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A tidal wave of cheap Chinese imports floods the national market.
Industries reel, companies crumble and factories close their doors for good.
The livelihoods of countless families disintegrate.
This could be a description of the original “China Shock,” the long-term result of the United States’ policy of “free trade” with China, which cost America 2.4 million jobs between 1999 and 2011.
But it also describes what countries across the globe are facing right now: a massive glut of vital industrial inputs and high-value goods, courtesy of Chinese overproduction.
Just look at Latin America, where a sudden inundation of Chinese imports has dragged Brazil’s chemical industry to its lowest point on record and driven Chile’s sole remaining steel mill out of business.
Look at Asia, where India and Vietnam are investigating a variety of market disruptions.
Or look at Europe, where UK machinery manufacturers have been forced to sell their products at a loss and Chinese-made automobiles have seized a third of the EU’s electric vehicle market in less than five years.
This “China Shock 2.0” could devastate a slew of national economies.
And its impacts could be even “more fundamental” than those of the first China Shock, experts say, because they involve industries more critical to countries’ survival.
Gone are the days when China’s manufacturing ambitions seemed limited to cheap toys and apparel.
Today, Beijing openly touts its aims to position China as the sole supplier of commodities and high-tech goods that other countries would cease to function without.
And yet, across the globe, elites invested in the economic status quo are determined to . . . do nothing.
German Chancellor Olaf Scholz and Spanish Prime Minister Pedro Sanchez are examples.
Their nations’ auto industries rake in short-term profits from car sales in China and Chinese investments in their own EV companies.
In other words, they are dependent on good terms with Beijing.
To no one’s surprise, they are actively undermining EU plans to hike tariffs on Chinese-made EVs.
Another example comes from the International Monetary Fund.
This multinational agency stands for “open, stable, and transparent trade policies,” the polar opposite of Chinese export dumping.
Yet IMF economists are diverting blame from Beijing’s industrial policies to “macro forces” due to the COVID-19 pandemic — while chastising the United States for defending domestic production.
Why?
Simply put, the institution is biased by Beijing’s membership, and its economists are blinded by their free-trade fundamentalist training.
The truth is that Chinese overproduction is far from accidental: The Chinese Communist Party laid out its plan to dominate global trade in vital industrial inputs and high-value goods almost 10 years ago.
My office rang the alarm on that plan in 2019, but the world’s response was too little, too late.
Now, as my office’s latest research demonstrates, Beijing has near-total control over the supply chains of industries that will define the 21st century.
This threatens countless non-Chinese companies — and the working families who rely on them — in countries across the world.
It also threatens the national security of the United States.
After all, the more dependent we are on our chief adversary for critical goods, the more easily that adversary can cut us off from those goods.
The CCP is already flexing this power with new restrictions on antimony, a metal that’s crucial to the production of many military supplies, including bullets, missiles and nuclear weapons.
Half of the world’s supply comes from China, which means Beijing’s new trade restrictions are purposefully throwing our defense industrial base into disarray.
It’s not the first time we have experienced this tactic: Beijing curbed shipments of medical supplies during the COVID pandemic and restricted exports of minerals critical to semiconductor manufacturing last year.
All this is only a taste of what China’s supply-chain dominance can do.
To secure our economic independence, we must challenge that dominance.
We must invest more in domestic production, identify non-Chinese sources of critical inputs, deregulate our stifled manufacturing sector and hike tariffs on Chinese imports.
We must ensure those tariffs cover Chinese companies that seek to evade them by setting up shop in third countries like Mexico.
And we must strengthen protections against Beijing’s spying and intellectual-property theft.
Other countries must do the same.
The evidence shows that “free trade” with China is a one-way ticket to broken industries, bankrupt businesses and widespread unemployment — as well as to security dependence on a power-hungry dictatorship.
Whatever leaders hope to gain from riding the tiger, whatever value elites see in taking a second China Shock lying down, no short-term profits are worth that dreadful cost.
Marco Rubio (R) is a US senator from Florida.