By Dr. Soma Marla
The world is facing the brunt of attacks by Donald Trump after his installation as the 47th president of the US. This person combines the qualities of an early capitalist adventurer and an American cowboy-robber baron of a bully and a businessman. Thrown up by the collapsing world imperialist economic order, he appeared on the world stage to rescue crisis-ridden capitalism with raw, savage corporate capitalism. In his latest avatar, he is surrounded by a new breed of unruly technocapitalists who plan to plough huge profits out of powerful new technologies to crush other competitors and pauperise poor developing nations and workers domestically and worldwide.
Trump’s strategy of economic ‘nationalism’ is to restore American dominance in the world. He wants to combine neoliberalism at home with protectionism against foreign competition. It is a position that breaks with the neoliberal strategy of free-trade globalisation hatched by the Reagon Thatcher duo in the 1980s. However, inside the United States, Trump continues to pursue some aspects of neoliberalism. He plans to cut taxes on the rich, dismantle bureaucracy and organisations and sack thousands of employees. He threatened to impose tariffs on American corporations that plan to move their production to other countries.
He has already scrapped the Trans-Pacific Partnership (TPP) and the Transatlantic Trade and Investment Partnership (TTIP) with Europe. He pledges to renegotiate the North American Free Trade Agreement (NAFTA) with Mexico and Canada to secure more favourable terms. In response to the protectionist measures from China and the European Union, he threatened to impose a 45 per cent border tax on Chinese goods and retaliatory tariffs on Indian exports to the United States. These measures could trigger a world trade war and shake the world markets. Trump is doing all this not to benefit American people but to gain a competitive advantage for America’s super-rich.
The United States has pioneered the neoliberal world order of free trade globalisation since the collapse of the USSR and the socialist camp in the early 90s. Despite the emergence of a unipolar world heralded by wars in Afghanistan and Iraq, world capitalism had to face a severe global crisis triggered by the 2007 Great Recession. It has intensified competition between corporations and states. Subsequently, trade wars have paralysed the World Trade Organization (WTO) and disrupted regional free trade deals and blocs, such as TPP, NAFTA and Brexit. With the rise of the economic might of China and Russia, trade wars between America and China became a daily routine in the world arena.
Neoliberalism was implemented ruthlessly in America following privatisation and deregulation. The ruling class got rid of regulations on capital and launched a war against workers. The attacks were mainly aimed to sabotage the worker rights and paralyse trade unions. American neo-liberalism had forcefully coerced others, especially developing nations like India, to privatise state-run enterprises and discard worker rights by imposing hire and fire, threatening employment security to millions of workers.
Indeed, the world has entered a new period of imperialism, the unipolar world order under the hegemony of the United States, which has been eroding with the emergence of a multipolar world. These developments have seriously alarmed the world capitalist system. Eventually, Trump tore down the veil and resorted to pure American dominance and primitive accumulation of capital. He scrapped USAID, withdrew from WHO, and cut down on American funding for different developmental activities in the third world. He threatened to reduce American funding for NATO. He proposes a return to unvarnished rules of naked capitalist competition and exploitation in desperate mutual competition with Russia, China, the European Union and, to a lesser extent, India and Brazil. Trump defies all previous norms only to restore America to a position, wresting the lion’s share from the spoils of a new trade war.
Trump is attempting to rearm the American military to push back against all rivals: China, in particular, waging an ugly racist war against Palestinians. He even imposed sanctions against South Africa for implementing land reforms. It should be noted that even after three decades of independence, the racist white minority (of 7 per cent) holds 70 per cent of the land while the landless poor suffer in that country.
China has become a formidable world economic power during the last three decades. It transformed itself from a backwater producer to the new workshop of the world. It vaulted from producing about 1.9 per cent of global GDP to about 19.5 per cent in 2024. It is now the second-largest economy in the world and is predicted to overtake the United States as the largest economy shortly. China is not the sole beneficiary of the neoliberal expansion. Brazil, India, Russia, and other regional economies have also developed. By forming a parallel economic bloc, BRICS nations, primarily representing the global South, have side-lined G7 and G20. Alarmed by the BRICS’ proposal to dedollarize and resort to a parallel currency system, Trump recently threatened to impose high trade tariffs. The recent American offer to buy Greenland from Denmark is one example of curtailing China’s potential future military operations in the region.
Curry favouring Russia and mediating in the ongoing Russia-Ukraine war is an attempt to separate Russia from China. This reminds one of President Nixon’s historic visit to China in the early ’70s. However, China and Russia have developed strong economic, military and social alliances. China heavily depends on Russia to import vast quantities of oil and gas. Similarly, in the wake of economic sanctions imposed by Western nations, Russia badly needs technological and economic assistance from China to sustain its economy. Hence, it is not easy for Trump to separate two friends.
Can Trump succeed? Already, Trump is facing several obstacles in implementing his new strategy. He is already becoming an unpopular president, with an approval rating hovering below 40 per cent in his first month in office. Dismantling administrative units, the sacking of thousands of workers and employees, and unpopular discriminatory gender and equal rights policies largely contributed to this development. He and his crony capitalist cabinet will no doubt face many obstacles to push through their agenda.
There are also real economic challenges to his ability to follow through on his economic program. He simultaneously promises to cut taxes for the wealthy, spend hundreds of millions on domestic infrastructure (billions to build a wall along the US–Mexico border), and expel thousands of illegal immigrants, which will undoubtedly impose a substantial economic burden. On top of all this, multinational capital opposes American protectionism. Dozens of American Multinational corporations with tens of billions of investments overseas are fighting against Trump’s high tariffs and economic nationalism. The reality is that the United States economy continues to decline in the neoliberal world order. Despite many contradictions, China continues to benefit from the current trade faceoff. Trump’s contradictions could stymie his ability to impose his economic nationalist program in future.
In the face of the big successes of right-wing forces in many European states, and to resist Trump’s imperialistic policies, workers around the world should come together to show solidarity. In this fight, the global working class should make alliances with third-world nations fighting against Trump’s tariffs and economic protectionism. In today’s world, science and economy have emerged cosmopolitan, and without mutual help and respect, no nation, however mighty, can survive in the long run. (IPA Service)
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