasures of its own. Xi Jinping broke with his predecessors’ cautious foreign policy, promising to carry out a “national rejuvenation” to fulfill “the Chinese Dream” of reclaiming the country’s status as a great power.

But Xi confronts innumerable challenges of his own. China’s economy has slowed from around 10 percent annual growth in the 2000s to now about 5 percent, and it’s plagued with overproduction, a burst real estate bubble, massive debt, corruption, an aging and shrinking workforce, and high youth unemployment. China’s regime has also faced waves of class and social struggle from strikes and mass protests in the 2000s to the democratic uprising in Hong Kong, Uyghur resistance to Han settler colonialism in Xinjiang, and insurrectionary job actions and mass marches against its brutal Zero-Covid lockdowns.

To maintain his rule against bureaucratic rivals and resistance from below, Xi has turned to authoritarian repression. He has purged dissident and corrupt bureaucrats, banned labor NGOs, carried out cultural genocide and mass incarceration of Uyghurs in Xinjiang, crushed the movement in Hong Kong, and ramped up the oppression of women and LGBTQ people as part of the regime’s pro-natalist drive to raise the birth rate and replenish its labor force.

Xi paired that repression with massive new investment in the economy, with two goals in mind—shoring up domestic support with the promise of a better life and fending off Washington’s attempt to block China’s rise. The regime enacted an enormous stimulus plan to sustain economic growth after the Great Recession and amid the global slump.

In 2015, Xi inaugurated Made in China 2025, a state-funded industrial policy to develop the country’s high tech companies, ensure they’re self-sufficient, and position them to outcompete their multinational rivals. By any measure it has been a smashing success. China now boasts world class chip design and manufacturing companies like HiSilicon and SMIC, the world’s largest EV company, BYD, the world’s leading battery maker, CATL, the dominant manufacturer of solar panels, JinkoSolar, pathbreaking AI innovators like DeepSeek, robotics makers that have automated factory labor at a higher rate than Europe and the United States, and a near monopoly on rare earth processing plants and magnet manufacturers that supply the world’s high tech industry.

China has started not only to catch up, but in some cases surpass U.S. high tech industries. As two influential economists argue,

“According to the Australian Strategic Policy Institute, an independent think tank funded by the Australian Department of Defense, the United States led China in 60 of 64 frontier technologies, such as A.I. and cryptography, between 2003 and 2007, while China led the United States in just three. In the most recent report, covering 2019 through 2023, the rankings were flipped on their head. China led in 57 of 64 key technologies, and the United States held the lead in only seven.”

In reality, Washington’s bans on tech exports to China backfired, driving Chinese corporations to develop their own capacity that is now challenging, and in some cases surpassing, those of its rivals in the advanced capitalist world. That led Nvidia CEO Jensen Huang to declare Washington’s tech bans on China a “failure” that “only strengthens foreign rivals” and “weakens America’s position.”

Competing for markets

All this government stimulus has not saved China from capitalism’s global slump. It has instead produced a crisis of overinvestment, cut throat competition between state and private capitalist corporations, declining profitability, deflation, and overcapacity.

This in turn led capital to flow into speculative investment in housing, creating a giant bubble that popped with the collapse of the world’s largest real estate corporation, Evergrande. That exacerbated the country’s debt crisis, hammered the household wealth of the country’s middle class, and undercut consumer demand.

Even after China partially stabilized this crisis, it has not solved its problem of overproduction. In fact, the regime exacerbated it with a new stimulus package to drag its economy out of the pandemic recession. As a result, China produces more of everything—from concrete to steel, solar panels, and EVs—than it can sell domestically at high enough profits.

The Chinese ruling class had hoped that its Belt and Road Initiative (BRI), launched in 2013, could help China export its excess industrial capacity. BRI was planned as a $1 trillion infrastructure development project that builds roads, railway networks, and ports mainly in the Global South.

Participating states have taken out loans from Chinese banks to pay for the construction, making China the world’s largest debt collector. And, in a classic imperialist pattern, the transport systems built through BRI are more often than not designed to deliver raw materials from developing countries’ extractivist industries to China for its manufacturing system.

China has also ramped up exports, triggering protectionist responses from capitalist states, not just the U.S., but also the European Union and various states in the Global South. They have all started to complain about China dumping its surplus in their markets and undercutting their less competitive corporations.

The export splurge has had a negative impact on Beijing’s nominal allies. For example, it has exacerbated the deindustrialization of Brazil, increasingly reducing its economy to the export of raw materials and agricultural produce to China, a classic dependency trap.

Beijing’s diversification of its export markets is also intended to insulate its economy from Washington’s increasing tariffs and bans. As part of that effort, it has decreased its holding of U.S. treasuries and increasingly conducted trade with other countries like Russia in its own currency.

But there is no way China can replace the U.S. market entirely. So, to evade U.S. tariffs, it relocated plants to countries like Vietnam and Mexico to use them as export processing platforms.

At the same time, the regime realized that it had to develop its own internal market. To accomplish this goal, it launched its dual circulation strategy, which invests in state-owned enterprises producing for its domestic market while maintaining a parallel export-oriented economy.

As part of that strategy, Xi has repeatedly promised to raise domestic demand by increasing workers income, bolstering the state’s minimal safety net, and stabilizing the real estate market. But such proposals for “common prosperity” have died on the vine in the past.

Why? Because China’s economic growth has been entirely premised on exploitation of cheap, migrant labor. It therefore refrains from increasing these workers wages and its social spending. That’s why Xi has opposed “egalitarianism” and “welfarism” that reward “the lazy.” As a result, China still remains dependent on its export economy.

Forging alliances in a multipolar world

To maintain and expand its access to the world market, China has forged multilateral and bilateral political pacts. It established the Shanghai Cooperation Organization, which brings together Eurasian as well as Middle Eastern states, most importantly China and Russia, in an economic, political, and security alliance.

Even more importantly, China set up the BRICS alliance, made up of Brazil, Russia, India, China, and South Africa, as well as a growing list of other countries, but in which Beijing is by far the dominant player. China has used this alliance to advance political and economic initiatives, including The New Development Bank and Asian Infrastructure Investment Bank, establish economic relations with countries in the Global South, and attempt to lead them in a challenge to Washington’s unipolar order in order to establish a multipolar one.

China doubled down on its most important geopolitical alliance with Russia when Xi and Vladimir Putin inked their “friendship without limits” at the Beijing Olympics in 2022, right on the eve of Russia’s imperialist invasion of Ukraine. As the dominant player, China has increased exports to Moscow—including so-called dual-use technology for its military industry, to prevent Russia from collapsing under U.S. and EU sanctions—and inked deals with Russia to import oil, natural gas, and coal.

But these powers do not form a coherent bloc of states, nor are they forging an “Axis of Upheaval” against the United States. They are internally divided by their distinct and sometimes competing interests.

There are countless examples of their schisms. India, for example, is in the BRICS alliance with China, but is also in the QUAD along with the United States, Australia, and Japan against China. India and China just recently clashed over disputed border claims. And Russia and China abandoned Iran, another member of the BRICS,when it was attacked by the United States and Israel.

Nor are Beijing’s pacts breaking from the neoliberal order the United States has established. For instance, the BRICS’ New Development Bank declared support for “the multilateral trading system with the World Trade Organization (WTO) at its core.” In fact, China has used its alliances to advance its interests within the neoliberal order of free trade globalization that the United States built.

Flexing military power

To back up its economic and geopolitical assertion of power, China has modernized its military. It has increased annual military spending for thirty years in the row to a whopping $296 billion in 2023, the second largest in the world but still just a third of what the U.S. spent at over $916 billion in 2023.

It has developed a blue water navy boasting more ships than any other power, including three aircraft carriers, with a fourth now under construction. And it is expanding its air force, nuclear arsenal, and battery of intercontinental ballistic and hypersonic missiles at a rapid pace.

China has flexed its military might in the South China Sea. It has deployed its navy to protect shipping lanes, asserted control over fisheries, and staked claims to undersea oil and natural gas reserves. That has brought it into conflict with several countries in the region over rival claims to islands, including the Philippines and Japan and behind them the United States, Asia’s overlord.

Most importantly, China has deployed its military in increasingly aggressive exercises around Taiwan, which it considers a renegade province that it aims to assimilate by force if necessary. The United States has armed the island nation and maintained “strategic ambiguity” as to whether it would defend it in the case of a Chinese invasion.

The stakes of the standoff are not only geopolitical, but also economic. Taiwan produces 90 percent of the world’s most advanced microchips, which are essential to everything from computers to high tech fighter bombers like Lockheed Martin’s F-35. The United States and China are at odds over Taiwan, each using it as a pawn in their rivalry while overriding the nation’s right to self-determination in the process.

“Making America Great Again” again

To fend off China’s challenge to U.S. hegemony, Trump is carrying out a radical break with Washington’s post–Cold War grand strategy of superintending global capitalism through multilateral economic, political, and military alliances. In place of that, he is implementing the Heritage Foundation’s authoritarian nationalist strategy.

At home, Trump has launched a neoliberal class war. He hopes that austerity, tax cuts, and deregulation will stimulate capitalist investment in manufacturing, restore U.S. economic independence, and bolster competitiveness in general and specifically against China.

He is carrying this assault in authoritarian fashion, using executive orders, overriding and in some cases smashing the federal bureaucracy, and testing the boundaries of the U.S. Constitution. He has dismantled whole sections of the so-called deep state that obstructed him in his first term, shredded the welfare state, and fired federal workers. To divide and conquer working class resistance, he has scapegoated migrants, trans people, people of color, and Palestine solidarity activists.

Abroad, Trump is implementing “America First” unilateralism. It is not isolationist, despite mainstream commentators’ repeated and mistaken claims. He is determined to intervene economically, politically, and militarily throughout the world to advance U.S. interests at the cost of both allies and adversaries, especially China.

His bombing of Iran’s nuclear facilities proves this. The attack was intended to send a message to powers throughout the world, especially China, that the administration is more than willing to use its powerful arsenal of destruction to pursue its aims.

Nor is his strategy to forge a new “Concert of Great Powers,” dividing global capitalism up into spheres of influence overseen by the United States, China, Russia, and other great powers. Whatever deals he has offered to Putin and Xi, their potential spheres of influence overlap and contradict one another.

The United States, for example, will not relinquish Asia to China, nor will it abandon Europe to Russia. No Yalta 2.0 is in the offing. Trump is asserting U.S. dominance throughout the entire world against both allies and antagonists.

Editors’ Note: Part Two of Ashley Smith’s article will run next week. It more closely analyses the roots of the Trump administration policy and the Chinese response.