It’s now clear to the whole world that China is the main target of Trump’s trade wars. The U.S. has slapped massive tariffs—up to 245%—on Chinese goods. China hit back with 125% tariffs of its own and refuses even to negotiate until U.S. tariffs are lifted.

Ever since President Obama announced a U.S. “pivot to Asia” in 2011, both U.S. political parties have seen China as the main global competitor, or even as a target for U.S. military force. China is now encircled by a staggering 100,000 U.S. military personnel in Japan, South Korea and Guam (plus 73,000 in Hawaii and 415,000 on the U.S. West coast) and enough nuclear and conventional weapons to completely destroy China, and the rest of us along with it.

To put the trade war between the U.S. and China in context, we need to take a step back and look at their relative economic strength and international trading relations with other countries. There are two ways to measure a country’s economy: nominal GDP (based only on currency exchange rates) and “purchasing power parity” (PPP), which adjusts for the real cost of goods and services. PPP is now the preferred method for economists at the IMF and OECD.

Measured by PPP, China overtook the U.S. as the largest economy in the world in 2016. Today, its economy is 33% larger than America’s—$40.7 trillion compared to $30.5 trillion.

And China isn’t alone. The U.S. is just 14.7% of the world economy, while China is 19.7%. The EU makes up another 14.1%, while India, Russia, Brazil, Japan, and the rest of the world account for the other 51.5%. The world is now multipolar, whether Washington likes it or not.

So when Malaysia’s trade minister Tengku Zafrul Aziz was asked whether he’d side with China or the U.S., his answer was clear: “We can’t choose—and we won’t.” Trump would like to adopt President Bush’s “You’re either with us or with the terrorists” posture, but that makes no sense when China and the U.S. together account for only 34% of the global economy.

China saw this coming. As a result of Trump’s trade war with China during his first term in office, it turned to new markets across Asia, Africa, and Latin America through its Belt and Road Initiative. Southeast Asia is now China’s biggest export market. It no longer depends on American soybeans—it grows more of its own and buys most of the rest from Brazil, cutting the U.S. share of that market by half.

Meanwhile, many Americans cling to the idea that military power makes up for shrinking economic clout. Yes, the U.S. outspends the next ten militaries combined—but it hasn’t won a major war since 1945. From Vietnam to Iraq to Afghanistan, the U.S. has spent trillions, killed millions, and suffered humiliating defeats.

Today in Ukraine, Russia is grinding down U.S.-backed forces in a brutal war of attrition, producing more shells than the U.S. and its allies can at a fraction of our cost. The U.S.’s bloated, for-profit arms industry can’t keep up, and our trillion dollar military budget is crowding out new investments in education, healthcare and civilian infrastructure on which our economic future depends.

None of this should be a surprise. Historian Paul Kennedy saw it coming in his 1987 classic The Rise and Fall of the Great Powers. Every dominant empire, from Spain to Britain to Russia, eventually confronted relative decline as the tides of economic history moved on and it had to find a new place in a world it no longer dominated. Military overextension and overspending always accelerated the fall.

“It has been a common dilemma facing previous ‘number one’ countries that even as their relative economic strength is ebbing, the growing foreign challenges to their position have compelled them to allocate more and more of their resources into the military sector, which in turn squeezes out productive investment…,” Kennedy wrote.

He found that no society remains permanently ahead of all others, but that the loss of empire is not the end of the road for former great powers, who can often find new, prosperous positions in a world they no longer dominate. Even the total destruction suffered by Germany and Japan in the Second World War, which ended their imperial ambitions, was also a new beginning, as they turned their considerable skills and resources from weapons development to peaceful civilian production, and soon produced the best cars and consumer electronics in the world.

Paul Kennedy reminded Americans that the decline in U.S. leadership “is relative not absolute, and is therefore perfectly natural; and that the only serious threat to the real interests of the United States can come from a failure to adjust sensibly to the newer world order…”

And that is exactly how our leaders have failed us. Instead of judiciously adapting to America’s relative decline and carving out a new place for the United States in the emerging multipolar world, they doubled down—on wars, on threats, on the fantasy of endless dominance. Under the influence of the neocons, Democrats and Republicans alike have marched America into one disaster after another, in a vain effort to defy the economic tides by which all great powers rise and fall.

Since 1987, against all the historical evidence, seven U.S. presidents, Democrats and Republicans, have blindly subscribed to the simplistic notion peddled by the neocons that the United States can halt or reverse the tides of economic history by the threat and use of military force.

Trump and his team are no exception. They know the old policies have failed. They know radically different policies are needed. Yet they keep playing from the same broken record—economic coercion, threats, wars, proxy wars, and now genocide—violating international law and exhausting the goodwill of our friends and neighbors around the world.

The stakes couldn’t be higher. It took the two most deadly and destructive wars in human history to put an end to the British Empire and the age of European colonialism.

In a nuclear-armed world, another great-power war wouldn’t just be catastrophic—it would very likely be final. If the U.S. keeps trying to bully its way back to the top, we could all lose everything.

The future instead demands a peaceful transition to international cooperation in a multipolar world. This is not a question of politics, right or left, or of being pro- or anti-American. It’s about whether humanity has any future at all.

This content originally appeared on Dissident Voice and was authored by Medea Benjamin and Nicolas J.S. Davies.

Although the decline of the West is rapidly becoming more evident to informed observers of current events, the start of that decline is less easy to pinpoint, in part because it seemed less inevitable and more reversible until quite recently. Was the high point the Austro-Hungarian Empire? Victorian England? The U.S. Eisenhower administration? Some might date it from the dissolution of the USSR in 1991, marking the beginning of the truncated “New American Century.”

That “century” appears to be ending in the manner of so many other powers that fill the pages of Kennedy’s book – through imperial overreach, excessive military spending, lagging economic productivity and competitiveness, and failure to invest in the physical, technical and human resources necessary to remain a dominant power. In short, the West is flagging.

The signs for this are too evident to ignore. The industrial base of the West is withering. Post-WWII, the U.S. dominated because it was the only major industrial power to survive unscathed, and its investment in western Europe and Japan increased the wealth of all three. Over the last half of the 20th century, however, these economies began to shift much of their industry to countries with cheaper labor and more efficient production, such that by the 21st century much of their manufacturing capability had vanished, and they became mainly consumer societies.

2023 has become a watershed year for the power shift, due to dramatic western weaknesses exposed by the Ukraine war. The war revealed that a relatively modest economy (Russia) had the capability to outproduce the U.S. and all the NATO countries combined in war materiel. The U.S. “arsenal of democracy” and its European partners proved unable to provide more than a fraction of the weapons and ammunition that Russia’s factories produced. Ukrainian soldiers supplied by NATO countries found themselves vastly outnumbered in tanks, artillery, missiles, unmanned and manned aircraft, and even the latest hypersonic and electronic weapons that were arrayed against them in seemingly limitless supply. The U.S. and European NATO partners could only cobble together small numbers of incompatible weapons from their diminishing inventories, and make promises of future deliveries after months or years.

But the U.S. and its allies were not counting on physical weapons alone. They weaponized the U.S. dollar, through seizures of Russian accounts in U.S., European and other banks totaling more than $300 billion, and through application of economic sanctions, including expulsion of Russian banks from the SWIFT dollar trading system. This also backfired.

First, Russia retaliated by seizing U.S. and European assets within Russia, in equal or greater amounts. Second, they “pivoted east,” negotiating new trading partnerships with China, India and other countries. Third, they and their new partners, including other targets of U.S. sanctions, began to develop financial agreements to displace or reduce the use of SWIFT. Even countries that had heretofore not been threatened with asset seizure or economic sanctions, like Brazil, South Africa, and Saudi Arabia, joined these agreements, in order to expand their trading base, and as insurance against use of the USD for financial pressure or threats. The result was that the Russian economy proved astonishingly resilient – moreso even than many of the NATO countries. The Russian GDP fell by less than 2% in 2022 and is expected to rise by up to 2% in 2023, despite the war and sanctions. Russia has opted for a sustainable but inexorable war with less than 1/6 the casualties of Ukraine. Visitors report that it hardly feels like a country at war. The annual St. Petersburg Economic Forum attracted 17,000 participants from 130 countries and concluded 900 deals and contracts worth 3.9 trillion rubles ($46 billion).

The decline of Europe was further illustrated by the consequences of the US bombing of the Nordstream gas pipelines in September, 2022, and the sanctions on Russian natural gas and petroleum products imposed by NATO. Together, these ended the competitiveness of the European economies, which had hitherto thrived on accessibility to cheap Russian fuel. As predicted by Radek Sikorsky, MEP, this meant

… double-digit inflation, skyrocketing energy prices, and electricity shortage, … Germany will be deindustrialized, … German industries, scientists and engineers will move to the US, who will generously accept them.

And Europe will be set back a couple of decades. Already, most European countries — France, Italy, Spain etc. — have had zero growth in GDP-per-capita for more than a decade. Add in inflation, the standard of living will soon be down 30-40%.

In effect, the U.S. had defeated its NATO “partners” (mainly Germany) and cannibalized their industries for the sake of its own benefit, potentially short-lived.

But the United States believed that its mighty dollar could offset its faded industry and increasingly toothless military – that it could be printed in unlimited amounts without losing value, and could become its most powerful weapon. The history of this dollar began in 1971, when President Richard Nixon announced that, in effect, the U.S. dollar would no longer be backed by gold, but rather by whatever the dollar could purchase in the U.S., i.e. by the U.S. economy itself. This became widely accepted because a) the U.S. was the world’s largest economy, b) the two great international regulatory financial institutions, the World Bank and the International Monetary Fund, were also based on the dollar, and c) nearly all the world’s countries outside of the Soviet Union and other socialist societies used the dollar as the reserve currency for their own money. In addition, the world shed fixed exchange rates, with their troublesome periodic revaluations, for floating rates, which generally made the changes more gradual and more stable for the major currencies, and especially the dollar.

The effect of so many dollars circulating so widely was to invest most of the world in protecting its value. The more a country’s non-dollar currency became based on the dollar as its reserve currency, the more the incentive for that country to defend the dollar. Later, as the U.S. began to lose its industry, it came to depend on this value to maintain its economy. It marketed its debt to other countries and “persuaded” other countries to fund U.S. bases on their territories for the purpose of “mutual defense.” This is part of the reason the U.S. now has more than 800 military bases worldwide. Although the U.S. national debt is, at time of writing, more than $33 trillion, the U.S. Treasury and the Federal Reserve Board seem to think that they can continue to unload it without limit onto other countries.

Decision makers in the U.S. seem to think that they have found the goose that lays the golden egg: when they need more money, they have only to borrow indefinitely and market their IOUs to buyers, many of whom don’t really have the option of saying no. Thus, for example, it used unlimited borrowing to fund without hesitation a very costly Ukraine war by more than $100 billion in 2022 alone, while denying basic services to its own citizens.

But borrowing is not the only way that the U.S. raises funds. Given the stability of the dollar, many countries store or invest them in the U.S. But when a country has a disagreement with the U.S., or chooses a leadership or policies not approved by the U.S., the U.S. is not above confiscating those funds. In 2011, this is what it did with $32 billion of Libyan funds, the largest but by no means the only such confiscation of another nation’s funds at that time. Since then, similar confiscations have occurred with Iran, Venezuela, Syria, Afghanistan and other nations. Eclipsing Libya, however, was the confiscation of Russia’s $300 billion by the U.S and its mostly NATO allies, an estimated $100 billion of it by the U.S. alone.

Recently, however, other countries are becoming wary of the U.S. and choosing other options that reduce their participation in what they view as a Mafia-style protection racket as well as their placement of assets in places where they could be confiscated in case of disagreement. As noted earlier, a growing number of countries are opting to either bypass the dollar-based SWIFT system, or to complement it with new agreements where goods are paid in another currency or with multiple currencies. Even Saudi Arabia has begun accepting payment in Chinese Yuan and paying Russia in rubles. In addition, China and other countries have decided to limit or reduce their USD exposure. So far, this has had no appreciable effect on the value of the USD. But if the dollar starts to become less desirable, it may become a questionable investment, in which case the U.S. risks losing its status as a world power – even a modest one. At that point, having demolished German and other European access to cheap fuel, the U.S. will join the rest of the west in its decline, leaving the rising economies of China, India, Brazil, Russia and other countries in Asia, Latin America and possibly Africa to displace them.

Is the Dollar overvalued? By the laws of supply and demand, one could argue that it is not. But it is a fair question when the supply is enormous and growing, and the demand is artificial and coerced. What will happen when the dollar’s near monopoly as an exchange medium ends? The dollar has not always been the preeminent tool for pricing international transactions. At the turn of the 20th century, the British pound sterling was literally the gold standard. But the British economy was fading, and the pound continued to fall against both gold and the USD. Now, although it is still a major currency, it is a mere shadow of its former self. If or when the many dollars worldwide come home to claim their true value, we may discover that they buy little more than castles of sand.

When world power has shifted elsewhere, the U.S., Great Britain, Germany, France and the entire West may come to depend for glory upon their historical and cultural treasures, like the ones of other bygone civilizations that western tourists once visited so widely.

This content originally appeared on Dissident Voice and was authored by Paul Larudee.

Since Kennedy wrote those words, we have seen the end of the Cold War, the peaceful emergence of China as a leading world power, and the rise of a formidable Global South. But the United States has indeed failed to “adjust sensibly to the newer world order,” using military force and coercion in flagrant violation of the UN Charter in a failed quest for longer lasting global hegemony.

Kennedy observed that military power follows economic power. Rising economic powers develop military power to consolidate and protect their expanding economic interests. But once a great power’s economic prowess is waning, the use of military force to try to prolong its day in the sun leads only to unwinnable conflicts, as European colonial powers quickly learned after the Second World War, and as Americans are learning today.

While U.S. leaders have been losing wars and trying to cling to international power, a new multipolar world has been emerging. Despite the recent tragedy of Russia’s invasion of Ukraine and the agony of yet another endless war, the tectonic plates of history are shifting into new alignments that offer hope for the future of humanity. Here are several developments worth watching:

De-dollarizing global trade

For decades, the U.S. dollar was the undisputed king of global currencies. But China, Russia, India, Brazil, Saudi Arabia and other nations are taking steps to conduct more trade in their own currencies, or in Chinese yuan.

Illegal, unilateral U.S. sanctions against dozens of countries around the world have raised fears that holding large dollar reserves leaves countries vulnerable to U.S. financial coercion. Many countries have already been gradually diversifying their foreign currency reserves, from 70% globally held in dollars in 1999 to 65% in 2016 to only 58% by 2022.

Since no other country has the benefit of the “ecosystem” that has developed around the dollar over the past century, diversification is a slow process, but the war in Ukraine has helped speed the transition. On April 17, 2023, U.S. Treasury Secretary Janet Yellen warned that U.S. sanctions against Russia risk undermining the role of the dollar as the world’s global reserve currency.

And in a Fox News interview, right-wing Republican Senator Marco Rubio lamented that, within five years, the United States may no longer be able to use the dollar to bully other countries because “there will be so many countries transacting in currencies other than the dollar that we won’t have the ability to sanction them.”

BRICS’s GDP leapfrogs G7s

When calculated based on Purchasing Power Parity, the GDP of the BRICS countries (Brazil, Russia, India, China and South Africa) is now higher than that of the G7 (United States, United Kingdom, Canada, France, Germany, Italy, Japan). The BRICS countries, which account for over 40% of total world population, generate 31.5% of the world’s economic output, compared with 30.7% for the G7, and BRICS’s growing share of global output is expected to further outpace the G7’s in coming years.

Through the Belt and Road Initiative, China has invested some of its huge foreign exchange surplus in a new transport infrastructure across Eurasia to more quickly import raw materials and export manufactured goods, and to build growing trade relations with many countries.

Now the growth of the Global South will be boosted by the New Development Bank (NDB), also known as the BRICS Bank, under its new president Dilma Rousseff, the former president of Brazil. 

Rousseff helped to set up the BRICS Bank in 2015 as an alternative source of development funding, after the Western-led World Bank and IMF had trapped poor countries in recurring debt, austerity and privatization programs for decades. By contrast, the NDB is focused on eliminating poverty and building infrastructure to support “a more inclusive, resilient and sustainable future for the planet.” The NDB is well-capitalized, with $100 billion to fund its projects, more than the World Bank’s current $82 billion portfolio.

Movement towards “strategic autonomy” for Europe

On the surface, the Ukraine war has brought the United States and Europe geostrategically closer together than ever, but this may not be the case for long. After French President Macron’s recent visit to China, he told reporters on his plane that Europe should not let the United States drag it into war with China, that Europe is not a “vassal” of the United States, and that it must assert its “strategic autonomy” on the world stage. Cries of horror greeted Macron from both sides of the Atlantic when the interview was published. 

But European Council President Charles Michel, the former prime minister of Belgium, quickly came to Macron’s side, insisting that the European Union cannot “blindly, systematically follow the position of the United States.” Michel confirmed in an interview that Macron’s views reflect a growing point of view among EU leaders, and that “quite a few really think like Emmanuel Macron.” 

The rise of progressive governments in Latin America

This year marks the 200th anniversary of the Monroe Doctrine, which has served as a cover for U.S. domination of Latin America and the Caribbean. But nowadays, countries of the region are refusing to march in lockstep with U.S. demands. The entire region rejects the U.S. embargo on Cuba, and Biden’s exclusion of Cuba, Venezuela and Nicaragua from his 2022 Summit of the Americas persuaded many other leaders to stay away or only send junior officials, and largely doomed the gathering. 

With the spectacular victories and popularity of Andres Manuel Lopez Obrador in Mexico, Gustavo Petro in Colombia, and Ignacio Lula da Silva in Brazil, progressive governments now have tremendous clout. They are strengthening the regional body CELAC (the Community of Latin American and Caribbean States) as an alternative to the U.S.-dominated Organization of American States. 

To reduce reliance on the U.S. dollar, South America’s two largest economies, Argentina and Brazil, have announced plans to create a common currency that could later be adopted by other members of Mercosur — South America’s major trade bloc. While U.S. influence is waning, China’s is mushrooming, with trade increasing from $18 billion in 2002 to nearly $449 billion in 2021. China is now the top trading partner of Brazil, Chile, Peru and Uruguay, and Brazil has raised the possibility of a free-trade deal between China and Mercosur.

Peace between Iran and Saudi Arabia 

One of the false premises of U.S. foreign policy is that regional rivalries in areas like the Middle East are set in stone, and the United States must therefore form alliances with so-called “moderate” (pro-Western) forces against more “radical” (independent) ones. This has served as a pretext for America to jump into bed with dictators like the Shah of Iran, Saudi Arabia’s Mohammed bin Salman and a succession of military governments in Egypt.

Now China, with help from Iraq, has achieved what the United States never even tried. Instead of driving Iran and Saudi Arabia to poison the whole region with wars fueled by bigotry and ethnic hatred, as the United States did, China and Iraq brought them together to restore diplomatic relations in the interest of peace and prosperity. 

Healing this divide has raised hopes for lasting peace in several countries where the two rivals have been involved, including Yemen, Syria, Lebanon and as far away as West Africa. It also puts China on the map as a mediator on the world stage, with Chinese officials now offering to mediate between Ukraine and Russia, as well as between Israel and Palestine.

Saudi Arabia and Syria have restored diplomatic relations, and the Saudi and Syrian foreign ministers have visited each others’ capitals for the first time since Saudi Arabia and its Western allies backed al-Qaeda-linked groups to try to overthrow President Assad in 2011. 

At a meeting in Jordan on May 1, the foreign ministers of Jordan, Egypt, Iraq and Saudi Arabia agreed to help Syria restore its territorial integrity, and that Turkish and U.S. occupying forces must leave. Syria may also be invited to an Arab League summit on May 19th, for the first time since 2011.

Chinese diplomacy to restore relations between Iran and Saudi Arabia is credited with opening the door to these other diplomatic moves in the Middle East and the Arab world. Saudi Arabia helped evacuate Iranians from Sudan and, despite their past support for the military rulers who are destroying Sudan, the Saudis are helping to mediate peace talks, along with the UN, the Arab League, the African Union and other countries. 

Multipolar diplomatic alternatives to U.S. war-making

The proposal by President Lula of Brazil for a “peace club” of nations to help negotiate peace in Ukraine is an example of the new diplomacy emerging in the multipolar world. There is clearly a geostrategic element to these moves, to show the world that other nations can actually bring peace and prosperity to countries and regions where the United States has brought only war, chaos and instability.

While the United States rattles its saber around Taiwan and portrays China as a threat to the world, China and its friends are trying to show that they can provide a different kind of leadership. As a Global South country that has lifted its own people out of poverty, China offers its experience and partnership to help others do the same, a very different approach from the paternalistic and coercive neocolonial model of U.S. and Western power that has kept so many countries trapped in poverty and debt for decades.

This is the fruition of the multipolar world that China and others have been calling for. China is responding astutely to what the world needs most, which is peace, and demonstrating practically how it can help. This will surely win China many friends, and make it more difficult for U.S. politicians to sell their view of China as a threat.

Now that the “newer world order” that Paul Kennedy referred to is taking shape, economist Jeffrey Sachs has grave misgivings about the U.S. ability to adjust. As he recently warned, “Unless U.S. foreign policy is changed to recognize the need for a multipolar world, it will lead to more wars, and possibly to World War III.” With countries across the globe building new networks of trade, development and diplomacy, independent of Washington and Wall Street, the United States may well have no choice but to finally “adjust sensibly” to the new order.

This content originally appeared on Dissident Voice and was authored by Medea Benjamin and Nicolas J.S. Davies.