Category: China

Xi Jinping and His Republican Party-Style Contempt for Socialism

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.

Scab of the World

August 10, 2023

By Stephen Gowans

The integration of China into the economies of the G7 lifted hundreds of millions of Chinese out of poverty at the expense of middle-to-lower income workers in G7 countries. These proletarians, displaced by competition from lower-wage Chinese labor, have gravitated toward the far-Right, which demagogically offers relief from their precarious economic condition. The fractured, feckless, disoriented and China-addled Left, in contrast, doesn’t even offer the sop of false promises.

While it has traditionally been the professed champion of the proletarian, the Left—from liberals who sing paeans to globalization and defenders of “socialist” China who rhapsodize about globalization raising hundreds of millions of Chinese out of poverty—has abandoned the world proletariat and the campaign for socialism, for the Third World proletariat and its integration into a capitalist world economy under the guidance of political parties who claim to be on a journey to a socialism which exists, perhaps, in some crepuscular future. Liberals see in the massive Third World work force the bourgeois attraction of access to cheap labor while defenders of “socialist” China have found their golden calf in the Communist Party of China.

The left has failed to mobilize the despair of displaced workers in the countries of the G7 and channel it into the project of socialist transformation, in part because it is transfixed by China and Beijing’s opposition to the United States, and by what it sees as the achievement of the country’s Communist party in lifting hundreds of millions out of poverty. But China’s uplift is Janus-faced. What the Chinese have gained—their transformation from a nation of mainly poor farmers producing food for local consumption into a nation of mainly poor factory workers producing gadgets for Western consumers—has undermined the achievements of the labor movement elsewhere in the world and weakened the working-class struggle globally.

China’s opening to the West meant that the pool of labor available for exploitation by capitalists of the G7 expanded significantly. A G7 labor market in which the proletariat had achieved some degree of protection by way of unionization and the concession of social reforms extracted from business-dominated and -oriented governments, was suddenly flooded by a cataract of low-wage labor with few social welfare protections. On top of this blow, came another: The Communist Party of China, keen to ensure that its workers prevailed in the competition for jobs, offered the world’s largest enterprises the sweeteners of tax breaks, subsidies, and party-controlled pseudo-unions, to relocate factories to China. G7 governments that had relied on businesses to defray part of the expense of funding social supports for workers, now found that the social supports were no longer affordable in what was described as “an increasingly competitive global environment.”

The court philosophers of the bourgeoisie offered soothing words. More competition was a good thing, so long as the G7 took steps to remain competitive. Remaining competitive meant: lower wages; no unions; bare-bones social security. That is, becoming like China.

This isn’t the view of the apostles of “socialist” China. While they rhapsodize about the hundreds of millions of Chinese lifted out of poverty, they attribute this development, not to the displacement of high-wage unionized workers in the West by low-wage (effectively) non-unionized workers in the East, but to “socialism with Chinese characteristics”.  As such, they match G7 economists in producing a consoling illusion. If defenders of “socialist” China attribute the uplifting of hundreds of millions of Chinese to “socialism with Chinese characteristics” (and not to the competition for jobs being won by Beijing offering to indulge the G7 bourgeoisie with low-wages, ductile labor, tax concessions and subsidies—essentially scabbing) then G7 economists attribute it to something called “globalization.”

“Globalization”, we’re to understand, is a good thing because it has uplifted hundreds of millions of Chinese and delivered goods to Western consumers at very low prices. But what of the other side of the coin? Low prices come from workers toiling gruelingly long hours in sweatshops for subsistence-level wages. Also left unsaid is that these workers have displaced their class cohorts who once commanded higher wages, worked fewer hours, and enjoyed better benefits. In other words, “globalization” has been good indeed for the bourgeoisie but a net loss for the proletariat, whose conditions, on a world-scale, have worsened.

We’re also told by the apostles of “socialist” China that the Communist Party of China is a good thing for the same reason G7 economists say globalization is a good thing: because it has uplifted hundreds of millions of people. But the Communist Party of China and globalization, are, in this context, the same thing. The Communist Party of China lifted hundreds of millions of Chinese out of poverty because it cooperated with the G7 bourgeoisie in the project of globalization—that is, in scabbing on a world scale.

To be sure, a net proletarian loss globally is of little moment to a Left which seems incapable of seeing the world as an integrated whole, preferring, instead, to confine itself to matters of parochial significance. Chinese workers were uplifted, but what happened elsewhere? Did Chinese uplift happen in a Panglossian world of win-win? The problem with a national perspective is that what happens in one’s own little corner of the world is affected by, and affects, other corners of the world. No man is an island, and neither is a country. Some Communists believe, contra Marx and Lenin, that the Left ought to concern itself with what happens within their own country’s borders, and let people in other countries worry about their own affairs. That might be sage advice, if the world’s over 195 countries were not interconnected in multifarious ways into a global whole. If the Chinese Communist Party has organized a giant campaign of scabbing, there are profound implications for the socialist project and for the working class in toto, touching workers in every country. One might subscribe to the theory that Chinese Communists should look after the Chinese, while Canadian, US, and British communists champion Canadian, US, and British workers. Sauve qui peut. The trouble is, even if that is what one thought the Left should do, and it isn’t what the Left should do, it is not what the Left is actually doing. For all the talk of addressing local issues, the Left is hardly addressing the “local” issue of the plight of workers who have been displaced by competition from low-wage Chinese labor. That has fallen, by default, to the far-Right.

It should be plain to Marxists that it is not the job of communists to advance the interests of one part of the world’s proletariat against another, not the Chinese part against the G7 part, and not the G7 part against the Chinese part. “Workers of the world unite!” while inscribed on the banner of many communist parties, is a slogan, it seems, that carries little weight these days in discussions in some communist circles. “Sure, it’s all fine in theory,” one can hear some communists harrumph, “but this is the real world!” When the Bolsheviks took power in 1917, they did so as part of a project of world revolution, not to present Russia as the low-wage factory floor to which the European bourgeoisie could shift production in search of higher margins.

There’s an assumption that needs to be addressed that lurks in the idea, or, to put it more aptly, in the unexamined doctrine, that “globalization” or “the Communist Party of China” lifted hundreds of millions out of poverty.  The assumption is that the gain in China’s GDP could not have happened without China’s embracing capitalism under the direction of the Communist party.  I have no doubt that the outcome of China’s integration into global capitalism would have been less favorable for China had the Communist party not taken a strong guiding hand. But the assumption that it is only by embracing capitalism that the Communist party could have directed China to its present level of development is debatable. To Marx, it was not private ownership of the means of social production that produced a society of plenty, but what had developed with it: social production, the division of labor, and the extension of human productivity by machinery. It was possible for China to take advantage of these benefits without promoting a private sector.

The USSR had, from its first five-year plan until Gorbachev began dismantling the socialist economy, grown at an often strong pace, and always unremittingly, without the high degree of income inequality, unemployment, and brutally long working hours that have stained China’s journey along the capitalist road. Moreover, Soviet economic development did not come at the expense of the proletariat in the West. On the contrary, the USSR provided a counter-narrative to capitalism that spurred Western governments to make concessions to their workers as a prophylaxis against a possible revolution inspired by the example of what Soviet workers had achieved—full employment, virtually free housing and public transportation, free education and healthcare, unmatched advances in the status of women, racial equality, and so on. In contrast, China inspires no proletarian movement anywhere. China’s effect on the lives of workers in the Western world has been the exact opposite—to worsen their conditions, rather than improve them. Whereas the Western bourgeoisie found in the Soviet Union a competitor with which it had to vie for the allegiance of the world’s proletariat, in the Communist Party of China, the bourgeoisie of the G7 has found a partner with which it can divide the workers of the world.

China-enthusiasts have crowed about how the Communist Party of China, unlike its Soviet counterpart, cracked the code of rapid economic development. But their analysis is flawed. First, it understates the robustness of Soviet economic growth. Second, it fails to take account of the reality that the Soviet Union, in remaining faithful until Gorbachev to its Marxist-Leninist origins, had to row against the strong current of US opposition—an opposition which never rested for a moment in its efforts to contain Soviet economic development. Deng Xiaoping set China on a course of side-stepping this problem by undertaking two transitions: from socialism to capitalism and from competing with the US capitalist class to cooperating with it. Once China offered itself as America’s low-wage factory floor, Washington did all it could to accelerate China’s growth. China’s economic development had more to do with Washington than Beijing, just as impediments to Soviet growth had much to do with US policy.

Times have changed. Fired by dreams, not of world revolution, but of remaking China as a great civilization, Chinese Communists have decided to embark on yet another transition—this time, from corporate America’s supervisor on the Chinese factory floor, to world leader of the industries of the future. But there’s a hitch. Corporate America won’t yield its spot at the pinnacle of the global bourgeois order without a fight. And so it is that the growth in China that G7 economists hailed as the blessing of capitalism and China’s claque of sycophants in the West celebrated as the product of the Communist Party’s brilliance, withers under the assault of a concerted campaign of US economic warfare. Where is the vaunted Chinese growth model now? Whereas Washington once worked unremittingly to sabotage Soviet economic growth because Soviet socialism threatened US capitalism, the US government now works ceaselessly to kneecap the Chinese economy because Chinese capitalism threatens US capitalism.

Chinese officials cry foul. “No fair,” they grouse. The scabs are learning what capitalism is really all about. In the meantime, the victims of globalization—the low-and-middle-income proletariat of the G7 – drift toward the pseudo-solutions of the far-Right, because the Left – which no longer believes in Marxism, socialism, the doctrine that workers have no country, or the necessity of uniting the world’s workers—has nothing to offer globalization’s losers except celebration of the scabs who took their jobs.

“Socialist” China and Its Many Illusions

Growth that depends in large part on US cooperation goes away when you no longer fulfil the prerequisites of US cooperation.

By Stephen Gowans

August 9, 2023

An article in today’s Wall Street Journal, “U.S. to Ban Some Investments in China,” and relatedly, China’s recent economic tribulations, prompted the following thoughts on what was not too long ago presented by Sinophiles as the world’s paragon economic model.

The take-off Sinophiles celebrate as the outcome of China’s so-called ‘unique’ economic paradigm, began soon after Beijing decided to transition from its role as communist competitor of the United States to capitalist economic partner of its former enemy.

Deng Xiaoping’s “If you can’t beat them, join them” project, opened the gate to US, European, and Japanese investment, which drove the country’s development.

China was—and remains—an investors’ dream. It offered a vast pool of educated, disciplined, low-wage workers, a stable political environment, a government eager to cater to foreign investors, and a huge market—all the ingredients that investors needed to pull in huge returns.

What made the model unique was China’s history, size, and demography, as well as its Communist Party, which had the legitimacy and Washington’s backing to mold China’s vast population—at that time the largest in the world—to its will of catering to foreign investment. The model couldn’t be transferred to other places, because other places lacked the combination of education, political stability, infrastructure, size, proximity to sea routes, and willingness to collaborate with the United States, that made China the world’s premier investment opportunity.

Times have changed.

Having used Western investment to vault to the first ranks of the global capitalist economy, Beijing has embarked on a second transition, this time from US economic partner to US economic competitor. Chimerica, the integration of China into the US economy, with the US as the union’s finance, R&D, and marketing arm, and China as its manufacturing base, has yielded to China 2025, Beijing’s plan to dominate the industries of the future, provoking Washington’s counter-measures to stop it.

As China challenges US supremacy, its once torrid growth has slowed. Direct U.S. investment into China has hit a 20-year low. U.S. venture-capital investment has hit a 10-year low. Without US commitment to building China as the factory floor of the US, EU, and Japan, China’s economic prospects are no longer as sanguine as they once were.

People’s China, contrary to a myth perpetrated by Sinophiles and apostles of multipolarity, didn’t develop in a world of its own making, insulated and kept separate from capitalism, neo-liberalism, US leadership, and the US economy. It developed precisely because it willingly became a part of all these things.

Now that it’s trying to extricate itself from its former submission to US economic leadership in order to vie with US capital for economic supremacy, foreign and venture capital investment is drying up and China’s torrid growth has disappeared in a puff of political reality, viz., growth that depends in large part on US cooperation goes away when you no longer fulfil the prerequisites of US cooperation.

China’s economic model is not so different from the state-led capitalist development of Germany’s Second and Third Reichs or Meiji-restoration Japan that we should regard it as unique; we certainly shouldn’t regard it as socialist.

Nor, given that China’s rulers have adopted a state-led capitalist development model, guided moreover by a nationalist ambition to restore China to the great civilization it once was, should we harbor illusions about the political project of the Chinese Communist Party. It is not the worldwide proletarian revolution, nor even, it would seem, the proletarian revolution in China, but the vaulting of China to supremacy in the world capitalist market—the same ambition of every other capitalist power with heft.

We should not, therefore, regard the political primacy of the communist party in China as investing the country’s rivalry with the US and EU with a character any different from Germany’s earlier rivalry with Britain for supremacy in Europe or Japan’s erstwhile rivalry with the United States for pre-eminence in the Pacific and East Asia.

China is not a paragon, a model for other countries to emulate. It is just one more capitalist power vying for markets, raw materials, investment opportunities, strategic territory, and the power to shape the global economy to its advantage.

The Era of Ultracheap Labor Is Under Threat

Factories in China and Vietnam are struggling to attract young workers, which is bad news for Western businesses accustomed to offshoring jobs at subsistence-level wages.

August 8, 2023

The world’s largest capitalist enterprises, having located their factory floors in low-wage Asia, are running into a big problem: The young people of China and Vietnam, two Asian giants ruled on behalf of Western businesses by Communist parties, don’t want to work in factories at dehumanizing jobs for subsistence-level wages. 

The twilight of ultracheap Asian factory labor is emerging as the latest test of the globalized manufacturing model, which over the past three decades has delivered a cornucopia of profits to wealthy investors around the world. American businesses accustomed to bargain-rate labor in Communist-controlled China and Vietnam might soon be reckoning with higher prices.

“There’s nowhere left on the planet that’s going to be able to give you what you want,” said Paul Norriss, the British co-founder of the Vietnam garment factory, UnAvailable, based in Ho Chi Minh City. CEOs of the world’s largest enterprises are going to have to change their business models.

Workers in their 20s routinely drop out of training programs for low-wage factory jobs.  Those who stay often work for just a couple of years.

“Everybody wants to be an Instagrammer or a photographer or a stylist or work at a coffee shop,” rather than a factory worker who toils long hours doing mind-numbing tasks for survival-level pay.

In response to the crisis, Asian factories have had to increase wages and adopt sometimes costly strategies to retain workers, from improving cafeteria fare to building kindergartens for workers’ children. 

Toy and game maker Hasbro said this year that labor shortages in Vietnam and China had pushed up costs from subsistence-level to barely above subsistence. Barbie-maker Mattel, which has a large production base in Asia, also is grappling with the pressure of higher labor costs in China on corporate profits and bonuses for its hyper-wealthy CEO. Both companies have raised prices for their products, to protect investors’ profits. Nike, which makes most of its shoes in Asia, flagged in June that its product costs had gone up because of higher labor expenses. 

For U.S. businesses that have been accustomed to having low-wage workers as a certain and relatively stable part of their business model, that foundation is going to have to be rejiggered.

Starting in the 1990s, China and then other Asian manufacturing hubs integrated into the global capitalist economy, turning nations of poor farmers into nations of poor factory workers. Labor was available at dirt-cheap wages, allowing businesses to expand their margins and reap a cornucopia of profits off the toil of Communist-led workers reduced to the status of machines for producing surplus value. 

Now those manufacturing nations are running up against a generational problem. Younger workers, better-educated than their parents and veterans of Instagram, TikTok and other social media, are deciding their work lives shouldn’t unfold in dehumanized toil inside factory walls at barebones pay for the benefit of billionaires in New York and Shanghai.

Demographic shifts are playing a role. Young people in Asia are having fewer children than their parents did, and at later ages, which means they are under less pressure to earn a steady income in their 20s. A booming services sector offers the option of less-grueling work as store clerks in malls and receptionists at hotels.

The problem is acute in China, where urban youth unemployment hit 21% in June even though factories had labor shortages. Multinational companies have been moving production from China to nations including Malaysia, Indonesia, Vietnam and India. Factory owners there said they, too, are struggling to get young people to sign up.

In the past, manufacturers, scouring the globe for workers deprived of all options but to condemn themselves to lives of ceaseless, demeaning toil at wages incapable of supporting their families in anything but conditions of squalor, might simply have moved to less expensive destinations. That’s not so easy these days. There are nations in Africa and South Asia with large labor pools, but many are politically unstable, or lack good infrastructure and trained workforces.

That’s why China has been so attractive to the world’s largest capitalist enterprises. The infrastructure is excellent, the workforce is trained and disciplined, and Chinese workers can be hired to toil long hours for little pay. The Communist Party of China ensures that conditions are highly favorable to investors by making conditions highly unfavorable to workers.

Clothing brands were stung when they expanded into Myanmar and Ethiopia, only to find operations disrupted by unrest and civil war. Bangladesh has been a reliable base for producing clothes, but restrictive trade policies and clogged ports have kept it from making much beyond that.

India has a huge population, and firms seeking alternatives to China are expanding there. But even in India, factory managers are beginning to complain about the difficulties of retaining young workers. Many young people prefer farm life, no matter how gruelling, to equally gruelling lives in factory dormitories in industrial hubs.

Asian factory owners are trying to make the jobs more appealing, including subsidizing kindergartens and funding technical-training programs. Some are moving factories to rural areas where people are more willing to do manual labor, but that puts them farther away from ports and suppliers and forces them to accommodate rural life, including worker absences during harvest. 

Christina Chen, the Taiwanese owner of a furniture maker that sells to American retailers such as Lowe’s, decided to move her factory out of southern China four years ago, hoping it would be easier to recruit. She first considered industrial zones near Ho Chi Minh City, but she heard nightmarish stories about workers demanding wages above subsistence levels.  How are capitalists to earn fat returns when workers balk at a life of penury?

Young people from developing countries who otherwise might take factory jobs are finding work caring for the growing numbers of the elderly people in developed nations, as well as plugging gaps in those countries’ aging workforces. The pay is low, but above the subsistence-level pay of factory labor back home.

Susi Susanti, a 29-year-old from Indonesia, said she tried factory jobs after graduating from high school. She hated being pressured to work faster by her managers at an electronics factory, and in a second job making shoes. She told her mother she had to do something else.

A six-month training course taught her rudimentary Mandarin, and she set off to work caring for an elderly couple in Taiwan. Her pay is three times as high as she earned in factories back home, she said, and it’s less exhausting. “When the person I’m looking after is doing well,” she said, “I can relax.”

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This article is from The Wall Street Journal of August 7, 2023. It has been edited for class perspective. The original article, written by Jon Emont, is titled  “The Era of Ultracheap Stuff Is Under Threat.”

“People should be awake to this tactic, and refuse to be fooled by it”

December 28, 2022

Stephen Gowans  

Beijing’s abandonment of its zero-Covid policy has created a spate of propaganda. On one side, US sources use the surge in cases following Beijing’s volte-face on infection control to unfairly tarnish China’s reputation. On the other, pretend Marxists at the congregatio de propaganda fide sinae pump out flagrant “what about?” propaganda to deflect attention from China’s health care crisis.

The New York Times of December 27 offers an emblematic example of Covid-related anti-China propaganda.

Reporters Isabelle Qian and David Pierson write that “China’s hospitals were already overcrowded, underfunded and inadequately staffed in the best of times. But now with Covid spreading freely for the first time in China, the medical system is being pushed to its limits.”

This may be true, but it’s also true of high-income countries. Change the word China to Canada or any of a number of other G7 countries, and you have a serviceable description of the Covid crisis in countries better equipped than China to deal with medical emergencies owing to their greater wealth. That they haven’t used these resources to avert crises in their own health care systems condemns them more than China.

China—ranked 79th of 185 countries in GDP per capita, just below Iraq— is a fairly poor country in per capita terms. Poor countries necessarily have inadequately resourced medical systems, too few hospitals and a dearth of medical staff.

If hospitals in high-income countries are being pushed to the limits by Covid, would we not expect the same in a mid-income country?

Qian and Pierson fault Beijing for failing to use “the past three years” of virus suppression “to bolster its health system by stockpiling medicine and building more critical care units.” They argue that China “could have launched a major vaccination drive targeting the millions of vulnerable older adults who were reluctant to receive a jab or booster,” noting, however, that “China did little of that.”

But could the Chinese have realistically done what Qian and Pierson say they should have done? No country has unlimited resources, especially a middle-income one. At the time Beijing was incurring the costs of implementing zero-Covid, it’s unlikely that it could have taken on the additional fiscal burden of increasing the number of its critical care beds and broadening its vaccine roll-out. That would have been difficult even for a high-income country.   

Many countries, including China, coped with Covid by calibrating mitigation measures to hospital capacity. China, with limited hospital capacity and few critical care beds, had to implement very stringent mitigation measures to prevent hospital overcrowding. As high-income countries did, it too followed the strategy of bending the curve, but its relative poverty meant that it had to bend the curve to zero, where G7 countries, with more money and more richly-resourced medical systems, had the luxury of never having to go quite so far.

What’s known now as “bend the curve” was originally known as “bend the curve and raise the line.” “Raise the line” refers to the necessity of expanding hospital capacity, something few countries did.

Here’s the idea: To cope with an increased burden on medical systems caused by the emergence of a novel pathogen, governments ought to reduce the spread of the pathogen through mitigation measures to limit the number of people who will require medical attention at any one time (bend the curve), and increase the capacity of the system to deal with the people who do need attention (raise the line.) Most high-income countries ignored the second part of the formula. Singling out China for the same failure, especially in light of its limited resources, is unfair.

If Qian’s and Pierson’s reporting is partial, the commentary of the avowed Beijing propagandist, Carlos Martinez, is pure diversion. Martinez fires back at criticism of Beijing for prioritizing profits over people in lifting its zero-Covid strategy, by emphasizing Washington’s poor performance in protecting its own citizens from the dangers of Covid.

But pointing out that Washington signed up as one of the killer’s henchman long before Beijing did, hardly absolves Beijing of blame for choosing to follow Washington down the same road. All the same, Martinez tries gamely to draw fire away from Beijing, with an article in China state media CGTN. The Friends of Socialist China, an avowed platform for propagating pro-China narratives, introduces Martinez’s propaganda piece this way:

“The following article … compares the rising hysteria in the Western media over China’s Covid situation with its near-total silence in relation to the ongoing public health crisis in the US. The US has just surpassed 100 million Covid cases; its Covid death toll exceeds 1 million; and its average life expectancy has dropped to 76.4 years – the lowest since 1999. What’s more, as a result of centuries of systemic racism, the impact of this crisis is multiplied for the black, Latino and indigenous population. The media prefers to sensationalize the wave of Covid cases in China – as a form of deflection and diversion, and as part of the generalized campaign of China-bashing. People should be awake to this tactic, and refuse to be fooled by it.”

The argument is that the US media are trying to divert attention from Washington’s execrable pandemic performance by emphasizing China’s challenges with Covid. The problem is that it is the US media themselves that have documented Washington’s Covid failures, from the 100 million cases, to the death toll north of 1 million, to the decline in US life expectancy. If the US media were really trying to obscure these facts, why would they have reported them in the first place? Indeed, the fact that Martinez even knows about “the ongoing health crisis in the US” contradicts his claim that there is “near-total silence” about it.

But then it comes as no surprise that an avowed pro-China propagandist would regard any reporting that casts China in a less than glowing light as sensationalistic and anything less than a total media obsession with developments that cast the United States in an unfavorable light as “near-total silence.” The reality is that the US media have not imposed “near-total silence” on the United States’ Covid struggles any more than they have “sensationalized” China’s. A more plausible account is that they have simply reported the struggles of both, and that propagandists on either side don’t like to hear bad news about their side and delight in hearing bad news about the other side. So, the propagandists try to draw attention to the other side’s bad news.

That’s what Martinez has done. In mentioning Washington’s bad conduct, he and his coreligionists at the congregatio de propaganda fide sinae hope to accomplish what they accuse the US media of trying to achieve: divert and deflect attention. Indeed, the passage from the Friends of Socialist China platform introducing Martinez’s CGTN article can be turned back on the congregatio:

CGTN, the Friends of Socialist China, and Carlos Martinez prefer to sensationalize the United States’ health care crisis as a form of deflection and diversion from Beijing’s struggles with Covid, and as part of the generalized campaign of US-bashing. People should be awake to this tactic, and refuse to be fooled by it.

Clearly, zero-Covid is unsustainable as a long-term project in a world where no other countries are pursuing the same suppression measures. At a certain point, Beijing would have had to transition to a new policy if it wanted to avoid the penalty of retarded economic growth and growing popular recalcitrance. Beijing abandoned zero-Covid for three reasons: pressure from the streets; pressure from business; and because the policy was unsustainable.

If zero-Covid was necessary in a country with limited resources to provide medical care to its citizens, in order to protect hospitals from overcrowding and the medical system from collapse, then the lifting of restrictions will have consequences as dire, if not more so, than those that beset the citizens of the United States, where greater US wealth provided the government with the capability to offer robust protection—a potential that was never realized.

China’s pandemic performance has reflected its nature: not that of a socialist country, which it clearly is not, notwithstanding the fantasies of various dreamers, but a middle-income capitalist country with limited resources, whose strength lies in a strong central government able to make the most of its limited resources in the pursuit of its central aim: the rejuvenation of the country, by means of capitalist development, as a great nation, capable of pushing back its economic frontiers in competition with rival powers—a project known in more flattering terms as championing the development of a multipolar international order, or more honestly, as the return of great power competition and inter-imperialist rivalry.

The Multipolaristas’ Theory of Ultra-Imperialism Doesn’t Fit a Multipolar World

December 27, 2022

By Stephen Gowans

Recently, The Wall Street Journal reported that “Mr. Putin” is “convinced Russia’s Western enemies” are “seeking to yank Ukraine from Russia’s orbit.” Clearly, the United States and Russia are locked in a struggle over Ukraine; each wants the territory in its own orbit—that is, in its own empire. US efforts to yank Ukraine from the Russian orbit have been largely successful. Russia is yanking back, but it’s unlikely to win the tug of war.

The idea that the war in Ukraine is but one battlefield in a larger war between two empires is difficult to grasp for people whose understanding of imperialism is influenced by dependency theories developed in the immediate post-WWII period. That period was characterized by one capitalist empire, that of the United States, absorbing most of its former capitalist rivals into its orbit. Under US supervision, the now combined powers, once rivals, jointly exploited the periphery.

People who subscribe to this view, whether consciously or through osmosis, look at the world through a lens whose purpose, when the lens was crafted, was to explain the international system at a time when neither Russia nor China existed as capitalist powers and rivalry among capitalist powers was muted by US primacy. Glimpsed through this lens, Russia and China appear as what they once were, but are no longer: socialist counterweights to a capitalist metropolis.

This, to be sure, is a view of a world that expired 30 years ago, when the Soviet Union was succeeded by a capitalist Russia, and China was at least a decade along the path of capitalist development and integration into the US economy as a low-wage manufacturing center.

Today, Russia and China are capitalist powers. But if they appear to some, not as metropolitan powers keen on integrating regions into their own expanding economies, but as powers lying outside the metropolis, as opposed to merely outside the US empire, it’s because they are understood incorrectly as being what they once were, rather than what they have since become. Both powers are external to the US empire (to some degree; China is so only partially), but the US empire is no longer equal to the metropolis; it is now only one part of it.

Karl Kautsky developed a theory of ultra-imperialism. Kautsky argued that the stress might shift from conflict between imperialist powers to maintenance of a world system of exploitation, i.e., conflict between the metropolis and periphery. It is surely the latter, the worldwide exploitation of colonial peoples by the metropolitan bourgeoisie, observed Anthony Brewer, which is generally understood by the term ‘imperialism’ today. At the time, the very suggestion that such a shift was possible aroused vehement hostility from the left. For the left, inter-imperialist rivalry leading to war was the very essence of imperialism. The concept of imperialism has shifted its meaning between then and now, but the emergence of a multipolar international system, or of great power rivalry in Washington’s terms, means that the understanding of imperialism now lags developments in international relations. Contemporary international relations now bear a greater affinity with the classical Marxist theory of imperialism than with Kautsky’s ultra-imperialism.

None of this is to say that theories about metropolitan exploitation of the periphery are wrong, only that the notion that Russia and China are external to the capitalist metropolis is mistaken. The former socialist giants have joined the metropolis, not as a part of a Kautskyist ultra-imperialism led by Washington, but as rivals of the USA, EU, and Japan.

Is there a better theory?

In its emphasis on rivalry among capitalist powers, the classical Marxist theory of imperialism comports more fully with contemporary developments than dependency theories. If we accept that the contemporary international system is marked by an emerging multipolarity, and that the principal powers in the multipolar system are capitalist, then the world of today bears a much stronger resemblance to the late 19th and early 20th centuries, to which the classical Marxist theories of imperialism referred, than it does to the 20th century period of US-led ultra-imperialism.  

That’s not to say that the classical Marxist theory is without its problems. But it does say that despite its problems, the classical theory is a better fit with an emerging multipolar world than theories which were developed to explain a world characterized by a US-led metropolis exploiting a periphery, opposed by a socialist Russia and socialist China.

Continuing to see Russia and China as socialist powers that lie outside the metropolis, when they are now large capitalist powers with unconcealed projects of integrating regions into their own economies, is tantamount to applying the geology of the desert to the rainforest, and on this basis, declaring that trees (i.e., an imperialist Russia and an imperialist China) don’t exist.

To summarize, here are four errors that are made by seeing the contemporary multipolar world through a Kautskyist ultra-imperialist lens.

  1. Adopting the now extremely dated view that Russia and China are socialist, rather than capitalist.
  2. Seeing Russian and Chinese opposition to the US empire as rooted in socialism, rather than capitalist rivalry for economic territory.
  3. Perceiving the US empire as equal to the metropolis, rather than as only one part of it, along with Russia and China.
  4. Regarding the periphery as exploited by the US empire alone, rather than by Russia and China, as well.

For the Friends of Socialist China, a Very Bad Week

December 10, 2022

By Stephen Gowans

It has been a tough week for the star-gazers who run a platform called Friends of Socialist China, a motley collection of Sinophiles and pretend-Marxists who support “the People’s Republic of China” and aim to “spread understanding of” what they call “Chinese socialism.”

With Beijing lifting Covid restrictions in response to pressure from capitalists at home and abroad— a move expected to sacrifice up to 2 million Chinese or more to the Moloch of profit—it will be difficult to continue to “spread understanding” that “Chinese socialism” elevates people above capital accumulation.

On 7 December, The Wall Street Journal reported that while Beijing has “repeatedly emphasized the need to maintain the zero-Covid policy,” the “official tune began to change after Covid-related disruptions at the world’s biggest iPhone assembly plant led Apple Inc. to question whether it can still rely on China as its biggest manufacturing base.”

The next day the newspaper reported that:

  • “A letter from the founder of the world’s largest iPhone assembler played a major role in persuading China’s Communist Party leadership to accelerate plans to dismantle the country’s zero-tolerance Covid-19 policies.”
  • “In the letter to Chinese leaders, Foxconn Technology Group founder Terry Gou warned that strict Covid controls would threaten China’s central position in global supply chains.”
  • “Chinese health officials and government advisers seized on Mr. Gou’s letter to bolster the case that the government needed to speed up its efforts to ease its tough Covid-19 controls.”

The lifting of the infection control measures is expected to “put unprecedented strain on the Chinese health system.”

“Using Hong Kong as a proxy, London-based health analytics firm Airfinity estimated in late November that a lifting of zero-Covid measures in China could lead to anywhere between 1.3 million and 2.1 million deaths,” the Wall Street Journal reported.

China-supporters have long pointed to China’s very low pandemic mortality rate to argue that, unlike other states, Beijing puts people’s lives before profits. The argument no longer holds.

But if Beijing puts profits ahead of people, what accounts for China’s superior pandemic performance? The answer, paradoxically, is its poorly-resourced health care system.

It’s often forgotten, if ever understood, that while China has the world’s second largest, if not the world’s largest, economy, that in per capita terms, China is poor. A country that is wealthy in aggregate is not necessarily wealthy on a per person basis, and this is true of China, a country with a large economy, but whose aggregate wealth is divided over an extraordinarily large population.

GDP per capita, 2021 (Current US dollars, Source: World Bank)

  • China, $12,556
  • USA, $69,287

Because China has little wealth per person, its has few health care resources to allot to each person.

Health care expenditures per capita, 2019 (Current US dollars, Source: World Bank)

  • China, $535
  • USA, $10,921

According to The World Population Review, the United States has 34.7 critical care beds per 100,000 people. China has a mere 3.6.

Clearly, as a relatively poor country on a per capita basis, China does not have the resources to adequately deal with a viral outbreak. This is especially true in rural areas, where medical resources are stretched thin.

With a feeble health care infrastructure, China has had no option but to implement stringent infection control measures to prevent outbreaks, otherwise its hospitals would have been overwhelmed.

This means that while China’s approach to pandemic control has always looked different from the West’s, it’s actually the same.

The Western approach, called hospital-based surveillance, calibrates public heath restrictions to hospital capacity. China has followed the same strategy. The only difference is, that because the country has so few critical care beds, it has had to rein in infection levels to keep people out of the hospital.  

China’s superior pandemic performance hasn’t, then, reflected a stronger orientation to people over profits, but limited options. China is just another capitalist country prioritizing capital accumulation, but owing to its poorly-resource medical system, it has had to work extremely diligently to keep people out of the hospital. The calculus, however, has shifted, and countless Chinese citizens will be whisked to early graves to save China’s central position in global supply chains, to the greater glory and benefit of Terry Gou, Tim Cook, and Apple shareholders. 

Equally troubling for the Friends is reporting from The Wall Street Journal this week that China is transferring drones and ballistic missiles to Saudi Arabia, the tyranny that is waging a war of aggression on Yemen.

The Friends did little to put themselves in good stead when they defended the transfer of Chinese weapons to Riyadh on the grounds that arming the Saudis benefits the global working class!

Here is how the Friends replied to my Tweet criticizing them for failing to call out Chinese arms transfers to Saudi tyrants. Some of the Friends had earlier led campaigns to denounce Western arms sales to the same despots, but couldn’t find the courage and integrity to condemn Beijing for doing the same.

Hypocrites to be sure, the Friends are also bold. After all, to claim China is socialist, when it so obviously is not, takes a fair amount of chutzpah. “Socialist China” strikes a jarring note, like “Flat Earth” and “Square Circle.” Imagine a group called Friends of Peace-Loving USA, self-described peace-activists who support the United States with the aim of spreading understanding of America’s rich devotion to a world without war. This is what the Friends are all about: propaganda—and, as it turns out, they’re unabashedly avowed spreaders of Beijing’s manure.

They claim to be Marxists, and while they may think they are, their knowledge of Marxism is wafer-thin. At worst, they’re frauds. Carlos Martinez, one of the group’s principals, criticized a view of imperialism based on the writings of Rudolph Hilferding, Nicolai Bukharin, and V.I. Lenin—what’s known as the classical Marxist theory—as non-Marxist. Martinez labors under the mistaken impression that Marxists understand imperialism to be what the G7, and only the G7, does. Chinese chauvinists may hold this view, but Marxists? No.

On their website the Friends ask Why China? To support “all states building or aspiring to socialism.” What they mean is that China is not socialist, but says it aspires to be someday. For the moment, it’s capitalist, and thoroughly so. Hence, the lifting of pandemic restrictions under pressure from capitalists at home and abroad. Hence, throwing Yemen under the bus by selling arms to the Saudis. Profits take priority over lives and principal as much in Beijing as Washington.

As to the deceit embedded in the term “socialist China,” I may aspire to be a Nobel Prize winner, but calling myself Nobel Prize winning Steve, would be more than a little deceptive; so too, referring to China as socialist, when China says only that it aspires to be socialist someday, is sheer mendacity.

But, then, deception is the name of the game where the Friends are concerned. No sooner does the Friends’ website acknowledge indirectly that Chinese socialism is aspirational, that is, for the future, does it resume talking about Chinese socialism in the present, as if it’s a real thing.

And then there’s the Friends’ devotion to the backward concept of multipolarity. “China,” the Friends intone, “is the most prominent force pushing for the establishment of a multipolar system of international relations.” Multipolarity is important to the Friends, because it’s important to Beijing, though it’s hardly a Marxist aspiration, or has much to do with Marxism. Marxism aspires to a nonpolar world free from the division of humanity into classes and nations. Martinez and crew wouldn’t know this, because, well, they don’t know much about Marxism. But they do know something about what the Chinese tell them Marxism is.

Multipolarity—the idea that a few large powers should divide the world, so long as one of them is China—is an idea of significance to Chinese nationalists; they’re keen on engineering China’s rebirth as a great power so their profit-making enterprises can claim a greater share of the world market. In practice, multipolarity means that, rather than relying on the United States alone to get arms to wage a war of aggression on Yemen, the Saudi tyranny can also buy weapons from China. One might understand why the leader of a rising power, or a Saudi tyrant, might value multipolarity, but it’s hard to see why a genuine Marxist would.

The Friends of China, of course, are not Marxists, any more than people who would call themselves Friends of Peace-Loving USA would be peace-activists. The Friends are little more than automata who march to the drumbeat of that most capitalist of states, the People’s Republic of China.

The group’s mission, unabashedly acknowledged on its website, is to provide a platform for pro-China propaganda. When you say you support the People’s Republic of China and that your mission is to spread understanding of it, you acknowledge that your aim is to promote information supportive of Beijing; that is, that your role is one of propaganda.

In the Friends’ view, spreading pro-China propaganda equals anti-imperialism. Anti-imperialism, thus, becomes a project of objecting to criticism of China and promoting pro-China narratives; that is, of pro-China propaganda. Behind this absurd conception of imperialism lies an article of faith: that China does not seek to integrate foreign territory into its national economy in competition with other capitalist powers. In other words, China alone, among large capitalist powers, is not compelled by the competition inherent in capitalism to project power abroad, through economic, political, diplomatic, and military means. That Beijing obviously vies with the United States, Europe, and even Russia, for markets, raw materials, investment opportunities, and strategic territory, escapes the notice of the Friends, who prefer to think of Beijing projecting influence abroad on behalf of its billionaires as China selflessly promoting development and fostering socialism around the world. One can find the Friends’ equivalent on the other side of the inter-imperialist aisle, who will swear up and down that Washington’s engagement with the world is inspired by lofty ideals of promoting stability, development, human rights, and democracy.

Martinez’s Twitter handle, @agent_of_change is more honestly rendered @agent_of_Beijing. That’s demonstrated by his reaction to my challenging the theory that China puts people ahead of profits. The avowed propagandist complained that I was spraying “anti-Chinese propaganda around the Internet.” When criticism is peremptorily dismissed as propaganda, and propaganda is presented as unalloyed truth, it becomes clear that it’s not information the Friends are spreading, but disinformation. Sadly for avowed propagandists, but happily for scientific socialism, reality is challenging so many of the myths Beijing’s agent of change seeks to propagate under the guise of a phony anti-imperialism.   

Socialist China or Capitalist China? It’s All the Same to the Country’s Communist Rulers

May 13, 2022

By Stephen Gowans

Empiric, a word infrequently used these days, refers to a quack. This seems odd, considering that empiric and empirical (based on observation) are related. In antiquity, empirics were physicians who relied on their experience and observation rather than on the texts of Aristotle and other philosophers to treat patients. Medicine based on the thinking of philosophers was the realm of the scholastics, or schoolmen, the established medical authorities of their day. Challenging the pure reason of Aristotle with facts was considered an act of quackery.

Soon after writing a blog post titled Why China Is Not Socialist, whose title expresses a conclusion based on the same empirical method the established authority of the ancient world so reviled, I received a rebuke, in the form of an e-mail, from a scholastic, citing chapter and verse from Chinese Communist Party texts. Had I not read any of these texts, the outraged schoolman demanded?

According to my correspondent, my quackery was based, not in any of the following observations, which I was assured the omniscient Chinese CP, endowed with an Aristotelian authority, had already taken into account and factored into its plans.

  • China’s development is proceeding along capitalist lines.
  • Capitalism is in command.
  • China is integrated into the world capitalist economy of exploitation, as one of its most important players, if not the most important.
  • The vast fortunes of such Western billionaires as Elon Musk, and the wealth of such Western CEOs as Tim Cook, is minted out of the exploited labor of Chinese workers.
  • As a major power integrated into the world capitalist system, China vies with other capitalist powers for access to markets, raw materials, investment opportunities, and strategic territory, i.e., is part of an imperialist system.
  • China is not socialist.

But if my observations were already well known to China’s CP, and factored into its plans, why was I being excoriated by an agitated scholastic? After all, I was being censured for the alleged sin of “assuming that 100 million small oriental minds could not figure this out themselves,” another way of saying I was only stating the obvious.

The answer appears to be that while these observations are apodictic, making them is considered bad form. China may be a capitalist power fully integrated into an imperialist system as a major participant, but you’re not supposed to say so.

Having objurgated me for my lapse in etiquette, my schoolman sought to instruct me on proper form. The rules for polite discourse, it turns out, are contained in Chinese CP texts (the one’s my aggrieved correspondent demanded to know whether I had ever read.) Therein one learns that the word socialism can be made infinitely plastic. Indeed, where it was once the antithesis of capitalism, correct form demands it now be used as a synonym of capitalism. In short, Chinese scholastic etiquette redefines capitalism as various stages of socialism, from primary, to intermediate, based on the degree of capitalist prosperity. This allows the schoolmen in Beijing to approach the problem of a capitalist and imperialist China run by Communists as a branding problem. Simply call Chinese capitalism and the country’s integration into an imperialist system of rivalry among capitalist states, “socialism”, and poof, the branding problem disappears.  

No longer is it necessary to cast about vainly for an answer whenever someone asks, “How can a capitalist behemoth be run by Communists?” All you have to say is “What do you mean? China is socialist. Haven’t you read the CP documents? C’mon, get an education!”

If one were to observe the punctilios of Chinese proper form, China would be referred to as “primary stage socialist China.” If anyone as unversed in proper form as I am, were so bold as to ask, “What does primary stage socialism mean?”, the honest answer would be “capitalism at a low level of development.” In other words, if you read Chinese CP texts closely, China ought to be referred to as “capitalist China at a low level of development.” You can call “capitalist China at a low level of development” “socialist China” if you like, but then again, you can also call moon rocks Swiss cheese.

In short, “socialist China” is a euphemism for “capitalist China,” in the way “lavatory” is a euphemism for “crapper”. Euphemisms are useful for concealing delicate truths you don’t want mentioned publicly (such as that this vampire, who Beijing has indulged with innumerable subsidies and advantages, is accumulating profit on a Pantagruelian scale on the backs of cheap labor supplied by Chinese workers, or that Chinese President Xi Jinping is in the habit of justifying the exploitation of proletarians in the same manner every Republican does, namely, by invoking the aphorism ‘a rising tide lifts all boats.’)

I replied to my aggrieved correspondent with this:

You remind me of Christians who scream at me that I should read the bible. I have read the bible, which is why I’m not a Christian.

I have also read Chinese CP plans. Having done so, I know that even Chinese Communists do not consider China socialist. Not yet. At least not in any ordinary meaning of the word.

You mention plans. In 2100, when China expects to have achieved a fully publicly-owned, fully-planned economy, our grandchildren can have a conversation about whether the plan has been achieved. If it has, I’m sure they will be quite happy to call China socialist. Until then, the term “socialist China” is purely aspirational and until the time China achieves its goal, if indeed that time ever arrives, I’ll call China what it is, and what the Chinese acknowledge in their plans their society is, and will continue to be for quite some time: capitalist. 

Long before 2100, and long before the day arrives when we can assess whether China actually arrives at the destination its Communists have mapped out for it, we can have a conversation about whether there are roads to socialism other than those that follow the path of capitalist industrialization; that is, other than the one the Chinese CP has chosen to follow.

Is there a path of socialist industrialization, following along the lines explored by the Soviets, one, which, unlike the Chinese path, isn’t based on integration into the world capitalist economy of exploitation; one that doesn’t compel a people to participate in the project of minting the wealth of billionaires like Elon Musk out of their exploited labor; one that doesn’t enmesh a country in a system of imperialist competition for raw materials, investment opportunities, export markets, and strategic territory?

One senses that you are embarrassed about the capitalist path the Chinese CP has chosen to take, with all its ugliness in exploitation and imperialist rivalry, and that you seek to assuage your embarrassment and burnish China’s reputation by transposing an aspirational distant socialist future onto the present. It’s an exercise in deception. There is no socialist China. All that exists at this point is a China that hasn’t eliminated the exploitation of man by man but embraces it; a China that doesn’t plan to eliminate exploitation fully for decades to come, and may never eliminate it; all that exists today and will continue to exist until the next century is a capitalist China which exhibits all the ugliness that capitalism contains within it.

Have I read the Chinese CP texts? Yes. My question to you is, have you understood them?

Why China Is Not Socialist

Colonial politics and imperialism are not healthy, curable deviations of capitalism…they are the inevitable consequence of the very foundations of capitalism. Competition among individual entrepreneurs either to become ruined, or to ruin others; competition between individual countries places before each of them the alternative of their remaining behind, running the risk of [falling behind], or ruining and conquering other countries, thus elbowing their way to a place among the great powers. – V.I. Lenin, “Imperialism and Socialism in Italy”

May 12, 2022

By Stephen Gowans

From The Wall Street Journal we learn that China’s President Xi Jinping has hammered home the need for tighter party control over the economy with a wider role for state enterprises. Under Xi, China’s Communist Party has tried to transition from ‘economics in command’ to ‘politics in command.’

But now “China’s economy is struggling, and its financial markets are suffering. Some economists expect growth to contract this quarter. Millions of graduates are struggling to find jobs.”

Premier Li Keqiang is “helping press Xi to dial back some measures that have contributed to China’s economic slowdown.”

“As a young man, Li pursued a doctorate in economics under a prominent Chinese economist known for advocating Deng Xiaoping’s market-reform agenda and privatizing state firms.”

“Under Mr. Li’s influence, Beijing recently eased a regulatory crackdown on private technology firms, loosened lending to property developers and home buyers, and acted to help some manufacturers”, including Tesla, controlled by Elon Musk, the world’s richest person, “resume production when much of China has been forced into lockdowns by Mr. Xi’s zero-Covid approach.”

As the Marxist sociologist Albert Szymanski once pointed out, communists, like Xi, who choose to operate within the capitalist system soon discover that state policy is structured by capitalism, not by their policy preferences. Decision-makers who defy capitalism’s imperatives find their actions precipitate crises. Humbled, they quickly back peddle.

In a Chinese idiom, economics, i.e., capitalism, is in charge.

I explore this issue in my new book The Killer’s Henchman: Capitalism and the Covid-19 Disaster.

“The political orientations of the people who hold high-level positions in the capitalist state are largely irrelevant. The logic of capitalism structures the policy boundaries within which policy- and decision-makers operate, forcing conservatives, liberals, social democrats, and even communists who elect to work within the capitalist system, to operate within the same narrow pro-capitalist policy space. The prosperity and stability of a capitalist society depends on the private owners of capital accumulating sufficient profits. If they cannot generate enough profit, they cease to invest, and economic activity grinds to a halt. To maintain stability, governments must pursue policies to support the profit-making activities of their business communities. If they choose not to, their only option is to mobilize popular support to bring the economy under public ownership and control, so that investment decisions can be transferred from private hands to the public sphere, from profit-making as its goal to satisfying public needs as its end. There is no middle ground, where working-class interests can be robustly and continually expanded within a capitalist framework at the expense of the capitalist class.”

Capitalism structures state policy, not only in the realm of domestic matters, but in foreign relations, as well. Communists who elect to operate within the capitalist system are constrained to compete with other capitalist states for markets, raw materials, spheres of investment, and strategic territory, vital to their investors and profit-accumulating enterprises. If they are to play the capitalist game, states can no more absent themselves from rivalry with other states— with potential to escalate to war—than a private firm can absent itself from rivalry with its competition.

As two Bolsheviks wrote in their ABC of Communism, each “producer wants to entice away the others’ customers, to corner the market. This struggle assumes various forms: it begins with the competition between two factory owners; it ends in the world, wherein capitalist States wrestle with one another for the world market.” And in the struggle of capitalist states for the world market—in arms, oil and natural gas, rare earths, vaccines, robotics, supercomputers, AI, autonomous vehicles, 5G, and other commodities—lies the potential for war.

There is no doubt that Beijing has chosen to play the capitalist game. It is the centerpiece of its  development project. There is, therefore, no option for China to excuse itself from imperialism. If it is to develop along capitalist lines, it must behave as a capitalist state, including by vying with other states for capitalist advantage around the world and indulging billionaires like Elon Musk and Apple’s Tim Cook, capitalists who have grown immensely wealthy by exploiting cheap Chinese labor.

That China’s capitalist development project is under the command of communists, neither negates the reality that the project is one of integration into a world capitalist system based on exploitation, or that, as Xi is finding out, politics in command can be checked by capitalism in command.

As political science professor Minxin Pei told The Wall Street Journal, Xi may be a “leftist deep down, but he has to make tactical compromises over the economy.” That is, the world capitalist economy.

In sum, despite the Communist Party being nominally in charge, and the president being a leftist “deep-down,” China is integrated into the world capitalist economy as a major, if not the major player, by the choice of China’s Communist Party rulers. State policies are not structured by communists seeking to end the exploitation of one human by another, but by the imperatives of the capitalist system Chinese communists have consciously embraced.

The idea that China is socialist is as far-fetched as the idea the moon is made of cheese.

Imperialism and the Solomon Islands

By Stephen Gowans

April 21, 2022

In Lenin’s view, imperialism is immanent in capitalism as a global system. Inasmuch as China is one of the most significant players in this system, if not the most significant, the implication of Lenin’s view is that imperialism is also immanent in China.

A number of people who claim to be anti-imperialists and to understand the concept thoroughly, to the point of holding workshops, participating in panels, and writing articles to instruct others on what it means, have, despite their professed knowledge, defined the concept in a manner that departs significantly from the way in which imperialism has been understood historically. Until Russia invaded Ukraine, there was little mystery about what imperialism is. Now, it has become altogether different from what it has always been understood to mean. And while many of these same people claim at least a passing knowledge of Lenin’s view of imperialism, the Bolshevik leader would have been baffled by their understanding.

In opposition to commonly accepted definitions and the Leninist tradition, the anti-imperialist docents have developed a view of imperialism that resonates less with Lenin and more with a view developed by Shintoist Japan in the 1930s. According to this view, imperialism is North American and Western European domination of the world. Anti-imperialism is the effort of a rising power to liberate its neighbors from this domination by folding nearby states into its own (declared or undeclared) regional empire (the Greater East Asian Co-Prosperity Sphere in Japan’s case.)

Hence, Russia’s efforts to “liberate” Ukraine from the United States and Europe, and to incorporate parts or all of it into a palingenetic Russian empire, is viewed as anti-imperialist. Likewise, China’s new security agreement with the Solomon Islands is seen as anti-imperialist—a weakening of US and Australian domination of the islands. While it certainly is this, it is also an effort to define a security architecture that allows Beijing to protect Chinese investments abroad and to safeguard shipping routes that are vital to the unimpeded access of Chinese billionaires to foreign markets and sources of raw materials.

The Leninist view of imperialism as inherent in a globalized capitalism can be used as a lens to parse the New York Times’ reporting on the recent China-Solomon Islands security agreement. According to a leaked draft of the accord, Beijing is empowered to dispatch police, troops, and warships to the islands to protect Chinese investments and Chinese citizens, an agreement that resonates with multiple similar accords struck between Washington and countries in Latin America and beyond.

The Times, tacitly defining US ruling class interests as humanity’s interests, presents the accord as a danger to the world. “China’s leader, Xi Jinping, and his army now have a foothold in an island chain that played a decisive role in World War II and could be used to block vital shipping lanes,” the newspaper warns. What isn’t mentioned is that the United States and its satellites control the shipping lanes. The deal allows China to challenge US control of the maritime routes on which it depends—or more precisely, on which its capitalist economy depends—for access to foreign markets and sources of raw materials. The deal doesn’t threaten humanity so much as it threatens US leverage over a capitalist rival.

The Times continues its diatribe against the accord by noting the pact’s imperialist features, all the while avoiding any mention of the similar accords Washington, London, Paris, and other imperialist capitals have signed with numberless governments around the world for centuries, sometimes at the point of a gun.

“To start,” the accord “provides a broad mandate for China to potentially intervene when its foreign investments and diaspora are under threat, as it stretches its projection of military power.”

The newspaper quotes Richard Herr, a law professor at the University of Tasmania, who observes that “With the pact, China is essentially trying to establish a principle of using military force to protect its economic presence in places where it claims the government does not have the capacity.” In this, China acts no differently than the United States.

“What the Solomons’ deal tells the world, at the very least,” he adds, “is that China believes that if its major projects are threatened, it wants a right to protect them.” Again, this is standard US procedure, or, to put it another way, standard procedure for major capitalist powers. Consider also France’s intervention in Africa to protect access to and investments in uranium mines, vital to an important form of French energy.

“The lesson for the rest of the world is that China is looking to rebalance the global order in its favor,” Herr continues. “And whether that means opening trade routes, establishing a military facility or signing a security agreement, Beijing will act to benefit its own interests.” Herr goes on to say that Beijing will do so at the expense of “democracy and an open and free world”, euphemisms for the US empire.  In other words, the expansion of a Chinese empire comes at the expense of a US empire.

What the Times’ article shows, albeit in a clearly chauvinist way, is that large capitalist powers and blocs—the United States and its satellites, Europe (to the extent it acts independently of the United States), China, and Russia—seek to fashion the world order in their favor.  They seek to bring as much of the world economy as possible under their own control. This means security arrangements and treaties to protect their investments abroad, and to safeguard their access to foreign markets, sources of raw materials, strategic territory, and investment opportunities. To be sure, the United States is by far the strongest of the rivals, but that doesn’t mean that Russia and China are not driven by capitalist compulsions to dominate the planet every much as strong as those that drive US expansion—a compulsion to settle everywhere, to nestle everywhere, to establish connections everywhere.

With multiple capitalist power centers existing within the framework of a globalized economy, rivalry for profit-making opportunities is inevitable. The rise of one power center at the expense of another may appear to be anti-imperialist, but only so far as the declining power is erroneously viewed as the sole imperialist, i.e., as the lone capitalist power in search of investment opportunities, markets, and raw materials. The decline of US and Western European influence in East Asia with the rise of Japan beginning in the 1930s may have appeared to the naïve as an anti-imperialist victory—this was certainly the illusion Tokyo aimed to create—but it was an illusion all the same. So too is China’s rise an illusory anti-imperialist victory. It may be a victory against China’s domination by the United States, as the rise of the United States was a victory against US domination by Britain, or Germany’s rise was a challenge to British hegemony, but it is in no way a victory over the persistence of capitalist rivalry for markets, raw materials, investment opportunities, and strategic territory. It is simply a continuation of this process.

Imperialism within a globalized capitalist economy can be envisaged along two axes. One axis concerns the process of large countries exploiting profit-making opportunities in smaller countries. The anti-imperialist docents err in thinking of imperialism in these terms alone. The other axis concerns the rivalry among large countries for profit-making opportunities within the borders of the countries its rivals dominate and within the borders of its rivals themselves. The first axis is one of large countries dominating weaker ones. The second is of large countries competing among themselves to monopolize the sum total of the world’s profit-making opportunities—to shape the global order in their favor, to use terminology favored by the New York Times.  

The security pact between China and the Solomon Islands is a manifestation of imperialism, in three acts:

  • In China seeking to create a security architecture to protect its tycoons’ investments beyond China’s borders.
  • In Beijing’s efforts to counter US domination of shipping lanes important to China’s capitalist economy.
  • In the opposition of the United States (and its sub-imperialist partner, Australia) to China’s challenge to US-led control of maritime routes.

Capitalism need not be invoked to define China and Russia, along with the United States, France, and Great Britain—the permanent members of the UN Security Council—as imperialist states. As victors of WWII, these self-defined “model” nations have assigned to themselves rights and privileges senior to those of all other nations. Russia, for example, can test a new ballistic missile with impunity, by virtue of its permanent membership on the council and access to veto powers, while participating, along with China, in the imposition of international sanctions on a small country, North Korea, for doing precisely the same.

Large countries, including the largest of all, China, have historically dominated their weaker neighbors, even if some of them, China not excepted, were dominated themselves. A fortiori, we would expect large capitalist countries, driven by an expansionary capitalist logic, to continue in this manner. China shows no evidence that it is an anomaly or a departure from expectation.