Steve Bannon, the former adviser to Donald Trump, calls the US-China trade war a fight to prevent Beijing from becoming a “global hegemonic power”. China’s fourth most powerful leader Wang Yang, matches this rhetoric, calling it the “grand game of the century” in a closed-door meeting with Taiwan delegates.
The goal of the trade war is to glorify neither liberal trade, nor the liberal global order, but American hegemony. China’s rise makes the strategic conflict destined to happen.
The optimal strategy for Beijing would be delay, to avoid global economic calamity and to give China much-needed time to build alternative global manufacturing supply chains, strengthen trading routes through Eurasia and the Pacific, and upgrade its technological collaboration with Europe.
Within China, President Xi Jinping has successfully portrayed the trade war as a US attempt to inflict national humiliation. His faction within the Communist party gains legitimacy by not going soft on the US.
The faction of economic liberals has been largely silenced. This group is represented by the princelings and elites, many of them educated in the US, who fostered China’s integration into the global system over the past three decades under former Chinese premier Zhu Rongji, and his protégé vice-president Wang Qishan.
Some of them spoke out initially: Li Ruogu, former president of China’s Export-Import Bank, warned that China as the weak side . . . “must know how to make a retreat”. And Long Yongtu, formerly Beijing’s chief negotiator at the World Trade Organization, said in November that China should have avoided hitting back at America with tariffs on soyabeans.
When nationalism and populism meet in China, economic liberals are attacked as traitors to the country’s rightful cause, and accused of surrendering to America. After former finance minister Lou Jiwei called Mr Xi’s “Made in China 2025” plan a waste of taxpayers’ money, he was unexpectedly ousted as chair of the country’s National Social Security Fund.
With the trade war, Mr Xi has successfully waged a war not only against liberal market forces but also liberal thinking within his party.
In January, a “Study Xi” app, designed by Alibaba, debuted as a mandatory self-study tool for 90m Chinese Communist party members and all government employees. The app‘s contents are filled with “Xi Jinping Thoughts”, and his daily speeches. Party members are ranked daily based on the time spent and points earned on the app. The app hit number one in the Chinese Apple Appstore in February.
Undeterred by the recent stormy protests in Hong Kong, Mr Xi has sought party solidarity by resurrecting Yan’an Rectification, a 1930s and 1940s Communist party ideological movement. Mao Zedong used it to consolidate power, indoctrinate members and cultivate a personal cult.
For his part, Mr Xi wants the control of free thinking, both within his party and among the populist masses. The trade war has given him the perfect reason to do so.
By amassing state power and ideological thinking under one man, Mr Xi aims for a different end than Mao, who was attempting to build a global proletariat community under communism. Mr Xi aspires to restore the glory of ancient empire, under a modern veneer.
Thus far, liberal globalists in both Chinese and American politics have lost their voice and privilege. The two countries are set on an irreversible course of division and departure. Ironically they are led, in the words of Mr Trump, by two “friends” who are both champions of populism, nationalism and supremacy.
The writer, a former Chinese national television (CCTV) news anchor, is a senior visiting fellow at the London School of Economics