After marshalling Europe in its proxy war against Russia, America is now determined to repeat this success against China. Here, the consequences for Europe could be even more significant than the economic shock of the past year. Yet, despite a few grumbles from Macron and others, European leaders are largely playing along with this increasingly aggressive approach: at last week’s biannual US-EU Trade and Technology Council, both parties claimed to “see very much eye-to-eye” on the issue.

Below the surface, however, views are hardening against the EU’s efforts to emulate America’s hawkish approach, which includes economic decoupling (or “de-risking”, as it’s now called) and increasing Nato’s presence in the Indo-Pacific. Over the past four years, von der Leyen has worked tirelessly to keep Europe aligned with America’s aggressive geopolitical strategy, often appearing to prioritise Washington’s desires over Europe’s strategic interests. No wonder Politico dubbed her “Europe’s American president”.

On China, von der Leyen has taken an increasingly tough line, recently urging Europe to “de-risk” its relationship. The bloc’s foreign policy chief, Josep Borrell, has echoed her tone, calling President Xi’s support of Russia “a blatant violation” of its UN commitments. Brussels is also devising a Sustainable Corporate Governance initiative, which would force European companies to ensure that EU social and human rights standards apply throughout their supply chain. Germany has already introduced a softer version of the rule, which currently applies only to 150 companies, though the number is set to rise to 15,000.

Already many European companies are pushing back against the measures, claiming that they place an excessive regulatory and bureaucratic burden on industry at a time of massive economic challenges. Unsurprisingly, German companies are leading the charge: China is the country’s largest trading partner, with total trade last year of nearly €300 billion. Europe’s economic powerhouse has already taken a heavy it from its decoupling from Russian gas and other commodities; with its economy in recession and an inflation rate of 7.2%, Germany cannot afford to lose China as well. The same can be said for the EU as a whole.

The fact that the von der Leyen insists on mimicking the American strategy despite the bloc’s deep interdependence with China highlights the extent to which the EU, wedded as it is to a subservient interpretation of the bloc’s relationship to the US, is now a threat to Europe’s core interests. As Wolfgang Münchau noted: “The EU economy is not built for Cold War-style relations because it has become too dependent on global supply chains… The underlying reality of modern-day Europe is that it cannot easily extricate itself from its relationship with China.”

In this context, it is hardly surprising that German businesses are pushing back against Chancellor Olaf Scholz’s call to weaken Germany’s economic relationship with China. Abandoning China is “unthinkable” for German industry, Mercedes CEO Ola Källenius said in April, in comments that echoed across the country’s boardrooms — from Siemens to BASF to BMW, all of which have vowed to continue investing in the country. “We won’t give up on China,” Volkswagen’s chief financial officer made clear.

Yet while similar views are being expressed in Italy and France, China’s other two largest trading partners in the EU, it remains unclear whether this will translate into a decisive shift in Europe’s official China policy. For now, most national and EU leaders seem more interested in pleasing the US establishment than thinking about Europe’s long-term economic and geopolitical interests. However, European business leaders can count on some powerful allies in the US — not in Washington, but among fellow capitalists.

For in America, a similar revolt is brewing over the administration’s decoupling with China. Despite the fraying of Sino-American relations at the political level, several American CEOs have continued to visit China. While the bosses of J.P. Morgan, Starbucks, GM and Apple have all flown in since March, it was Elon Musk’s visit, which took place last week, that predictably caused the biggest shockwaves.

According to the Financial Times, “in just two days… Elon Musk had more top-level Chinese meetings than most Biden administration officials have had in months”, including with Chinese Foreign Minister Qin Gang. The foreign ministry quoted Musk as saying that he was willing to expand business in China and opposed a decoupling of the US and China economies, adding that he described the world’s two largest economies as “conjoined twins”. Musk’s trip coincided with that by J.P. Morgan boss Jamie Dimon, who in a speech in Shanghai called for “real engagement” between Washington and Beijing.

Such open defiance of Washington’s foreign policy stance by some of the most powerful CEOs in America represents a striking development. Critics of US-Western foreign policy and military interventionism have traditionally (and correctly) seen the latter as being essentially aimed at enforcing the Western-led global capitalist order — in other words, as being in the service of big business by opening up new markets, securing control of resources or intervening whenever Western business interests were threatened. As New York Times columnist Thomas Friedman put it in 1999: “The hidden hand of the market will never work without a hidden fist — McDonald’s cannot flourish without McDonnell Douglas, the builder of the F-15. And the hidden fist that keeps the world safe for [American corporations] is called the United States Army, Air Force, Navy and Marine Corps.”

However, in light of the growing rifts between America’s economic and political elites, does this analytical framework still hold? It’s hard to see, after all, how the West’s aggressive US-led foreign policy — aimed at antagonising and militarising relations with China, the world’s second-largest consumer market and largest rare-earth mineral exporter, in the same fashion as it has with Russia — serves the “general interests” of Western capital, or even how it serves a strictly capitalist logic. How is Nato “helping McDonald’s”, to borrow Friedman’s phrase, by forcing it to exit Russia at a cost of more than $1 billion? No wonder major representatives of Western corporate interests aren’t peachy about the prospect of a new Cold War — not to mention an actual war with China, which would have devastating effects on the US and global economy.

However, their appeals today seem to fall on deaf ears in Washington and other Western national capitals. As Adam Tooze has observed: “The ‘peace interest’ anchored in the investment and trading connections of US big business with China has been expelled from centre stage. On the central axis of US strategy, big business has less influence today that at any time since the end of the Cold War”. Yet this begs the question: if US-Western foreign policy no longer serves the interests of big business, whose interests does it serve?

Well, there is really only one social class that stands to benefit from the militarisation of great-power relations: the military-industrial complex, Eisenhower’s description for the network of corporations and vested interests that revolve around a country’s defence and national security sector. What’s changed since the Sixties, however, is that these interests are no longer aligned with those of the Western corporate community — in fact, the two are diametrically opposed.

The paradox, of course, is that for decades big business has encouraged the continuous expansion of the military-industrial complex as a tool to promote its interests abroad. Yet in a Frankenstein-like twist of fate, the beast has been allowed to become so powerful that it has broken free from its masters — and is now turning against them. No longer is the military-industrial complex subordinated to the general interests of the capitalist class; rather, it is the latter that is increasingly subordinated to the interests of the military-industrial complex.

Now, the military-industrial complex follows a capitalist logic as well, of course: war, or even just the constant preparation for war, is clearly good for business. But, ultimately, it’s about more than just profits: it’s about ensuring the reproduction of the military class, which extends well beyond the big defence companies to include civilian auxiliaries in defence-related government agencies, think tanks, academia, and many others.

What’s slowly becoming clear, however, is that the old capitalist class doesn’t seem willing to go down without a fight. Indeed, we may be on the verge of a new historical class struggle: the owners of the means of production against the owners of the means of destruction. Whoever wins, the peculiar nature of this conflict should not be underestimated: the greatest resistance to the new Cold War isn’t coming from a global peace movement, but from the boardrooms of Western corporations. Faced with China’s supremacy, they have nothing to lose but their chains.

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