Elizabeth Ingelson
In 2012, before he joined the Trump administration and before he became a convicted criminal, Peter Navarro, then best known as a maverick economist at UC Irvine, toured the United States launching a film he had made, Death by China. One of its signature images, used in promotional materials and featured in the film, is a knife, “Made in China” on its blade, stabbing a map of the United States right at the Midwestern heartland. As blood pools outwards from the wound, viewers see a Chinese banknote wrapped around the handle of the knife. Yearning for “small and mid-sized US manufacturers,” the film blends fear of Chinese power with an anti-corporate globalization scepticism. Linking the two is Made in China: a symbol, in Navarro’s depiction, of the increasing loss of American manufacturing jobs and the blame he places squarely on both large corporations and China’s ascension into the World Trade Organization in 2001.
Despite peddling nostalgia for small-scale manufacturing jobs, Navarro received significant funding for the film from Nucor, the United States’ second-largest steel company at the time. The giant steel corporation hardly represented the ideal of localised manufacturing that Navarro invoked. But this was no matter. Nucor benefitted from the message that domestic manufacturing needed to be protected. Steel was one of the most heavily subsidized U.S. industries and public support for manufacturing helped sustain that government handout. So too did Navarro’s future political career benefit from the longing for manufacturing. Five years after his filmmaking days, Navarro served as a key trade advisor in the Trump administration.[1] There, like Nucor, Navarro reaped mileage from the politically potent idea of protecting blue-collar manufacturing employment even as he helped implement policies that undermined conditions for working Americans.
In the opening decades of the twenty-first century, Made in China—found on the undersides of coffee mugs, stitched on the labels at the necks of dress shirts, or visible along the sides of kitchen knives—has become a potent symbol of globalization and its discontents. When journalist Sara Bongiorni decided to boycott Chinese goods in 2005, she chronicled her efforts in a book detailing “my year without Made in China.” As she surveyed the goods in her own home, she exposed readers to the deep entanglements that accompanied the globalized economy of the new millennium.
Yet at the heart of Made in China’s symbolic power lies a paradox. On the one hand, it has come to represent the epitome of globalized manufacturing. Goods marked with the label are produced along chains of supply that usually include multiple countries along the way. They travel the globe connecting people through a shared consumerism. On the other hand, the label is bound up with the nation-state. The goods Bongiorni boycotted or the trade restrictions imposed in more recent years are treated as means of targeting China. Marketing scholars describe this connection between country-of-origin labels and the nation state as “nation branding.”[2] If Made in China represented a threat to American manufacturing, then “Made in the USA” suggested its effects could be countered, too, by the nation-state. This is the twenty-first century paradox of Made in China: it simultaneously represents the nation-state and globalization.
This paradox is political rather than material. It has emerged from a politics that continues to benefit from framing trade in terms of the nation-state—China’s goods and the United States’ need to make more of its own. And it persists despite the transformations in global capitalism and manufacturing that have occurred over the last eighty years. It retains its power even though global value chains are a familiar part of the globalized landscape by now; most consumers understand that an iPhone labelled “designed in America, made in China” involves many other nations in its manufacturing process too. A book like Bongiorni’s is no longer a revelation explaining global interconnectedness.
Why, then, does framing manufacturing in terms of the nation state continue to hold such political potency in the United States? And what gets lost as a result? Part of the answer to the first question has to do, of course, with the formidable combination of nationalism and xenophobia that invoking “Made in China” can bring. The long history of yellow peril fears combined with the national pride engendered by the ameliorative “Made in the USA” have long been a winning combination in American politics. This is why the very first executive order President Biden passed in early 2021 was dubbed “Made in America.” It called for more federal agencies to use products produced within the United States. The fine-print of Biden’s executive order, however, reveals the messiness behind country-of-origin labels today. The standard for his Made in America plan would be met if only 55% of components were manufactured within the United States.
The political appeal of using country-of-origin labels to single out a nation for its perceived threat is not new. In the 1950s, it was “Made in Japan” that elicited political fearmongering. In 1956, for example, state legislatures in South Carolina and Alabama passed laws requiring all businesses stocking Japanese clothing to display signs declaring, “Japanese textiles sold here.” Punishable by a $100 fine and thirty-days imprisonment, the laws were part of a larger effort by textile managers and political leaders across the United States to condemn imports from Japan as harming the domestic textile industry.
In fact, country-of-origin labels as we know them today were first used precisely for identifying goods that were associated with particular nation-states. The labels were first introduced in the late nineteenth century in England. Then, it was German goods that elicited concerns. Beginning around the 1880s, a growing British fear of German industrial strength began to focus on labels declaring “Made in Germany.”
“Roam the house over, and the fateful mark will greet you at every turn, from the piano in your drawing-room to the mug on your kitchen dresser,” lamented Ernest Edwin Williams in his bestselling book of 1896. Over one hundred years before Bongiorni, he took readers on an imagined tour of their own homes, encouraging them to note the ubiquity of the labels. “As you rise from your heathrug you knock over an ornament on your mantelpiece,” he envisaged. “Picking up the pieces you read, on the bit that formed the base, ‘Manufactured in Germany.’”
By 1897, British policymakers passed the Merchandise Marks Act, which required country-of-origin labels for all imports. They hoped that with the labels they would encourage a consumer boycott of German imports to protect British industrial jobs. The boycott failed and instead elevated German goods and other imports to luxury items.[3] But the use of such labels remained. Three years later, in 1890, the United States passed its own labelling requirements under the McKinley Tariff Act.[4] Ultimately, country-of-origin labels, a political creation in the age of empires, became an integral part of international trade.
A deep nationalist sentiment underpinned the reactions to these labels, whether they emanated from late nineteenth century Britain or early twenty-first century United States. But this line connecting the twentieth century’s bookends also obscures important differences between them. Unlike imports of Ernest Edwin Williams’ days, those marked with Made in China no longer held literal significance. When British politicians implemented their laws in the late 1890s, they could be certain of the country whose workers had manufactured the goods simply by identifying where the ship had left. Merchandise Marks Act, 10 (2) stated “in the case of imported goods, evidence of the port of shipment shall be prima facie evidence of the place or country in which the goods were made or produced.” If the goods were imported on a ship that left Germany, they must have been made there too, the law outlined.[5]
In late nineteenth century, trade could be equated with the nation-state in ways that country-of-origin labels expressly denoted. But by the mid-twentieth century, the increasingly globalized flows of trade and finance changed the dynamic between nations and corporations. By century’s end, corporations and capital operated at transnational planes, often beyond the full jurisdiction and taxation of nation-states. Trade and manufacturing no longer held such direct ties with the nation, even as significant portions of it relied upon subsidies from the state.
What gets lost amidst the continued political power of country-of-origin labels despite the extraordinary changes in manufacturing and trade since the late-nineteenth century? What does “Made in China” hide? Part of the explanation can be found by looking more closely at the history of how “Made in China” emerged in the first place–both as a symbol of globalization and specifically in terms of U.S.-China trade. I chart this history in my forthcoming book, drawing together two of the most significant transformations of the 1970s: deindustrialization in the United States and diplomatic rapprochement with China. It was in this decade that Mao began to increase China’s trade for the first time since the communists’ victory in 1949. This was assisted by the United States’ lifting of its trade embargo, which had been in place for over twenty years. I argue that over the course of the decade, the interests of the Chinese state and US businesspeople began to align–at the expense of American workers and aided by American diplomats.
Two key factors stand out from this history of U.S.-China trade that help explain the continued political power involved in thinking of trade in terms of the nation-state. The first relates to business interests. Focusing on foreign-made goods deflects attention away from managers and corporations that have pursued cheap labor by moving to wherever manufacturing wages could be kept lowest, particularly, since the 1970s, to locations in East Asia. It is in the interests of major U.S. corporations to make China the problem, not their manufacturing practices. In the 1970s, the internationalization of manufacturing remained contested, including in Congress, which repeatedly introduced legislation that aimed to limit tax incentives for corporations’ offshore manufacturing, most particularly through the 1972 Foreign Investment Act.[6] Ultimately Congress could not pass the legislation and as the decade drew to a close, U.S. imports of manufactured goods increased dramatically. These imports did not complement but rather replaced domestic production.
As the patterns of global trade changed and U.S. corporations increasingly outsourced their manufacturing to cheaper sources of overseas labor, some business leaders saw China as holding the potential to not only join but also assist this process. China had long been a place upon which foreign businesspeople projected their economic hope. In the late 1890s, the United States’ Open Door policy, with its exuberant rhetoric promoting economic expansion, reinforced the idea that the China market could yield huge profit for surplus American goods through sales to its customers. By 1937 Carl Crow, an American journalist turned ad-man, crystalized these ideas in his bestselling book, 400 Million Customers. Crow’s evocative title quickly saw “four hundred million customers” become a metonym for the potential profits to be made from trade with China.
In the 1970s, when businesspeople from the United States and China began to trade with one another after over twenty years, the allure of wealth that had long drawn foreign businesspeople to China re-emerged among the new generation of American traders. Fascination, hope, excitement, frustration: emotions guided their decisions as much as hard-headed economics—often more so. They were driven by similar feelings to those of American businesspeople in the Open Door era, but U.S. merchants in the 1970s also began to see something new in the China market. Working alongside businesspeople in China, they reframed the meaning of trade. What had once been a fantasy of 400 million customers slowly started to become one of 800 million workers instead. For their part, pragmatists within the Chinese politburo experimented with ways of increasing their exports to fund their purchases of industrial goods. Both groups were met with considerable opposition from within their nations but their efforts nonetheless prevailed.
These efforts were assisted by the foreign policy priorities of U.S. policymakers at the time, the second major factor that gets hidden by country-of-origin labels. In the 1970s, U.S. policymakers prioritised diplomatic relations with China over the interests of American workers. From the very re-opening of trade ties in the early 1970s, organized U.S. labor representatives and workers, especially in the textile industry, warned of the impact that trade with China would have if greater industry safeguards were not implemented. As workers and organized labor in the United States protested the ways the increasingly globalizing world was emerging, they saw China as holding the potential to exacerbate these dynamics. In these early stages of economic relations, it was African American and Latina women in the U.S. textile industry who were most affected by the ways that trade with China was unfolding. And U.S. policymakers saw the concerns of these women of colour as a threat to the geopolitical discussions that were happening in Beijing and Washington.
These two factors—the deflection away from corporate behaviour and the prioritisation of geopolitics over labor interests—have continued to shape U.S. trade policy in general and its relations with China, in particular. They hide the fact that China did not cause the loss of manufacturing jobs in the United States.[7] Rather, the job losses were the result of changes within U.S. capitalism enabled by policies in Washington. American capital and manufacturing became increasingly internationalized in the 1970s, accelerated by the Nixon economic shock in 1971 and the Trade Act of 1974. By 1979, two political economists, Barry Bluestone and Bennett Harrison, warned of the recent “hypermobility of capital” that had led to “shuttered factories, displaced workers, and a newly emerging group of ghost towns.” As they sought to make sense of the processes they had lived through in the 1970s, Bluestone and Harrison formulated a new term to describe corporate decisions to withdraw capital from factories in cities and towns throughout the country: deindustrialization.[8]
As it turned out, something more complicated occurred.[9] Between the late 1940s and early 2020s, manufacturing in the United States remained relatively stable as a proportion of real GDP. The United States continues to make goods. In fact, until 2010 it was the world’s largest manufacturing country, after which it remained second only to China. It was not manufacturing that went into decline in the United States, but its employment: a result, largely, of new technologies used in the manufacturing process, new kinds of high-tech goods being made, and the movement of labor-intensive industries to factories overseas. Over the same eighty-year period, far fewer Americans held jobs in manufacturing even as U.S. factories churned out goods. It was the impact on labor that Bluestone and Harrison observed in the late 1970s.
By invoking “Made in China” as the problem, or “Made in America” as a needed remedy, policymakers today peddle the myth that the United States is no longer a manufacturing nation, and they remove accountability from corporation actions that prioritize low wages over all else.
If there is a lesson to this history, it is not one that calls for a return to an imagined ideal of manufacturing employment; for a pursuit of “Made in America.” Rather, it is for a political vision that centres and listens to the concerns of working people—both domestically and internationally—and in the process frees itself from the chimera that businesspeople are informal diplomats working on behalf of the state.
Geopolitics and globalization collided in the 1970s in ways that transformed and ultimately expanded U.S. power. But a slower, quieter change was also beginning to take shape in which the United States and China constructed an interdependent trade relationship in the very moment interdependence shaped U.S. foreign policy. By making Made in China, U.S. diplomats and businesspeople used trade to lay the groundwork of a process that might, one day, mark the end of their empire and reemergence of China’s.
Author
Elizabeth Ingleson is an assistant professor in the international history department at the London School of Economics. She has published widely on U.S. foreign relations, U.S.-China relations, capitalism and labor. Her first book, Made in China: When US-China Interests Converged to Transform Global Trade, is forthcoming with Harvard University Press in spring 2024.
Notes
[1] For more on the connections between the steel industry and Trump administration trade officials, see Quinn Slobodian’s article on New Constitutionalism, which also includes discussion of Death By China and its funder, Nucor. Quinn Slobodian, “The Backlash Against Neoliberal Globalization from Above: Elite Origins of the Crisis of the New Constitutionalism” Theory, Culture, and Society, 38 (Nov. 2021), 51-69.
[2] Keith J. Dinnie, “Country-of-Origin 1965-2004: A Literature Review,” Journal of Customer Behaviour, 3 (no. 2, 2003): 65–213. For a historical perspective on nation branding, see: Jessica Gienow-Hecht, “Nation Branding: A Useful Category for International History,” Diplomacy & Statecraft, 30 (Winter 2019), 755-79; Carolin Viktorin, Jessica Gienow-Hecht, Annika Estner, and Marcel Will, “Beyond Marketing and Diplomacy: Exploring the Historical Origins of Nation Branding,” in Nation Branding, ed. Viktorin et al. (2018), 6–9.
[3] Walter E. Minchinton, “E. E. Williams: ‘Made in Germany’ and after,” VSWG: Vierteljahrschrift für Sozial- und Wirtschaftsgeschichte, 62 (no. 2, 1975), p. 231.
[4] For a good overview of the origins of the labelling in the United States, see: Peter Chang, “County of Origin Labeling: History and Public Choice Theory,” Food and Drug Law Journal, 64 (no. 4, 2009), 693-716.
[5] Act cited in full in: Henry Miles Finch, The law relating to the Merchandise Marks Acts 1887 to 1894 (1904): 14.
[6] For an excellent examination of this history, see: James C. Benton, Fraying Fabric: How Trade Policy and Industrial Decline Transformed America (2022).
[7] This is not to diminish the very real impact on labor that the “China shock” had in the United States after China’s ascension into the World Trade Organization in 2001. Instead, it is to suggest that the changes enabling the China shock to occur in the first place had long since already occurred. The China shock was a symptom of larger structural changes that had already taken place within the United States economy. On the China shock see: David H. Autor, David Dorn, and Gordon H. Hanson, “The China Shock: Learning from Labor-Market Adjustment to Large Changes in Trade,” Annual Review of Economics, 8 (Oct. 2016), 205-40.
[8] Barry Bluestone and Bennett Harrison, The Deindustrialization of America: Plant Closings, Community Abandonment, and the Dismantling of Basic Industry (1982), 6.
[9] For a reappraisal of Bluestone and Harrison’s landmark book, see their preface and the accompanying essays in: Jefferson Cowie and Joseph Heathcott, eds., Beyond the Ruins: The Meanings of Deindustrialization (2003).