The Trade War isn’t about Jobs. It’s about Technological Supremacy.
China is emerging as a new technological superpower. The US can't let that happen.
When Donald Trump launched his trade war with China during his first term, the mainstream press was quick to offer the usual explanations. Some said it was about protecting American jobs from offshoring. Others claimed it was about challenging the Chinese Communist Party’s authoritarianism. A few optimists even suggested it might signal a break from the free trade consensus of the neoliberal era.
But none of those arguments hold up. The real motivation for Trump’s escalating trade war – a trade war that Biden continued during his time in office – is not protecting jobs, democracy, or economic populism. It’s about maintaining the US’ technological supremacy.
America’s position at the apex of the global economy has never been based solely on its manufacturing capacity, natural resources, or even its military dominance. For the last half-century, US hegemony has depended on its control over the frontiers of technological innovation. And that control has increasingly been maintained not by producing new technologies, but by enclosing existing ones.
You don’t need to look far to see how this works. The most important battles in recent trade negotiations haven’t been over tariffs, but over so-called ‘intellectual property rights’. US trade policy has been based on attempts to extend and enforce intellectual property protection; from the USMCA, which replaced NAFTA in Trump’s first term, to the Trans-Pacific Partnership. The goal is simple: to ensure that American companies can extract rents from innovations long after they’ve been developed.
This regime of enclosure allows the US to monopolise the returns from technological development while outsourcing the dirty work of global production. It creates a world in which Apple designs the iPhone in California and assembles it in Shenzhen, using conflict minerals mined in the Democratic Republic of the Congo – with all the profits being sucked back into financial markets in New York.
But now, that model is under threat. Over the past two decades, China has defied the expectations of Western policymakers who believed it would remain stuck in the low-wage, low-tech end of the global value chain.
