The reindustrialization of the USA, which Trump wants to force through his protectionism, is being undermined by automation trends in industry.
June 6, 2025, by Tomasz Konicz – Translation by OlIver Blackwell
What does Donald Trump want? Since the so-called “Liberation Day” at the beginning of April, when the right-wing populist announced the introduction of comprehensive tariffs for almost the entire late capitalist world, Washington’s specific regulations, tariff rates and exemptions have been changing almost on a weekly basis. The economic uncertainty that Trump’s protectionism brings with it is considered by economists to be an important factor that could contribute to an economic slowdown or even recession in the US. Companies and corporations cannot calculate reliably, the flow of trade between the US and China has largely come to a standstill, and supply bottlenecks in the US can hardly be avoided despite the latest postponement in the trans-Pacific trade war.
Link: https://exitinenglish.com/2025/06/06/trump-at-the-inner-barrier-of-capital/
First and foremost, it is around seven million industrial jobs that Donald Trump wants back. For more than 40 years, employment in the industrial sector in the United States has been declining, from just under 20 million industrial workers in 1978 to just under 13 million in 2023.[1] Between 2002 and 2022, the number of industrial companies in the United States fell by 45,000, which corresponds to a decline of around 14% within two decades.[2] This deindustrialization of the US has led to the very social disruption that has once again propelled Trump into office – and the White House must confront this misery, precisely because the increasingly authoritarian Trump administration can hardly afford to be voted out of office without ending up in prison due to multiple obvious violations of the law. The consolidation of an authoritarian regime in the United States can only be achieved by socially immobilizing broad sections of the population, similar to what Putin was able to do in Russia.
And, from a narrow-minded national perspective, the connections are clear: the deindustrialization of the US goes hand in hand with the creation of massive trade deficits with China and German Europe in the age of globalization. Last year, the United States recorded a new record deficit of $1.21 trillion,[3] which is far above the highs during the US housing bubble in 2006 (786 billion) and the post-Covid era in 2022 (971 billion).[4] Last year, the US recorded a deficit of $295 billion with the People’s Republic of China alone,[5] while the figure for the EU was $235 billion, of which Germany accounted for $84 billion.[6] Trade surpluses are used to export deindustrialization and debt, which also formed the core of the German beggar-thy-neighbor economic model at the height of globalization. This correlation is also manifested in the share of industrial production in total GDP,[7] which in 2023 was around 26% in China, 18.5% in the FRG and only around 10% in the US (in the 1970s it was still just under 25%).[8]
So is this a big scam, as the Trump administration is postulating in order to legitimize its protectionism? The relationship between job losses in the industrial sector and the actual output of US industry makes it clear that it was primarily competition-mediated productivity increases that led to the deindustrialization of the US. Between 1980 and 2000, during the same period in which the industrial workforce in the United States fell from just under 19 million to 17 million,[9] US industrial output roughly doubled (percentage figures from the Fed, in inflation-adjusted 2017 prices).[10]
Rising industrial production with declining employment in the industrial sector is an expression of the rationalization push in commodity production in the course of the IT revolution from the 1980s onwards; it is the empirically verifiable consequence of the inner barrier of capital – the competition-mediated tendency of the capitalist valorization process to get rid of its own substance, the value-forming labor in commodity production. Even in the 21st century, when the US industrial workforce shrank massively (from 17 million to just under 13 million), the output of this shrinking industrial workforce stagnated without a corresponding decline (the crisis-related slumps in industrial output in 2009 and 2020 were quickly reversed).[11]
What’s more, according to the National Association of Manufacturers,[12] value added in the United States amounted to around $2.93 trillion in 2024 (in 2010 it was just under $1.8 trillion, in 1997 only $1.38 trillion),[13] with the United States paradoxically growing primarily in foreign trade. Manufacturing exports have more than doubled in the last two decades, from $622.3 billion in 2002 to $1.63 trillion in 2024. What is Trump and his entourage upset about? Well, in the same period – the heyday of globalization – the volume of world trade has more than tripled: from $4.9 trillion in 2000, to $9.8 trillion in 2010, to $15.7 trillion in 2023. The US’ share of world trade has thus fallen – to 7.9% in 2023.
The opposing trends in capitalist commodity production – which lacks new labor-intensive fields of valorization – were also noticed and addressed by US monetary policy. As early as 2014, the US Federal Reserve noted that industrial production in the United States was continuing to grow (with the exception of short-term slumps caused by the crisis), while employment was not, meaning that “industrial growth is not synonymous with growth in industrial jobs.”[14] The Fed offered “productivity growth” and a shift in sectoral focus towards “computers and electronics” as explanations.
Trump’s protectionist policy thus appears to be failing due to the increasingly clear inner barrier of capital, the relentless melting away of the mass of spent labor in commodity production as a result of competition-mediated rationalization (the idea that capitalism could be reproduced as a financial market-driven service society was already disgraced in 2008). This is particularly evident in the development in China, where Trump’s protectionism believes it has recovered its lost industrial jobs. Even in the state capitalist workshop of the world, which owes its economic rise to millions of mercilessly exploited cheap workers, automation tendencies are spreading ever faster.
China is now the global leader in the installation of industrial robots. By 2023, the People’s Republic had already overtaken Japan and Germany in the automation of goods production: 470 industrial robots per 10,000 wage earners were in use in China, compared to 419 in Germany and 429 in Japan.[15] The dynamics of this automation push are dizzying: in 2023, more than twice as many robots were put into operation in the People’s Republic than in the next five industrialized countries combined. The world’s automating workshop accounted for more than 50% of global demand for robots in 2023.[16] Meanwhile, forecasts predict that the People’s Republic will become the center of robotics, with more than half of humanoid robot production predicted to be based there this year.[17]
And it is precisely Trump’s protectionism that is tempting capital to further boost automation in reshoring in the United States. According to the US automation service provider Formic, which specializes in the leasing of industrial robots, the general uncertainty caused by the trade disputes led to a 17% increase in the use of robots at the beginning of 2025. The new settlements of industrial companies, which Trump’s capricious customs regime is intended to provoke, would also be built at the globally applicable productivity level, which would entail a high degree of automation. Chinese robotics manufacturers in particular are likely to sense new market opportunities here. Trump’s crazy idea that millions of US wage earners would manufacture smartphones by hand is becoming obsolete, even in China, due to rapidly advancing automation.
Ultimately, however, Trump’s reshoring fantasies are milquetoast calculations that overlook the connection between declining industrial production and the inflated global financial markets. Hyper-productive global industrial production – especially in China – was dependent on a global deficit economy with the US at the center of deficit cycles in which global debt has risen faster than global economic output since the 1980s. And it is precisely this deficit economy, realized by means of increasing financial bubbles, that has been extinguished since the major inflationary surge of 2020, after the central banks had to curb their expansive monetary policy. According to the IMF, global debt fell between 2021 and 2023, contributing to the global economic slowdown, the widening of the US deficit and the increasing destabilization of the globalized world economy through deficit cycles.[18]
The erratic, contradictory behavior of the White House mentioned at the beginning is above all an expression of this contradiction: the US trade deficit is exploding because its trading partners are having to rely more heavily on exports due to the economic slowdown, while Trump’s protectionist measures are jeopardizing the dollar’s position as the world’s reserve currency and causing turmoil on the US bond markets. Trump expected turbulence with his protectionist turnaround, which is why he wanted to initiate it as soon as he took office – but it was the rapid rise in interest rates on US government bonds that forced him to reverse course. In the meantime, US trading partners such as Japan are threatening to sell US government bonds during negotiations.[19] It is effectively the nuclear option in the trade war, which also highlights the absurd state of late capitalist commodity production, whose production surpluses are exported to the US, which can borrow in the world’s reserve currency as the measure of value of all commodities.
[1] https://www.bls.gov/opub/btn/volume-9/forty-years-of-falling-manufacturing-employment.htm
[2] https://www.visualcapitalist.com/the-decline-of-u-s-manufacturing-by-sector/
[3] https://www.bea.gov/news/2025/us-international-trade-goods-and-services-december-and-annual-2024
[4] https://www.macrotrends.net/global-metrics/countries/USA/united-states/trade-balance-deficit
[5] https://ustr.gov/countries-regions/china-mongolia-taiwan/peoples-republic-china
[6] https://www.fool.com/research/us-trade-balance/
[7] https://ourworldindata.org/grapher/manufacturing-value-added-to-gdp
[8] https://fred.stlouisfed.org/series/USAPEFANA
[9] https://fred.stlouisfed.org/series/MANEMP
[10] https://fred.stlouisfed.org/series/IPMAN
[11] https://fred.stlouisfed.org/series/OUTMS
[12] https://nam.org/mfgdata/facts-about-manufacturing-expanded/
[13] https://www.macrotrends.net/global-metrics/countries/USA/united-states/manufacturing-output
[14] https://fredblog.stlouisfed.org/2014/12/manufacturing-is-growing-even-when-manufacturing-jobs-are-not/
[15] https://archive.ph/bL8tt#selection-1101.15-1101.47
[16] https://ifr.org/downloads/press2018/2024-SEP-24_IFR_press_release_World_Robotics_2024_-_China.pdf
[17] https://www.asiamanufacturingreview.com/news/china-to-manufacture-half-of-world-s-humanoid-robots-by-2025-nwid-1613.html
[18] https://www.imf.org/en/Blogs/Articles/2024/12/02/persistent-fall-in-private-borrowing-brings-global-debt-down
[19] https://thediplomat.com/2025/05/how-japans-1-1-trillion-in-us-treasuries-became-a-strategic-lever-in-the-new-tariff-war/
Originally published on konicz.info on 05/26/2025