Branko Milanovic on What Comes After Globalization

Speakers say rising U.S. political instability—driven by broad anti‑elite sentiment that mobilized roughly 77 million voters and persistent immigration/border salience—has pushed policymakers toward externalizing blame by targeting China (tariffs and outward‑focused tools) rather than adopting redistributive domestic reforms like higher taxes or transfers.

Since around 2016 Western governments have coalesced on a Trump‑era posture toward China, creating bipartisan continuity and intensified China‑targeted economic policy that is being paired with reshoring initiatives to rebuild domestic industrial and military‑relevant capacity hollowed out by highly efficient Chinese production (for example, Chinese EV competition affecting Germany).

Speakers warn that China's unprecedented concentration of production and decades of compounding growth could produce a 'China shock' extending beyond manufacturing into finance, services and jobs, and that this shift risks crowding out other countries' normal mid‑level industrialization pathways.

China's inward cultural preferences—media and readers focused largely on domestic audiences—limit its soft power projection abroad, while Xi Jinping's recent interventions to curb wealthy entrepreneurs and block or control major IPOs underscore a sharper boundary between private fortune and political power.

Post‑Mao China rapidly expanded capitalist classes and redirects SOE retained earnings into strategic infrastructure, technology and overseas influence, yet its consumption‑to‑GDP ratio is only around 45%—a pattern blamed on wage compression and weak rural social protection—which means continued high Chinese growth can mechanically increase measured global inequality unless poorer regions also grow.