Joe Biden's stance on China will not break free of bipartisan fear of the PRC's rising global dominance. Photo: AFP / Angela Weiss

American media and political elites are abuzz with speculation and commentary about the incoming Joe Biden administration. After the absurdities and offensiveness of the Trump years there is a widespread sense among the liberal Democrats and corporate and financial backers that an age of smoother sailing is in the offing.

In some policy arenas there is indeed likely to be some readjustment to the legacy of radical Republican domination. The US will almost certainly re-engage with the Paris Climate Agreement, will probably seek to reactivate the nuclear deal with Iran, and will no doubt seek to restore more normal relations with NATO and other allies.

None of this reflects any fundamental reorientation of US governmental interests, which remain devoted to the promotion and perpetuation of the wealth and power of the economically privileged. What will appear on the public stage will be a “kinder, gentler” form of domination, both at home and abroad.

One area in which change will be minimal is in policy toward China. The posture of fear and hostility that has been built up under both Democratic and Republican administrations is now a bipartisan consensus, shared even by many so-called progressives and self-proclaimed leftists.

China is portrayed as a rising menace, bent on global domination and the imposition of a totalitarian system on the helpless peoples of the planet. This hysterical imagery is a projection of American elites’ fears of the loss of their own global domination, which has been key to their massive accumulation of wealth and power over the past century.

They see China’s rise as an existential threat, and are determined to try to stop it, to block China’s further economic development, and to derail China’s efforts to become a significant participant in global affairs.

This is a completely unrealistic agenda, because it is based on a shallow and faulty understanding of the underlying dynamics of modern history. Any consideration of global economic relations over the past half-millennium will demonstrate the folly of American elite fantasies.

Geopolitical power shifts

In 1500, arguably the approximate beginning of the “modern” world, China and India together accounted for about 50% of all productive activity on the planet. This tracked pretty closely with their place in terms of global population. Europe was around 18%, and of course there was no place for the US at that time.

Beginning in the late 18th century, when Britain began to take over India and systematically destroyed its world-leading textile industry, India’s share began to drop rapidly. When the East India Company then turned to opium, becoming the greatest drug dealers in history, and sending vast quantities of opium to China, China’s share began to falter.

When Britain defeated China in the 1939-42 Opium War and opened China’s domestic markets to low-cost industrial products, China’s historically pre-eminent capitalist manufacturing economy was devastated.

By the 1940s India and China had been reduced to less than 10% of global gross domestic product together, while Western Europe and the US, which had risen on the tide of the Industrial Revolution, made up just over 50%. But with decolonization, and with the sharing of industrial productive technologies through aid from the Soviet Union and through gradual diffusion, and the victory of the Revolution in China, these trends reversed.

New normal

As China has developed its modern industrial economy it has returned to a role in global economic activity closer to its historical norm. India lags behind, but is also increasing its relative position. The US and Western Europe have dropped back to just under 20% each, about equal to China in 2019.

Going forward, as modern productive technologies continue to evolve, with China now at the heart of that process, the People’s Republic will become the largest contributor to global GDP, and the US share will recede even further.

This is the dynamic that terrifies American (and Western European) elites. They cannot imagine a world in which their industrial and financial dominance does not entitle them to run things their way. But this is not a process that is going to be stopped or even significantly slowed by any conceivable policies of trade or economic management.

Even if China, and Asia more broadly, only achieves an average level of labor productivity, the simple demographic facts will yield the leading role in global production to China, India, and the rest of Asia. If China is able to excel in research and development and to put new, cutting-edge technologies in place, which seems highly likely, its pre-eminence will be even greater.

American capitalist elites cannot understand or accept this reality, or at least they have not been able to do so thus far. President Donald Trump’s flailing trade war, and his predecessor Barack Obama’s “pivot to Asia,” were pointless efforts. As well, Western business is too deeply interpenetrative with China for any military option to be viable.

So far there has not been any indication of a realistic, clear-eyed approach to the future by American elites, who seem monomaniacally obsessed with the idea of retaining their historical brief moment in the sun. 

What is needed at this time is not a misty-eyed hope for a new dawn of liberal Democratic paternalism, but rather a way to make Americans understand the simple historical truth of what is taking place in China and the wider world, and to try to find the path to a shared future of mutual benefit. This may not be possible under existing capitalist social and political arrangements.

Kenneth Hammond

Ken Hammond is professor of East Asian and global history at New Mexico State University. He lived in Beijing from 1982-87, before completing his PhD in history and East Asian languages at Harvard University in 1994. He is currently associate editor of the Journal of Chinese History published by Cambridge University Press, and heads a research team working on the study of visual materials in Chinese local gazetteers at the Max Planck Institute for the History of Science in Berlin.