August 24, 2023 (Updated August 28, 2023)
By Stephen Gowans
Despite the depiction of China by its ruling Communist party and supporters as a “socialist” country, Beijing offers its citizens a very rudimentary social safety net. As the New York Times reports, “Government payments to seniors are tiny. Education is increasingly costly.” And health care insurance, which is mainly the responsibility of municipal governments, is nearly bankrupt.
In contrast, the Soviet Union and its satellite states offered their citizens a wide range of social services, from free education through university, with living stipends for students, free health care, virtually free housing and transportation, and guaranteed employment—a world apart from the Chinese model.
Even overtly capitalist countries with a history of labor militancy feature social safety nets that are stronger by a long shot than China’s. According to the Wall Street Journal, “Chinese households’ cash benefits from the social-security system make up only 7% of the country’s gross domestic product—about a third of the ratio in the U.S. and the European Union.”
In other words, socialism—or the social welfare that has long been understood to be one of its characteristics—is more emphatically present in the bastions of capitalism than in “socialist” China. Indeed, apart from socialist iconography, anything that has been traditionally associated with socialism, is completely absent in the East Asian state.
How can this be?
The obvious answer is that China, despite the claims of its Communist Party that it is pursuing a socialism “with Chinese characteristics,” isn’t socialist at all (or that “with Chinese characteristics” means “with capitalist characteristics and not really socialism.”)
In fact, apart from a few people with their heads in a cloud, no one actually believes that the People’s Republic of China is a socialist state, including, as it turns out, the Communist party itself. China’s Communists define socialism as building the means of production. In the late 1970s, the party decided to accomplish this by following the capitalist road.
To be fair, the CPC recognizes that, in the Marxist view, socialism depends on the prior development of a robust economy. Capitalism is the “bridge” to socialism. It could be said, then, that China is crossing a bridge, but hasn’t yet arrived at its socialist destination. Once it does, it will introduce the kind of social welfare programs we’ve come to associate with socialism.
Is this a reasonable expectation?
Not if you believe the reporting of the New York Times. “China’s top leader, Xi Jinping, has a well-known aversion to any social spending, which he has derided as ‘welfarism’ that he believes might erode the work ethic of the Chinese people.”
One could defend Xi’s dislike of ‘welfarism’ on two grounds: China lacks the resources to spend generously on social programs, and every yuan spent on ‘welfarism’ is one less yuan spent on building China’s bridge to socialism.
China has the world’s first or second largest economy, depending on how you measure it, so why is Xi so averse to ‘welfarism’? Surely, the country can afford to provide its citizens better pensions, free education, and stronger healthcare.
It’s true that when one combines the total product of China’s 1.4 billion citizens, China looks like a wealthy country. But this total product of all China’s citizens has to be divided among an awfully large number of people. On a per person basis, the money available to fund education, healthcare, and pensions is actually quite small.
That doesn’t mean that Beijing doesn’t have the bandwidth to step up its spending on social welfare. It does. But doing so would mean it would have to reduce its spending on roads, factories, airports, railways, supercomputers, and other infrastructure, including its self-defense.
As the Wall Street Journal explains, Xi believes that “China should address ‘insufficient effective supply capacity’—in essence, build more factories and industry” than provide social assistance to the unemployed, ill, and aged.
Just as Xi does today, Stalin in the 1930s deliberately held expenditures on the immediate needs of his country’s citizens in check in favor of channeling limited resources into rapidly industrializing the country, in order to enjoy a more prosperous and secure future. Xi believes that austerity today breeds prosperity tomorrow.
On the other hand, there are reasons to wonder whether, unlike Stalin, China’s Communists are sincerely committed to the goal of achieving socialism. According to the Wall Street Journal, Xi “has repeatedly said that China should not create a Western-style welfare state” because he believes “Western-style social support would only encourage laziness.”
In a speech two years ago, the Chinese leader said: “Even in the future, when we have reached a higher level of development and are equipped with more substantial financial resources, we still must not aim too high or go overboard with social security, and steer clear of the idleness-breeding trap of welfarism.”
There’s enough wiggle-room in Xi’s statement to interpret it as meaning nothing more than what Lenin meant when he defined socialism by reference to a Biblical dictum: He who does not work, shall not eat. On the other hand, it smacks of the kind of Republican Party-style bromides of which the Communist party has a special fondness, from “a rising tide lifts all boats” to “capitalism is history’s greatest anti-poverty program.” “Welfare saps the will to work” is just one more anti-socialist adage.
There are three reasons to suspect that Xi’s vision of a future China is a vision of a capitalist China.
First, the CPC committed itself to capitalism beginning in the late 1970s, although a non-capitalist path was available. The way the party tells it, China has to travel the capitalist road to develop its economy to a point where it will be able to realistically transition to socialism. To be sure, industrial development is a necessary prerequisite of a socialist transition. But however much industrial development has been associated with capitalism, industrial development has also been achieved by non-capitalist means–those pioneered by the Soviet Union, which did not depend on private ownership, commodification of labor, or avoidance of ‘welfarism.’ Today, Beijing and its supporters propagate the myth that state-directed capitalism is the only path to industrial development and the only option for China.
Second, Beijing has stretched the meaning of the word socialism to create the impression that it is pursuing a socialist path when it is not now doing so and may never do so. If China is socialist because it is building the means of production, then so too is every other capitalist country, for every other capitalist country is also building the means of production. If China is socialist because it is building a bridge to socialism, then so too is the United States, Russia, Germany, and Japan, for they too are building bridges to socialism. The idea that a country is socialist because it is building a bridge to socialism is meaningless, because it makes socialism a near-universal category.
Chinese society displays none of the characteristics of the really-existing socialist societies of the twentieth century that uniquely distinguished them from the capitalist world. These socialist societies featured low levels of income inequality, high levels of social security, and steady (and at times rapid) economic development. The economies of these socialist states were free from inflation, depression, and unemployment.
China, in contrast, has one of the world’s highest levels of income inequality, higher even than that of the United States; a very low level of social security; and an economy afflicted by every capitalist ill, from unemployment to slowdowns to pervasive economic insecurity to low wages and gruelingly long working hours. Beijing’s sole claim to socialism is its dirigisme, but state-direction of capitalist development has a long history in the capitalist world, including in Germany, Japan, and France. It might be argued, too, that the US economy is as state-directed as any other, but that its dirigisme works largely through the Pentagon and programs such as DARPA (Defense Advanced Research Projects Agency), Project Warp Speed, The Chips Act and The Inflation Reduction Act, among many other programs and legislation. Dirigisme is not a distinguishing feature of socialism. Despite this, China persists in mendaciously referring to its society as “socialist.” The idea that Beijing could continue to preside over a capitalist development path, while professing that it is building a socialist society, cannot be dismissed.
Third, Xi’s caution that the country must limit social spending, even after it has reached a higher level of development, hints at a long-term commitment to capital-expenditures at the expense consumption-expenditures—a strategy suitable to the goal of matching or surpassing the economic development of the United States.
Is the goal of socialism (or even of China’s ostensible bridge-building) to follow the trajectory of capitalist development to its highest possible apogee? Or is it to achieve the following: Humanity’s liberation from:
- Material insufficiency;
- Dehumanizing toil;
- Exploitation; and
- Enslaving illusions?
The project of the CPC is not so broad as to encompass all humanity; it is less ambitiously and more narrowly focused on one country: China. In this regard, we can question whether it is a Marxist socialist project at all, or simply one of Chinese palingenesis (rebirth as a great civilization).
None of the Marxist socialist goals appear to form any part of China’s agenda. While freedom from material insufficiency is a possible unintended side-effect of state-directed capitalist growth (assuming Beijing’s aversion to ‘welfarism’ wanes, along with its willingness to allow the gains of development to concentrate in the hands of billionaires), as part of a socialist agenda, liberation from material insufficiency is something quite different.
Within a socialist context, it means secure access to the material requirements for a healthy life; enough food to eat and clothes to wear; decent accommodations; universal access to high quality health care, physical exercise, and recreation. It doesn’t mean material development to the highest degree obtained by the richest country. Nor does it mean achieving a very high level of economic development but none of socialism’s other goals.
Has China evinced the slightest evidence that it is pursuing any Marxist socialist goals? Far from liberating humanity from enslaving fictions, it promotes them, from Confucianism, with its defense of traditional hierarchies, including patriarchy, to the myth, beloved by Xi, that social welfare produces idleness. Far from liberating humanity from dehumanizing toil, innumerable Chinese laborers work gruelingly long hours at repetitive machine-like tasks. As for the goal of ending commodified labor, is that even on the horizon, let alone set as a goal?
All of this might be excused if there weren’t other paths to industrialization than capitalism; if the Chinese project didn’t appear to have more to do with overcoming China’s “century of humiliation” by capitalism than transcending capitalism to overcome humanity’s long history of humiliation; and were Xi and other Chinese leaders not so fond of the kind of maxims that have long inspired Republican Party attacks on the working class and its movement for socialism.
But China on the capitalist path is a China whose differences with other rising capitalist powers are difficult to discern. The rejoinder that China is different because its state is not under the command of capitalists but Communists ignores the fact that other rising capitalist powers, Japan and Germany, for example, became great capitalist powers under the direction of monarchies, not capitalists. France was no less a developing capitalist society under the restored Bourbon dynasty and the July Monarchy than under the Third Republic. Indeed, the difference between the rule of capitalism-committed Communists and the rule of capitalism-committed capitalists is approximately zero. Even their maxims are the same, as Xi has revealed.
What's Left 
Indeed, “In fact, apart from a few people with their heads in a cloud, no one actually believes that the People’s Republic of China is a socialist state.” A few years ago, communists outside of China could calmly discuss whether the economy was some mix of socialism and capitalism, or thoroughly capitalist. Today there is no doubt it is the latter.
The fierce discussion today is whether China fights against U.S. domination alongside the peoples of the world, or whether China is an expanding monopoly capitalist power seeking to displace the U.S. in the world imperialist system. The latter is the case. This increasingly antagonistic contradiction will drive working people to find a revolutionary path that either frustrates global carnage or emerges from it.
I am interested in what you have written above: “Capitalism is the bridge to Socialism”.
I believe every nation has its own complexity. There is no one universal system that can fit all nations. The system also needs to adopt the local cultural wisdom. Let the system evolve by itself according to the development of society. It is the same in the political field, where western-style democracy is not necessarily suitable for eastern countries that have their own local wisdom.
Btw, this post is very interesting.