China’s foreign policy will, entirely correctly, take advantage of the departure of anti-China hawk Steve Bannon from the White House to attempt to continue to convince the Trump administration that the policy in the interests of both countries is a ‘win-win’ one. This policy is clearly correct whatever the immediate results. If, most favourably, reasonable forces in the White House gain control of policy then the results of China-US economic and geopolitical cooperation will aid both countries. If anti-China forces gain control of US policy then it is important for other countries, and the people of the United States, to see as clearly as possible that it was US neo-cons which created tension which will damage both the US people and third countries.
But whatever the outcome there should be no illusions. Bannon, and the forces he represents, will remain a powerful factor in US politics due to the destabilisation of Western politics. Bannon may have left the White House but the forces he represents remain powerful both due to their resources and their strategic understanding of key features of current Western politics. Whether or not ‘Bannonism’ will gain control of the White House in the future remains to be seen, but it will continue to remain influential within US politics. Indeed, Bannon made clear in one of his first declarations after leaving the White House that he continues to support Trump, and is seeking to free him from forces Bannon conceives as against Bannon’s long term goals and his long term opponents within US policy making:'If there’s any confusion out there, let me clear it up: I’m leaving the White House and going to war for Trump against his opponents -- on Capitol Hill, in the media, and in corporate America,” he told Bloomberg. '
To put it in an aphorism Bannon is on vacation from the White House, he hasn’t left it permanently. To understand why it is necessary to grasp Bannon’s grasp of key features of present politics.
Bannon will have money
The most superficial, but nevertheless important, reason Bannon and those around him will continue to have influence is because they will be extremely well funded. Even before formally leaving the White House Bannon immediately made contact with his long-time backers the billionaire Mercer family.
Axios, the US news website which broke the news of Bannon’s departure from the White House, reported: ‘Steve Bannon's next moves will be all about the billionaire Mercer family... Bob Mercer and Steve Bannon had a five hour meeting Wednesday to plot out next steps, said a source with knowledge of the meeting.’
Bannon has at his disposal Breitbart news, which the Mercers have also supported. As Axios confirmed: ‘A source familiar with Breitbart's operations told me they would go "thermonuclear" against "globalists" that Bannon and his friends believe are ruining the Trump administration, and by extension, America…. this war — which has already begun — [is] against White House officials like HR McMaster, Dina Powell, Gary Cohn, and Jared and Ivanka."
Breitbart News itself reported ‘Steve Bannon Meets with Billionaire Mercer Family as He Prepares for War’. It noted: ‘Friends of Bannon said that he “felt liberated… ” and could… return to Breitbart News, where he was once executive chairman, to operate what he reportedly calls a “killing machine.” Breitbart News later confirmed he had returned to them as Executive Chairman.
With billionaire financial backing and a major news outlet under his direct control Bannon and the forces he represents have ample resources.
But still more significantly Bannon has a correct grasp of key features of US and Western politics and therefore a clear strategic line.
The destabilisation of Western politics
Bannon understands that Western politics has been made profoundly unstable. The traditional Western political ‘centre ground’ is being steadily eroded by the economic and social effects of the ‘Great Stagnation’ of the Western economies since the international financial crisis. Average Western economic growth is now slower than in the Great Depression – the details may be found in ‘China Faces Slower Western Growth than in the Great Depression’. The result is that Western politics, including US politics has been fundamentally destabilised – as analysed in ‘The ‘Anglo-Saxon’ Political Crisis - from Reagan & Thatcher to Trump & Brexit.’
Of the major Atlantic advanced economies only Germany, which has the highest per capita economic growth since the financial crisis, has escaped serious political destabilisation. The other major countries of this region have seen the steady rise of forces to both the right and left of the old ‘political centre’.
As he anticipates the erosion of the US political centre Bannon and those around him seek to create a right-wing US coalition on an anti-China line. As he put it in his final interview before leaving the White House, with the ‘The American Prospect’ magazine: “To me,” Bannon said, “the economic war with China is everything. And we have to be maniacally focused on that."
Bannon’s aim is to create an alliance of the US right and what may be termed the US ‘fake left’ around an anti-China basis. As Bannon put it in his interview with Robert Kuttner, co-editor of The American Prospect, which is a 'progressive' US publication: 'Bannon explained that his strategy is to battle the trade doves inside the administration while building an outside coalition of trade hawks that includes left as well as right. Hence the phone call to me.'
This US ‘fake left’, of the type of Hillary Clinton and others within the Democratic Party, and of which parallel forces exist in other Western countries, is the one that supports US military interventions abroad, that supports a US military build-up against China, that supports sanctions against Russia etc. This ‘fake left’ is to be contrasted to the real Western left, of the type of Sanders or Corbyn, which opposes Western austerity policies and such foreign policy measures – Corbyn, for example, is a strong opponent of US military build-up against China, Sanders voted against sanctions against Russia.
The conclusion which follows from these trends and events is clear. It would be wrong to be excessively alarmist. The Western economies, although not breaking out of their fundamental very slow growth, will undergo a moderate upturn in 2017 – which means there will be no very short term breakthrough of either ‘radical right’ or ‘radical left’ forces. But the underlying very slow growth of the Western economies means the forces represented by Bannon will not disappear – and China must be prepared for this at the same time as it rightly seeks ‘win-win’ solutions with the present Trump administration.
In particular the following trends should be anticipated:
Again, to put it in an aphorism, Bannon has gone on vacation from the White House, but Bannonism is, and will remain, very alive in US politics.