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U.S. Imperialism: Return to “Normalcy” or More World Disorder?

Continuing with the analysis in our previous article on contemporary imperialism and the situation in the United States, here Esteban Mercantante discusses the balance of the first (and perhaps only?) presidential term of Donald Trump.

Esteban Mercatante

October 30, 2020
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Illustration: Mar Ned- Red Focus

Trump came to the presidency riding the wave of dissent that has swept through all the rich countries during the last decade and that was also evident in Brexit — which, like a “black swan,” took the media, the British ruling class, and the European Union (EU) completely by surprise. The devastating and lasting social effects of the crisis that began in 2008 struck at the consensus basis for governing, what Tariq Ali called the “extreme center1Tariq Ali, The Extreme Centre: A Warning (London: Verso Books, 2015. — which in Europe has meant alternating between the right wing and social-democratic parties and in the United States is expressed by the bipartisan establishment. This produced a political polarization that manifested itself not only on the right but also on the Left (initially breathing life into the “neo-reformist” parties that today find themselves in crises or, like Podemos in the Spanish State, are increasingly integrating themselves into the very system of the parties they challenged).

Trump’s “America First” program was intended to be a break with several of the principles that had governed U.S. imperialist policy for the past several decades. “Americanism, not globalism, will be our credo,” he proclaimed in his election campaign.

What has this meant so far in the Trump administration? Clearly there was not, nor could there be, any “isolationism” — renouncing intervention in international affairs on the part of the main imperialist power — even though Trump’s campaign speech pointed in that direction. U.S. interests and interventions (economic, diplomatic, and military), which are expanding all over the planet, do not permit such an orientation.2Until World War II, isolationism was a strong current in U.S. politics, reflecting reluctance about the growing interventionism the ruling class was pushing to establish its world primacy. As Perry Anderson states, its bastion was traditionally “in the small-business and farming population of the Mid-West.” Perry Anderson, “Imperium,” New Left Review 83 (September/October 2013), 20.

But “America First” did result in an abrupt change in approach to dealing with international issues on all fronts. First, abandoning multilateralism — in which the United States has been a major player in the world — has led to the creation of a new set of rules and regulations. It was through multilateralism that the United States sought to impose its interests, in association with other imperialist countries — such as having the EU and Japan as leading partners. Now, with bilateralism favored, the United States negotiates separately with each country and avoids committing itself to points that the U.S. government might consider unfavorable. 

Republican presidents distrusting the network of multilateral institutions is not new, despite the fact that all of them were created at the behest of the United States. George W. Bush also made this clear by carrying out a policy that privileged close alliances with some countries to advance his administration’s war adventures — to the detriment of the cover of multilateralism. But Trump has taken disdain and a willingness to disengage from these institutions to unprecedented extremes. It has been expressed across the board: from informal blocs of countries and collective governance bodies created at the behest of the United States (such as the G7 and the G20), whose aim was always international coordination, to the State and Treasury departments, the policies that have long served U.S. imperialism and have been used to negotiate with other powers to sustain alliances are now treated by the “tycoon” president as inconsequential. His participation has been focused on staging conflicts (with Germany and France over NATO military expenditures and with China over trade in the G20). They have also allowed him to mount “shows” aimed at demonstrating that this or that dispute had been successfully settled, such as when in Buenos Aires he and Xi Jinping signed a truce in the trade war — which didn’t even last a week. Trump went so far as to withdraw from the World Health Organization, of which the United States has been a member since the late 1970s and was the main financial contributor, as is the case with almost all multilateral institutions. This happened at the height of the pandemic.

In matters of trade, bilateralism was expressed in the refusal to promote big trade agreement treaties, which have been abandoned in favor of negotiating with each country individually as a way to extract greater concessions. In other words, the principle of seeking greater trade openness has not been abandoned, but the priority is less to ensure general rules all countries will be obliged to follow and more to ensure a share for the United States, measured as an improvement in the trade balance (through a lower trade deficit).

The Obama administration had concentrated its energies on two large-scale strategic agreements that would unite dozens of countries — the Trans-Atlantic Trade and Investment Partnership (TTIP) and the Trans-Pacific Partnership (TPP) — which included most of the world economy, except for China. These agreements had been the response to the paralysis of the World Trade Organization (WTO). With the founding of the WTO in 1995 (as a continuation and institutionalization of the General Agreement on Tariffs and Trade, which since the 1950s had negotiated trade integration in successive rounds), “capital won a decisive battle,” in the words of Ernesto Screpanti.3Ernesto Screpanti, Global Imperialism and the Great Crisis: The Uncertain Future of Capitalism (New York: Monthly Review Press, 2014), 76. But while the WTO crowned and reinforced the advances of decades of trade integration under pressure from the richest economies, whose companies benefited greatly, at the beginning of the millennium it was at an impasse, unable to deepen economic integration. After the failure of the so-called Doha Round, opened in 2001 and suspended in 2006 due to the lack of agreements, the TPP and TTIP treaties — which would surpass in scale all existing treaties — became the new path by which the most globalist sectors of imperialism sought to deepen integration in matters of trade and investment for the benefit of multinational capital. A key objective of these agreements by the U.S. under Obama was to condition China. As Amor, Leaño, and Merino maintain, they aimed at “the installation of a transnational institutionality that sets norms and authorities of exogenous application to each state and assures global capital the power of self-regulation in relation to the emerging power and its enterprises.” And they point out, as Obama expressed it, that what was at stake “is who sets the rules of the game for the 21st century, and it cannot be China.”4Juan Andrés Amor, Andrés Leaño, and Gabriel Esteban Merino, “La Alianza del Pacífico (AP) y el Acuerdo Transpacífico (TPP), entre globalistas y americanistas” [The Pacific Alliance (PA) and the Trans-Pacific Partnership (TPP): Between Globalists and Americanists], in Geopolítica y economía mundial: El ascenso de China, la Era Trump y América Latina [Geopolitics and World Economy: The Rise of China, the Trump Era, and Latin America], Gabriel Esteban Merino and Patricio Narodowski (eds.) (La Plata, Argentina: CIG-IdIHCS-Conicet, 2019), 233.

Trump left the TPP after the agreement for its creation had already been signed and implementation was pending, and he disengaged from ongoing negotiations to advance the TTIP. One of the main points of his campaign had been that these types of agreement had resulted in the loss of millions of U.S. jobs — which he promised to recover — and in the decline of vast sections of the country. However, unlike what might have been expected — especially since he had raised it in his campaign — Trump did not withdraw from the North American Free Trade Agreement (NAFTA), the most important agreement the United States has with Canada and Mexico. It was renegotiated and replaced by the United States–Mexico–Canada Agreement (USMCA). The United States imposed its criteria in the new pact, replacing multilateralism with bilateralism: it was negotiated separately between countries, with the United States threatening trade sanctions during the difficult negotiations if Canada and Mexico did not accede to its demands. The treaty maintained trade integration, but for the United States, it ensured — at least on paper — more local components in automotive production, one of the keys to the agreement. Quotas were set for the number of cars Canada and Mexico can sell in the United States, and dispute resolution mechanisms were eliminated for nearly every sector (leaving open the freedom to establish quotas and tariffs unilaterally). The USMCA will also have a periodic review every six years.

The “trade war” with China is another chapter that highlights this bilateralism. From the beginning, Trump’s main argument for launching it was the trade deficit, but the real heart of the dispute is the intention of the United States to halt China’s advance in high-tech development. The war of tariffs and other trade barriers between the two countries has had its ups and downs since it was launched in March 2018, and it has made the WTO even more irrelevant. With the negotiation of new rounds of trade openings frozen, the only reason for the WTO’s continued existence has been to settle the open conflicts between countries for noncompliance with the rules they had committed to accept and that the WTO watches over. But in this trade war, the WTO became a mere observer. While the United States had already been reluctant during George W. Bush’s presidency to abide by unfavorable WTO rulings (although it eventually accepted them under the threat of trade sanctions from other countries), Trump took another leap. Not only did he ignore the WTO, but he liquidated the WTO’s Appellate Body — its main resolver of disputes — by refusing to agree to the appointment of new judges. Since December 2019, the group has not had the minimum of three judged required to make rulings, which is why the EU, China, and other countries have promoted the creation of a parallel court, something the United States has not accepted.

Trump’s approach, as Foreign Affairs magazine correspondent Richard Haass complains, has focused on “narrowly defined economic interests,” and its corollary has been “the almost total neglect of other aims of U.S. foreign policy.5Richard Haass, “Present at the Disruption: How Trump Unmade U.S. Foreign Policy,” Foreign Affairs, September/October 2020. The Trump administration pushed for a review of some of the historical alliances on which U.S. imperialism has relied. He threatened to abandon NATO, created during the Cold War to integrate Europe militarily, unless other countries committed to significant increases in their contribution to sustaining the alliance. It withdrew from the Paris climate agreement that limited U.S. development of fossil-fuel and other polluting industries. Unilaterally, Trump repudiated the treaty Obama had signed to halt Iran’s nuclear development. I could go on and on. But he has kept other historic pillars of imperialism unchanged, such as support for Israel and Saudi Arabia. With respect to Latin America, the relationship was undone by the anti-immigration policies Trump applied the moment he took office, which have targeted migration from the region in particular, as well by the government’s position on Venezuela. Trump, like his predecessors, has been a pillar of support for the opposition to Chavism and its failed coup attempts.

Trump’s “America First” turn has also translated into a significant increase in military spending, something previous administrations were also prone to do. It has increased an average of 6 percent each year between 2016 and 2020, reaching $720 billion this year — which is 38 percent of total world military spending. But at the same time, despite the aggressive rhetoric, Trump managed to avoid starting any major new conflicts, just as Obama had done — except, of course, for Obama’s massive use of drones during his eight years in office to intervene militarily in the Middle East. Trump’s main military interventions were the bombing of Afghanistan (with the so-called “superbomb”), the bombing of a Syrian base where chemical weapons were allegedly stored, and the assassination of Iranian General Qasem Soleimani days after he had helped organize an assault on the U.S. embassy in Baghdad at the end of 2019.

Overall, “America First” has not meant the abrupt break forecast so ominously by some sectors of the U.S. establishment. Among other reasons, this is because the agenda had to confront strong resistance from some parts of the most globalized American bourgeoisie — the sectors that have prospered the most in the last few decades. The latest example of this rejection is the lawsuit filed at the end of September by 3,500 companies, among them Coca-Cola, Disney, Tesla, Ford, and the pharmaceutical company Abbott, seeking compensation for the costs generated by the Trump tariffs imposed on China. Trump’s policies have clashed with the same inclinations, deeply rooted in bipartisan consensus, that weigh on all levels of the U.S. regime. This explains, for example, those who conspired against his intentions to get closer to Russia so he would concentrate on the fight with China.

In short, Trump has accelerated numerous tendencies we could already see unfolding. He has deepened the situation of world disorder, and in that sense, his administration could be considered a turning point that has configured a new situation that will be difficult to reverse. It’s not isolationism, but rather selective intervention in the international arena in accordance with U.S. interests — but at the same time, he is blatantly more aggressive in defense of those interests, without trying to reconcile them with the agenda of the “international community” or anything of the sort. On the whole, we are seeing a renunciation of the main power’s commitment to continue acting as supporter and guarantor of the architecture on which the internationalization of capital was based over the last four decades, and that has tremendously benefited a good portion of the U.S. capitalist class.

Leo Panitch and Sam Gindin correctly argue that the global capitalism of the last decades was a “construction,” that is, that the configuration it established, and the willingness of states to get involved in ensuring all the guarantees to global capital and get involved in multilateral institutions, depended decisively on the intervention of U.S. imperialism. For that very reason, however, we must take quite seriously the consequences that the refusal of this administration to continue fulfilling this role has already had, even if Trump is defeated on November 3. The Trump administration marks much more than an internal U.S. “political crisis” with no consequences for the ordering of the “informal empire,” as these authors seem inclined to interpret it.[Leo Panitch and Sam Gindin, “Trumping the Empire,” in Socialist Register 2019: A World Turned Upside Down? (London, Merlin Press, 2019), 13. For a debate on this, see Esteban Mercatante, “¿Podrá el imperio norteamericano sobrevivir a Trump?: Entrevisa a Leo Panitch” [Can the American empire survive Trump: Interview with Leo Panitch], Ideas de Izquierda, June 17, 2018.]]

America, First?

Trump’s motto doesn’t seem to have made much progress in becoming a reality. The greatest achievement the “billionaire” could point to before the pandemic, which was sustained economic growth, was not associated with any of his disruptive policies but with the continued monetary alchemy of the Federal Reserve. This was aided by his administration’s tax cut for the capital repatriated by companies with investments abroad. Although the design of this tax giveaway has the marks of “America First,” it is not that different from what all Republican administrations since Ronald Reagan have done when they’ve been in office. Trump’s tax cut prompted many multinationals to repatriate capital to the United States, but far from “creating jobs for Americans” by investing in new ventures, the money went to financial investments or payments to shareholders.

The administration had set boxing in China as one of its great objectives. But it began by giving China great relief with the abandonment of the PPT, which represented a significant threat to the country. The two years of “trade war” did not yield favorable results, either. The U.S. deficit with China continued to grow, while the balance of cross-sanctions seemed to hit U.S. capitalists (both those exporting to China and those dependent on critical U.S. inputs) relatively worse. The dispute, which since 2019 has openly become a competition for leadership in 5G and other technologies, does not look any better in that arena. The biggest blows to China so far have been the United States restricting access to chips manufactured by Taiwan Semiconductor Manufacturing Co. (TSMC), which means blocking a key input for the construction of 5G and artificial intelligence, and getting many countries to join the U.S. rejection of Huawei’s 5G technology for security reasons. But this does not abort China’s technological development in these fields. Another tough blow was the blockade of TikTok and WeChat on U.S. territory. Contrary to Trump’s wishes, the Economist suggests it may have been the United States that helped Beijing find the strategic sectors to prioritize in its “Made in China 2025” plan:

Basically, every department in the industry ministry came up with pet projects. But there was no real action strategy,” says Yu Yongding, an economist involved in developing some of China’s five-year plans. However, its ambition, coupled with China’s industrial-policy mystique and habitual spying, prompted America to react. And that has provided Mr. Xi with the criteria by which to select its true priorities.6Xi Jinping is trying to remake the Chinese economy: The new state capitalism, The Economist, August 15, 2020.

Paradoxically, as some analysts have maintained with some irony, a balance sheet of Trump — whose 2016 campaign slogan was “Make America Great Again” — may end up being that his administration, despite its intentions, ends up helping Xi realize more quickly his own “Make China Great Again.”

More generally, the goal of “selling more” and “buying less” from the rest of the world, which was an important component of foreign relations during these years, has had meager results. As a result, the trade deficit did not fall but instead has continued to grow, except for a slight decline in 2019 that was reversed in 2020 — a year headed for setting a record in the red.

In other areas, Trump has not fared much better, while his approach has alienated allies and has continued to weaken the U.S. position. As Claudio Katz summarizes:

Trump’s strategy depended on the discipline of his allies (Australia, Saudi Arabia, Israel), the subordination of his partners (Europe, Japan), and the complacency of one adversary (Russia) to force the capitulation of another (China). But the magnate did not achieve these alignments and the consequent relaunch of American supremacy failed from the outset.7Claudio Katz, “El resurgimiento americano que no logró Trump” [The American Resurgence that Didn’t Make Trump], blog post, July 28, 2020.

If Trump’s Out, Does the United States Again Become “Indispensable”?

The notion that if Trump is defeated — and accepts that defeat — we will return to normalcy is unfounded. The United States will not simply return to its place at the head of the “liberal transnational order,” even if that is what a hypothetical Biden administration actually intends (which is far from clear).

Mistrust of old allies is not reversed with a change of administration; among other reasons, that mistrust only accentuates the deeply divergent interests that have long existed. Managing global monetary policy with an eye on U.S. GDP, unilateral interventions such as in Iraq, and disputes over management of the effects of the 2008 crisis — especially the strategies for dealing with the debt crises in the EU — already made it clear that what is good for the United States is not necessarily good for its old allies. Trump only accentuated the magnitude of the divergences, adding uncertainty about the U.S. role. “Alliances are predicated on reliability and predictability, and no ally is likely to view the United States as it did before. Seeds of doubt have been sown: if it could happen once, it could happen again. It is difficult to reclaim a throne after abdicating it.” 8Haass, “Present at the Disruption.”

Nor will it be easy to recapture the spaces now occupied by adversaries, such as in Syria, where Russia took advantage to make an advance. The war between Armenia and Azerbaijan, in which Turkey and Russia play roles, is another example of the gaps the United States has left in its self-assigned role as international referee.

When it comes to China, there is also no reversal in sight of the course of conflict. In short, any attempt to return to a more multilateralist imperialism will be fraught with pitfalls. It is not surprising, then, that apologists for “rules-based” imperialism — which was prosperous for capital at the price of subjecting the entire planet to exploitation by the multinationals and fostering social polarization and environmental disasters — should be lamenting that it may simply have been an exceptional interregnum9See, for example, Michael Beckley, “Rogue Superpower: Why This Could Be an Illiberal American Century,” Foreign Affairs, November/December 2020. within the course of exacerbated competition between powers and wars, which go hand in hand with sharper class clashes in each country. That is something Trump’s policies have also helped spur within the United States itself, by aggravating political and social tensions. We’ve seen a recent example of this with the massive anti-racist mobilizations across the United States.

First published in Spanish on October 11 in Ideas de Izquierda.

Translation: Scott Cooper 


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Esteban Mercatante

Esteban is an economist from Buenos Aires and a member of the PTS.

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