Diplomacy & Crisis News

Last year, with heavy earthmoving equipment behind him, President Joe Biden proclaimed, “The future of the chip industry is going to be made in America.” His aspirational rhetoric was equal parts political opportunism and wishful thinking, fueled by the passage of the CHIPS and Science Act, which authorized $53 billion in incentives for U.S. semiconductor manufacturing.

Perhaps there was reason for optimism. The president delivered his speech as Intel Corp. broke ground in rural New Albany, Ohio for a $20 billion chip fabrication plant. The construction alone would create 7,000 jobs, while the new “fabs” would employ 3,000 workers, each earning an average of $135,000 per year. But that happy day was not the end of the story; it was just the beginning.

Ten months later, just before Independence Day, the Chinese Communist Party struck back against U.S. industrial policy by announcing new export controls on gallium and germanium, set to take effect on August 1. These minerals are critical components in a host of advanced technologies, including semiconductors. Moreover, China corners the market on them. Business insiders don’t hesitate to say that Beijing’s export controls “will have an immediate ripple effect on the semiconductor industry.”

So much for that speech on the construction lot. When President Biden bragged about America’s economic future, it seems he forgot our greatest economic vulnerability: our supply chains’ deep dependence on a regime that wants to weaken and ultimately overtake the United States. This is unsurprising because the president has a decades-long track record of being wrong about China. Unfortunately, his naiveté—or whatever you want to call not learning a lesson in half a century—is infectious.

In April, when National Security Advisor Jake Sullivan tried to acknowledge the threat of Communist China, he summed up the appropriate response as “protecting our foundational technologies with a small yard and a high fence.” That’s a fun turn of phrase, but small yards with high fences don’t offer much protection if you have to go outside the yard for everything you need to maintain it. That is exactly what’s happening now.

In the case of chips, the Biden team assumed government subsidies and export controls on advanced technology would vault U.S. industry to the top. CHIPS Act subsidies will almost certainly increase our production capacity. But through an insane loophole, companies can also invest in China to build so-called “legacy” chips. The Biden administration’s export controls are similarly weak, allowing companies like Nvidia and Intel to sell China advanced chips to build its artificial intelligence sector. Meanwhile, Beijing’s controls on gallium and germanium show the Chinese Communist Party still wields lots of leverage—and isn’t afraid to use it.

U.S. innovation is important, but innovation alone won’t make our economy less reliant on our adversaries. At this moment, China controls 63 percent of the world’s rare earth minerals and 85 percent of its mineral processing capacity. If Beijing cut us off, as it cut off Japan in 2010, we would be at China’s mercy. All our fancy factories and machines would be useless.

The same dynamic plagues the Biden administration’s “green transition” investments, especially those tied to the Inflation Reduction Act (IRA). President Biden touts this law as an industrial policy aimed at creating jobs and increasing our economic resilience. Yet there are inherent flaws with the legislation that prevent that from occurring. For instance, because the IRA simply seeks to expand solar power in the United States without addressing Beijing’s grip on global solar panel supply chains, it is actively strengthening that grip, sending obscene quantities of cash to Chinese companies—even ones that profit from Uyghur slave labor.

These missteps squander public trust. If we aren’t careful, they will destroy people’s faith in our ability to rebuild and reindustrialize our economy. That would be tragic because there’s a lot we can do to make America a manufacturing power again. And if we fail, the consequences for our national security will be dire. After all, gallium and germanium aren’t just essential to semiconductor manufacturing—they are also key components in weapon systems. Why would China’s communist overlords grant U.S. defense contractors access to these minerals in the event of a military standoff? They probably won’t. This should serve as a wake-up call to Washington and our defense contractors—some of which, like Raytheon, are naively hoping China will play nice.   

What’s more, export controls on a handful of critical minerals barely scratch the surface of China’s economic leverage. Imagine the havoc Beijing could wreak by depriving America of pharmaceutical ingredients or the $100 billion’s worth of electrical machinery we import every year. The United States will not be safe until we act to eliminate these vulnerabilities.

To do so effectively, the Biden administration must move beyond end product-focused projects and begin securing critical supply chains from start to finish. Undeniably, this will be more difficult than throwing money at companies compromised by China. Nevertheless, it is what the American people need and deserve if they are to remain free and prosperous throughout the twenty-first century.

Marco Rubio is the senior U.S. senator from Florida. He is also the vice chairman of the Senate Intelligence Committee and a member of the Senate Foreign Relations Committee.

Image: Shutterstock. 

Since the United States has designated space a warfighting domain, similar to traditional warfighting environments such as air, land, and sea, the interest in the extraterrestrial plane from the American political, military, and industrial world has significantly increased. In 2021, the Biden administration unveiled its Space Priorities Framework, which reaffirmed the nation’s space objectives, helping to align the U.S. government's strategies with the rapid advancements of the American commercial space industry and safeguarding national interests in an increasingly competitive space domain. From this point of view, growing Russian Chinese space capabilities pose military and geopolitical challenges. To cope with these challenges, American policymakers also need their allies to strengthen their capabilities in this domain, particularly if these capabilities have transatlantic relevance and support NATO activities. This is precisely the case with Italy, with whom space has been at the core of cooperation between the two allies over the past years.

The recent diplomatic missions to the United States of Guido Crosetto, Antonio Tajani, and Adolfo Urso—respectively, Italian ministers of defense, foreign affairs, and enterprises—have highlighted the growing relevance of the space industry for this partnership. More importantly, Prime Minister Giorgia Meloni’s upcoming trip to Washington DC will devote significant attention to space issues.

From Draghi to Meloni: Continuity is the Keyword

From an industrial perspective, Italy stands out as one of the few nations whose businesses span the entire space value chain, including all upstream, midstream, and downstream operations across all major technological domains. The outgoing government of Mario Draghi released a “Digital Italy” white paper, presenting progress on this front while outlining the vision for the future.

According to this document, space represents a robust sector for Italy and an excellent opportunity for further development. The strategy for the years 2021–2026 commends the industry for “consolidating its presence in the so-called upstream sector: in launchers… satellites with multiple operational characteristics… crucial to enhance Earth observation capabilities, and… space modules functional to the exploration of space.”

On space policy, the continuity between the previous and the current government is striking, an important consideration for foreign governments and companies hoping to invest or collaborate. Italy is among the nine nations that earmark an annual budget of €1 billion ($1.04 billion) for their space sectors. Regarding investment relative to GDP, Italy ranks sixth globally, trailing just behind India and Germany. In an industry globally known for the presence of prominent actors, in Italy is peculiar the relevance for this sector of small and medium-sized enterprises (SMEs).

SMEs constitute an astonishing 80 percent of the national space industry and employ more than 7,000 people. Italy is also a notable contributor to the European Space Agency (ESA) ranking as the third-largest donor after Germany and France.

The Partnership with the United States

Space was at the center of Minister Urso’s agenda in DC. He met Chirag Parikh, the Executive Secretary of the National Space Council. The bilateral conversation underscored the intent to fortify the collaboration on space exploration. Urso emphasized that “global challenges are played out in space” while acknowledging the numerous collaborations with the United States.

These collaborations include participation in the International Space Station (ISS) and the Artemis program—Italy was among the first to sign to the latter, even expressing interest through a joint statement in September 2020—human spaceflight, lunar exploration, scientific missions, and numerous agreements with NASA and private corporations. Urso also unveiled that talks have commenced for a Technology Safeguards Agreement (TSA), expressing hope for a swift conclusion of these negotiations and aiming towards a reciprocal arrangement with the United States.

Interestingly, Minister Urso engaged with a delegation of representatives from leading U.S. space and aerospace corporations. The intent was to cultivate cooperation based on a B2B (business-to-business) approach, transcending government boundaries and extending to the industrial realm. The goal is stimulating interaction and collaboration between businesses, moving beyond mere institutional dialogue. This approach represents a strategic step towards a comprehensive bilateral partnership, underscoring the potential for cross-sector collaborations and a more agile approach to building partnerships in the space industry.

Anticipating the retirement of the ISS and the surge in the commercialization of low Earth orbit, the Italian Air Force has struck a deal with the Texas-based company Axiom, a key player in the construction of commercial space stations. In early March, the Italian Air Force signed an agreement to guarantee Italian Air Force (ItAF) training and an Air Force astronaut's mission participation from the ISS to Earth. This agreement builds upon the joint activities initiated between the two organizations in 2018, further cementing the Italian Air Force’s position in space exploration and commercialization.

Axiom Space is at the forefront of innovative space infrastructure, collaborating with NASA to construct the first commercial space station. In 2025, the first module manufactured by Axiom will link to the second node of the International Space Station (ISS), slated for retirement in 2031. This arrangement will expand the habitability and functionality of the ISS before these modules ultimately detach to form a completely independent residential and commercial entity in space.

This memorandum positions the Italian government and private sector to contribute substantially to the future space economy. It allows participation in building, utilizing, and marketing space infrastructures. The agreement allows for expansive collaboration, particularly the “definition of technological solutions and operational concepts for an Italian module that could subsequently be developed and integrated into the Axiom Space Station.”

The Geopolitics of Space

Developing this sector has several significant geopolitical implications for Italy. This sector is increasingly gaining transatlantic momentum: reflecting this growing interest, NATO recognized space as a major operational domain in 2019, while the 2022 Strategic Concept frequently references space issues. Italy is among those few NATO-allied nations possessing space capabilities, which it avails to the organization through sharing and pooling.

For other Transatlantic partners, the positioning of Italy as a trailblazer in space exploration is worth noting. However, the strategic value of Italy as a partner in the space sector to the United States, and more broadly NATO, transcends immediate bilateral cooperation and expertise sharing within the alliance, as it also has other dimensions.

For instance, Italy’s prowess in this domain could also prove instrumental in other geographies, such as the Mediterranean and Africa, where space-based capabilities can have a significant impact and represent a tool to contain the influence of other actors. For instance, Italy boasts substantial experience in Earth observation, which could equip Mediterranean and African partners with capabilities in diverse sectors, including agriculture, water scarcity management, extreme weather events, and natural disaster prediction.

Italy is introducing the “Iride” program, poised to become a crucial satellite program for low Earth orbit observation. This program will deliver eight core services: marine and coastal monitoring, air quality, land movement monitoring, land cover, hydro-meteorological climate, water resources monitoring, emergency management, and security. Crucially, Iride will generate analytical data to drive the development of commercial applications by startups, SMEs, and various industry sectors.

Cooperation on low Earth orbit observation could also be a key collaboration area with African partners. The Luigi Broglio Malindi Space Center positions Italy as an attractive partner for numerous countries on the continent. Established in 1966 and managed by the Italian Space Agency since 2004, the center is strategically located in Malindi on the Indian Ocean, near the Equator, which is crucial for achieving higher escape velocities for launch vehicles. Despite its potential, the site has only seen twenty-three launches, the latest in 1988.

Today, the center is a significant hub for receiving satellite and telemetry data, tracking launches, and other space objects. It forms an essential node in the cooperation network with other countries and space agencies such as NASA, ESA, France’s CNES, China’s CNSA, and others. During a state visit to Kenya in March of the current year, Italian president Sergio Mattarella toured the center and attempted to reinvigorate Italy’s partnerships with various African countries interested in advancing their space capabilities.

This element has obvious transatlantic implications: in recent years, China has tried to deepen cooperation with African countries in this domain, seeking to boost their space aspirations in a clear attempt to undermine U.S. supremacy in this field. As such, deepening ties with African countries could also be part of a responsible transatlantic burden-sharing approach, which has been a crucial topic of debate among NATO partners for a few years now.

The Case for Cooperation

The United States’ recognition of space as a warfighting domain, akin to traditional battlefields like air, land, and sea, has spurred considerable interest from the political, military, and industrial sectors to bolster capabilities to cope with potential challenges emanating from the space domain. Against this backdrop, the United States is also interested in bolstering space capabilities among its allies, focusing on those having transatlantic relevance and the potential to aid NATO activities.

The case of Italy served as a prime example of this, with space becoming a central pillar of cooperation between the two nations in recent years. Italy has shown a remarkable pledge to deepen its expertise and expand its presence in the space sector, establishing itself as a critical player in the global space community.

The recent ministerial visits underscored this commitment. The development of this industry has clear geopolitical implications, which can be relevant not only for Italy but also for the US. First and foremost, the emphasis is on strengthening Italy’s transatlantic synergies in this field, which is growing in significance due to the increasing recognition of space as a new crucial operational domain by NATO, but also represents a potential partner for many countries in Africa and the Mediterranean that need support on space activities.

On top of commercial and industrial considerations, the geopolitical logic of Italy’s development as a space actor is of particular relevance for the United States, as—if Rome continues to strengthen its space capabilities—it could provide robust help to Washington to cope with the risks and the challenges coming from this domain.

Dario Cristiani is a Senior Resident Fellow at the German Marshall Fund of the United States. Opinions expressed are solely of the author and do not express the views or opinions of the German Marshall Fund.

Image: Shutterstock.

Former CIA analyst Andrea Kendall-Taylor with the big-picture view on Russia’s war in Ukraine.

Deux ans après l'arrivée au pouvoir du parti de Mme Aung San Suu Kyi, la liberté d'expression est en fort déclin en Birmanie. Un verrou semble avoir été posé sur l'État de l'Arakan, où l'armée mène une campagne de nettoyage ethnique contre les Rohingyas. Entre menaces de mort et fausses nouvelles, la (...) / Asie du Sud-Est, Birmanie, Islam, Minorité nationale, Droits des minorités, Racisme, Religion, Violence, Répression - 2018/05

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Chinese president Xi Jinping, speaking to the Chinese Communist Party’s (CCP) 19th Congress in October 2017, announced: “It is time for us to take center stage in the world.” Yet a funny thing happened on the way to China’s coronation as a superpower: the very policies Xi implemented to transform his country into a global juggernaut are precisely what is gradually driving China toward an economic implosion.

For certain, Xi had help. The coronavirus pandemic and subsequent lockdown slowed domestic growth in China, much like it did for the rest of the world. And China is still the top trading partner for more than 120 countries—so it may seem premature to predict China’s economic decline. But the signs are there.

The Signs

First, China’s Belt and Road Initiative (BRI)—a trillion-dollar infrastructure push that was supposed to cement China’s role throughout the Global South—has unleashed a flood of unbridled corruption, pointless airports, failing dams, deep debt dependency, and widespread backlash. Instead of building loyalty to Beijing among leaders around the world, Chinese corruption has led opposition candidates to rise to power in unexpected places like Malaysia, Sri Lanka, and Indonesia—all while riding a wave of anti-Chinese sentiment. China is now far less popular around the world than it used to be.

Second, Xi has implemented a series of “national security” laws that make investment and business operations in China increasingly difficult. For example, Chinese “anti-espionage” laws make it illegal for international companies to collect even basic information about China or Chinese citizens. As a practical matter, this criminalizes basic corporate due diligence and know-your-customer safeguards—protocols whereby multinational companies look into their counterparties for risks of corruption, sanctions evasion, or human rights abuses. American laws, like the Foreign Corrupt Practices Act and the Uyghur Forced Labor Prevention Act, mandate that companies conduct robust due diligence and that such information is directly shared with corporate leadership. Firms that learn about the use of bribes or modern slavery would need to either violate Chinese law, by reporting the information to their leadership, or violate American law by not engaging in customary due diligence. U.S. counterintelligence officials have issued fresh warnings to American businesses about the risks these laws pose to basic operations and safety for companies and executives operating in China.

Additionally, a recent spate of raids on Western companies and detentions of senior employees demonstrate that Beijing intends to act aggressively against legitimate businesses engaged in standard due diligence in the country—actions that are likely to have major chilling effects on multinational corporations in China. The incompatibility between Chinese laws and global business practices will be even more stark when the European Union passes the much-anticipated Corporate Sustainability Due Diligence Directive, which requires multinationals to conduct comprehensive human rights, environmental, and labor rights due diligence throughout their value chains—a huge percentage of which currently pass through China. As time goes on, these jurisdictional conflicts will increasingly make it impossible for Western companies to operate or invest in China or to route their supply chains through China.

Beijing’s statute claiming the right to examine information and data collected by any Chinese business anywhere in the world is equally damaging. This law applies not only to state-owned entities but every mom-and-pop business operated by Chinese citizens in every single country —in effect turning the entire 10+ million Chinese population living abroad into a massive spying operation. The result of this law will make multinational companies and governments less likely to engage Chinese businesses outside of China, given that such businesses are legally required to pass all information from the transaction directly on to the Chinese Communist Party.

Third, taking for granted China’s role as the world’s largest exporter, Xi has disregarded the opinions of leaders in the countries that buy most of China’s goods. On human rights, on dismantling of Hong Kong’s democracy, on the Russian war, on fentanyl production, and on countless other topics, Western governments have pushed Beijing to rein in its controversial practices—overtures that China has roundly rejected as attempts at interference in its domestic affairs. This attitude ignores that these same countries are China’s main customers—and it is never a good idea to ignore your customers.

Now, new and proposed laws in the United States and Europe are forcing companies to disengage from countries, like China, that continue to brazenly employ forced labor. Furthermore, an increasingly confrontational Beijing has led many Western companies and governments to actively decouple from China or pursue a “China Plus One” strategy by keeping some operations in China while creating supply chain redundancies in alternative locations. China’s economy is still export-dependent, with more than 20 percent of its GDP coming from exports and 40 percent of those being sent to North America and Europe. Ironically, the pandemic has increased dependency on exports to offset slowing domestic growth, putting a damper on the CCP’s objective of transitioning to a consumption-based economy.

Given its substantial domestic economic headwinds and its collapsing real estate market, exporting the economy out of trouble is often a central element of Beijing’s economic recovery plans. But its political intransigence now threatens those exports and, in turn, large portions of its economy. 180 million Chinese workers are employed in jobs that depend upon exports and trade—more than the entire U.S. workforce. This becomes doubly risky for China as it seeks to pivot further away from low-cost manufacturing to producing more high-tech goods and components that are primarily aimed at high-income countries’ markets. Piled on top of that, the Biden administration’s highly anticipated Outbound Investment Executive Order will likely further limit China’s access to critical technology that Beijing will require for this transition.

Possible Paths

At the most basic economic level, China needs the United States—a fact that Xi clearly either hasn’t yet realized or refuses to admit. As a weakening export-driven economy, amid a bursting real estate bubble, with an aging population, the accelerating movement of Western companies and critical supply chains out of China is going to hit a tipping point where China loses economic power slowly and then all at once. This, combined with the Global South starting to push back on the BRI and Chinese meddling in the domestic politics of dependent nations will narrow the potential options left for China to take its time on “center stage.”

With the status quo of the last thirty years eroding, what pathways does China really have left?

Path 1: Appeasement

Given Xi’s policies to date, his temperament, and the domestic popularity of antagonizing the West, this path is almost certainly not on the table for the Chinese Communist Party. And yet, the best and easiest way for China to truly claim its place in the world as a superpower is to play nice with others. If Beijing were to reverse course on its national security laws; engage constructively and meaningfully on Uyghur rights, Taiwan, and Hong Kong; take steps to rein in corruption, money laundering, fentanyl production, and intellectual property theft; and reduce its surveillance state and pro-authoritarian support of global dictators and strongmen, then there is no doubt that the United States and Europe would readily and happily welcome China back into the economic fold. This path is the only way to truly salvage the Chinese economic miracle. China can claim this is all Western-values-based bullying, but the fact of the matter is that we are their customer and we are well within our rights to refuse to buy goods from countries that engage in slavery and actively seek to disrupt the global order.

Path 2: Division

Xi’s preferred path is to divide and conquer Western democracies—fundamentally driving a wedge between the interests of the United States and Europe in hopes of exploiting each. French president Emanuel Macron’s recent statements that France and Europe should take a path of “strategic autonomy” between China and the United States has bolstered Chinese hopes that a fractious and divided Europe can be easily driven apart from a partisan and divided America. And there is truth to the fact that democracies are loud and raucous in internal dissent and international disagreement—particularly in hyper-partisan times.

And yet, Xi’s miscalculation is to underestimate the motivations of a multinational private sector that shares a single, overarching, and unifying goal: to manage risk. While Western politicians banter about divergent approaches to a bellicose China, it is cautious and calculating boards of directors that increasingly are recognizing the costs of doing business in or with China. And while American laws undoubtedly contribute to the compliance-driven decisions of the modern company, it is the imminent EU Corporate Sustainability Due Diligence Directive that will force private companies to seek alternatives to a regime that fails to embrace responsible corporate governance. Once that happens, China will be unable to attract higher levels of Western investment and economic engagement, irrespective of the number of statements by presidents and prime ministers to the contrary.

Path 3: Resistance

China has long advocated for a multipolar global order to challenge the United States. In reality, however, the United States is just a dominant player in a carefully negotiated international financial system and interwoven global economy. If China seeks to build an alternative to the global economy and order, it is well within its rights to do that. It is unlikely, however, that other major economies have anything to gain by signing on to that. Instead, China will find itself increasingly limited to a rogue’s gallery of autocrats leading weak economies. Russia, which every day inches closer to becoming a failed state, is currently China’s largest ally. And certainly, Iran, Syria, Venezuela, North Korea, and Cuba would love to continue to align with China—but all of those countries combined have a GDP less than that of the Netherlands. This axis of authoritarians is hardly the sort of economic behemoth to fundamentally challenge the global economic order.

Path 4: Regression

Finally, China could downshift its high-octane economy and return to its roots as a producer of low-cost goods for export to the economies that are still within its orbit—the emerging economies of the Global South. And while the citizens of Kenya and Ecuador may resent China’s role in building overly expensive or unusable infrastructure under opaque and corruption-laden conditions, they still may be willing to sign up for cheap Chinese-made consumer products.

All Eyes on Xi

Ultimately, much will turn on what Xi, himself, wants to become. Does he seek a Vladimir Putin-like role as the king of a crumbling kingdom, or as a savvy technocrat that pivoted his country away from disaster by reengaging with the West? As the recent reversal of China’s zero-coronavirus policy shows, it is not impossible for Xi to abruptly change course.

China, as a country of citizens, must also choose its path—does it want to be led by a short-sighted CCP into an axis of weak authoritarian states that are surely on the downslope of history or does it want to re-engage with the global order as an economic leader that constructively engages with the Western world?

If today, Beijing maintained the status quo with Taiwan, provided substantial rights to the Uyghurs and other ethnic minorities, and removed onerous laws aimed at appropriate due diligence, Xi could re-inject China into the global order and be a peer to the United States for the next fifty years. If, instead, he digs in his heels and pushes disengagement with the West, Xi is very likely to become the leader most responsible for destroying his own standing on the global center stage.

Elaine Dezenski is senior director and head of the Center on Economic and Financial Power at the Foundation for Defense of Democracies.

The opinions expressed in this publication are those of the author. They do not purport to reflect the opinions or views of The National Interest or its editors.

Image: Shutterstock.

Autocratic producers, largely Russia, Iran, Saudi Arabia, the United Arab Emirates, Qatar, Venezuela, and China, and democratic consumers, fossil fuel-dependent nations, largely the so-called Global South, are convening and uniting over oil, gas, coal, petrochemicals, natural gas-derived fertilizers, and mined raw materials. This trend is detrimental for both the global climate and the United States.

China straddles both worlds as the largest producer and consumer of coal in the world and the second-largest consumer of all fossil fuels after the United States. The United States is the largest producer of oil and gas for now, but while government policies tamp down investment in future domestic production, U.S. energy companies scour the world to increase production to serve global markets.

It’s the autocratic countries who produce the fossil fuels that benefit from American production decline. This is due to the fact that the major democratic countries of the Global South— including India, Brazil, Indonesia, South Africa, etc.—who buy oil and gas products, need to feed their people, fuel their vehicles, and, in general, sustain, grow, and develop their economies at reasonable cost. 

Autocratic Russia, a giant energy producer, continues to sustain its economy and finance its war in Ukraine, playing defense and waiting for Western electorates to lose patience. Moscow counts on continued fossil fuel sales to consumer countries. Meanwhile, China is importing record amounts of oil and gas from Russia which makes China the largest financier of Russia’s war in Ukraine by far. China, courtesy of Saudi Arabia’s Aramco, is on the upswing in building new refineries, becoming a major petrochemical producer while U.S. energy policy to phase out fossil fuels has curtailed U.S. companies from making such investments.

Pursuing sweeping policies to address climate change, America and the West deride and downgrade the value of these lifeblood fossil fuel products for China (coal, oil, and gas), Russia (oil, gas, and coal), Saudi Arabia (oil and gas), and the relevant fossil fuel value of other producer nations. Western governments’ attitudes toward fossil fuels are derived from their fear of future climate change. Such attitudes create a deep and abiding conflict of interest over time between the West and both fossil fuel producers and consumers who see fossil fuel-dependent growth and development of their respective economies as paramount.

Herein lies the conundrum. If the United States and the West will not be major producers, where do consumers turn for their needed energy? Unfortunately, they turn to the producers who happen to be autocratic states—Russia, Iran, Saudi Arabia, the UAE, Qatar, and Venezuela— who respond to that need by increasing their oil and gas production to meet global demand while bolstering their economies and strengthening their governments in the process. Producers friendly to the West such as Saudi Arabia, the UAE, and Qatar are not the problem. Others are.

In a nutshell, the West’s cutbacks on fossil fuels are being replaced by fossil fuel production for consumers’ developing and expanding economies. And if producers make up for declining supply from America and the West to developing and growing consumers, which seems to be the case, the overall human contribution to climate change will remain essentially unchanged for now and actually grow into the future. 

Interesting to note that the United States is now importing environmentally-dirty crude oil from autocratic and adversary producer Venezuela, rather than expanding its own domestic production. Natural gas previously exported from Russia to Europe will soon be replaced by Exxon and Chevron from Algeria. 

Adding to the West’s dilemma regarding wind and solar energy alternatives, China dominates the world in the related technologies, manufacturing processes, and critical materials involved in the production of such “renewables” such as solar and wind energy. While U.S. politicians are ramping up talk about reducing dependence on China for critical items related to American economic and national security, a fossil fuels-denying West, ever more dependent on renewables like solar and wind, is subject to a new energy dependence on China.

It seems we are witnessing a geopolitical shift of historic proportions with fossil fuel-friendly China and the autocratic producers, the biggest winners, and fossil fuel-repressing democratic America and the West, the biggest losers. Plus, the democratic consumers are, more and more, beholden to the autocratic producers. You might think that energy supply and demand issues have something to do with some eighty nations staying neutral on the Ukraine war!

Russia and OPEC members have their single largest and ever-expanding market for their oil, gas, and raw material products in China, which in turn can increasingly manufacture whatever the producer nations need. China receives the fuels and raw materials to power and feed its vast energy-hungry, export-oriented industries and its immense agricultural economy. Other consumer nations will likewise purchase or trade for fossil fuel products from producers. The symbiosis between producers and consumers is clear.

And the West, including the United States, no matter how hard it tries, will continue to be dependent on fossil fuels from producers. The U.S. Energy Information Agency predicts that by 2050 the United States will still be 65 percent dependent on fossil fuels for its overall energy needs, as opposed to 79 percent today.

The Chinese manufacturing powerhouse and its rapidly advancing military will be enriched by an inevitable shift away from Western manufacturers who will see their costs and prices increase without reasonably priced fossil fuel-derived energy and derivative products. 

China’s 1.5 billion people, repressed, surveilled, and cajoled, are also disciplined, educated, and increasingly productive and wealthy. With the growing sophistication of its military, autocratic China is the biggest winner of all from the present Western strategy to abandon fossil fuels. And if the United States and the West continue along their present path of shifting away from fossil fuels, it is quite possible that autocratic producers will dominate the world, and China, soon to surpass the United States as their biggest consumer, will be the dominant player. 

Don Ritter holds a Science Doctorate from MIT and served fourteen years on the House of Representatives Energy and Commerce and Science and Technology Committees. After leaving Congress he created and led the National Environmental Policy Institute.

Image: Shutterstock.

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Editor Daniel Kurtz-Phelan and authors Samuel Charap, Fiona Hill, and Andriy Zagorodnyuk mark the launch of the July/August issue with a discussion of possible endgames in Ukraine.