Monday, May 29, 2023
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< view full issue: USA-China, cold war 21st century
José Antonio Nieto Solís

​Europe, more necessary than ever

Professor of Applied Economics at the Complutense University in Madrid

Globalisation does not respect borders. Donald Trump knows this well, although in their proclamations and tweets, he prioritizes nationalisms. Even if he opens up trade wars in the name of their country, the interests that motivate him go beyond borders and flags. It seems that forms do not matter in their strategy. This is difficult for us to understand in Europe, where, in addition to the substance, the form has value.

Comercio de china y europa

Without apparent concern for diplomacy, Trump lashes out against anyone who does not share their opinions and interests. However, he knows where to aim and what he's looking for. of course, the American president is clear about who he owes their allegiance to: to the companies that support him and benefit from doing so, and to those who have voted for him, strengthening a discourse that reaffirms them in what they intend to keep on doing: being the centre of their own local universe, the navel of the world, the head of the empire (without questioning whether the Earth is capable or not of generating resources and absorbing waste at the rate that maintaining their lifestyle and the United States' world position demands).

Initiating a trade war with those who they can overshadow -China- is only a first step in the strategy of the US president and those around him. 

These confrontations are also aimed at dividing those who offer alternatives: Europe. Moreover, they are aimed at dismantling multilateralism as the basis of the current international system, to return to seemingly nationalist and bilateral approaches (and to blackmailing and pressures).

Trumpism seems to rest on a nationalism This is more rhetorical than real, but its geopolitical consequences are not trivial. It manages to block certain multinationals (Huawei), favouring others, although many of them -regardless of their place of origin- find it quite easy to ignore conventional borders; they only invoke their local character if they need it to maximize profits on a global scale. 

Tax havens are an excellent example of how capital movements circumvent whatever barrier. 

The delocalisation and fragmentation of production processes, together with the growing commercial traffic between companies within the same group, help explain to what extent customs regulations can be adulterated, even though their legislative base is national. For Trump, tariffs are an instrument of pressure, a warning that nothing will stop their plans. The point is that this plan generates victims, inside and outside Europe.

Protectionism and trade wars have shown their destructive power throughout history. However, while the US economic machinery is at work it will be difficult for a majority of its the general public to be willing to heed the teachings of history and look to the future in a less selfish and more sustainable way.

Protectionism does not favour a country as such, but rather the oligarchy of that country. It is in no way useful for companies, possibly only for some entrepreneurs. Moreover, it does not benefit the general public, except certain groups. Often, the benefits are limited to the moral satisfaction of knowing they are protected from the enemy, real or fictitious, and from those who are or think differently (immigrants, foreign societies...). The costs are difficult to evaluate, since transnationalisation affects more and more activities and they are interlinked without respecting national criteria. The business priority is to improve income, if possible worldwide. This is why, in terms of borders and economic policies, appearances deceive: although some governments give in to disguised blackmail of tariff protection: commercial wars are not fought by countries, but rather by their companies.

If nothing prevents it, the logic of the concentration and centralization of capital leads large companies to become global monopolies.

Competition is watered down, particularly when there are pressure groups involved. The growing power of finance reinforces the expansion of activities, seeking hegemonic positions in the markets. Therefore Trump regards China as the greatest rival. It does not matter if the borders and tariffs have lost relevance or if the Chinese power has spread around the world at the hands of its multinationals and its the general public, with due governmental support. The simpler the message and its forms, the more forceful it will be and the greater its capacity to hide the underlying interests. Stereotypes win the game: the enemies are China, the EU, the multilateral bureaucracy...

But it will not be easy for Trump, or anyone else, to stop the internationalization of Chinese companies (or from other places). Among other reasons, because the economic agents of the Asian giant are strengthening their alliances in the world and, if necessary, will respond with the weapons they have at their disposal: trade defence measures, restrictions on exports of strategic materials, use of monetary and exchange policy, alternatives to current trade, distribution and information networks, support for global organisations that survive the Trump attacks, and creation of new international agencies, just in case. China was preparing for its technology, its transportation and, if necessary, its leadership and its finances to be at the centre of the world. Many would like to say the same. but are not able to.

In the midst of that situation, the consequences for Europe are obvious. The commercial war is a succession of battles to strengthen the power of some economic groups, as well as a coup by Trump on the world's chessboard to consolidate the hegemony of neoliberalism in all possible areas. The ultraconservative, antidemocratic, antisocial, individualist, consumerist, supremacist and negationist bias that is behind Trump's strategy is not compatible with the objectives of European integration. It cannot be, neither in respect to human rights and the principle of non-discrimination, nor in the effort to preserve the environment, nor in the will to activate regulatory mechanisms of economic and business activities in favour of equity, cohesion and equal opportunities. 

Although the logic of the accumulation of capital has a universal character, it is worth remembering that the European construction rests on regulatory mechanisms and public policies that trumpism despises shamelessly.

The EU should have it clear and act in block against trumpista tactics. If it does not do so, its future is at risk and its international projection is on the way to extinction. Even more if the multilateral organisations are definitively eclipsed. The WTO -long since paralyzed- provides the best example, but not the only one, of the scenario that Trump would love: to strike down any regulation that questions the idea of America First. Although it would be more appropriate to say First me and mine. To that we could add "first the private and then the public". In this way, even if the current EU is atrophied and its foreign policy is invisible, Europe is now more necessary than ever.

Further proof that Trump does not waste ammunition: in his recent visit to the UK he has not hesitated to reaffirm their interest in the disintegration of the EU; he distributed concoctions to digest a hard Brexit; he has promised fantastic commercial agreements to anyone who follows his pied piper music; he attacked those without fault who are on the wrong side (including the dissenting media)... This gives wings to one of the great dangers of the EU: the resurgence of nationalism, the Europhobia that runs through the Old Continent, covering up with its ghostly sheet possible constructive criticism of what does not work, which is considerably, to re-float the poor and well-worn idea that national states are what matters: they are the future. However, it is not true. The national states, their barriers, their policies, are systematically crossed by economic, financial, cultural globalisation... In addition, the EU Member States have been removing borders and lifting common legislations for decades, as a means to strengthen their economic activities and preserve shared values. (tolerance, openness, cohesion...), but also in the certainty that Europe is losing relevance on the world stage.

The EU is a substantial commercial power, but it lags behind the USA and China in technology (the 5G battle has only just begun). The European population has less and less weight in the world. The cultural heritage will survive, if the Trumpian neoliberalism and its oligopolistic doctrine do not triumph devastatingly. 

The conclusion seems clear: Europe will resist provided it acts together, if it strengthens its union, if it reinforces its internal and external identity... If it avoids trade wars and supports multilateralism, instead of the false nationalist bilateralism of Trump.

European integration has quite serious problems: divorce between institutions and the public at large, deficiencies in the monetary union, insufficient economic and social cohesion, a technological gap, demographic exhaustion, immigration as a false threat, recurrent fiscal crises, cuts in public policies, a boom in intolerance, the effects of global warming... To those problems, a meteorite exterminator, is added one more threat: Trump is supplying poisoned air to an UE already lacking oxygen. Unfortunately, in Europe there are those who prefer to deactivate integration, to be small-thinking, to dig up nationalisms that are reluctant to share sovereignty, perhaps because in their projects, the word sovereignty resonates more strongly than it really does in reality.

Hence the importance of promoting European construction, making tangible benefits for EU citizens. Hence the need to strengthen the presence of Europe in the world (economic agents exercise their activities autonomously, but the EU has to be present in the forums where the internationalization processes are regulated, albeit partially). Moreover, hence the obligation to use arguments and develop means of action rather than war, designed to preserve the social achievements of European nations. These are achievements that cannot be inspired by old imperialist formulas, but rather by new paths open to international cooperation and a more sustainable, democratic and equitable multilateral order. Not what Donald Trump seeks and who support and benefit from it.



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