China's lead in manufacturing production is unbeatable

The unipolar American hegemony that emerged in 1991 with the implosion of the Soviet Union lasted 18 years and finally ended in 2008/2009 when the international financial crisis erupted on Wall Street with the collapse of Lehman Bros.

From there, a completely horizontalized and unified multipolar system emerged, driven by the technological revolution, which accelerated its integration at the dizzying pace of instant digitalization; and with it, the phenomena of dependency and subordination that had characterized the 40 years of the Cold War disappeared.

The main structural factor that emerged during the unipolar period of American hegemony was the emergence of China as the major player in a completely unified global economy; this became evident in all its extraordinary power after its entry into the World Trade Organization (WTO) in 2001.

Over the next 15 years, China's international trade grew 30% annually, while its GDP expanded 9.9% every 12 months.

From then on, China began to build its extraordinary comparative advantage, becoming the leader in global manufacturing production.

It did so by combining its abundant and cheap labor force of more than 900 million workers, bolstered by capital investment provided by large transnational corporations from Japan, Europe, and the United States, which turned to producing there and selling worldwide.

This coincided with a growing weakening of the US in the international system, which took its most extreme form during President Joe Biden's four years in office, during which even Washington revealed a clear power vacuum.

At that stage, large regions of the USA, especially those of the industrial Midwest (Pennsylvania, Ohio, Michigan, Wisconsin) – the former North American Ruhr – were devastated by the China Shock (David Dorn and Gordon Hanson / 2016), which is the manifestation of the immense competitive capacity that the recent manufacturing superpower of the People's Republic had – and has – deployed in the arc that goes from Hong Kong to Shanghai, crossing the basins of the Pearl and Yangtze rivers.

This led to a visceral rejection of globalization in large parts of the United States, while coastal areas, the financial system, and high-tech services were the big winners of the new phase of capitalist development.

This was most evident during the administrations of Bill Clinton, the "president of globalization and unipolarity," a figure of exceptional charisma and leadership in the United States.

The situation has changed dramatically now, and the United States has regained its political will under Donald Trump, while China has consolidated its extraordinary comparative advantage in global manufacturing production throughout the country's southern region, where a high-tech production machine has emerged that is virtually unbeatable in the current international system. This gives the People's Republic a competitive hegemony unlike any other in the history of capitalism, including that of the United States, the victorious leader of World War II.

This formidable manufacturing machine is the result of a combination of subsidies, special prices, highly skilled labor, cheap and reliable electricity, a continental market scale, and, above all, fierce internal competition fostered by a state with a long-term strategic vision.

The current international trade system has become a byproduct of the People's Republic's formidable comparative advantage; and this is precisely what Donald Trump is challenging with his dual proposal—which strategically is one and the same—of transforming the United States from a consumer-driven economy into the world's leading manufacturing superpower. To this end, he uses tariff policies as his main instrument of action, which pits him against the entire world, but where the epicenter of the conflict is unequivocally the confrontation with China.

Trump has now managed to isolate China by imposing a 145% tariff, which could rise to 245% at any time, and whose practical significance is that he has cut off its exports from the North American market, the world's largest consumer market.

Trump knows that access to the U.S. market is the trump card in this new global game, in which the fate of the world is at stake, and that's why he presumes that time is on his side.

What remains pending now is the inevitable negotiating meeting between Trump and Xi Jinping, the two leaders of the new world system. Leadership—charisma and decisiveness—has always been and will always be the essence of the political phenomenon, the true spice of history. And what about the rest? Clausewitz's rule applies to it: "The incidental always follows the fate of the principal."