Western manufacturing is in steep decline, and a major reason is its inability to compete with China’s artificially low production costs. In We Are Funding China’s Growth, Edouard Prisse explains how China’s combination of low wages and state-controlled industries have created a huge enrichment of China. It is in fact an unfair playing field. This leads to the de industrialization of the U.S. and Europe and shifts economic power to Beijing.
1. China’s Low Wages Give It an Unfair Advantage
One of China’s biggest advantages in global trade is cheap labor. While wages in the U.S. and Europe have risen significantly over the past few decades, China is still artificially keeping its wages from catching up with ours.
Suppressing worker rights: The Chinese Communist Party (CCP) bans independent labor unions, ensuring that wages remain stagnant.
- Exploiting rural-to-urban migration: Hundreds of millions of workers from rural China move to cities for factory jobs, accepting lower wages than their Western counterparts.
Prisse highlights that in 2020, Chinese factory workers were paid only 29% of what U.S. workers earned. This massive wage gap makes it nearly impossible for Western manufacturers to compete.
As a result, Western companies struggle to match China’s artificially low prices, leading to factory closures and job losses in the U.S. and Europe.
2. The Result: De industrialization in the U.S. and Europe
The consequences of China’s low pr1oduction costs are getting devastating for Western economies:
- Western companies forced to relocate: Even major firms like BASF (Germany’s largest chemical company) have moved production to China just to remain competitive.
- Dependence on Chinese goods: The West now relies on Chinese manufacturing for everything from electronics to pharmaceuticals.
Prisse argues that this is not just an economic issue, but a national security threat—China’s dominance in global manufacturing gives it leverage over critical supply chains.
5. The Only Solution: Equal Trade, Not Free Trade
Prisse insists that free trade with China must end if the U.S. and Europe want to rebuild their industries. His solution:
- Enforce trade balance policies, so China can only export as much as it imports.
Without these corrective measures, Western manufacturing will continue to collapse, leaving China as the world’s dominant industrial power.
The Fight for Western Industry
Western manufacturers are not losing to China because they are inefficient—they are losing because China is too cheap. By keeping wages low, China is undercutting Western production at every level.
If the U.S. and Europe want to regain industrial strength, policymakers must abandon outdated free trade policies and adopt strategic protections. Otherwise, as Prisse warns, China will continue to control global manufacturing while the West becomes permanently dependent on Beijing.