INTRODUCTION

China’s rise in power will alter the Western global order, challenge American hegemony, and transform the world economy. The growth of China as an economic superpower has allowed its military and industrial capabilities to rise to compete with the West’s liberal order following

the Cold War. China’s growth will change established international institutions by the West that have long allowed the greatest interconnected and cooperative economy of all time. As China

grows, the world economy will decrease in its openness due to Western countries’ rising protectionism. Through the frameworks on International Political Economy and the unprecedented expansion of China, the West’s culture of open markets will lead to its eventual rejection of its long-standing trade liberalization goals. While we have seen these trends in recent years, the rise in US-China tensions and the expansion of China’s Belt and Road project will exacerbate more protective foreign policy. Since the beginning of time, every historical great power has been poised against a rising challenger, and using models developed, we can predict the response of the United States to China.

INTERNATIONAL POLITICAL ECONOMY

As globalization continues and China’s market expands, we can observe how patterns of social stability may be inversely related to late-stage economic openness. China’s comparative advantage in labor-intensive industries has allowed manufacturing jobs to flow at the cost of employment in outside capital-intensive countries. The trade of capital and labor is motivated by availability and price differences in these countries, as shown by the Heckscher-Ohlin Theorem and the works of Political Science expert Stephen Krasner. As China grows larger, industrializes, and dominates as a global superpower, the capital-intensive West will fight for protectionism against the shift of manufacturing jobs moving abroad. China’s growth stems from its access to the free market, and in irony, it will cause the West to have an ideological shift to protectionism. While beneficial for the United States now, the short-term gains may lead to the loss of considerable influence over time. Wages and employment in these capital-intensive countries will be fought for through protective measures such as high tariffs and trade restrictions, especially with the addition of Western fear over Chinese dominance. Using the Stolper-Samuelson Theorem, lobbying for economic protection will rise as major parts and labor sectors of the West increasingly become the ‘losers’ of globalization to China. The theorem explains how high-skill workers and capitalists will continue to fight for free trade while labor losses will increasingly organize for protectionism. These changes will likely occur in intergovernmental trading systems, such as the World Trade Organization, gradually decreasing the global economy’s openness.

We can see these trends on a smaller scale in recent events. In the United States, a similar situation occurred when NAFTA was debated. As openness between Mexico and the US expanded, American farmers were hurt by removing import taxes as labor-intensive Mexico began creating cheaper goods for US citizens. This major expansion of trade openness lowered wages and employment among US farmers and other American industries. During the Trump presidency, farmers continued lobbying in response. The negative associations of globalization among the American public during NAFTA may predict a similar reaction to China. As NAFTA began, issues of drugs, weapons, and migrants became central cultural issues when discussing trade. Similarly, anti-China rhetoric would be present as fears of China’s rise of the United States continue in the 21st Century. The example of NAFTA and its associated anti-globalization helps explain how China’s labor-intensive economy will hurt capital-intensive countries’ growth and may lead to a Western-led backlash for a less open global economy.

FOREIGN MONEY

In the realm of globalization and world trade, the United States is falling behind on foreign investment. With neoliberal ideas dating back for decades, the United States has lost its dominant role in providing foreign aid for the developing world. With its strict rules that push for economic liberalization, these countries have been drawn away and pulled into another more appealing deal.

While the United States has had much historical success with building new economic markets and advancing US interests, China has risen with a new proposal for the developing world. China’s Belt and Road Initiative (BRI) has provided a massive infrastructure project in Asia, expanding to Eastern Europe, Africa, South America, and more. As China creates alternative pathways and influences away from typical Western initiatives (The World Trade Center, International Monetary Fund, etc.), China dominates more of the political-economic world. The United States, without a solid competing vision, is poised to be excluded from the historical initiative China has brought. President Biden, along with the members of G7, had led efforts to create the Build Back Better World Initiative (B3W). This project, designed to compete with China’s BRI, has failed as a competitor due to its flawed 6 million dollar budget.

China’s push for foreign investment has led to economic ties with many countries by providing growth in GDP and employment opportunities in the developing world. In Africa, China has doubled the amount invested by the United States, allowing China to influence and import significant natural resources as it continues to expand its power. As China loses its ability to get natural resources from the West, its influence in Africa has allowed it to maintain its position as an emerging global leader. As China’s global involvement becomes more suspicious to the West and globally influential, the rise of protectionism will likely dominate Western politics.

TRANSFORMATION OF THE 21ST CENTURY

China’s ascent as a global power will be a dominant force, marked by its ever-growing population, ideas, and industrialization. As China dominates economically and politically, its

cultural influence will affect the world, marking a change from Western dominance. Although China will become stronger militarily, in a world of nuclear weapons, it will not be able to force Western countries into trade as a hegemon, as past theoretical frameworks would suggest. Through the Heckscher-Ohlin model and its derived Stolper-Samuelson Theorem, China’s growing economy and country will surpass the West’s open market ideology, closing the global economy towards protectionism in favor of the West. As we watch historical tensions unfold, perhaps a new sense of urgency in Western policy will determine the trajectory of global economic institutions as new leaders emerge in the 2024 global elections.