Trump’s aggressive 2025 moves backfired, while Xi used China’s dominance to strengthen his global position.
The loudest story of 2025 was President Donald Trump’s barrage of executive orders. He moved quickly to dismantle federal bureaucracy, rewrote trade rules on “Liberation Day,” and mixed threats of war with declarations of peace. Yet the year’s biggest winner was President Xi Jinping. By resisting Trump’s tariffs, China showed how much America relies on its policies and supply chains.
China’s industrial strength was on full display. It now produces more than a third of global manufacturing value added, giving it the ability to disrupt supply chains instantly. In green technology, Chinese companies supply most of the world’s solar panels, wind turbines, and electric vehicles.
DeepSeek highlighted China’s progress in artificial intelligence, while its pharmaceutical firms run clinical trials at nearly the same scale as American peers, often faster. What began as Western firms investing in China for cheap labor has shifted to building laboratories there.
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Xi used this dominance as leverage. Restrictions on rare‑earth exports showed how dependency can be turned into a weapon. Research from the Australian Strategic Policy Institute found China leads in 66 of 74 scientific fields, including computer vision and grid integration.
Trump’s choice of bilateral tariffs was a misstep. Chinese firms, hardened by adversity and shielded from democratic pressures, endured pain better than American industries. Instead of rallying allies to encircle China commercially, Trump alienated them with tariffs.
At home, Trump’s attack on science added to the damage. He canceled grants, withheld billions in funding, and targeted institutions he disliked. Immigration restrictions, especially against ethnic Chinese researchers, pushed talent away. Skilled people either left America or chose not to move there, while China gained.
In the short term, China holds the advantage. America and its allies cannot quickly break Beijing’s chokeholds. If Xi chose to pressure Taiwan, sanctions might trigger reprisals that hurt industries and citizens more than they can bear, destabilizing East Asian security and America’s Pacific role.
Longer‑term risks remain for China. Factory‑gate prices fell 2.2% in November compared with a year earlier, marking 38 straight months of decline. Property prices are more than 20% below their peak and still falling. While the party promises to boost demand, it continues to double down on manufacturing, deepening overcapacity.
By 2026, this could look like hubris, as provinces and cities struggle with debt and stagnation similar to Japan’s lost decades. Deflation may worsen if countries block China’s cheap exports. Yet Xi, preparing for a fourth term in 2027, faces little internal challenge.
China’s rigidity contrasts with America’s built‑in capacity for change. MAGA’s deregulation drive and impatience with political correctness reflect that adaptability. America’s foundation on universal values has long attracted talent and strengthened alliances.
By comparison, China’s ethno‑nationalist framework limits acceptance for non‑Han citizens. These values should provide America with renewal, but Trump’s disdain undermines them. His admiration for authoritarian rulers and framing of diversity as a threat erodes the nation’s greatest advantage.
