The Hegemonic Siege on American Power: US-China Disputes in the Shaping of the 21st Century World-System
Eduardo Martínez-Ávila
Ph.D. student at the Postgraduate Economics Program, Instituto de Investigaciones Económicas UNAM. Professor at the Faculty of Economics UNAM.
Please cite the paper as:
Eduardo Martínez-Ávila, (2020), The Hegemonic Siege on American Power: US-China Disputes in the Shaping of the 21st Century World-System, World Economics Association (WEA) Conferences, No. 1 2020, Trade Wars after Coronavirus, Economic, political and theoretical implications
Abstract
The hegemony of the United States is undergoing a process of structural weakness. The 1970s represented an exceptional economic period in the crisis-reconfiguration of the Western economic system. The restructuring of the world-system under the project of neoliberal globalization, the productive delocalization and the accumulation regime with financial predominance, violated the American power. American industries lost dynamism in the accumulation of capital. The intensification of production went to the emerging economies, mainly to the Far East region. The United States developed a fictitious accumulation scheme based on the expansion of the financialised regime. However, China’s high rates of economic growth from the 1990’s onwards surprised Western economies. This stage represented the beginning of the Chinese hegemonic siege on American power, consolidated with the XII Five-Year Plan, 2011-2015.
The contest for supremacy of the inter-state world-system has a place when the hegemonic nation is experiencing a context of structural vulnerability. The articulation of a world-system enters a phase of instability when the financial system assumes the central role in the accumulation of international capital. The hegemonic siege represents a rival states project of dispute for world power. However, to achieve the hegemonic State’s role in the international system, it is not enough to dispute the dimensions that make up power. There must be a definitive blow. An act of confrontation -most of the time, warlike- will end the change of hegemony.
In this way, the article aims to characterize the systemic dimensions in dispute from a historical perspective that defines the Chinese siege hegemonic on American power in the potential conformation of the world-system of the 21st century. In the last decade, China has disputed the first place in the productive, commercial, energy, and technological fields. However, the lack of direct -or indirect- confrontation leads to the fact that the United States maintains the world-system’s weakened leadership. In metaphorical terms, China experiences an economic and geopolitical challenge that consists of the power to break down the “walls” that keep the American “fortress” in place -in military, political-institutional and monetary terms-, to establish a final assault on the power that will transform the prevailing world-system.
Hi Eduardo,
Congratulations for the paper. I think we have quite a few parallels in the work we have presented for the congress. I believe that in both cases the influence of Arrighi’s work is very important.
Going into the analysis, taking into account the nine areas you present (productive, commercial, energy, technological, monetary, diplomatic, political-institutional, cultural, and military fields integrate the systemic dimensions of power), I think it’s difficult to argue that China is ahead of the United States in so many areas. At least at the present time. It is clear that historical trends suggest that China will overtake the United States in many respects.
In this respect, although it is true that China is ahead in GDP measured by purchasing power parity, in its measurement per capita or in market terms, the United States continues to lead in this aspect. The same applies to technology. As an argument in my work, although China is in first place in the race for 5G, in terms of leading technological development and, above all, homogeneous technological development throughout the country, I believe that the United States continues to lead. It may be that everything will change with the break-up of 5G, as it may mean a qualitative change.
On the other hand, I agree that at an institutional, cultural, monetary and diplomatic level, the United States has a great advantage (just look at the number of problems China has with its neighbours).
Perhaps, the aspect that China clearly leads is the commercial one. Both as an export leader and, more importantly in my view, as a major trading partner over the United States.
Another area that I believe could be key in the future is energy. As you comment in your paper, Oscar Ugarteche’s paper points out that there is a clear confrontation between the energy industries of the future: the fossil industry, led by the United States, and the clean industry, in which China plays a central role. This could also be transferred to the realm of multilateral rules and institutions. A recent article by Adam Tooze comments on this aspect: https://foreignpolicy.com/2020/10/17/great-power-competition-climate-china-europe-japan/
Best regards,
Juan Vázquez Rojo
Universidad Camilo José Cela and Corporación Universitaria de Asturias
Hi Eduardo,
I think we have quite a few parallels in the work we have presented for the congress. I think that in both cases the influence of Arrighi’s work is very important.
Going into the analysis, taking into account the nine areas you present (productive, commercial, energy, technological, monetary, diplomatic, political-institutional, cultural, and military fields integrate the systemic dimensions of power), I think it is difficult to argue that China is ahead of the United States in so many areas. At least at the present time. It is clear that historical trends suggest that China will overtake the United States in many ways.
In this sense, while it is true that China is ahead in GDP measured by purchasing power parity, in its per capita measurement or in market terms, the United States continues to lead in this aspect. I would say the same for the technological section. As an argument in my work, although China is in first place in the race for 5G, in terms of leading technological development and, above all, homogeneous technological development throughout the country, I believe that the United States continues to lead. Everything may change with the break-up of 5G, as it may mean a qualitative change.
On the other hand, I agree that at the institutional, cultural and monetary level the level of American power is higher. Also in terms of ties and relations with other countries, alliances between the United States and other countries are stronger than those of China (at least for the time being).
Another section that I think could be key in the future is energy. As you comment in your work, Oscar Ugarteche’s paper points out that there is a clear confrontation between the energy industries of the future: the fossil industry, led by the United States, and the clean industry, in which China plays a central role. This could also be transferred to the realm of multilateral rules and institutions. A recent article by Adam Tooze comments on this: https://foreignpolicy.com/2020/10/17/great-power-competition-climate-china-europe-japan/
Greetings.
Thank you very much.
Juan Vázquez Rojo
Universidad Camilo José Cela and Corporación Universitaria de Asturias
Eduardo,
You argue that the restructuring of the world-system under neoliberal globalization, the productive delocalization, and the accumulation regime with financial predominance violated the American power. However, all of them come from the US, and perhaps the difference should be made into what resulted in an improvement for US corporate interests and what in Government interests. This is what makes for a global political economy. When you point out that “The United States developed a regime of fictitious capital accumulation,” I would argue that a more precise definition might be that US corporate interest developed such a regime and transferred production abroad for productivity reasons. In this way, the stock markets boom, employment is lost, economic dynamic slows down, but income concentrates at the top. This shift was accompanied by a theoretical shift from Keynesian to neo Keynesian and Chicago school Austrian economics.
Interestingly, you argue that China has “sieged” the US and not the other way around, most of which would argue. If China is doing the siege, then it is the US that is in a corner trying to defend itself from the takeover by the sieging power. This would mean that China has a clear lead. However, from what Ripak and Slipak argue, there is no clear leadership and there is a productive cohabitation, where neither can do without the other. This might lead you to refine your argument.
The previous analysis of hegemony seems outdated as new actors and new divisions are on the stage. Hegemony was an inter-state concept. We see with the Huawei example a corporate competition with the State interfering in the competition process if it goes against its capital interest. So it is market-led technological competition, ma non-troppo when the corporate interests are at stake. The idea that a Government official travels worldwide to interfere in the market mechanism because competition hurts “our” interests reveals the new definition of the market economy and the new role of Government.
High tech in both countries is developed with Government assistance, yet the market interference seems to be one-sided so far. The global political economy has given corporate power a greater say on technology and the State’s role, apparently. This is far from the old concept of hegemony in more military and political terms.