Adam Tooze · Great Power Politics: What was Bidenomics?

As sparks​ fly up from the welding rods, the beak of a bald eagle emblazoned on the welder’s mask curves menacingly towards the viewer. With comic-book subtlety the image screams: American industrial power at work. It’s an image of industrialism more redolent of socialist realism or the New Deal than of the 21st century. And yet there is nothing tongue in cheek about it. The image adorns the front cover of the National Defence Industrial Strategy, a document released at the start of what would turn out to be Joe Biden’s final year in office. Across its glossy pages, a roster of contemporary Americans weld things, move molten metal in and out of furnaces, and haul their bulky bodies through cargo planes. It’s Top Gun meets McKinsey, well-lit, diverse, globally minded, filled with clichéd 20th-century Americanisms and entirely in earnest.

Presenting the document at the Pentagon, its author, Laura Taylor-Kale, underscored the need for the state to boost its defence industry as America’s adversaries build up their military power to levels not seen since the Second World War. She noted the intensifying threat of China upending the existing international order, and America’s continued support for Ukraine as it defends itself from Russian aggression and for Israel in its fight against Hamas. ‘This arsenal of democracy helped win both world wars and the Cold War,’ she said. ‘And long into the future, it can and must provide that same enduring advantage in support of integrated deterrence.’ These are the production lines that will feed the artillery battles in Ukraine and Israel’s relentless bombardment of Gaza and Lebanon: Second World War revivalism in a slick 21st-century package. If the Trump administration was the policy equivalent of pulp fiction, the style of the Biden administration was a blend of high-end Ralph Lauren and Andy Warhol.

We can use the past tense because, whatever happens in the election, Bidenism is over. The project anchored on the long-serving senator from Delaware and Obama’s vice president had one term in it. Up until the last moments, his entourage closed ranks to deny this fact. They clung on even though, as Bob Woodward reveals in his new book, War, it was clear already in June 2023 that Biden was failing.* It wasn’t until a year later that they, unwillingly, accepted that a man born in 1942, during the autumn of Stalingrad and El Alamein, was not fit to run for president in 2024. The fact that his opponent wasn’t fit to run either is another matter.

We are left asking how this four-year period fits into recent American history and what legacy it leaves. The National Defence Industrial Strategy (NDIS) offers to do some of the work for us. Like other, better-known documents of the Biden era – Jake Sullivan’s speech on ‘Renewing American Economic Leadership’ at the Brookings Institution in April 2023, for instance – the NDIS is historically self-conscious. The basic Biden narrative was of America’s fall from greatness, starting in the 1990s, when the industrial fabric of the nation began to fray and China’s manufacturing capacity surged. Now China and other competitors are rising fast. The home front is undermined by polarisation and social dysfunction. But, with measures such as the Inflation Reduction Act, the CHIPS Act (which increased spending on semiconductor research), the bipartisan infrastructure law and the NDIS, the Biden administration was attempting a national rebuilding centred on industrial production and a revalorisation of manual work.

One of the sleights of hand this narrative performed was to claim the current moment, and Biden’s response to it, as unprecedented. In his Brookings speech, Sullivan announced that the administration was calling time on neoliberalism. In his farewell letter, Biden described the IRA as the biggest climate measure in history. The NDIS is supposed to be the first document of its type ever issued by the Pentagon. In fact, neoliberalism lives on precisely because it continuously reinvents itself. The IRA may be a first in the US, but Europe puts more money into climate solutions and China’s subsidies for its microchips industry are four times those of the US. The facts were less important, however, than the claim of novelty. Bidenism wanted to respond to America’s many crises not with orthodoxy but by making a historically significant break.

In October 2023, Sullivan wrote in Foreign Affairs, the house journal of the US foreign policy establishment, that the world had entered the third era of American power since the Second World War. The article seemed to be modelled on one of George Kennan’s famous memos staking out the terrain of the Cold War. As a source of inspiration, the Kennedy moonshot moment has some appeal. But within the Biden administration, it was the 1930s and 1940s that captured the imagination. Jigar Shah, who runs a $400 billion loan programme at the Department of Energy, liked to evoke the Second World War in his attempts to inspire America to do ‘big things in a very short period of time’.

The irony, of course, is that this narrative is anything but new. In all but name, this is MAGA, and credit for it belongs to the Trump team in the 2016 campaign. If we were to date it precisely, as good a moment as any would be Trump’s speech to the Republican National Convention on Thursday, 21 July 2016, in which he portrayed the nation as besieged by violence and terrorism. That moment was telling because President Obama responded in the following days that he saw a very different country. Americans weren’t living in a gothic world of doom. They were taking their kids to school and to sports camp. They were getting on with finding real solutions to real problems. Trump wasn’t all that Republican or even conservative, he implied; Trump was just weird. Come November 2016, however, it wasn’t Trump but Obama who seemed out of touch. Obama would afterwards face the accusation, not just from Republicans but from those in his own party, that he had failed to recognise the discontent brewing in American society. The Biden team were determined not to make that mistake.

This wasn’t entirely fair to Obama. As a young senator, he had warned of a brewing crisis in American society and urged fundamental reform. As president, his term of office was defined by the 2008 financial crisis and its long aftermath. In response he passed not just a major cyclical stimulus, but also the Dodd-Frank Act, to regulate finance, and Obamacare, the single most significant domestic policy reform in decades. But Obama was enough of a man of the 1990s to believe that crisis was temporary and normality was just that, the norm. It would return.

That assumption ended with Trump and Biden, both of whom believed that things were not well in America and that they must provide a historic turning point. The grisly name given to this darker version of reality in Trump’s 2017 inauguration speech was ‘American carnage’. To judge by the more grotesque moments in his stump speeches in 2024, Trump now takes carnage more literally than ever. (Deporting pet-eating illegal immigrants would, he said at one rally, be ‘bloody’.) Then, as now, it is a crude obfuscation of the actual ills afflicting American society. There is a reason policymakers have been talking about ‘deaths of despair’ since 2015: the life expectancy of working-class Americans of all races is declining, and not because of migration.

The Trump presidency was empty of actual achievement. Other than crude protectionism and lopsided tax cuts, its domestic policy agenda was negligible. Even though ‘healthcare socialism’ supposedly posed a mortal threat to American freedom, the Republican-controlled Congress didn’t manage to repeal Obamacare. Trump’s most significant legacy was his administration’s redefinition of the US National Security Strategy, which directed the Pentagon (and its $850 billion budget) away from the war on terror and towards Great Power competition. For the first time, China was defined as what American defence planners call the ‘pacing threat’ – not simply a long-term challenge to US power but an immediate military threat. Despite Trump’s alleged personal proclivities, Russia was number two on the list. Documents such as NDIS blend the industrial policy style of Bidenomics with the national security policy agenda set under Trump.

For all his lacklustre legislative performance, Trump was riding high in early 2020. Markets were booming. He was confident of re-election, for which he thought it best to dispense with any policy platform at all. Those dreams were crushed by a crisis for which Trump was the least well suited of all recent presidents – a pandemic with obscure origins in China. He answered with erratic conspiracy theories and failed to counter vaccine scepticism among the Republican faithful, which had the effect of raising America’s death toll to 1.2 million. But to reduce the Trump administration’s response to Covid to a matter of science denial, a theme beloved of American liberals, is to miss the obvious. If the Covid crisis had a viable solution it was not mask-wearing or social distancing. The solution was the vaccine. And in the American case, as for much of the world’s more fortunate population, the key vaccines, produced by Moderna and Pfizer, came out of the Trump administration’s Warp Speed programme.

The name may have been silly, but not only did Warp Speed deliver a remarkable medico-industrial breakthrough, in the process it shaped a new economic policy focused on making lots of important, high-tech stuff fast. In other words, Trump delivered the first demonstration of an industrial policy that a short time later would be claimed as the great historical novelty of Bidenomics. Indeed, if any industrial policy can claim to have helped revive the economy and improve ordinary life for the average American, it is Operation Warp Speed not the CHIPS Act or the IRA.

Biden’s team saw Trump not as a precursor, however, but as a symptom. The problem was not his sense of unease but how narrowly he defined it. Trump worries about migration, the dilapidation of American cities, foreign car imports and the state of America’s airports. The Biden team agreed with the diagnosis of malaise but interpreted it in far more capacious terms. They declared a triple threat: to US democracy from within, to Western hegemony from the rise of China, and to humanity as a whole from global environmental threats such as Covid and climate breakdown. You could argue that this is the consensus among centrists the world over. European policymakers agree with this account, so do their equivalents in Brazil or Australia and the crowd at Davos. The difference is that the diagnosis adopted in Washington matters, both because of America’s power and because of the intensity of America’s problems at home.

At the federal level, the US today barely has a functioning welfare state. This was exposed by Covid, when it became clear that not only did the government lack the administrative and legal infrastructure to implement a sophisticated furlough scheme, it didn’t have a functioning unemployment insurance system either. The Covid relief measures had to be as large as they were in part to make up for this lack of institutional structure. The $2 trillion CARES (Coronavirus Aid, Relief and Economic Security) Act of March 2020 showed that if you threw money at the problem, you could alleviate seemingly chronic conditions such as child poverty.

Republicans voted for the measures in 2020, because Trump was in the White House. But it was the Democrats, who took control of Congress two years earlier, who set the pace and, in so doing, prepared the way for Bidenomics. The left of the party had rallied around the Green New Deal, a climate policy combined with a vision for the US economy centred on a new welfare programme, which would help the country’s diverse and predominantly female working class. It had an industrial component, of course, but that sector is only a small part of the economy and the workforce. This momentum followed through into the Biden administration’s first year, with the $1.9 trillion American Rescue Plan in March 2021. Meanwhile, the longer-range vision of the Green New Deal morphed into the promise of Build Back Better, which included what Biden called his ‘American Families Plan’.

The agenda of the Democrats in 2021 was as radical and comprehensive as anything seen in American politics since the Great Society programmes of the 1960s. What they lacked was a broad base in Congress. The late runoff Senate elections in Georgia had given them only a wafer-thin majority. The hope was that a radical legislative programme could break the political impasse and secure a lasting majority for progressive reform. For that they needed unity, and they didn’t have it. There was no social policy reform under Biden to compare with Obamacare. Build Back Better was negotiated away in the struggle to hold the party majority together. Joe Manchin, the senator for West Virginia, a state with a population far smaller than that of Brooklyn and a life expectancy lower than that of North Korea, shredded the bill. Manchin didn’t want welfare spending, and he wanted higher taxes to pay for any other spending. The equally right-wing senator from Arizona, Kyrsten Sinema, vetoed any talk of taxes. What passed in the end was not the capacious ecological and feminist vision of Build Back Better, but the bipartisan infrastructure act, CHIPS and the IRA. What do they have in common? They are industrial, productivist and framed in terms of hostility to China.

The IRA was undeniably a breakthrough. The Democrats managed to do in 2022 what they had failed to do under both Obama and Clinton: they passed major climate legislation, even if they didn’t call it that. The IRA uses tax credits to incentivise green energy investment, while avoiding the carbon pricing and taxing of earlier attempts. It has turned obscure administrative offices such as the Loan Programmes Office of the Department of Energy into powerhouses of the energy transition. It is also overtly protectionist, reshoring everything from solar panels to electric vehicles, wrapping the cause of green energy in Red, White and Blue. Europe was more than a little impressed. The $370 billion in the IRA for clean energy sounds like a lot of money; its boosters project that private investment will take that sum up to $1 trillion or more. But this money is spread over ten years and the US economy comes to over $20 trillion. As a share of GDP, the baseline commitment of the IRA is less than 1 per cent. That is modest compared to EU subsidy levels or those available for China’s green energy champions. Rather than a revolutionary demonstration of American might, the IRA’s ingenuity is a reflection of the political constraints under which it was devised.

What​ America has avoided under Biden is austerity. Coming on the back of trillions of dollars in Covid stimulus, the American Rescue Plan hurled the US into the most successful recovery on record. Politicians including Manchin and Nancy Pelosi harped on about fiscal responsibility, but it was plain that one of the other important shifts of the Trump era was the unfettering of the US government from conventional notions of budget balance. This shouldn’t have come as a surprise. Reagan didn’t balance the budget. George W. Bush didn’t balance it either. Trump didn’t even make a pretence of doing so. Since the enormous pro-rich tax cut of 2017, the taps were open. There are figures at the heart of both parties who would like to have a debate about spending priorities and revenue raising, but they are stymied on the left and the right by the huge electoral constituencies that protect the big welfare programmes and tax cuts.

Advocates of adventurous monetary theories such as MMT once earned clicks by arguing that American democracy must overcome its deficit fixation. There is precious little sign of that in Washington today. But that doesn’t mean that America’s huge fiscal capacity is available for constructive governance. On the contrary, constructive spending proposals like Build Back Better were swept off the table as ‘unaffordable’. The tax credits that halved child poverty during the pandemic were revoked for being too expensive. Imaginative proposals to provide the World Bank and the IMF with new capital – among other things to compete with Chinese lending – were reduced to trivialities by Congressional in-fighting.

The US has thus found itself with a government budget defined on the expenditure side by defence and non-discretionary programmes such as Medicare, on the revenue side by an undersized tax base concentrated heavily on higher income households, and an overall balance that is stuck in deficit. It is constraining to government, light touch when it comes to taxation and generates a huge flow of new debt for financial markets to digest. In 2024, with the economy humming along close to full employment, the deficit stands at an unprecedented 6 per cent of GDP. The signature programmes of Bidenomics – IRA, CHIPS and infrastructure – are minor adornments to this basic picture. Although the new era of industrial policy has excited think tanks around the world, and although it has real consequences on the ground, it barely figures in the budget balance and is largely unknown to the American public. Conservatives do talk about debt sustainability. Dark warnings of an inflationary disaster, for example, summoned by goldbugs and the crypto crowd, have created demand for so-called ‘safe haven’ assets. But there is no real threat to the financing of American government. Even with a slower pace of foreign purchases, the debt markets have absorbed record US Treasury issuance. There is no sign of any decline in the dollar as reserve currency.

The Biden administration did have to ride out a panic in 2021-22, when worldwide supply chain disruption, compounded by Russia’s attack on Ukraine, sent the price of many commodities rocketing. Amid much talk of a return to the 1970s, Larry Summers and other war horses of the Clinton and Obama administrations came out of pasture to castigate Biden’s spendthrift policy. But from early 2022 the Fed hiked rates and inflation proved to be transitory. The outrageous increases in food, rent and energy prices – poorly captured in the indices used by the Fed to set monetary policy – have left a legacy of bitterness that may cost the Democrats the election. But contrary to the grim predictions of Summers et al, inflation has come down without a disastrous surge in unemployment.

Allowing for the scale of the Covid shock, the macroeconomic record of the Biden administration could hardly be better. And given the lack of major social policies, macroeconomics has been the chief tonic for American society. The huge surge in unemployment during the pandemic could have been a disaster for working-class Americans. Thanks to open-handed fiscal and monetary policy, it has been the opposite. As growth in the US has pushed ahead of other advanced economies, the labour market has run hot. Though inflation has hurt, the wages of those in low-pay sectors have surged, creating the most dramatic reduction in inequality in decades. Trade unions are more prominent and popular with the public than at any time in living memory. The observation that they have grown more popular as they have become less powerful shouldn’t cause us to underestimate the shift.

National productivism, the common denominator of GOP and Democratic politics since 2016, can embrace both employers and workers. It can even embrace domestic consumers, the majority of whom are working class, if anti-trust and price-busting measures are pitched as increasing supply and expanding markets. That is the way the anti-trust team of the Biden administration presented their aggressive assault on monopolistic price-fixing.

Trump liked to appear in the White House flanked by trade unionists. Biden went one better. In a spectacular display in September 2023, he showed up on a United Auto Workers picket line. It was unprecedented, but it was also revealing. Why was the president on a picket line? Why was he not making policy? The short answer is that there was little hope of passing any legislation after the Democrats lost their Congressional majority in the mid-terms. Progress depended on winning in 2024, so Biden switched to campaign mode, trying, gamely, to rally the blue-collar vote. Halfway through most presidencies, domestic politics stops being about legislating, and becomes about preparing for the next election. In so far as there was policymaking in the second half of Biden’s term, it revolved around things the White House could control, chief among them foreign policy.

The role​ the US played internationally under Biden was quite unlike that during his immediate predecessors’ terms in office. Under Obama, a steady pair of hands, America’s principal international role was in orchestrating recovery from the 2008 financial crisis. As far as alliances were concerned, Trump was far from steady, but when the world economy shook in 2020, the Fed showed up again, pumping liquidity into financial markets on an even more spectacular scale than in 2008. Biden didn’t have to deal with a worldwide economic emergency. The crises that dominated his presidency were crises of foreign affairs – so much so that his acolytes liked to refer to him as a ‘wartime president’.

The title of Woodward’s new book, War, captures the drama of international events over the past four years, but in its narrow and arbitrary focus on Biden’s ‘wars’ with Trump, Putin and Hamas, this rushed book presents a one-sided picture of Biden’s period in office. We are given a portrait of a team of talented and resourceful fire-fighters, engaged in a series of struggles of good v. evil. In the process, Woodward almost entirely obscures the actual pivot of Biden’s strategy: the confrontation with China. Ukraine and the Middle East are, in the calculus of the Biden team, clearly subordinate to the challenge of China, and it is with regard to China that we see the Biden team co-ordinating global alliances including Nato, AUKUS and the Quad like no administration since Reagan or George H.W. Bush.

The Biden team may have agreed with the previous administration about the international challenges faced by the US, but their most fundamental disagreement was over alliances. This was a matter of temperament. Trump is crudely unilateral and transactional. Biden, Blinken and Sullivan liked the spotlight of the international stage. As one early account had it, Biden ‘enjoys the hell out of being the Leader of the Free World’. His team considered alliances a source of strength, but also as something greater than that. Never mind that the UN General Assembly and governments representing a majority of the world’s population repeatedly failed to follow America’s lead, the defence of universal values demands a global stage, and for Biden and his team that meant Nato and the G7.

But the other lesson of the Biden era is that those alliances expose the US to entanglements and unexpected crises. First in Ukraine and then in the Middle East after 7 October last year, the Biden administration has been forced to widen its strategy. It did not choose either conflict, but hasn’t pushed hard for an end to the violence. Instead, it has chosen to widen the front beyond its original focus on China. As a result, it is now involved in high-risk struggles in three arenas – East Asia, Ukraine and the Middle East – that entail a fundamental rewriting of the post-Cold War order.

When Russia invaded Crimea in 2014 Obama took a back seat, allowing Germany and France to run the Minsk process. To the frustration of hawks undeterred by the debacle in Libya, Obama limited America’s engagement in Syria. Biden insisted on the withdrawal from Afghanistan in 2021. And he has been careful to avoid direct engagement of US forces in most arenas. But the NDIS reflects the fact that the US has become engaged to an unprecedented degree in supporting sustained large-scale war both in Ukraine and in the Middle East. One of Biden’s favourite phrases, ‘arsenal of democracy’, is straight out of the World War Two dictionary. As Democratic speaker of the House, Nancy Pelosi liked to note that her father had voted for the first Lend-Lease bill to aid Britain in 1941 and she was now doing the same for Ukraine. In a mindboggling throwback to the 20th century, the NDIS hails America’s effort to revive the production of 155 mm shells. These, it turns out, are the common denominator in the two major wars of the moment. It also tells us something about the technological level of those conflicts.

Since its 20th-century industrial capacity is atrophied, America’s new manufacturing lines for shells are equipped with forging machinery imported from Turkey. In a strange echo of the PPE panics of the Covid era, Nato is now worrying about securing enough cotton for the explosive charges in artillery ammunition. But American production diplomacy goes well beyond such basic equipment. Over the medium term the US is involved in highly sophisticated programmes like the European missile shield and the F35 aircraft programme, two new priorities of German defence policy since 2022.

Above all, the US has supported the global energy market. Biden presented himself as a climate president. But what changed during his term wasn’t US ‘leadership’ in clean energy, but America’s position in the global fossil fuel economy. Biden inherited the legacy of fracking investments made under both Obama and Trump, and production of oil and gas has surged since 2021. The US is now the largest ever producer of hydrocarbon energy. American oil and gas have helped to keep the lights on and the boilers burning in Europe and Asia. This was the geopolitical rationale for the expansion of shale energy in the 2000s and the debacle of Bush’s policy in Iraq. Far from the promise of the Green New Deal, it is those arguing for US autonomy in fossil fuels who will see themselves vindicated by the events of the last four years.

As dramatic as the shale surge has been, the Biden administration would have liked to have seen more. In December 2022, as sanctions against Russia intensified, Biden’s chief energy policy adviser, Amos Hochstein, denounced Wall Street as un-American for hobbling further investment in fracking in the interests of something as petty as profit maximisation. The current crisis in the Middle East has revealed the importance of energy to the administration and to Middle East experts including Hochstein and Brett McGurk. McGurk is a true-blue neocon veteran of the Iraq invasion of 2003, who served under both Obama and Trump. Hochstein started his adult life in the IDF and has alternated between government service and oil and gas lobbying. McGurk reputedly views Middle East politics through a resource lens to a degree that shocks even his colleagues. Hochstein likes to boast about driving an electric Mustang, but his mantra as far as energy goes is simply more, more and more. Both of them apparently see Israel’s current campaign as an opportunity to resume the reordering of the Middle East that has stalled since the Abraham Accords between Israel and the Emirates in 2020.

Other than​ military hardware and fossil energy, the force that both stretches and challenges US power is technology. While the launch of the first smartphones and of social media framed the Obama presidency, and Trump was the Twitter president, Biden’s term may well be remembered for the breakthrough of AI and ChatGPT. The AI boom powered a gigantic stock market run-up led by Nvidia and the other Mag 7 companies, which include Apple and Meta. Nothing adds more to the mood of bourgeois America. But from a Great Power point of view this technological shock is ambivalent. Apple is the case in point. The world’s first three trillion-dollar business owes its success to design labs in California and a highly sophisticated supply chain in China. Apple is the success story of Chimerica. Whether in Taiwan, South Korea, Japan, the UK, Germany or the Netherlands, high tech everywhere depends on integration with production in China and derives significant market share from sales there. The mass production of microelectronics for consumption in countless applications all over the world is the most sophisticated example of the human division of labour our species has ever realised.

One task to which American power is now dedicated is the minimisation of China’s role in that supply chain. Again, this didn’t begin under Biden. It started with Obama. The American campaign against Huawei commenced in earnest under Trump. But the Biden team has doubled down, both ramping up negative measures and introducing a new level of subsidy in the form of the CHIPS Act. It is no coincidence that books on strategic sanctions, including Nicholas Mulder’s The Economic Weapon and Chris Miller’s Chip War, both published in 2022, have been Beltway hits. This is the kind of economic history the new age requires.

It is unclear whether this campaign can succeed. Can America be made into something more than a mere auxiliary to the Taiwan-centred production network that currently dominates the microelectronics industry? Does the US have a credible competitor to TSMC (Taiwan Semiconductor Manufacturing Company) in the area of ultra high-end chip fabrication? Is Intel, America’s ailing champion, salvageable? And, finally, for all the ballyhoo around the CHIPS Act, $40 billion will probably not be sufficient to compete in the chip game. Even setting aside the huge funds that China is making available, private firms such as Samsung invest that kind of sum annually. As Biden’s term comes to an end, it is telling that officials including the commerce secretary, Gina Raimondo, are lobbying for a second effort from Congress.

But whatever the immediate answer, microelectronics are pivotal because in this domain more than any other we see the basic aspiration of state power. Tech won the first Cold War. In tech, above all, the US must remain not just strong, but dominant. As far as China is concerned, America’s aim is not to create a level playing field but to ensure by any means necessary, including forceful interventions in private business trade and investment decisions, that China is held back and the US preserves its decisive edge.

It is hard to overstate the decisiveness and import of that position. It is a departure from a purely economic understanding of globalisation. It is unabashedly confrontational and from China’s point of view the menace is clear. America’s more liberal-minded spokespeople may talk about America limiting itself to defending a small yard with a high fence. But what is inside that fence is clearly everything that matters to state power in the current moment.

The analysis of Great Power competition first formulated as a basis for US foreign policy in the Trump era has been put into practice under Biden. And the particular significance of the high-tech struggle is that it confirms to an almost embarrassing degree the claim used to justify the aggression of the more overtly revisionist powers of the current moment. The contention of Russia and China is that their revisionism is justified by the fact that the status quo ante was shaped to America’s advantage in the unipolar moment of the 1990s. Make of that what you will with regard to Ukraine or the South China Sea; in the tech space, this is what the United States itself now says out loud. Globalisation was an American project, from which American businesses profited handsomely, until technological and industrial developments threatened to undermine US state power in the most important area of modern technology. At that point, the American state changed the rules, joining the revisionists.

The result is that at the same time as the Pentagon is organising to supply munitions to Nato, Ukraine and Israel, the US has also effectively declared a limited economic war against China. As the Treasury secretary, Janet Yellen, spelled out in an unabashed address, Washington sees many areas in which China can grow without challenging US leadership. But any progress in more sensitive areas will be met by American countermeasures. Even if Beijing didn’t have the intention of establishing itself as the hegemon in East Asia, this would constitute a fundamental constraint on its sovereignty. Europeans, as well as those in Japan and South Korea, may be used to paying this price for the benefit of America’s security umbrella. China rejects the terms of the bargain altogether.

If financial crisis haunted Obama and the pandemic brought disaster to Trump, it is under Biden that the prospect of Great Power war has shifted from Pentagon planning documents to a manifest threat. This is a historic shift. Of course, since the end of the Cold War, the US and its coalitions of the willing have launched several Great Power interventions. But they did so when their enemies were weak and without risk of escalation.

Under Trump there was a moment in which many feared a nuclear confrontation with North Korea. But that was defused. The situation since 2022 is far more ominous. All the Great Powers have signalled their willingness to up the ante. In Ukraine this takes the form of a high-intensity proxy war. Following the dramatic success of Ukraine’s counter-offensive in the autumn of 2022, White House intelligence warned that there was a 50:50 chance of Russia engaging in a nuclear escalation that would immeasurably increase the risk of Nato involvement. Nevertheless, when the chairman of the joint chiefs of staff, General Milley, suggested it was time to negotiate a ceasefire, he was silenced by the White House.

Only months later, China and the US faced off directly over Taiwan and the spectacularly mishandled balloon incident. It was an open secret in Washington in early 2023 that the military command chain was bracing for imminent confrontation. The leaks about US generals readying their troops for a war with China in 2025 should be taken at face value. Over the coming months, this escalation was also walked back. But we should be under no illusion: there has been nothing like this level of threat since the dangerous final phase of the Cold War in the early 1980s. With China committed to a rapid build-up of its nuclear arsenal, we are well on the way to an unprecedented three-way nuclear standoff.

The response in Washington is predictable, given the prevailing mood. The Pentagon and its allies are preparing for a gigantic push for nuclear force modernisation and expansion. This is not comprehensible at the relatively domestic scale of the NDIS with its welding masks, shell production lines and hand-launched drones. It dwarfs the green industrial policy of the Inflation Reduction Act and the CHIPS investments. Nuclear modernisation will cost more than $1.5 trillion over the next thirty years.

It is not the expense that is shocking. Intercontinental ballistic missiles on atomic submarines lurking deep in the world’s oceans are, relatively speaking, a cheap form of deterrence. You could even think of them as sustainable. Barring accidents they have a minimal carbon footprint. Large-scale conventional defence would be far more expensive and dirty. That is why mutually assured destruction came to dominate defence policy from the 1950s onwards.

The daunting historical significance of the policies on tech and nuclear weapons that have been enacted under Biden is that they mark the definitive and self-conscious end of the globalising post-Cold War moment. This was a while in the making. The Obama presidency felt the first tremors. The US is obviously not the only accelerant – far from it. The challenge posed by Russia and China is real. But what has been so striking and concerning about the Biden administration is its lack of imagination in answering them. It doubled down on historic claims to US leadership ranging from the Second World War, via the space race, to the 1990s unipolar moment. And yet for all the gestures to historical grandeur, American statecraft of the 2020s is threadbare. To sell a clean energy Marshall Plan in Washington today, start by dismissing any pretension to the complex hegemonic calculus of the original. What the moment calls for is an America First export promotion. The alternative on offer from Trump’s team is even less substantial and far more unpredictable. If nothing better emerges in the coming years, the outlook is for a grim escalation of tension between a changing world and a vision of American power that, though technologically sophisticated, is in political terms increasingly anachronistic.

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