Opinion polls show a growing fear of China. According to a Lowy Institute poll last year, as many as 63% of Australians apparently saw China as a security threat.
These figures have grown dramatically in recent years in large part due to a carefully orchestrated campaign. Academic Clive Hamilton has even asserted that Australians of Chinese background might not be trusted. A perception of fear, helped along by the corporate media, has been created.
Is it therefore any wonder that people are increasingly buying the lie, or that politicians are accusing each other of being “Manchurian candidates”?
Why China is now, officially, a threat has little to do with politics and everything to do with economics.
The drive to demonise China is tied to the crisis-ridden nature of capitalism: capitalist China has been both friend and enemy. It has been hero and villain, depending on the state of play within the global economy.
It was not long ago, in 2014, when Australia’s ruling class and media competed with one another as to which could sing China’s praises the loudest. Chinese President Xi Jinping spoke at Parliament House and the future relationship between the two countries could not have been happier. Chinese capitalism came as a knight on a white charger to ensure that Australian capitalism would thrive. Today, China is a pariah, seeking to control our government, a communist threat and an enemy of the free world.
A lot has happened in those eight years: we are now on a virtual war footing. Australia seems more than willing to lead the charge against China.
There is no logic to this: there is no threat and such belligerent behaviour on the part of Australia can only lead to economic loss. The Chinese have called Australia “ignorant” and “stupid” and while one in every 13 Australian jobs is linked, in some way, to the economic relationship between the two countries, the descriptors seem rather mild.
Australia’s economy is dependent on China, but the former has always been beholden to a bigger economy — be it Britain or the United States. When trade war politics emerged, the two-way trade between the two countries was $252 billion. Australian exports to China totalled $169 billion, but leaders seem more than willing to destroy this.
Why then does the Australian capitalist state appear to be so much in thrall to the US?
Trade is one measure of importance. Foreign investment is another. Of all foreign investment into the economy, the strictly Chinese component is just 2% — the ninth largest investor. The US, on the other hand, accounts for 25% of the total — the biggest. Should we be fearful of US investment? Should we be fearful of Luxembourg, whose investments make up 2.2%?
A capitalist economy survives because other economies invest and yet so much fear is engendered by such a small degree of direct Chinese investment.
Australia’s economic health relies on buying and selling, but a significant proportion of this trade is in private hands. Twiggy Forrest, or Gina Rinehart, return relatively little to benefit working people. The state needs foreign capital, and it is the US and its direct investment that is piping the tune.
In the dying days of the Donald Trump presidency, US Secretary of State Mike Pompeo made things clear. He suggested that the US might “disconnect” Australia from its telecommunications, military and intelligence networks if the latter made any arrangements with China deemed not in accord with US “national security interests”.
In other words, play by our rules or else.
Pompeo was speaking to Sky News when he also commented that “every nation has its own sovereign right to make decisions for itself, and I suppose Victoria has some rights … but every citizen of Australia should know that every one of those Belt and Road projects needs to be looked at incredibly closely".
This was not deemed to be “bullying” behaviour. Bullying is what China does. The US engages in “robust diplomacy”.
Arthur Culvahouse, then-US ambassador to Australia, saw the need to further clarify things: “We have every confidence that Australia, as a close ally and Five Eyes partner, would take every measure necessary to ensure the security of its telecommunications networks.” The government got the message.
The message has not changed since Joe Biden came to office. The crisis in capitalism, combined with the continuing shift in economic power from the US to China, has made things even worse. The period since the 1970s and the desperate moves by capital to escape crisis and loss of profit have led us to this dangerous impasse, with war being openly spoken of.
In 1970, a total of 25% of all Australian jobs were in the manufacturing industries. By 1982, that figure had shrunk to 18%. At the end of 2020, just 6.6% of the workforce worked in manufacturing.
The collapse of manufacturing in Australia was mirrored in all developed economies. It was a direct response by individual manufacturers and multinationals to avert the worst of the crisis that affected the global economy in the 1970s. Production simply moved offshore.
This crisis coincided with the historic decision by the Chinese government to open up to the West and pursue a capitalist economic structure. The 1970s and 1980s presented enormous possibilities for businesses to prosper from their interactions with China and for the latter to create the basis for its dramatic rise as a capitalist power.
The problem came when the global economy again moved into crisis territory.
This new stage of capitalist crisis was paralleled by the rise of economic nationalism and, with it, political nationalism. For many, the question was simply either globalisation or a return to national capitalism. Whether it be national or global capitalism, the fact remains that workers continue to be exploited.
As national borders become stronger, it is well to be reminded of history.
Nationalism and economic nationalism, tariffs and trade wars have had a habit of turning into wars or, as the 19th century French economist Frederic Bastiat put it: “If goods don’t cross borders, soldiers will."
Capitalism, in seeking to outrun crisis, globalised production. Crisis followed. Economic nationalism is now once more in vogue, but crisis is still there. China is now being openly described as an enemy. Capitalism is the enemy.
The state seeks to portray the growing conflict with China as being political, or ideological, or representing a crisis of sovereignty, or of national security. None of this is true, but while capital rules, then fear, war and insecurity will never be far away.