As trade tensions rise and industrial policies are reshaped, labor faces critical decisions in a world plagued by economic nationalism and climate change.
Workers install solar panels in Rodeo, California, on July 31, 2024. (David Paul Morris / Bloomberg via Getty Images)
The US-China trade war, which began in January 2018 under Donald Trump with the imposition of tariffs on Chinese goods is heating up again and drawing more countries into the fray. Closely related to these trade tensions are competing industrial policies between the world’s two largest economies.
This development presents significant challenges for labor movements worldwide. Tariffs are not only about protecting jobs; they can also result in job losses. Industrial policy, used by nation-states to create jobs and move up the global value chain, can also be driven by great power competition and national security concerns. Under these circumstances, workers’ interests risk being sidelined or absorbed into to the military-industrial complex under the guise of industrial policy.
With the added pressure of climate change, labor movements around the world are at a crossroads. Workers worldwide are being buffeted by the competing demands of industrial policy, trade wars, and the pressing need for climate-conscious production strategies.
Climate and Competition
Earlier this year, after the Biden administration announced 100 percent tariffs on Chinese-made electric vehicles (EVs), Canada quickly followed suit. The European Union has also joined in, though its tariffs on Chinese EVs are set at 45 percent. In response, China has imposed tariffs on EU brandy and launched an anti-dumping investigation into Canadian canola oil. While these are hardly commensurate retaliatory measures, Chinese tariffs could escalate significantly if Trump returns to the White House. Trump, meanwhile, has been talking about the possibility of retaliatory tariffs on India, underscoring how easily this kind of rhetoric can spiral.
A largely underreported story in the Global North is the increasing number of developing countries imposing tariffs or investigating China for dumping. This includes fellow BRICS members like South Africa and India. Several Latin America countries have also placed tariffs on Chinese steel. So far, Beijing has not seen these tariffs in the Global South as a major threat. In fact, China has continued to expand the number of African countries that qualify for tariff-free access to its market. After Turkey imposed 40 percent tariffs on EVs in March, Chinese EV maker BYD quickly struck a deal to build a plant there.
The recent activation of the African Continental Free Trade Area is a further incentive for Chinese investment in Africa, creating opportunities for supply chain efficiencies and new markets. These investments could also serve as potential bases for Chinese companies to “tariff-jump” into Western markets. For China, not all protectionism is seen as equal, with tariffs from the West posing a much greater threat.
While Chinese investment in the Global South may create new working-class opportunities, the ongoing trade war could slow the transition to clean energy by making solar and wind power more expensive, potentially destabilizing fragile economies.
Unions in the United States and elsewhere across the West have historically objected to China’s deeper integration into the structures of global trade. In 2022, when Joe Biden considered lifting tariffs on China to combat inflation, American unions argued against the move, citing national security concerns. Biden’s tariffs on Chinese EVs also garnered widespread support from labor. Across the border, Canadian unions backed their government’s similar measures. However, Trump’s tariffs provide a cautionary tale: while they had union support, they may have cost as many as 245,000 American jobs due to reduced trade. Despite these measures, steel layoffs continued, revealing that tariffs are no panacea for declining industrial jobs and can, in fact, reflect sectional union interests over broader class concerns.
These developments are contributing not only to economic uncertainty but a growing sense that the world is entering a new Cold War between China and the United States. Institutions like the World Bank warn that this new wave of protectionism is “slowing growth and entrenching poverty.” Yet data shows that Chinese exports to the United States and EU, as well as imports from them, are actually rising.
Will Industrial Policy Even Work?
One of the key factors labor movements must navigate in this trade war is the role of industrial policy. J. W. Mason convincingly argues that industrial policy, especially under Biden, is inseparable from its nationalist agenda and security concerns. Adam Tooze goes as far as to state that “Bidenomics is MAGA for thinking people.”
There is a certain irony in the Democrats’ turn toward industrial policy. Since the 1980s, for many liberals, industrial jobs conjured up visions of middle-aged white men, despite the increasing diversity of workers in the sector. For a long time, there was also little attention paid to the consequences of deindustrialization on African American communities. Instead, as Adolph Reed Jr. points out, the focus shifted to “underclass” discourse, framing the problem as one of the “truly disadvantaged.”
Despite the Democrats’ identitarian posturing, they have done little for the 80 percent of the American workforce that is employed in the service sector, which is racially and gender diverse. Discussion of the Protecting the Right to Organize (PRO) Act or meaningful labor law reforms, which could offer worker protections in ways tariffs cannot, are notably absent. Viewed through this lens, Biden’s policies seem to be more and more about maintaining American dominance than “rebuilding the middle class.”
Despite the Democrats’ identitarian posturing, they have done little for the 80 percent of the American workforce that is employed in the service sector, which is racially and gender diverse.
Beyond the issues of nationalism and protectionism, there are serious questions about whether industrial policy in the Global North — especially in relation to decarbonization — will work.
Vivek Chibber stresses that for industrial policy to be effective, it must be able to effectively discipline capital, ensuring that subsidies are used properly and firms remain competitive. Recent policies in the EU and United States have been inconsistent on this front. Democrats like Pramila Jayapal and Elizabeth Warren have been raising alarm bells about Wall Street influence over the CHIPS Act, questioning who receives funding and the impact of stock buybacks. This echoes Daniela Gabor’s concept of “derisking,” which describes how recent industrial policies aimed at decarbonization in the Global North often safeguard private capital while lacking sufficient disciplinary mechanisms. James Galbraith adds that neoliberalism has hollowed out the capacity of many states to pursue industrial policy effectively. Compared to the West, China’s advantages are obvious and cannot simply be chalked up to “unfair practices.” China’s dominance in solar power is a prime example.
This situation puts unions in a bind, and labor is not unified on the issue. It is not surprising that the United Auto Workers has come out strong for the Kamala Harris campaign. While the union clearly wants to prevent the most regressive aspects of a potential second Trump administration, it also has a vested interest in keeping Bidenomics alive (though it’s uncertain if Harris would continue that approach).
This can be contrasted with the Teamsters, a union representing workers in transportation, parcel delivery, warehouses, and many other sectors of logistics and services. While many rank-and-file Teamsters support Trump, there is also a strategic logic to playing the Republicans and Democrats off each other. While there is no shortage of reasons as to why playing nice with Republicans is a mistake for labor, the Teamsters rely less on Democratic-backed industrial policy, giving them more flexibility in navigating the political landscape.
Associational Power
There are no easy answers when outlining a long-term vision for labor. Simply being skeptical about aspects of Bidenomics, industrial policy, and protectionism only goes so far. The labor movement’s positions on these issues will have both immediate and lasting consequences and the fate of industrial workers looms large. Ignoring them risks pushing them to the Right at a time when support from energy workers is essential for decarbonizing the power grid.
Manufacturing workers present an even thornier issue. There is ongoing debate over whether EV production will create more jobs, though the argument that it will increase employment is currently winning. However, long-term factors could limit job growth in sectors like EVs. None of the policies promoting EV production in the Global North protect against automation, and if these workers aren’t unionized, they may face work intensification that keeps employment numbers down.
Both automation and intensification have been frequently overlooked causes of manufacturing job losses in previous decades, which are frequently blamed on trade, especially with China. Additionally, a serious decarbonization push would likely require a major expansion of public transportation, which would dampen demand for personal EVs.
Under these circumstances, envisioning a just transition beyond fossil fuel sectors may become necessary. Nevertheless, if EV and battery supply chains are built, they need to be organized. Avoiding these questions now only fuels backlash against all green initiatives. We need to confront the fact that the Left has placed its hope in industrial policies tied to great power competition, which may not be able to provide long-term jobs.
There are still numerous opportunities for creating jobs by retraining workers to install clean energy, retrofit buildings, and address infrastructure deficits. However, the question remains: What will the labor movement of the future look like? Some of it is already taking shape, albeit slowly. In 2003, Beverly J. Silver’s seminal Forces of Labor: Workers’ Movements and Globalization Since 1870 offered a prescient analysis of the challenges facing the labor movement in the twenty-first century. Silver examined the relocation of jobs in the auto sector from the Global North to the Global South, leading to the rise of new, often militant, working classes in the Global South. She accurately predicted increasing labor unrest in China as it became the new workshop of the world. She also anticipated that labor movements in countries where manufacturing was in decline would reconstitute themselves to operate in a post-Fordist environment.
In this post-Fordist world, associational power — the strength of unions with mass membership and high solidarity — would replace the structural power workers once had by disrupting assembly lines. But unlike in the twentieth century, today there is no single dominant industry like auto manufacturing or textiles.
We need to confront the fact that the Left has placed its hope in industrial policies tied to great power competition, which may not be able to provide long-term jobs.
Silver identified opportunities for the labor movement in the twenty-first century in sectors such as transportation, semiconductors, producer services, education, and personal services. Transportation is the most obvious exception to the rule in terms of the decline to structural power, with workers still able to disrupt economies with strikes. The semiconductor industry is critical due to its intersection with industrial policy and national security, as exemplified by the CHIPS Act, which aims to boost domestic production and reduce reliance on foreign supply chains.
In services, where most of the global working class in the Global North now operates, labor has the opportunity to advance. Some producer services can be outsourced, likely creating a new digital working class in South Asia, but sectors vulnerable to campaigns like Justice for Janitors cannot be simply relocated. Education, as seen in movements like the Chicago Teachers Union and the worker strike wave of 2018–19, has also made real gains, though there is still work to be done. Personal services, though seemingly difficult to organize due to its dispersed nature, have also seen successes, such as the strides made by Starbucks workers, though huge challenges remain due to the sheer number of locations.
Beyond Industrial Nostalgia
Since Silver outlined the possibilities innate to these sectors, several notable economic developments have occurred. There has been an increased focus on health care workers, which is unsurprising, given their essential role in social reproduction, much like education workers. These jobs cannot be outsourced, and it’s no coincidence that the late Jane McAlevey prioritized organizing in both education and health care.
Another major development has been the rise of the gig economy. With its dispersed nature, evasion of regulation, and entrepreneurial rhetoric, it may seem like an unlikely sector for labor organizing. However, gig workers have mounted significant protests globally. These protests, largely involving what Jamie Woodcock and Mark Graham call “geographically tethered” gig work (like rideshare and delivery, distinct from online gig work), have demonstrated potential. These workers can coordinate across multiple countries and even identify new choke points, such as disrupting airports, offering new avenues for labor internationalism.
Finally, logistics has grown to be the lifeblood of modern capitalism, encompassing everything from transoceanic shipping to distribution centers for retailers like Amazon and Walmart. This sector is full of choke points and its workforce is young and racially diverse. While organizing efforts in logistics have been a focus in labor circles for years, there have been major victories recently, such as the UPS agreement, and progress in organizing Amazon and Walmart. The East Coast longshore strike was a powerful demonstration of the sector’s importance to the public. Given the length and complexity of global supply chains, logistics also presents opportunities for international labor cooperation.
These examples show that there are still many opportunities for labor to organize and expand its influence in sectors where unions have historically had little presence. Relying on the state to recreate industrial employment, especially in a way that bolsters great power competition, is a risky strategy for labor. While it may pay dividends in the short term, there is nothing to guarantee its long-term success.
The labor movement also must play a constructive role in addressing the climate crisis. As Dani Rodrik points out, “A glut in renewables and green products is precisely what the climate doctor ordered.” Labor movements in the Global North should push their governments to use diplomacy for economic compromises and agreements with China, fostering a collaborative green transition instead of a competitive one, while still protecting some jobs.
We have entered a new era that combines neoliberalism’s inequality and upward wealth distribution with increased state interventionism. This interventionism is reluctant to discipline capital to achieve economic and climate goals. How labor movements respond to these circumstances will determine their viability as well as outcomes on issues of climate change and global peace. Given the challenges — and the fact that the case for de-globalization is grossly overstated — progressive internationalism may hold more promise for labor’s future than a nationalist focus.