Climate crisis on track to destroy capitalism, warns top insurer

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https://www.theguardian.com/environment/2025/apr/03/climate-crisis-on-track-to-destroy-capitalism-warns-allianz-insurer

Some companies were ending home insurance in California due to wildfires, says Allianz SE board member. He says that without insurance, many other financial services become unviable, from mortgages to investments. Photograph: Mario Tama/Getty Images

Action urgently needed to save the conditions under which markets – and civilisation itself – can operate, says senior Allianz figure

The climate crisis is on track to destroy capitalism, a top insurer has warned, with the vast cost of extreme weather impacts leaving the financial sector unable to operate.

The world is fast approaching temperature levels where insurers will no longer be able to offer cover for many climate risks, said Günther Thallinger, on the board of Allianz SE, one of the world’s biggest insurance companies. He said that without insurance, which is already being pulled in some places, many other financial services become unviable, from mortgages to investments.

Global carbon emissions are still rising and current policies will result in a rise in global temperature between 2.2C and 3.4C above pre-industrial levels. The damage at 3C will be so great that governments will be unable to provide financial bailouts and it will be impossible to adapt to many climate impacts, said Thallinger, who is also the chair of the German company’s investment board and was previously CEO of Allianz Investment Management.

The core business of the insurance industry is risk management and it has long taken the dangers of global heating very seriously. In recent reports, Aviva said extreme weather damages for the decade to 2023 hit $2tn, while GallagherRE said the figure was $400bn in 2024. Zurich said it was “essential” to hit net zero by 2050.

Thallinger said: “The good news is we already have the technologies to switch from fossil combustion to zero-emission energy. The only thing missing is speed and scale. This is about saving the conditions under which markets, finance, and civilisation itself can continue to operate.”

Nick Robins, the chair of the Just Transition Finance Lab at the London School of Economics, said: “This devastating analysis from a global insurance leader sets out not just the financial but also the civilisational threat posed by climate change. It needs to be the basis for renewed action, particularly in the countries of the global south.”

Original article at https://www.theguardian.com/environment/2025/apr/03/climate-crisis-on-track-to-destroy-capitalism-warns-allianz-insurer

Neo-Fascist Climate Science Denier Donald Trump says Burn, Baby, Burn.
Neo-Fascist Climate Science Denier Donald Trump says Burn, Baby, Burn.
Elon Musk urges you to be a Fascist like him, says that you can ignore facts and reality then.
Elon Musk urges you to be a Fascist like him, says that you can ignore facts and reality then.
Orcas comment on killer apes destroying the planet by continuing to burn fossil fuels.
Orcas comment on killer apes destroying the planet by continuing to burn fossil fuels.
Continue ReadingClimate crisis on track to destroy capitalism, warns top insurer

Critics Ask If Trump and Musk Are ‘Intentionally Crashing the Economy’

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Original article by Brett Wilkins republished from Common Dreams under Creative Commons (CC BY-NC-ND 3.0). 

Then President-elect Donald Trump and Elon Musk pose for a photo during the UFC 309 event at Madison Square Garden on November 16, 2024 in New York City. (Photo: Jeff Bottari/Zuffa LLC via Getty Images)

“If you think back at the last economic crashes… the rich were able to buy up assets on the cheap and emerged even wealthier and more powerful than before,” noted one progressive commentator.

Are U.S. President Donald Trump, top adviser Elon Musk, and allied oligarchs deliberately trying to tank the economy in order to line their own gilded pockets?

More and more observers from both sides of the political aisle are asking the question this week as the U.S. president implemented steep tariffs on some of the country’s biggest trade partners, threatened a global trade war, and is taking chainsaw to government spending and programs—policies that, while inflicting economic pain upon nearly everyone else, could dramatically boost their already stratospheric wealth.

Numerous observers have likened it to the ” disaster capitalism” examined in Naomi Klein’s seminal 2007 book, The Shock Doctrine: The Rise of Disaster Capitalism—politicians and plutocrats exploit the chaos of natural or human-caused crises to push through unpopular policies like privatization and deregulation that harm the masses while boosting the wealth and power of the ruling class.

Economic alarm bells were already ringing before Trump’s 25% tariffs on most products from Canada and Mexico and an additional 10% on China—for a total of 20%—took effect on Tuesday, prompting retaliatory measures and threats of more to come.

Then, during his rambling joint address to Congress on Tuesday night, Trump threatened to impose reciprocal tariffs on every nation on Earth starting April 2 (because he “didn’t want to be accused of April Fools’ Day”) if those countries did not lower barriers to trade with the United States.

New York Times economic policy reporters Alan Rappeport and Ana Swanson called Trump’s sweeping tariffs “one of the biggest gambles of his presidency,” and a move “that risks undermining the United States economy.”

But what if that’s the whole point?

“I’ve been entertaining this theory a little bit more lately, because [Trump’s] economic moves seem so stupid and terrible and counterproductive without thinking that he is intentionally trying to cause harm,” progressive political commentator Krystal Ball—who also has a degree in economics and is a certified public accountant— said Tuesday on the social media site X.

Ball cited an X post by Saikat Chakrabarti, a progressive Democrat running for Congresswoman Nancy Pelosi’s (D-Calif.) House seat who worked on Wall Street for six years and helped found the online payment processing company Stripe, in which he accused Trump of “manufacturing a recession.”

“But it makes sense when you realize his goal is to create something like Russia where the economy is run by a few oligarchs loyal to him,” Chakrabarti added. “Creating that state is hard in a large, dynamic, powerful economy with too many actors who can oppose him. So he’s accelerating concentrating money and power into the hands of his loyalists while he crashes the rest out.”

Responding to this, Ball asserted that “at this point, until proven otherwise, the primary actor in the government and the economy is actually Elon, so I think it makes sense to think of Elon’s incentives here and what he may actually want to accomplish.”

“If you think back at the last economic crashes—both in Covid and in the 2008 financial crash—while initially everyone suffered, including the rich, out of both, the rich were able to buy up assets on the cheap and emerged even wealthier and more powerful than before,” she noted.

“So in 2008, not only did they get their own custom bailout, but they were able to buy housing stock at absurdly low prices,” Ball recalled. “The rich got richer than ever, inequality skyrocketed, and the big banks got bigger than ever.”

“Same deal with the Covid-era recession,” she continued. “So, while again, everyone suffered initially, there was a huge bailout package which, yes, did benefit ordinary people, but if you look at who came out really on top… you could see people like Elon Musk, people like Jeff Bezos, people like Mark Zuckerberg getting far wealthier. Their net worths, which were already very high, skyrocketed beyond anyone’s wildest dreams.”

Indeed, as Common Dreams reported, 700 billionaires got $1.7 trillion richer during two years of pandemic. Between March 2020 and April 2022, Musk got 10 times richer, while Zuckerberg’s net worth more than tripled and Bezos’ grew by nearly $80 billion, according to Forbes.

“Here’s the other piece that’s worth thinking about as well,” Ball added. “Crash and crisis leads to governments and authoritarian leaders claiming more power for themselves. They can use the crisis and the emergency as a justification for taking on extraordinary powers and for taking extraordinary measures… measures that can be custom fit to primarily benefit oligarchs like Elon Musk.”

“So I don’t know guys, while we’re running around here going… ‘can’t they understand how this is going to be devastating for the economy,’ maybe they do understand,” she concluded, “and maybe that’s kind of the point.”

Original article by Brett Wilkins republished from Common Dreams under Creative Commons (CC BY-NC-ND 3.0). 

Neo-Fascist Climate Science Denier Donald Trump says Burn, Baby, Burn.
Neo-Fascist Climate Science Denier Donald Trump says Burn, Baby, Burn.
Elon Musk urges you to be a Fascist like him, says that you can ignore facts and reality then.
Elon Musk urges you to be a Fascist like him, says that you can ignore facts and reality then.

Would love the explainer on why they are pushing us into a (likely) recession

dizzy: While it is accepted that the filthy rich benefit from economic collapse I suspect that there might be a more deliberate action to benefit certain actors more directly.

I suggest that you compare to the experience of short-lived former Prime Minister Liz Truss in UK. She was also supported and followed the instruction of an established, influential think-tank. Powerful and wealthy Capitalists may have benefited directly from market reactions to their directed actions. I would look at hedge funds and similar actors associated with those respective think tanks. Is it the same actor dominating and directing both think-tanks? Was the Liz Truss experience an initial test run?

Continue ReadingCritics Ask If Trump and Musk Are ‘Intentionally Crashing the Economy’

Capitalism’s Free Speech Trap: Bezos Shows How Billionaires Set the Boundaries of Debate

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Original article by Peter Bloom republished from Common Dreams under Creative Commons (CC BY-NC-ND 3.0). 

Amazon founder and Washington Post owner Jeff Bezos delivers remarks during the opening ceremony of the media company’s new location January 28, 2016 in Washington, D.C. (Photo: Chip Somodevilla/Getty Images)

The Washington Post’s shift toward free-market advocacy is not simply an editorial decision; it is a strategic move to reinforce the dominant ideological framework that benefits the billionaire class.

The recent directive by Jeff Bezos that The Washington Post editorial section should promote “personal liberties and free markets” is a stark reminder of how freedom under capitalism often boils down to the freedom of economic elites to dictate the parameters of public discourse. While Bezos has suggested that social media provides alternative perspectives, thus absolving his newspaper of the responsibility to represent diverse viewpoints, his decision is part of a broader trend of billionaire media ownership shaping acceptable discourse.

This phenomenon is visible across digital platforms as well. Elon Musk’s control over X (formerly Twitter) has demonstrated how ownership can shape public debate—both through direct interventions, such as the alleged suppression of progressive perspectives, and through more subtle changes to platform algorithms. Similarly, Mark Zuckerberg’s Meta has faced repeated allegations of privileging certain political narratives while suppressing others, including ending its “fact checking” policy that could challenge far-right viewpoints.

Perhaps the most glaring contradiction in Bezos’ advocacy for free markets is the extent to which he, and other billionaires like him, have benefited from state intervention as part of an intentional strategy of “corporate welfare.”

In each case, the rhetoric of “free speech” is selectively applied. While these platforms and newspapers claim to support open debate, their policies ultimately reflect the ideological preferences of their owners. This demonstrates a fundamental truth: In capitalist societies, freedom of expression is often contingent on the interests of those who control the means of communication. The Washington Post’s shift toward free-market advocacy is not simply an editorial decision; it is a strategic move to reinforce the dominant ideological framework that benefits the billionaire class.

The Myth of Meritocracy and the Far-Right’s War on DEI

Bezos’ framing of free markets as inherently linked to personal liberties exposes a deeper ideological assumption—namely, that economic success is the result of individual talent and merit rather than systemic privilege. This assumption is not unique to Bezos but is foundational to the way many economic elites understand their own wealth and influence.

The logic behind Bezos’ editorial direction is similar to the arguments used by the contemporary far-right to attack Diversity, Equity, and Inclusion (DEI) initiatives. The opposition to DEI is rooted in a desire to preserve the myth that success is determined purely by hard work and ability, rather than by racial, gender, or class privilege. By rejecting policies that acknowledge structural inequalities, The far-right seeks to uphold a narrative that justifies existing economic and social hierarchies.

This worldview is deeply intertwined with the ideology of neoliberalism, which insists that markets are neutral mechanisms that reward the most capable individuals. However, history shows that markets are anything but neutral. The barriers faced by marginalized groups are not simply the result of individual shortcomings; they are the product of centuries of systemic exclusion. The far-right’s attack on DEI serves to obscure these realities, just as Bezos’ insistence on free markets seeks to erase the role of privilege and power in determining economic outcomes.

By positioning The Washington Post as a champion of free markets, Bezos is promoting the idea that capitalism functions as a pure meritocracy. This serves not only to legitimize his own position but also to delegitimize calls for policies that challenge structural inequality, whether in the form of DEI programs, labor protections, or wealth redistribution measures.

The Illusion of the Free Market and Its Political Implications

Perhaps the most glaring contradiction in Bezos’ advocacy for free markets is the extent to which he, and other billionaires like him, have benefited from state intervention as part of an intentional strategy of “corporate welfare.” The notion of a truly free market, where economic actors compete on equal footing without government interference, is a fantasy. In reality, corporations like Amazon have thrived not because of unregulated competition, but because of significant government support.

From tax incentives to government contracts, Amazon has received billions in subsidies that have allowed it to dominate the retail and logistics industries. Moreover, the U.S. government plays a critical role in enforcing corporate-friendly trade policies, suppressing labor movements, and protecting the interests of multinational corporations abroad. These interventions are rarely acknowledged in discussions of free markets, yet they are crucial to understanding the power dynamics of contemporary capitalism.

If freedom under capitalism ultimately means the freedom of the wealthy to dictate the terms of discourse, then the very concept of free speech is in jeopardy.

Politically, Bezos’ editorial directive at The Washington Post serves to strengthen a broader ideological alignment between neoliberal economics and far-right nationalism. By framing free-market capitalism as an essential component of personal liberty, Bezos is laying the groundwork for a political agenda that fuses economic libertarianism with nationalist conservatism. This is significant because it provides an ideological foundation for challenging emerging economic policies that deviate from neoliberal orthodoxy—such as the rise of protectionism in response to globalization.

This alignment between free-market ideology and far-right nationalism is not new. Historically, neoliberalism has often coexisted with reactionary politics, as seen in the economic policies of figures like former U.S. President Ronald Reagan and former U.K. Prime Minister Margaret Thatcher. Today, this synthesis is being revived as right-wing populists seek to defend corporate interests while simultaneously appealing to nationalist sentiments. Bezos’ intervention in The Washington Post should be understood within this broader context: It is not just about shaping editorial policy but about consolidating an ideological framework that benefits economic elites while limiting the scope of acceptable political debate.

The Dangers of Billionaire-Controlled Media

Bezos’ decision to impose a free-market ideology on The Washington Post is not an isolated event; it is part of a larger trend in which media ownership is used to shape public discourse in ways that serve elite interests. This phenomenon extends beyond traditional journalism to social media platforms, where billionaires like Musk and Zuckerberg wield immense power over the flow of information.

At its core, this issue is about more than just media bias—it is about the fundamental tension between democracy and concentrated economic power. A truly free and open society requires a diversity of perspectives, yet the dominance of billionaire-controlled media threatens to constrain the range of acceptable debate. If freedom under capitalism ultimately means the freedom of the wealthy to dictate the terms of discourse, then the very concept of free speech is in jeopardy.

The consolidation of media power in the hands of a few ultra-wealthy individuals raises urgent questions about the future of democratic debate. If we are to challenge the ideological hegemony of economic elites, we must first recognize the mechanisms through which they shape public discourse. Bezos’ editorial mandate is not just about The Washington Post—it is a reflection of the broader struggle over who gets to define the boundaries of political and economic debate in the 21st century.

Original article by Peter Bloom republished from Common Dreams under Creative Commons (CC BY-NC-ND 3.0). 

Continue ReadingCapitalism’s Free Speech Trap: Bezos Shows How Billionaires Set the Boundaries of Debate

How Trump 2.0 could herald a new age of authoritarian capitalism

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Original article by Laurie Macfarlane republished from OpenDemocracy under a Creative Commons Attribution-NonCommercial 4.0 International licence.

This is not the same Trumpism that won the election in 2016. It’s a far more dangerous project | Chip Somodevilla/Getty Images

Trump’s weaponisation of US power poses a threat to peace, prosperity and the planet. It must be strongly resisted

After four years of narrowly avoiding prison, Donald Trump is back in the White House. For many observers outside the US, the re-election of a convicted felon who tried to illegally overturn an election is baffling.

But Trump’s second victory was no fluke – and nor was it merely the result of Russian interference or ‘deplorable’ voters. Although Trump left formal politics in 2021, the forces that brought him to power did not. This time, he is entering office far better organised, far stronger, and with a more diverse political base.

Trump is also not alone: across the West, right-wing populism is on the march, while progressive parties continue to find themselves on the back foot. In an increasingly unstable world, the rising tide of the authoritarian right poses huge challenges for the global economy. Left unchecked, it has the potential to imperil peace, prosperity and the planet.

To fully assess the threat this right-wing populism poses, and how to counter it, we must carefully assess the conditions under which Trump is assuming power – as well as the plans he has for wielding it. Like all political developments, Trump’s dramatic return has not happened in a vacuum. Instead, it must be viewed in the context of a series of profound political and economic shifts that are reshaping the face of Western capitalism.

The first shift – and by far most significant – is the rise of a rival economic superpower that could potentially threaten the technological supremacy that has long underpinned US hegemony.

Red Dragon Rising

Following China’s entry into the global trading system in 2001, many economists in the West assumed that China’s state-capitalist model would deliver some catch-up growth, then quickly run out of steam. The theory was that while state-led systems can be effective at rapidly mobilising existing resources, they struggle to drive productivity growth and innovation. This, it was thought, would eventually force China to open up its economy and embrace liberal democracy.

However, China’s achievements to date have made such pronouncements look remarkably naive. Not only has liberal democracy not arrived in the People’s Republic, but the Chinese Communist Party (CCP) has developed a distinct economic model that has lifted nearly a billion people out of poverty and transformed the country into one of the world’s largest and most dynamic economies. Somewhat ironically, it is Western governments that have had to adapt to China’s model – not the other way around. In recent years, China’s successes have forced Western governments to pivot away from free market orthodoxy and resuscitate muscular industrial policy, which had long been banished from Western policy toolkits.

The importance of China’s spectacular rise to Trump’s victory in 2016 cannot be overstated. At a time when most Americans felt the economy simply wasn’t working, Trump offered a clear albeit false diagnosis of the problems – China and immigration – and an aggressive strategy for dealing with them, when the Democrats were doing neither. His aim was to stand up to China, bring back jobs and put ‘America first’. His weapon of choice, tariffs, marked a major break with the neoliberal consensus of recent decades. Protectionism was back, spearheaded by the world’s largest economic and military power.

But in reality, Trump’s ‘trade war’ was never about trade or jobs. As I wrote back in 2020, it was primarily a response to US fears of losing technological supremacy in the face of successful Chinese industrial policy. From the very beginning, the ‘trade war’ was less about trade, and more about constraining Chinese development and preventing China’s rise as a rival technological power.

Since Trump’s exit from the White House in 2021, this ‘return of the state’ in Western economies has accelerated, fuelled by two other forces. The first has been a global ramping up of action to tackle the climate crisis. As a growing number of countries have embraced net zero targets, many have enacted new industrial policies to try and bolster capabilities to compete in emerging green supply chains. The second factor was the Covid-19 pandemic, which saw governments intervene in economies on an unprecedented scale. In order to contain the economic fallout, Western countries ripped up the neoliberal playbook in favour of widespread state planning and cash transfers. While the promises to ‘build back better’ inevitably rang hollow, many governments and businesses did act to bolster domestic supply chains in an attempt to address the chronic lack of resilience the pandemic exposed.

Acutely aware of these challenges, in 2021 the incoming Joe Biden administration sought to break with the economic consensus of his Democrat predecessors. Not only did Biden keep most of Trump’s tariffs on China, he increased them. His administration then embarked on the US’s most significant experiment with industrial policy for decades.

The key pillar of so-called ‘Bidenomics’ was the Inflation Reduction Act (IRA). Despite its name, the IRA was not primarily about reducing inflation. Instead, it launched the biggest investment programme in modern American history to revitalise the economy, enhance energy security, and tackle the climate crisis. The package included large tax breaks and subsidies to bolster US manufacturing capacity, and wean the US away from Chinese imports. In practice, the IRA was a significantly watered-down version of Biden’s initial ‘Build Back Better’ agenda, which, in addition to ambitious climate spending, also proposed trillions of additional dollars on social spending in areas such as housing, childcare and healthcare, as well as more progressive tax hikes. This agenda was blocked by Republicans and conservative Democratic senators, who also secured big giveaways to the fossil fuel industry.

Nonetheless, the IRA represented a significant step change in the ideological outlook of the world’s largest economy. It also posed new challenges for China, particularly as some policies were explicitly designed to discourage companies from using Chinese components. In a remarkable role-reversal, in May 2024 China lodged a complaint against the US at the World Trade Organisation (WTO), arguing that IRA subsidies “distort fair competition”.

GettyImages-453444611
US President Joe Biden shakes hands with Chinese President Xi Jinping at the Asia-Pacific Economic Cooperation summit in Lima, Peru, on 16 November 2024 | Lintao Zhang/Getty Images

On the basis of conventional economic metrics, Bidenomics appeared to be working. Following the pandemic, US economic growth outperformed peer nations, business investment soared, and unemployment remained low. The problem was that Americans simply weren’t feeling it. A big reason for this was inflation, which surged across the world as economies reopened after the pandemic, and Russia invaded Ukraine. Although in the US, inflation had fallen to less than 3% by the time of last year’s election, the damage had been done. Under Biden’s leadership, real earnings had fallen and satisfaction with the economy tumbled. Months before the presidential election, more than half of Americans wrongly believed the US was experiencing a recession, according to a poll for The Guardian. The consequences of this disconnect between buoyant economic statistics and peoples’ lived experiences were fatal. As economist Isabella Weber put it in the New York Times: “Unemployment weakens governments. Inflation kills them.”

As for Biden’s programme of green reindustrialisation, it didn’t quite live up to its promise. Although the IRA successfully catalysed billions of investments in clean energy, the immediate impact on jobs and living standards was modest. Since 2020, the number of manufacturing and construction jobs in the US economy has increased by around 800,000. While this might sound impressive, it amounts to less than 0.5% of the total workforce.

This does not mean the IRA should be seen as a failure – far from it. Investment takes time to deliver returns, and ironically it will be Trump who reaps the political rewards when they start to materialise. But these statistics also reveal a significant flaw in Biden’s approach to industrial policy. In the 21st century, most Americans do not work in manufacturing and construction, and likely never will. They don’t care much for semiconductors, nor do they pay much attention to GDP growth and business investment. What they care about is whether their life is getting better or worse. The initial Build Back Better agenda recognised this, while the watered-down IRA did not.

Trumpism 2.0

While Bidenomics failed to get its namesake re-elected, it played a crucial role in putting industrial policy back on the global agenda. Though this is long overdue, it is a mistake to think that a more interventionist state always pushes politics in a progressive direction. What really matters is who wins and who loses from these interventions. In other words: who are these interventions really designed to serve?

Seen through this lens, Trump’s vision for the role of the state looks rather different. He has already vowed to kill the IRA’s climate measures, referring to the act as “the greatest scam in the history of any country”. In its place, Trump has a new plan for industrial policy: “drill, baby, drill”. He has also pledged to deliver “the largest deportation operation in American history”, targeting millions of undocumented migrants whom he says are “poisoning the blood” of the US – and using the military to do so if necessary. The long-term economic impact of such a move would be severe, with some analyses estimating it could reduce annual US GDP by up to 7%, or nearly $1.7trn.

As a means of flexing American economic muscle globally, Trump has also promised to double down on tariffs, pledging to impose blanket 10-20% duties on all US imports and 60% on goods from China. In a sign of creeping paranoia that some countries may act to reduce their reliance on US trade, he recently threatened to impose 100% tariffs on the ten nations that form the BRICS bloc – Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Indonesia, Iran and the United Arab Emirates – if they create a currency aiming to challenge the US dollar’s dominance in global trade.

‘America first’ is the aim, while economic warfare is the game

In order to collect the billions in expected tariff revenues, the incoming president also recently announced the creation of a new ‘External Revenue Service’, stating: “Through soft and pathetically weak trade agreements, the American economy has delivered growth and prosperity to the world, while taxing ourselves. It is time for that to change.”

Whether these sharply higher tariffs represent a hard commitment or merely a negotiating tactic remains to be seen. However, it is clear that Trump intends to weaponise the US’s economic clout to strong-arm allies and adversaries alike. ‘America first’ is the aim, while economic warfare is the game, it would appear.

This again would not come without an economic cost – both to the US and its trading partners. Despite being Trump’s flagship policy, it remains unclear whether he knows how tariffs actually work. He has repeatedly insisted that they are paid by “other countries”, when in reality they are a tax on American companies paid when foreign-made goods arrive at the US border.

Perhaps most alarmingly, Trump has taken state interventionism to a whole new level by threatening to seize territories belonging to other sovereign nations. One prime target is Greenland, where the aim is to control its trove of natural resources to guarantee the US’s “economic security”, with a particular focus on rare earth metals. Another is the Panama Canal, which the US ceded control over to Panama in 1977 under President Jimmy Carter. Perhaps most ambitiously, Trump has floated the idea of annexing Canada, describing the two countries’ shared border as an “artificially drawn line” and vowing to use “economic force” to make Canada the 51st US state. The US projecting its power overseas to secure its economic interests is far from new. But rarely has a president been this direct and explicit about it.

The focus on Greenland’s rare earth metals is no accident. China currently dominates global rare earth metal production and has recently restricted the export of critical minerals and associated technologies ahead of Trump’s second term. These elements, which play a critical role in the manufacturing of batteries and countless high-tech products, are quickly becoming one of the most important geopolitical battlegrounds.

With China and the US each taking increasingly aggressive measures to limit the trading of key resources and components, the drift towards a new ‘technological cold war’ – as well as a military hot war – between East and West looks set to accelerate under Trump’s second reign. A partial decoupling of US and Chinese technology ecosystems is already well underway – with the extreme pressure the US applied to the UK government in 2020 to ban Huawei from the UK’s 5G network providing one example. Not unrelatedly, today the UK has among the worst-performing 5G signal in Europe. The recent US clamp down on the Chinese social media app TikTok provides another such example, with US lawmakers moving to ban the app on national security grounds. However, just before taking office Trump – who had previously backed a ban – pledged to delay implementation of the law to allow more time to “make a deal to protect our national security”.

If these trends continue to accelerate, it is possible to imagine a world that is bifurcated into distinct technological ‘zones’. In this scenario, countries would be able to use US technology or Chinese technology – but not both. Each country must pick a side.

A technological arms race

Any further slide towards technological bifurcation between East and West would pose huge challenges for the US and its allies. Whether it is clean energy, electric vehicles or radio communications such as 5G, Chinese companies are rapidly coming to dominate many critical 21st-century markets, in some cases to an extraordinary degree. As such, any further attempt to restrain Chinese technology or exclude Chinese goods from Western markets would have serious economic consequences, while also heightening military tensions. It would also pose existential challenges for China’s economic model, which has long relied on exporting to the US and other Western economies to drive economic growth.

Evidence indicates that China is also rapidly racing ahead to dominate many advanced technologies of the future. It is winning the technological race against the US in 37 of 44 advanced technology fields assessed in the report spanning defence, space, robotics, energy, biotechnology and artificial intelligence, according to a recent study by the Australian Strategic Policy Institute. The study also found there was a high risk of China establishing an effective monopoly in eight technologies – including supercapacitors, 5G and 6G communications, electric batteries, and synthetic biology – while the US enjoyed no such monopoly opportunities. For some technologies, all of the world’s top ten leading research institutions are based in China, which are collectively generating nine times more high-impact research papers than the US.

Perhaps unsurprisingly, China’s rapid advancements also extend to deadly weapons technology. While recent Chinese advances in nuclear-capable hypersonic missiles allegedly took US intelligence agencies ‘by surprise’, China has generated over 60% of the world’s high-impact research papers into advanced aircraft engines and hypersonics over the past five years, and currently hosts seven of the world’s top ten research institutions.

Chart - advanced aircraft research FINAL
China has produced over 60% of the world’s high-impact research papers into advanced aircraft engines and hypersonics over the past five years | Chart by openDemocracy using data from the Australian Strategic Policy Institute

While China’s rapid advancements have confounded its critics, its economy is far from invincible. Despite the best efforts of the CCP’s latest five-year plan, Chinese economic growth is slowing considerably and is widely expected to fall short of its target this year. Among the reasons for this has been China’s fragile real estate sector, which after decades of debt-fuelled speculation has finally started to unravel. In 2021 China’s largest property developer, Evergrande, defaulted on its debt, with multiple other major developers following closely behind. These defaults forced Beijing to announce an emergency package of support measures to stabilise the sector, which accounts for about a fifth of the country’s economic activity. In many ways, the sector’s woes – soaring debt and slowing growth – have become emblematic of the challenges facing the wider Chinese economy. Sustaining growth in the face of an escalating trade war would require a radical reorientation of China’s economic model, lessening dependence on exports and real estate speculation towards substantially boosting domestic demand.

China’s looming demographic crisis poses another major threat to its economic future. The CCP’s ‘one-child policy’, which was enforced between 1980 and 2015, means its population is currently ageing faster than any other country in modern history. Over the next decade, about 300 million people currently aged between 50 and 60 are set to leave the Chinese workforce. In 2020, there were five workers for every retiree, by 2050 this is expected to fall to 1.6 workers per retiree. The compounding effect of a rapidly contracting labour market, and the associated shrinking tax base, poses huge challenges for future growth and fiscal policy, as well as the provision of pensions and care in old age.

The challenge facing Beijing is therefore stark: can China continue to drive growth and technological advancement in the age of Trumpism 2.0, while staving off financial contagion and a demographic time bomb? China has confounded its critics before – but never before has its outlook looked so uncertain.

Europe’s predicament

Caught in the crossfire between China and the US, Europe stands at a critical juncture. Lacking the technological dynamism to compete with the world’s two economic superpowers, and with many key industries in decline, European leaders have struggled to respond effectively. To date, its strategy has amounted to a tepid foray into industrial policy through the Green Industrial Plan, which aims to counter the EU’s import dependency for key commodities and technologies.

In a grudging admission that the free-market dogma underpinning the single market might be a barrier to an industrial revival, the European Commission has also relaxed state aid rules, enabling states to provide more generous subsidies for green industries. While these necessary reforms to the single market are long overdue, the ongoing failure to reform the eurozone’s fiscal architecture makes it difficult to see the EU posing a serious threat to US and Chinese technological dominance anytime soon.

For EU leaders, the most pressing issue is the prospect of new tariffs and threats to sovereign European territory. While Europe cannot compete with the US technologically or militarily, as the world’s largest trading bloc it can compete on trade. Reports suggest the European Commission is exploring a ‘carrot and stick’ approach: implementing its own retaliatory tariffs while also pledging to buy more US goods. A trade war between the US and Europe is unlikely to end well for either party, but would be particularly painful for Europe.

The prospect of escalating transatlantic coordination between the authoritarian right and billionaire egomaniacs is one of the biggest threats to Europe’s future

Even if transatlantic tariffs are avoided, there is still the question of what to do in relation to China. If Trump follows through with imposing 60% tariffs on Chinese goods, should the EU do the same? If it doesn’t, Europe may face a flood of cheap Chinese goods dumped on its doorstep, further harming domestic producers. Then there is the question of how Europe should respond to the accelerating technological decoupling between East and West. While the EU has taken various steps to try and turbocharge research and innovation in recent years, it still lags significantly behind the US and China. In theory, there is a strong case to be made for Europe to forge its own path, neither bowing to US or Chinese authoritarianism. However, this ambition may be thwarted by challenges closer to home.

In recent years, far-right parties have seen a dramatic surge in support across the continent. Last year France came inches away from electing Marine Le Pen’s Rassemblement National, while in 2023 the Netherlands elected an Islamophobic populist. Far-right parties continue to make considerable inroads in Germany, Spain, Italy and elsewhere. Many of these parties are in direct contact with Trump’s wider networks and have also received glowing endorsements from billionaire and Trump fanboy Elon Musk, the owner of X (formerly Twitter). As well as being Trump’s largest donor, Musk has quickly positioned himself as one of the president’s most influential aides. The prospect of escalating transatlantic coordination between the authoritarian right and billionaire egomaniacs represents one of the biggest threats to Europe’s future.

Britain’s alignment problem

The challenges faced by the EU are perhaps even more acute in the UK. Brexit was supposed to unleash Britain as a great, swashbuckling trading nation once again. But this fantasy was always rooted in a failure to come to terms with the UK’s rapidly diminishing power in the world. While the EU lacks technological leadership but has considerable trade power, the UK has neither. At a time of growing geopolitical tensions over technology and trade, the UK is a sitting duck.

In the event that Trump does escalate a global trade war, Keir Starmer’s government will likely have to pick a major bloc to align with – or absorb considerable economic pain. This was always the deep irony of Brexit; while it was supposed to be about “taking back control”, the UK was always going to be forced to align with decisions taken by one of the world’s major power blocs, albeit having no control over the rules.

This reality was recently bluntly spelt out by Stephen Moore, one of Trump’s closest economic advisers. “The UK really has to choose between the European economic model of more socialism and the US model, which is more based on a free enterprise system,” Moore told the BBC last year. Moving towards the US model of “economic freedom” would significantly increase the likelihood of securing a US trade deal, he added. However, this would also likely involve bowing to US demands to open up key British markets – such as agriculture and pharmaceuticals – to American competitors. Given the gulf in bargaining power and Trump’s notoriously aggressive deal-making, this would almost certainly not end well for the UK.

Starmer’s government therefore faces an unenviable lose-lose dilemma. Align with the US to avoid tariffs and secure a trade deal, and suffer the deeply unpopular consequences of Trump’s trade conditions, from chlorinated chicken to significantly higher NHS drug prices. Or align more closely with the EU once again, and risk plunging the country into civil war over Brexit all over again. Given the present political dynamics in Britain, this could be disastrous for the Labour Party.

While, on paper, the landslide victory Labour secured at last year’s election victory appeared decisive, looks can be deceiving. In reality, the party’s majority was built on incredibly fragile foundations – and the UK is far from immune to the threat of right-wing populism. Since then, election support for the party has plummeted, while support for Nigel Farage’s pro-Brexit Reform party has surged. With the two parties neck and neck in the polls, any attempt to align more closely with the EU would be capitalised on by Reform, likely to devastating effect. Even without this, Reform could be on track to upend British politics in the next election, subverting the traditional two-party system, perhaps with help from an increasingly unhinged Musk.

Nigel Farage speaks at a press conference
Any attempt by the Labour government in the UK to align more closely with the EU would be capitalised on by Nigel Farage’s Reform Party | Carl Court/Getty Images

Global fractures

China’s global ascendency, combined with the US’s political fracturing, has led some to speculate that we may be witnessing the ‘end of the American century’. Back in 2020, I argued that such premonitions were premature. The two pillars of the US’s global power – military and financial – remained rooted in place.

However, it was clear that the election of Trump in 2016 was eroding the US’s soft power, and its ability to act as the paragon for liberal democracy. Trump’s subsequent attempt to overturn the result of the 2020 election only put this on steroids. Far from being viewed as a successful model to emulate, the US began to resemble a cautionary tale to avoid.

Biden made a conscious effort to repair US prestige on the world stage. “America is back,” he vowed at his first address to world leaders from the State Department in February 2021. “We are a country that does big things. American diplomacy makes it happen. And our Administration is ready to take up the mantle and lead once again.”

However, polling undertaken in 2021 found that while most people in Europe were happy to see Biden elected, they believed that the US political system was “broken”. Perhaps most alarmingly for US strategists, a majority also believed that China would be more powerful than the US within a decade – and said they would want their country to stay neutral in a conflict between the two superpowers. In the years since, Biden’s international standing has been further stained by his resolute support for Israel’s brutal assault on Gaza, which has generated intense animosity towards the US in many parts of the world.

Despite Biden’s efforts, it is likely that a second Trump term will fracture relations in the West further, as tensions relating to tariffs, Ukraine and NATO start to bite. How this plays out remains to be seen, any prolonged souring of relations among Western countries would likely benefit China, and hasten the transfer of global power from West to East.

Meanwhile, the much-vaunted ‘rules-based international order’ looks more fragile than ever before. Under Trump’s first reign, the US pulled funding from multiple UN agencies, withdrew from the Paris Agreement on climate change, and even pulled out of the World Health Organization (WHO) during the Covid-19 pandemic. Meanwhile, Trump and his allies severely criticised institutions such as the IMF and World Bank, long a critical tool for projecting US power. At the same time, the number of countries turning to Chinese-backed alternatives to fund development projects and joining China’s Belt and Road Initiative has continued to grow over the past decade.

In recent months, the ongoing war in the Middle East has exposed the feebleness of international law, with multiple signatory countries openly defying the International Criminal Court’s (ICC) arrest warrant for Israel’s prime minister and former defence minister. The US has never become a signatory to the ICC, but Trump previously sanctioned two ICC prosecutors after they began investigating whether US forces committed war crimes in Afghanistan – with secretary of state Mike Pompeo declaring it as a ‘kangaroo court’. At the start of this year, the US House of Representatives voted once again to sanction the ICC in retaliation for its arrest warrants against Israeli leaders.

What Trump’s stance towards such international institutions will be in his second term remains to be seen. But with his “America first” stance unlikely to soften anytime soon, the so-called ‘crisis of multilateralism’ looks set to deepen.

A global wake up call

Overall it is clear that Trump’s re-election represents a critical turning point for the West. While his first victory represented a high-risk gamble into the unknown, this time Americans fully knew what they were voting for. Far from softening the autocratic tendencies he was widely criticised for, he has doubled down on them.

Towards the end of Trump’s last reign, I argued that the West was being haunted by the spectre of ‘authoritarian capitalism’. The analysis identified three profound economic and political shifts that were reshaping Western economies: a China-induced pivot away from free-market orthodoxy, a clampdown on democratic freedoms, and a rise in state surveillance. Together, these shifts represented a distinct political economy that, if not contained, could usher in a new age of more authoritarian governance.

Thanks to the emerging transatlantic alliance between Trump, the European far-right and billionaire social media moguls, this is a reality we now face. Exactly what Trump will do in power, and whether his far-right allies in Europe will succeed in following his footsteps, is impossible to predict. But we should be under no illusions about the threat that this alliance poses. This is not the same Trumpism that won the election in 2016: it’s an altogether different – and more dangerous – project. How should progressives seek to counter the ascendance of a new authoritarianism?

One thing is clear: stoking anti-China sentiment will not cure the ills of Western capitalism. The roots of these problems, and therefore their solutions, can be found much closer to home. Simply trying to ban or censor voices on the authoritarian right won’t work either. When the voices in question include the US president and the second most popular party in the beating heart of Europe, silencing them isn’t an option (although that hasn’t stopped hundreds of German politicians from trying). Instead, the roots of these problems need to be dealt with at the source. In reality, it is not China or immigrants that are screwing over ordinary working people, but an extractive and unequal economic system.

Capitalism in the ‘developed world’ has primarily become an engine for redistributing wealth upward

The world’s richest 1% today owns more wealth than 95% of humanity. Last year total billionaire wealth increased by $2trn, growing three times faster than the year before. The wealth of the world’s five richest men has more than doubled since 2019, soaring from $506bn to over $1.1trn. That list includes Trump’s cheerleader-in-chief, Musk, who paid a true tax rate of just over 3% in the US between 2014 and 2018, according to an investigation by ProPublica. The average worker in advanced economies, meanwhile, has typically seen their real pay fall or stagnate.

The contrasting fortunes of the mega-rich and everyone else are not unconnected. Despite what our leaders claim, capitalism in the ‘developed world’ has primarily become an engine for redistributing wealth upwards – both from its own citizens and the rest of the world. Skyrocketing inequality is also inextricably linked to the climate and environmental crisis. As well as hoovering up much of the world’s wealth, the richest 1% emit as much carbon pollution as the poorest two-thirds of humanity. As such, tackling the climate crisis and reducing inequality must go hand in hand.

But by deflecting legitimate economic grievances towards external bogeymen and migrants, it is the authoritarian right – not the progressive left – that has most successfully capitalised on this broken system. If we are to address the central economic and environmental challenges we face, this urgently needs to change.

Progressive forces have transformed Western political economy before, and the task before us is to do so again. The goal must be to tackle inequalities, raise living standards and address the environmental crisis – while standing with migrants and other minoritised groups against persecution and oppression. This will inevitably involve a more proactive role for the state. The key question is: in whose interests will it act? The lesson from Bidenomics is that focusing primarily on industrial sectors such as renewable energy and manufacturing won’t work unless it is accompanied by policies to rein in corporate power and redistribute wealth. This means challenging the power of vested interests head-on, not cowering to them.

This project must also aim to strengthen democracy and protect civil liberties at a time when both are increasingly under threat. In recent years governments across the USEurope and the UK have cracked down on the right to protest with draconian legislation. Given Trump’s terrifying track record – including calling for the military to quash peaceful protests by “radical left lunatics” – we should expect the assault on the right to protest to intensify, alongside a curtailing of civil liberties more broadly. Peaceful protest will be absolutely critical for resisting the authoritarian right across the world, which is exactly why it is likely to be suppressed.

At the global level, lessons can be learned from Trump’s own playbook. In power, Trump has not shied away from breaking international norms or shaking up global institutions. Progressives must be willing to do the same – albeit for very different ends. While this may make some uncomfortable, it is a necessary prerequisite to delivering the kind of global transformation needed. The existing ‘rules-based international order’ is meaningless when some of the most powerful actors are not playing by these rules. Global cooperation is needed more than ever, but the existing multilateral order is fundamentally broken. It must undergo sweeping reforms to promote a more prosperous, peaceful and sustainable world.

Perhaps most importantly, however, there needs to be a clear focus on who the real enemy is – and the goals that need to be achieved to defeat them. For decades, the left has viewed its enemy as neoliberalism, and its main task as building an alternative to it. But if neoliberalism is not dead yet, it is slowly dying.

Instead of fighting the last war, progressives must start grappling with the distinct political economy of a new authoritarianism. In practice this requires developing a completely new set of strategies, tactics and policies. We are not only losing – we are losing badly. More of the same simply will not cut it.

The challenge now is therefore much greater than when Trump last took office. The spectre of authoritarian capitalism is not just haunting the West, it is already here, and it is actually quite popular. Now it must be resisted from the ground up.

The key question is: can we build the power needed to challenge it? Right now, it’s not looking promising. We can only hope that the arrival of Trump 2.0 provides the wake-up call the world so desperately needs.

Original article by Laurie Macfarlane republished from OpenDemocracy under a Creative Commons Attribution-NonCommercial 4.0 International licence.

Continue ReadingHow Trump 2.0 could herald a new age of authoritarian capitalism

Sanders Lays Out Plan to Fight Oligarchy as Wealth of Top Billionaires Passes $10 Trillion

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Original article by Jake Johnson republished from Common Dreams under Creative Commons (CC BY-NC-ND 3.0). 

Elon Musk and the wife of House Speaker Mike Johnson (R-La.) applaud during a House Republican Conference meeting on November 13, 2024 in Washington, D.C. (Photo: Andrew Harnik/Getty Images)

“If there was ever a moment when progressives needed to communicate our vision to the people of our country, this is that time,” wrote Sen. Bernie Sanders. “Despair is not an option.”

Bloomberg analysis of billionaire wealth published Tuesday found that the combined fortunes of the 500 richest people on the planet surpassed $10 trillion this year, a finding that came shortly after U.S. Sen. Bernie Sanders issued an urgent call to action to prevent the emergence of “an oligarchic and authoritarian society.”

The new analysis notes that the world’s top 500 billionaires “got vastly richer” this year with the help of “an indomitable rally in U.S. technology stocks.”

Just eight billionaires—Elon Musk, Mark Zuckerberg, Jensen Huang, Larry Ellison, Jeff Bezos, Michael Dell, Larry Page, and Sergey Brin—added more than $600 billion to their collective wealth in 2024 and accounted for 43% of the $1.5 trillion increase in net worth among the world’s 500 richest people, according to Bloomberg.

“But it was Musk—the so-called ‘first buddy’ of President-elect Donald Trump after unprecedented support for his reelection campaign—who dominated the world’s wealthiest in 2024,” Bloomberg observed, adding that Trump himself also saw his fortune surge to a record high this year, “boosted by the performance of his majority stake in Trump Media & Technology Group Corp.”

Musk’s use of his enormous fortune to influence the U.S. political system—including via his purchase of one of the world’s largest social media platforms and donations to Trump’s 2024 campaign—amplified existing concerns about the corrosive impact of massive wealth concentration on democracy.

And wealth inequality in the U.S. could soon get worse, with Trump and the incoming Republican-controlled Congress set to pursue another round of tax cuts for the ultra-rich and large corporations.

“They do not believe in democracy—the right of ordinary people to control their own futures. They firmly believe that the rich and powerful should determine the future.”

In an email to supporters on Monday, Sanders (I-Vt.) called the rapid shift toward oligarchy in the U.S. “the defining issue of our time,” warning that billionaires have come to increasingly dominate not only “our economic life, but the information we consume and our politics as well.”

“A manifestation of the current moment is the rise of Elon Musk, and all that he stands for,” Sanders wrote, pointing to Musk’s outsize influence on the 2024 election and his key role in shaping Trump’s billionaire-dominated Cabinet.

“But it’s not just Musk. Billionaire owners of two major newspapers overrode their editorial boards’ decisions to endorse Kamala Harris, while many others are kissing Trump’s ring by making large donations to his inauguration committee slush fund,” the senator continued. “They do not believe in democracy—the right of ordinary people to control their own futures. They firmly believe that the rich and powerful should determine the future.”

Progressives, Sanders wrote, have a “radically different vision,” one that prioritizes “an economic system based on the principles of justice,” “a vibrant democracy based on one person, one vote,” and making “healthcare a human right.”

“Even though we are not going to succeed in achieving that vision in the immediate future with Trump as president and Republicans controlling Congress, it is important that vision be maintained and we continue to fight for it,” wrote Sanders.

Since Trump’s victory in the 2024 election, Sanders has focused heavily on the need to organize the working class to combat the threat posed by Musk and other far-right billionaires who have amassed obscene wealth and political power.

In his email on Monday, the senator said he intends to “travel, organize, hold events, and create content that reaches people where they are” in the coming weeks as part of the “struggle to determine where we go from here.”

“Will this effort be easy?” asked Sanders. “No, of course it will not. Can it be done? We have no choice. If there was ever a moment when progressives needed to communicate our vision to the people of our country, this is that time. Despair is not an option. We are fighting not only for ourselves. We are fighting for our kids and future generations, and for the well-being of the planet.”

Original article by Jake Johnson republished from Common Dreams under Creative Commons (CC BY-NC-ND 3.0). 

Continue ReadingSanders Lays Out Plan to Fight Oligarchy as Wealth of Top Billionaires Passes $10 Trillion