Workers Vanguard No. 1132

20 April 2018


Down With Labor Tops’ Protectionist Poison!

Trump, Democrats Threaten China with Trade War

Defend China Against Imperialism!

The Trump administration’s threat to impose tariffs on more than $150 billion worth of imports may well signal the opening of an economic war on China. Prominent Democratic Party spokesmen, who normally denounce every tweet and policy pronouncement of the Republican president, have signed on to this anti-China crusade. So too have the top leaders of the trade-union bureaucracy, which has long combined chauvinist “America First” protectionism with anti-Communist China-bashing.

Senate minority leader Chuck Schumer said he wanted to give Trump “a big pat on the back” for “doing the right thing when it comes to China.” Bernie Sanders, the darling of the reformist left, recently stated, “I think the main target of our concern has got to be China” and reiterated his longstanding call for comprehensive measures against Chinese imports. For their part, the AFL-CIO tops are demanding concerted action by “America and our allies” to “bring tough pressure to bear on China,” while Steelworkers union leaders say they want to “work with the administration” against China to “rebuild our nation’s manufacturing sector and protect national security.”

At the same time, the American capitalists are far from unanimous in backing Trump’s tariff threats. U.S. agribusiness interests are up in arms at the thought of retaliatory tariffs by Beijing cutting off their profitable Chinese export market. Major retailers like Walmart and Costco protested that tariffs would raise the cost of basic household items. Many U.S. manufacturers, including in auto, have warned that the impact of new tariffs on today’s complex international supply chains would drive up their cost of production, undercut competitiveness and trigger layoffs. The U.S. moves against China are loaded with contradictions. Not only are the two countries’ economies closely tied through trade, but China is the biggest holder of U.S. government debt.

Bourgeois spokesmen opposed to Trump’s tariffs, including a hefty chunk of the Republican Congressional caucus, embrace what they call “free trade.” By this they mean the supposedly inherent right of U.S. imperialism to “freely” use its economic and military might to rip off weaker countries’ natural resources and drive their workers and peasants to starvation. Meanwhile, the capitalists have waged a decades-long onslaught in this country that has devastated the jobs and working and living conditions of tens of millions.

Countless factories have rusted into the ground after the bosses threw workers on the scrap heap and moved production elsewhere in a bid to boost profit margins. The ruling class has scuttled maintenance of roads, bridges, transit systems, airports, power grids, dams, water supplies—the very things needed for society to function. For years, the labor tops have screamed about low-wage workers overseas “stealing” American jobs, even as they have allowed much of the U.S. to become a low-wage outsourcing destination for both U.S. and foreign companies.

The labor misleaders claim that by pushing protectionism they are defending the livelihoods of working people against “unfair competition.” They promote the lie that workers in the U.S. have a common “national interest” with the capitalist ruling class. But there is no such common interest. The union bureaucracy’s collaboration with the enemy class is the very opposite of what is needed: class struggle against the capitalists to reverse their rampage against workers and the oppressed. In fact, the labor tops have been active accomplices in this one-sided class war, selling givebacks, multi-tier wages and other “sacrifices” to defend the profitability and competitive edge of U.S. imperialism against its rivals.

In backing Trump’s tariffs (and those imposed by the previous Obama administration), the labor bureaucrats are serving as foot soldiers in the imperialist drive to restore capitalist rule in China. The 1949 Chinese Revolution, led by Mao Zedong’s peasant-based army, overthrew capitalist-landlord rule and established proletarian property forms, centrally collectivized ownership of the productive forces and economic planning. The Chinese Revolution was a huge victory for the world’s working people, even though the workers state that emerged was deformed from birth by the rule of a parasitic bureaucracy that excluded the working class from political power. The collectivized economy made it possible to free China from imperialist domination, lift hundreds of millions out of dire poverty and lay the basis for significant advances in industry.

The current moves toward an anti-China trade war are part of a broader counterrevolutionary offensive by the U.S. and other imperialist powers that also includes military threats and capitalist economic penetration. Just as workers in capitalist countries must defend their unions against the bosses despite the sellout labor leadership, so they must stand for the unconditional military defense of the Chinese workers state against imperialism despite the ruling Stalinist Chinese Communist Party (CCP) bureaucracy.

Imperialism, China and Trade War

While it is often hard to find rhyme or reason behind Trump’s pronouncements, in regard to China there is a clear program of economic and military belligerence. Trump’s top trade advisers, Peter Navarro and Robert Lighthizer, are anti-China hawks. The AFL-CIO bureaucrats have long lionized Navarro for his hard line against China. Six years ago, they organized screenings in Ohio Rust Belt towns of Navarro’s film Death by China, an anti-Communist diatribe that portrays the country as a trade cheat using currency manipulation, illegal subsidies, intellectual property theft and other measures to steal American jobs. Welcoming Navarro’s appointment as a Trump adviser, an AFL-CIO spokesman saluted his “important critiques of American trade policy” and looked forward to “working with him to translate that into real policies that benefit America’s workers.”

Trump launched his anti-China trade war in January with tariffs on solar panels. Where a decade ago China was only a minor player in solar panel manufacturing, it now produces three-quarters of the entire world supply thanks to a state-run drive to develop renewable energy technology. The White House then announced measures against steel and aluminum imports, which have now gone into effect. When initially proposed, these tariffs also hit many U.S. allies, but it quickly became clear that China was the main target, even though Chinese steel and aluminum imports are a fraction of what top exporters like Canada provide. While most capitalist countries (though not Japan or Russia) were given reprieves, the measures against China remained intact. Far more significant was the March 22 threat to impose tariffs on some $50 billion in Chinese goods. When the CCP regime of Xi Jinping responded with equivalent tariffs on U.S. exports, chiefly agricultural products, the U.S. upped the ante by another $100 billion.

Washington’s chief target is China’s rapidly growing high-tech communications and computer industries. The “Made in China 2025” program, adopted by the Xi regime three years ago, aims to make China a global leader in artificial intelligence, advanced microchips, electric vehicles and other cutting-edge technologies. The imperialists are up in arms about such state-sponsored development, including China’s acquisition of technology through joint ventures and overseas purchases. In 2016, there was a backlash in Germany after a Chinese appliance maker bought Kuka, an advanced robotics company.

More recently, the White House blocked the takeover of the Qualcomm chip manufacturer by a Singapore-based company, fearing this would open the door for China, not the U.S., to become the main hardware provider for next-generation (5G) wireless communications networks. The policy is again bipartisan: the Obama administration blocked similar deals on national-security grounds.

Trump’s invoking of national security in announcing the steel and aluminum tariffs was derided by much of the capitalist media. But military-strategic considerations are a central component of Washington’s moves. Advanced computer/communications technology is critical to China’s defense against imperialism. The London-based International Institute for Strategic Studies recently concluded that China had become a military innovator that is “not merely ‘catching up’ with the West” but would soon break the U.S. monopoly of stealth combat aircraft and achieve at least parity in air-to-air missiles.

Washington’s latest Nuclear Posture Review and other strategy papers point to China as well as capitalist Russia as the U.S.’s main enemies. Earlier, the administration rolled out a “Free and Open Indo-Pacific” strategy that defined China as a hostile threat. This is consistent with Obama’s promised “pivot” to Asia, which was put on hold when the U.S. remained mired in the Near East. U.S. military jets and warships regularly menace Chinese forces and bases in the South China Sea, as Washington seeks to tighten the military encirclement of the country.

The Trans-Pacific Partnership (TPP) is a further example of the continuity between Trump’s policy of containing China and that of Obama, despite differences over specifics. The TPP was Obama’s proposed trade pact with other Pacific Rim countries, notably Japan. Its central purpose was to counteract Beijing’s economic influence. As part of his “America First” campaign, Trump ditched the pact soon after his election. The effect was to give China more leverage in the region. Japan then moved to reseal the TPP without the U.S.—and now the ever-erratic Trump is talking about rejoining it. The pro-imperialist labor tops rail that the TPP fails to create the “strategic advantage over China.” We defend China’s right to carry out measures to protect and expand its economy. As part of our defense of China, we oppose the TPP, which also further opens up semicolonial countries to imperialist depredation.

Economic Advances of the Chinese Workers State

Contrary to the view propagated by many bourgeois ideologues and reformist leftists that China has become a new capitalist power, the Chinese economy operates in a way that is fundamentally different from capitalism. The CCP has over the past four decades introduced numerous market reforms and welcomed imperialist investment in certain areas. However, the strategic core of the economy—most heavy industry, mining, communications and, especially, banking—remains state-owned.

The CCP’s policies have also led to the cohering of an indigenous capitalist class. Many of these private capitalists (including in high-tech industries) have amassed great wealth, but they do not control the Chinese state, which constrains and ultimately controls their activities. Nevertheless, the policies pursued by the bureaucracy have greatly increased the threat of internal counterrevolution.

It is China’s collectivized economy that underpins the country’s huge economic advances. From 2007 to 2013, as the capitalist world was mired in the Great Recession, China tripled its output of goods and services. Ten years ago it accounted for less than 1 percent of global e-commerce; today its share is 42 percent, more than the U.S., Japan, Germany, France and Britain combined. In recent years, China has carried out gigantic infrastructure development projects including highways, airports and a vast network of high-speed trains. This was made possible because the Chinese government makes investment decisions based on what it considers to be in the interest of national economic development, not the capitalist profit motive. At the same time, these projects are built through bureaucratic mismanagement with its attendant effects, including shoddy construction and dangerous working conditions.

In the U.S., the capitalists are starving the educational system, as underscored by the recent teachers strikes and protests in West Virginia, Oklahoma, Kentucky and elsewhere. The bourgeoisie educates only those it needs in order to keep production for profit going. Meanwhile, China’s universities now graduate nearly ten times as many STEM (science, technology, engineering and mathematics) students as the U.S.

The “unfair trade practices” that Trump, the Democrats and the labor tops denounce with regard to China actually typify the practices of the trusts and cartels that dominate modern capitalist industry, whether under the guise of free trade or of protectionism. When the capitalist magnates hope to seize a bigger market share by selling cheaply abroad, they demand “free trade.” When they are undercut by competitors, they enlist the strong arm of the government to give them an edge with subsidies and trade barriers.

The world is dominated by a handful of imperialist powers, which seek to control natural resources, markets and sources of cheap labor, especially in the neocolonial countries. This leads to the relentless cycle of neocolonial wars as well as the ongoing efforts to restore capitalist rule to China and the other deformed workers states (Cuba, Vietnam, Laos and North Korea).

Historically, trade wars lead to shooting wars, the ultimate means for capitalist states to secure foreign markets and spheres of exploitation. Witness, for example, World War II in the Pacific. During the Great Depression in the 1930s, trade barriers were thrown up against Japan by the U.S., Britain and their allies. For their part, starting in 1931, the Japanese imperialists occupied Manchuria in northeast China and other regions. Interimperialist rivalries in East Asia came to a head in July 1941, when the U.S. and Britain cut off oil shipments to Japan. Having helped provoke Japan into war, Washington then ended it with one of the most coldblooded atrocities of modern times: the A-bombing of the civilian populations of Hiroshima and Nagasaki.

For Revolutionary Internationalism!

China’s economic growth has produced substantial gains for the population. However, decades of CCP market reforms have also generated an enormous increase in inequality. On average, China remains poor relative to the U.S. and other imperialist powers. This is especially the case in the countryside, where 200 million small peasant holdings averaging about an acre scarcely provide a livable income.

The CCP leaders falsely believe that they can turn China into a great world power—indeed, the global superpower of the 21st century—in the face of the imperialists’ more powerful military forces, advanced technology and labor productivity. This is an expression of the Stalinist dogma of building “socialism in one country,” which accompanies the CCP bureaucracy’s chimerical quest for “peaceful coexistence” with world imperialism. In reality, the current ratcheting up of protectionist measures demonstrates that the imperialists will seek to impede the development of China when they perceive it to be a threat to their military and economic supremacy.

Stalinist misrule has repeatedly undermined defense of the workers states. The ruling bureaucratic caste must be ousted by a proletarian political revolution in order to preserve and extend the working-class property forms, institute workers democracy based on elected councils of the toiling masses, and pursue the struggle for socialism worldwide. The all-sided, egalitarian modernization of China hinges on the successful struggle for international proletarian revolution, not least in advanced capitalist countries like the U.S. and Japan. The establishment of a planned economy on an international scale will lay the basis for eliminating material scarcity through a vast increase in the global productive forces.

The labor bureaucrats who tie the U.S. workers to the class enemy through allegiance to the bosses’ parties (especially the Democrats) must be replaced by a class-struggle leadership. The workers’ fight must be consciously waged as an international one, based on an understanding that the interests of labor and capital can never be reconciled and that the historic gains resulting from the overthrow of capitalism in China and the other deformed workers states must be defended. The struggle for proletarian power in the U.S. requires the building of a revolutionary workers party. Our watchword is what Karl Marx and Friedrich Engels inscribed on their banner 170 years ago: “Workers of the world, unite!”