William I. Robinson*: Trump's tariff war

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beyond the smoke and As the mirrors show, Trump's tariff war is a response to three factors. First, it is a response to the crisis of global capitalism. Second, it is a component of the war against the American and global working class. And third, it is riddled with so many contradictions that it will end up worsening the crisis and contributing to the collapse of the Trump coalition.

Every country has been embedded in a globalized system of production, finance, and services over the past half-century, and withdrawing from it is not possible without massive disruption that would lead to chaos and collapse. Trump’s tariffs will aggravate global economic turbulence, but the system of global capitalism is also facing a spiraling political crisis of state legitimacy and massive social discontent. The political dimensions of the crisis reflect a fundamental contradiction in the organization of global capitalism: the disjunction between a globally integrated economy and a system of political authority based on the nation-state.

Each state has a contradictory mandate. On the one hand, it needs to achieve political legitimacy among its respective population and stabilize its own national social order. On the other hand, it must promote the accumulation of transnational capital on its territory in competition with other states. These two contradictory functions are incompatible with each other and play out in protectionist wars and other forms of interstate competition. Attracting transnational corporate investment requires providing capital with incentives such as low wages and labor discipline, a lax regulatory environment, tax concessions, investment subsidies, privatization, deregulation. The result is growing inequality, impoverishment, and insecurity for the working classes—precisely the conditions that throw states into crises of legitimacy, destabilize national political systems, endanger elite control, and give impetus to the rise of a neo-fascist right.

Long before Trump took office, successive US administrations in the 21st century sought subsidies, tax credits, and tariffs to attract transnational investors, triggering ongoing protectionist conflicts between states. Governments adopted more than 1,500 policies in the early 2020s to attract industries to their territories, compared with almost none in the 2010s, according to IMF data. Unlike the protectionism that countries imposed in the early 20th century, which aimed to keep out foreign capitalists and cultivate domestic industry, this new protectionism has not been aimed at keeping out foreign capital , but at attracting transnational corporate and financial investors.

If one part of the equation involves tariffs and other protectionist measures to attract transnational investment, the other part is a full-scale escalation of class struggle from above against the American and global working class. Trump’s program proposes destroying what is left of the regulatory state, privatizing what is left of the public sphere, massive cuts in social spending, a reduction in taxes on capital and the rich, an expansion of the state apparatus of repression and surveillance. The goal is to eliminate the remaining elements of the grand class compromise that emerged during the Great Depression of the 1930s and resulted in the New Deal , or social democratic welfare state.

The goal of Trumpism is to radically degrade US-based labor, which is already facing a severe crisis of social reproduction. Transnational investors are to be punished with tariffs if they are located outside the United States, but enticed to relocate within US borders by the incentive of a mass of labor put on the defensive and available for exploitation. Trumpism proposes to offer capital a desperate and easily exploitable working class, to make the exploitability of this class competitive with the exploitability of the working class in other countries. Tariffs will not hurt capital, but workers. Corporations will pass on the cost of tariffs through higher prices. This price increase will contract working class consumption. It is a calculated strategy to weaken workers by dividing and impoverishing them precisely at a time of mass discontent and growing class struggle.

The war on immigrants and the threat of mass deportation is an attack on the entire multi-ethnic and multinational working class, aimed at creating fear and chaos in labour markets and social institutions. Historically, hyper-nationalism serves to undermine working class unity and pit workers from different countries against each other. Racism must also be revived to divide and disorganise the working class.

Trump is a Frankenstein conjured by transnational capital’s dependence on the state to keep mass discontent in check and solve the problem of chronic stagnation. But it is doubtful that Trump’s trade wars will actually succeed in convincing transnational capitalists to relocate production to the United States. Transnational corporations may have a base in a particular country, but they operate through vast, interlocking global chains of production and distribution that are obstructed by tariffs or any other obstacles imposed by nation-states. The U.S. Chamber of Commerce, the National Association of Manufacturers, the National Retail Federation, and other corporate entities have opposed tariffs.

Trump will take advantage of the chaos generated by his program to unleash the full fury of the police state against popular resistance. Far from stabilizing global capitalism, the Trump project will aggravate all the contradictions that are tearing it apart. Global elites are divided and increasingly fragmented as the post-World War II international order cracks and geopolitical confrontation intensifies. The World Economic Forum published its annual Global Risk Report on the eve of Trump’s inauguration. As we enter 2025, the global landscape is increasingly fractured across geopolitical, environmental, social, economic and technological realms , it warned. The world faces a bleak outlook on all three time horizons: the current, the short-term and the long-term .

* Distinguished Professor of Sociology, University of California at Santa Barbara