Is China Socialist – Urbandale – Nov 14

I feel I should say that I do believe China is socialist, for reasons I’ll talk about in the post. Me saying that I think China is socialist shouldn’t lead anyone to believe I’m saying China is without problems, but socialism isn’t an idealist state after all, its got its own contradictions. This is gonna focus a lot on the economic arguments for why China is or isn’t socialist, but in order to do so we first have to look at a bunch of raw data. I’m gonna be referring a lot to World Bank stats so if you’re curious check them out here.

So what’s up with the Chinese economy? China under Mao was a China wracked with poverty. After his death in 1976 the poverty rate was about 86%. Despite efforts like the Great Leap Forward to build up productive capacity in rural areas the country was still left with a problem somewhat similar to the Soviet Union in 1928, namely what little production existed was based in urban centers while the overwhelming majority of the population lived in rural areas. The rise of Deng and the Special Economic Zones and sweatshop labor should be viewed in this historical context, because they came to exist, for good or ill, as a means of solving this problem. So, what did these Special Economic Zones and their sweatshops do for China? Over the last 35 years they are the chief economic cause of the reduction in the poverty rate from 86% to 12%. That’s about 600 million people coming out of poverty. For a sense of how massive this is, this is about double the entire population of the United States.

Obviously merely making more money is not the only factor at play in terms of happiness or anything like that. We’ve all heard about the infamous Foxconn suicides where 18 workers killed themselves in the span of a few months. There’s gotta be some serious shit wrong with this picture, and there most definitely is. I don’t want to claim that this policy is without problems. But we only hear about media stories talking trash on China for pursuing policies that are actually better for the population than rural poverty because demonizing China for sweatshop labor is what the cold warriors who were previously demonizing the USSR moved to. And its not just cold warriors. The AFL-CIO NGO Solidarity Center, the labor arm of US imperialism, was exposed using National Endowment for Democracy grants to fund Hong Kong protesters. But this is a tangent, and I should really get back to what this is supposed to be about. Last thing I’ll say on sweatshops is that there is a specific voice we never hear on this question, and its the voices of the workers themselves. Why is that? When the Foxconn suicides happened foreign media swarmed these sweatshops, interviewing hundreds of workers without state intervention. Why did we hear so few interviews in the US? Its because many sweatshop workers view their new life as industrial workers as a direct improvement of their old lives languishing in undeveloped rural areas. This is a TED Talk (I know, I know) discussing this issue but is also a report back on various interviews that were taken by the presenter. While I have a minor nitpicks about the presentation I think it serves as a good counterpoint to the stories about how awful these sweatshops are for their workers, serving to put this claim, while true in many regards, into its proper context.

So let’s compare China with another country that has a similar history. India has the same colonial background, similar population, and the same productive capacity post-liberation as post-liberation China. It’s got Special Economic Zones and extensive public firms. It also serves as a good comparison because almost no one calls India socialist, which works rather well as I’m contrasting China’s socialist economy with India’s capitalist one. What does India’s economy look like today? Fucking shit. There’s a lot of stuff to talk about on this comparison, but the entire first third of this talk goes into detail about India’s economy and what it looks like for workers there, so I don’t want to replicate it.

Ok, so now that we have a good capitalist example of what China could have looked like, and my brief outline of what China looks like, I hope the difference is somewhat clear. One last thing though. What do the millionaires do in order to get their money? Unlike the US where most make their money through finance, most Chinese millionaires make their money through appointment to work in public firms. However, as the post in the OP points out, public firms are constantly seeing changes in management, either through party members shuffling in and out to combat corruption or just cuz theres a bad manager or cuz of complaints about the person or a number of reasons. This is obscenely wasteful according to common capitalist logic. If you’re constantly putting in and removing people from positions in firms, your managers lose job security and get all scared, and you have periods of time where the new people have to get used to handling their new job and picking up where the last manager left off. This was part of the reason given for the bonuses given to the same banking institutions that were (supposedly) behind the Great Recession. While it was thoroughly mocked, it does comply with standard capitalist logic. If you’re not making as much money as you feel you should be, you have the right to find another job. But if China isn’t capitalist but instead socialist, it makes sense. It doesn’t need to care about what the bourgeois class its SEZ’s have created think, because they don’t hold power in the party. And if they throw a fit and have a capital strike or do a slowdown, they are simply removed from their position and have no recourse.