Sheldon Cooper/SOPA Images/Sipa USA via AP Images
Workers assemble speakers on a production line at Luyang Electronics Company, in Fuyang, China, March 31, 2022.
An article by Robert Kuttner has sparked a debate about U.S.-China policy and politics. This piece is part of that debate; you can read the counterpoint here.
Tobita Chow’s response to me invites a closer look at U.S.-China relations as a question of political economy. How do we rebuild a more socially just economy in the United States, and how does that goal connect to having a global economy that is more supportive of democracy, worker rights, and political pluralism?
China blends a Leninist one-party state with a novel hybrid of state-led capitalism. Though its system of economic development is brutal in some respects, it has lifted hundreds of millions of people out of dire poverty. What are China’s legitimate interests domestically and in the world? And how do they intersect or collide with those of the United States?
Chinese mercantilism has been one major instrument of the destruction of a more egalitarian America, but far from the only one. It was easier to defend a more equal society when corporations and banks did not use trade as a battering ram to undermine wages and social standards at home.
China’s system of mercantilism blocked exports from the West while it used state subsidies to build its own industry. It stole intellectual property. It conditioned Western investment on “partnerships” with Chinese companies. It priced exports below the cost of production, to displace domestic producers in the West.
Bill Clinton argued that admission of China to the WTO would make China more democratic and more normally capitalist. The opposite has occurred. In the meantime, the U.S. economy has become more dependent on Chinese exports, a dependence whose cost was vividly illustrated in the supply chain crisis.
China has had a powerful ally in U.S. corporations and banks. Wall Street has become a major underwriter of deals in and with China. Corporations complain quietly about Beijing’s terms, requiring them to share intellectual property, but they are happy to take the subsidies and the cheap, repressed labor.
President Trump broke with the neoliberal orthodoxy on trade and on China, but he did so in a fashion that was jingoist and xenophobic. His scattershot tariffs were not even effective economic policy. By contrast, President Biden has endeavored to connect his China policy to a strategic industrial policy, and has used tariffs both as an instrument of offsetting China’s subsidies and illegal dumping, and as leverage to a negotiated reset of U.S.-China relations generally.
THIS BRINGS ME TO CHOW’S rejoinder to my recent piece challenging efforts by him and others to brand criticisms of China’s economic policies as racist. Chow responds largely by changing the subject. He contends that taking a firm stance against China’s mercantilism is “counterproductive for Democrats,” and that it “feeds the GOP narrative strategy, alienating AAPI voters and others.”
In order to make this argument, Chow asserts that if the question of China deteriorates into which party is tougher, Republicans can gain because voters will see them as more anti-China. The trouble with this is that, with a few exceptions like Sen. Marco Rubio (R-FL), most Republicans have been all too content with China’s alliance with U.S. multinational corporations, and virtually all Republicans are anti-union.
The issue of China policy is not just about “narrative.” It’s about how to rebuild U.S. industry to benefit U.S. workers. Democrats such as Tim Ryan and the Biden administration are serious about that enterprise. Republicans are not. The idea that this contest operates mainly at the level of rhetoric does not reflect the political reality.
As evidence, Chow cites research by Anat Shenker-Osorio, which he says showed that a “blame China” messaging strategy backfires on Democrats. But this misrepresents the research. The ad studied in that research was a criticism of Trump for not being tough enough in blaming COVID on China. Of course that would backfire. Progressives are not critical of the Beijing regime for spreading COVID; that’s Trump’s nonsense. Progressives are critical of China’s predatory trade and industrial policy.
Chow, in this piece and in his other work, mostly ducks the issue of whether the U.S. and the West have a fair complaint against China’s mercantilism. Most progressives would argue that we do, and that to brand such criticism as racist limits the ability to improve U.S. policy.
In fairness to Chow, it’s clear that Trump’s xenophobic version of China criticism did stir up anti-Asian racism. That legacy makes it more difficult for Biden and other progressive Democrats to offer entirely legitimate criticisms of China without triggering anxiety on the part of Asian Americans. But conflating Tim Ryan and Donald Trump as fellow racists is counterproductive to the goal of restoring a well-paid American working class and finding a modus vivendi with China.
Late in his piece, Chow writes by way of disclaimer that there is a legitimate role for criticism of China. When he states that we need to keep the focus on corporate threats to workers and defend workers’ rights to organize and join unions, I completely agree with him. But then he adds, “As a number of Ryan’s critics have noted, his ad failed to do this, and instead joined Republicans in promoting their narrative, which scapegoats China for the problems facing U.S. workers.”
There is a lot more to Ryan’s views, and mine, than scapegoating China for the problems facing U.S. workers. China’s predatory trade practices are part of the problem. So is the alliance of American capital with China. So is the long slide of the Democratic Party into neoliberalism. But to cite other factors should not be to deny that China’s practices play a major role. This is hardly “scapegoating” China.
Chow also writes that we need to reject “the now dominant position, shared by Kuttner, that embraces industrial policy in the U.S. while attacking it in China and other developing countries—a piece of inconsistency that has been noticed in other countries and undermines U.S. credibility abroad.” This is a misrepresentation of my views. I have long supported the right of all countries to have a larger degree of economic sovereignty, as a counterweight against global capital. But at the place where industrial policy intersects with trade, there need to be roughly symmetrical rules.
AS CHOW’S PIECE SUGGESTS, China presents a conundrum for many on the left. For some, who see American imperialism as the main source of ills in the world, the rise of China is a long-overdue counterweight. Chow’s frequent collaborator, Jake Werner, has correctly pointed out that if China is stealing intellectual property and subsidizing infant industries, it is only doing what today’s rich nations did long before China. Others on the left are encouraged by the success of a nation that calls itself communist lifting itself out of poverty. The Nation had a very thoughtful piece on the left and China sorting out these arguments.
While the Marxian ideal of workers of the world uniting appeals to some, the fact is that if any kind of social compact between labor and capital is to exist, it must operate at the level of the nation-state, where there is some semblance of democratic accountability and the rule of law. In the U.S., Biden is trying to right several decades of imbalance, and China’s alliance with financial elites on behalf of corporate globalism is a prime obstacle. To deny that is either naïve or disingenuous. At the same time, even as we act to restrain the impact of China’s mercantilism, the two nations need some kind of mutual accommodation.
Last year, Bernie Sanders published a smart piece on China in Foreign Affairs. The title was almost totally out of sync with the body of the piece. The article was titled “Washington’s Dangerous New Consensus on China: Don’t Start Another Cold War.” But 95 percent of the text was a critique of China’s mercantilism, the impact on U.S. workers, and the naïveté of U.S. officials who welcomed China into the WTO. Sanders wrote:
I helped lead the opposition to that disastrous trade agreement [letting China into the WTO]. What I knew then, and what many working people knew, was that allowing American companies to move to China and hire workers there at starvation wages would spur a race to the bottom, resulting in the loss of good-paying union jobs in the United States and lower wages for American workers. And that’s exactly what happened. In the roughly two decades that followed, around two million American jobs were lost, more than 40,000 factories shut down, and American workers experienced wage stagnation—even while corporations made billions and executives were richly rewarded.
I don’t recall anyone calling Sanders a racist for those views.
