How China Eclipsed the United States in the New World Order

At this point, it should be obvious to everyone that the United States has ceded its dominance across most domains to China. This abdication has taken place within a milieu of willful ignorance, a disavowal not only by the consuming masses but among the highest levels of government as well. It has dire consequences for this country most assuredly but also the world at large.

No one should be surprised by these developments. In 1957, in a speech to the Supreme Soviet of the USSR, Chairman Mao said, “The socialist system will eventually replace the capitalist system; this is an objective law independent of man’s will.”¹ Whether or not that last phrase is true is unimportant; what matters is that the first one clearly is.

To head off the onslaught of commentators who will assuredly point to China’s engagement with the international system of global trade, as well as its establishment of publicly traded companies and stock exchanges, as evidence that China is in fact a capitalist country, consider another quote from Mao: “… the struggle to consolidate the socialist system, the struggle to decide whether socialism or capitalism will prevail, will still take a long historical period. But we should all realize that the new system of socialism will unquestionably be consolidated” (Quotations, p. 28).

In the end, it matters not whether one believes China to be socialist or capitalist. That they have eclipsed the United States and will become the next global hegemon is obvious. Our own response serves to demonstrate this. It is classically reactionary.

In October of 2022, the administration of then President Joe Biden published its National Security Strategy², outlining explicitly its great power competition with China:

In the contest for the future of our world, my Administration is clear-eyed about the scope and seriousness of this challenge. The People’s Republic of China harbors the intention and, increasingly, the capacity to reshape the international order in favor of one that tilts the global playing field to its benefit … These competitors mistakenly believe democracy is weaker than autocracy because they fail to understand that a nation’s power springs from its people.

The thing is, Chinese leaders do not “fail to understand” that the power of a nation comes from its people; in fact, that knowledge has been at the heart of the Chinese socialist project from the beginning. Turning again to Mao, he states, “…a decisive factor is our population of 600 million. More people mean a greater ferment of ideas…” (Quotations, p. 35), an insight that anticipated the economic theory of Paul Romer, and its later refinement by Chad Jones³, by more than twenty years.

While liberals bemoan the policies of Donald Trump and his second administration, they ignore their own culpability in accelerating the reactionary impulse. Working first to create the conditions for China’s rise before pivoting to protect the interests of their corporate donors, Democratic Party neoliberals set the stage for the working class backlash that returned Trump to office. It is only the moral dilemma that Trump’s platform poses that perturbs them, along with its diversion of profits from their benefactors to its own. In terms of policy, there is no difference between them.

Not that the consumer class in the United States is faultless; it has long been enthralled with the cheap products from Asia that have provided first Japan and now China with the dollars needed to develop industrial capacity. It is difficult to know whether the blind eye of the consuming masses owes itself to willful denial or bona fide ignorance, however, the result remains the same in any case. The indulgent lifestyle of US consumers, long underwritten by exploited Asian labor and deficit spending, has architected its own demise.

It must be pointed out, in light of the knowledge that the average person in the US is oblivious to this fact, that China is no longer a backwards country, inferior to the rest of the world. Rather it holds the leading edge of technological advancement. While it is true that much of China’s intellectual prowess was obtained from US universities, the reality is that this technical acuity has been wholly transferred to domestic Chinese. One need look no further than the astonishing, to US observers at least, success of Deep Seek to find proof of China’s rapidly advancing technological superiority.

What must be terrifying for establishment neoliberals – the MAGA reactionaries and white Christian supremacists hold an entirely different view – is that there is no lever left to pull. Clearly, for as long as the dollar remains the denominator of international settlements, the United States’ financial usury will provide a certain degree of income to the nation. But the fossil fuel exports that have made up the bulk of US returns⁴ no longer provide the comparative advantage they historically have.

The advent of fracking vaulted the US back into the lead of crude oil and condensate production⁵, and US oligarchs have been liquidating this depreciating asset as fast as they possibly can. It is not known whether former Republican National Committee chair and current MSNBC pundit Michael Steele was cognizant of the reality that these assets would soon be stranded when he famously implored the nation to “drill, baby, drill”, and it remains unclear whether US elites fully grasp the consequences of taking that tact.

What they should have done, and what China did, is invest in renewables.⁶

The BRICS countries – which includes China, alongside Brazil, Russia, India, South Africa, and new members Iran, UAE, Egypt, Ethiopia, and Indonesia – account for more than half of global carbon emissions, forty-five percent of the world’s population, and roughly thirty-five percent of global GDP. This gives these countries, but especially China, significant sway over the future of both the biosphere and the emerging world order.⁷

China, as Chairman Mao Tse-Tung understood, is and has been “carrying out a revolution not only of the social system, the change from private to public ownership, but also in technology, the change from handicraft to large-scale modern machine production” (p26). Industrialization was always both a goal and a necessary component of its economic and socialist development. This required that China engage with global markets. As Xiaoyang Tang, professor of international relations at Tsinghua University, explains:

All non-Western countries were and are forced to follow the Western path because Western modernization had enormous impacts on productive power, and no country could resist it. China learned this over a century-long period. With the 1978 market reforms, China understood that to modernize itself, it needed to foster economic productivity by operating in the global market and placing a new emphasis on infrastructure and technology. China’s approaches to trade, investment, and infrastructure building are all related to this modernization process—to increase productivity through the world market, there must be enough infrastructure to support commodity, labor, and information flows. This exchange of labor, commodities, and information allows production and the economy to scale up, fostering industrialization, which further stimulates the market to expand. This is what drives the Chinese approach to foreign economic engagement.⁸

It must be understood that China is engaged in a long-term coherent strategy to realize its aim of socialist consolidation. It should be further understood that its trade relations with the United States are a part of this strategy, a deliberate engagement with global markets to drive and underwrite its modernization and industrialization efforts. Finally, it must be understood that China has largely succeeded in this effort, to such a degree that it no longer needs the United States,⁹ having eclipsed it in terms of technology and industrial capacity.

While China has been investing heavily in the energy economy of the future, we have clung doggedly to our dependence on fossil fuels. To a growing proportion of countries, in particular those with abundant sunshine, the choice whether to align with the US and the fossil fueled post-WWII regime or China and its renewable energy ecosystem is clear.¹⁰ Only the United States seems oblivious to the fact that China will soon assume the dominant role in a reconstituted international order.

What is critically important in all of this is the understanding that what has allowed China to achieve this remarkable transition, and what will allow the United States to remain relevant, is its revolutionary project. Competition, whether economic or military, with China is a nonstarter; they have already eclipsed us in these domains. Our power, as Hannah Arendt defines it, is a function of our free society, precisely what the Chinese lack. This is the invaluable commodity we have to export.

Should the United States of America wish to persist in this world, it must embrace the inevitable. The question is not whether socialism will replace capitalism. It is, what kind of socialism do we prefer to live under: Socialism with Chinese or American characteristics?