Capitalism is the root cause of historic and modern US-China conflict

No discussion of green capitalism as a transnational project would be complete without attention paid to China. China is the dominant leader in sustainable technologies, including solar, wind, and hydro, and a top producer of electric vehicles and lithium batteries and storage. At $132 billion it’s the largest investor in renewable energy spending one-third of the world’s total (Buckley and Nicholas, 2017). China’s push into green manufacturing also play a key role in transnational accumulation. In the wind industry China has five of the top-ten turbine manufacturers, and in solar four of the top six. Both wind and solar TNCs have penetrated markets throughout the world, established regional headquarters, maintain foreign subsidiaries, global manufacturing and research institutions in every region of the world (Harris 2019). Additionally, in the production of solar inverters, the technology that converts the sun’s energy into electricity, China has seven of the world’s top-ten companies, Huawei being number one. Taking solar and wind together China has been the largest investor in clean energy for nine straight years, illustrating its central position in green capitalism. China also fulfills a leading role in organizing financial resources for green investments around the world. The Asian Infrastructure Investment Bank, founded by China with over 80 member countries, has made sustainable infrastructure a priority. In 2019 the bank issued its first global green bond attracting orders from 27 countries (AIIB, 2019). Through various financial institutions China has a large footprint in the world’s Green Bond market, which totaled $1 trillion by 2020. The China Development Bank (CDB) and China Export and Import Bank (CHEXIM) also play a role in promoting solar and wind companies abroad, loaning out more than $2.5 billion over the past decade. Globally, there are 2,000 funds dedicated to financing green development, with five trillion under management. Additionally, over $2.6 trillion has been invested worldwide in low-carbon energy projects. All this indicates the growing basis for a hegemonic bloc built around green accumulation in which China has taken a leading position. An important aspect of China’s activity are investments and loans in the Global South, financing sustainable energy projects in cash-poor countries at low rates. As Tim Buckley, director for the Institute for Energy Economics and Financial Analysis, notes, “It is a way of expanding China’s growing global presence and dominant economic force, and it progressively reorients the world from the US and European-centric view of the last fifty years” (Garrison, 2019). In this sense China becomes an influential leader for the Southern fraction of the TCC fighting for an equal place in a multi-centric world order. But China’s environmental effort is fraught with contradictions. The fossil fuel industry maintains tremendous political clout just as the industry does in the West. Although China increased solar and wind capacity by 65 gigawatts in 2019, it was overwhelmed by an expansion of 249.6 gigawatts of coal-fire capacity. Coal also plays an important role in China’s One Belt One Road strategy (OBR). Since 2001, Chinese state and private firms invested in 240 coal projects in 25 countries, surging 300 percent since the inception of OBR (Pen, et al., 2017). Moreover, in the $143 billion loaned for 165 energy and transportation ventures in 32 countries only 5.3 percent have been for solar and wind (Zhou, et al., 2018). Similar problems appear in CDB and CHEXIM loan activity. Between 2000-2018 almost 75 percent of their energy loans went to fossil fuel projects, while renewables constituted just 1.35 percent of total loan activity. (Kong and Gallagher, 2020). In the struggle to build what Xi termed an “ecological civilization” China faces its own class contradictions. Li Peilin, vice-president of the elite think-tank the Chinese Academy of Social Sciences (CASS), points to “three major contradictions of Chinese society…contradictions between rich and poor, labor and capital, and cadre and masses” (Li, 2018, 586). Xuangong Wu, also writing in the CASS journal, details how such contradictions manifest including “the return and even strengthening of economic exploitation, rapid widening of the income distribution gap…and significantly aggravated social contradictions” (Wu, 2019). Wu warns that China “developing at the highest speed in the history of the world…formed both socialist and capitalist production relations… as the two kinds of production relations and economic laws coexist and interact with each other, the more powerful one will guide the direction and determine the future and destiny of social development” (ibid, 3). These contradictions are evident in the struggle for an ecological transformation. Half of all large protests in China are over environmental issues, as the enforcement of laws are often weak and ineffective (Xin Zhou, 2020). Speaking to contending forces, Jeffery Ball of the Brookings Institute writes, …they depend on an ever-shifting balance of power inside China between opposite camps in what amounts to the mother of all energy-system transitions. On one side is China’s old-energy lobby, the shrinking but still-massive juggernaut invested in the continuation of an economy powered largely by coal: mining it, transporting it, and building and operating the massive machinery that burns it. This camp is largely government-controlled, run by many of the massive state-owned enterprises that have dominated China’s economy for decades. On the other side is the new-energy lobby, the growing but still-smaller constituency that earns its money by making, selling, and operating everything from solar panels to wind turbines to batteries to electric cars. This group includes prominent private firms founded in the last decade or so by entrepreneurs and widely traded on Western stock exchanges, which is to say owned by investors around the globe. The fight between the high-carbon and low-carbon energy camps is, to be sure, a battle among industries, among companies, and among government ministries. Increasingly and crucially, though, as the economic case for renewables grows more compelling, it also is a fight within each of those institutions (Ball 2020). Hence, the struggle to develop an environmentally sustainable society is as central to China as it is to countries in the West. China/US Relations Friction between the US and China exemplifies nationalist/globalist contradictions, reflecting tendencies in the competiting hegemonic projects. The tensions originate in historical imperialism, and over the future of global capitalism. Ideological differences on state and market economies are linked to Western colonial domination. Lacking sufficient capital many countries in the Global South use state-directed development, and China is the primary example. The Western TCC welcomed China into global capitalism when it offered cheap labor and investment opportunities. But with powerful TNCs and advanced technology, state subsidies and industrial policies are now seen as competitive advantages over neoliberal markets—ironic given Western criticism of state economics as inefficient and bureaucratic. Even so US, European and Chinese TCC fractions co-invest and mutually profit. Consequently, the globalist/nationalist hybrid authoritarian alliance responded with a two-sided trade war. One side demands China conforms to Western institutional rules that favor market mechanisms over state direction, and this plays well with US and EU TCC fractions. But the other side, which disrupts global value chains, drags Europe and Canada into trade conflicts with the US, and creates an uncertain investment climate are opposed by the TCC. This isn’t so much a struggle between nations, as over how best to construct a successful model for global capitalism. Most want problems worked out through negotiations within transnational institutions, and above all, not disrupt capital flows and linked production. Yet nationalist pressure has disrupted globalist’s goals. During two years of trade talks financial elites Stephen Schwarzman, Hank Paulson, and John Thornton were interlocutors between Wall Street, Washington, and Beijing. But Jude Blanchette from the Centre for Strategic and International Studies noted, “There is still a strong Wall Street-to-Beijing channel. The question is, is it effective? I think the answer is demonstrably no…The conversation is no longer prefaced on how do we boost economic growth and integration” (Mai, et al., 2020). What results is a complex mix of contradictions entailing imperialist history, the social fallout from globalization, and political calculations between nationalists and globalists. All this intersects with the conflicting TCC projects. If we view Trump’s full-scale antagonism towards environmental laws and science from the viewpoint of an emerging struggle between two hegemonic projects, his opposition takes on strategic clarity. This encompasses China’s lead over green accumulation. But for the TCC green technologies offer wide ranging opportunities for joint ventures, cross-border investments and transnational coordination to confront global warming. All of which are already in play.