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Upheavals in China by Peter Taaffe


Even before the recent clashes between China and Japan, China was at the centre of the world’s attention.

That is even more the case now. Japanese Prime Minister Koizumi, faced with sizeable demonstrations in China and attacks on Japanese businesses, finally complied with some of Beijing’s demands and expressed "deepest remorse" for the war crimes carried out by Japanese imperialism in the 1930s and the Second World War. Behind these demonstrations in Shanghai and a number of other cities (see previous CWI website reports) lies a mighty struggle between an emerging China and Japan, backed by the US, for the dominant position in Asia.

In this conflict, the Chinese regime has tapped into the deep wellsprings of Chinese nationalism. This is rooted in the justified belief of the Chinese people that they have been the victims of great historical slights inflicted on them by the Western capitalist powers. They understand that China was a significant power – in many respects more advanced than the West – before the emergence of capitalism in Europe and the subsequent occupation of China by imperialism and its cohorts. Added to this, is the terrible suffering of the Chinese people at the hands of Japanese imperialism in particular in the 1930s and during the Second World War. Therefore, an anti-imperialist and, particularly, anti-Japanese sentiment has always been an important strain in the "Chinese psyche" since then.

On some occasions, this has developed in a progressive direction. For instance, students in Beijing demonstrated in May 1919 against the handover of German "concessions" in China to Japan under the Versailles Treaty. What started as an anti-Japanese demonstration, however, turned quickly into a mass movement against weak, backward and authoritarian Chinese capitalism at the time. The present ruling elite also feared a similar outcome in the recent demonstrations and quickly drew them to a close.

However, with the demise of Stalinist ideology the increasingly capitalist Chinese regime has been forced to rely on nationalism as the one reliable tool allegedly holding China together. They have drawn on history to achieve this. Mao also drew on Chinese nationalism, as did Deng Xiaoping, the father of China’s march towards capitalism, with his introduction of "patriotic museums" dedicated in the main to past Japanese atrocities. Similarly, anti-Japanese protests preceded the Tiananmen Square revolution of 1989, illustrating how demonstrations against Japanese militarism can quickly spill over into a criticism of the Chinese regime.

The recent demonstrations are drawing on the wellspring of legitimate Chinese resentment against the atrocities meted out to them at the hands of the Japanese ruling class, but nevertheless have an element at least of government support and backing. Automatic imprisonment is usually the fate of those who try to organise demonstrations in China. There were a number of factors which led to these demonstrations. The Chinese ruling class were irked by Japan’s demands for a seat in the UN Security Council, the refusal of Koizumi, the Japanese prime minister, to suitably apologise for Japan’s war crimes, the remilitarisation of Japan and the conflict over the drilling for energy resources in the South China Sea. Apologies have, it seems, been made for Japan’s past crimes on 17 previous occasions. However, these have been mealy-mouthed and have inflamed the opposition of the Chinese. For instance, the Rape of Nanjing by Japanese military forces in 1937 – which involved the murder of an estimated 300,000 Chinese – is described as an "incident" in Japanese school textbooks.

Koizumi, in the teeth of the Chinese demonstrations and the fear that this could spill over into the economic field with mutual damage to the economies of both countries through a boycott, for instance, may cool the situation temporarily. However, the issues that triggered off the demonstrations in China remain unresolved.

Chinese economy

These events pose in a sharp fashion important geo-political questions and other crucial issues for China and the world. Will China be a lifeline for world capitalism? Will the growth of China’s economic might be matched by the deployment of enhanced military and diplomatic muscle on the world arena? In turn, what will this mean for Asia and the world? What will be the social and environmental costs, both for China itself and the world, of its explosive growth? Above all, for socialists and Marxists, is posed the key question of the Chinese working class and its prospects for creating its own independent organisations, trade unions and parties.

How to contain, if not satisfy, this potentially mighty force is the dilemma, indeed the nightmare, which haunts the Chinese elite. Undoubtedly, the continuation of China’s economic fireworks is perceived as a means of dazzling and holding in check the Chinese masses. This in turn will be affected by China’s relations with the rest of the world, by the other giants or would-be giants in Asia – India and Japan – and particularly with the world’s dominant power, US imperialism. For over 25 years, China’s Stalinist elite has been engaged on a sustained march towards a capitalist economy. Under the signboard of Deng Xiaoping’s famous aphorism, "It doesn’t matter whether the cat is black or white, so long as it catches mice", the ‘pragmatic’ Stalinist elite that ruled China envisaged this as the only means for China to escape from the economic impasse resulting from its own bureaucratic rule. To do this it has been compelled to rely on opening the door to massive Foreign Direct Investment (FDI) and the technology that goes with this, which in turn has generated a phenomenal growth rate, particularly in Guangdong, the Pearl River Delta, Shanghai-Yangtze Delta, Beijing and other areas where foreign investment has been important.

The beneficiaries of this have been, to some extent, the Chinese masses who have enjoyed – particularly in the urban areas – access to more consumer goods and a growth in living standards for significant sections. Other sections of the population have become far worse off with levels of inequality at a far higher level than under the old Stalinist regime.

However, China has a long way to go to catch up with Western capitalism. The Chinese executive vice-prime minister, Huang Ju, at the billionaires’ convention at Davos in January 2005, pointed out that China’s output today is $1.6 trillion and could soar to $4 trillion by 2020. More to the point, he says, "as a more accurate measure of wealth" China’s output per capita will triple to $3,000 per person by then. Inadvertently, perhaps, the Chinese prime minister shows the impoverished state of the mass of the Chinese population even in 15 years time. However, this is not true for the elite, which is transforming itself into the new capitalist class of China. Most output in the economy (about 60 per cent) now comes from the private sector.


Notwithstanding this, in the neo-colonial world, China, in some quarters, is held up as a ‘model’ for a successful escape route out of economic and cultural backwardness. Sections of the ‘radical’ and even ‘left’ intelligentsia, looking for an escape from the blind alley of landlordism and capitalism, eschew clear socialist and genuine Marxist ideas and now look towards China as the way forward. The same applies to some parties, such as the Communist Party of India - Marxist (CPM) which argues that China’s "mixed economy" offers a development path for India itself. It is incredible that the CPM, a party which allegedly stands for the defence of the workers and poor of India, can praise a system – emerging Chinese capitalism and imperialism – which presides over the ruthless exploitation of the working class and the poor of China.

There is nothing remotely ‘communist’ or ‘socialist’ in this ‘project’. It is a particularly pernicious modern-day example of the "primitive capitalist accumulation" of British capitalism described by Marx. This involves the intensified exploitation, indeed the super-exploitation, of the working class. With little or no organisation to resist the onslaught of capital, it pays a terrible price in low wages, long hours and drastic effects on health and safety (one example of this is the 6,000 miners killed annually in China). Not least are the fatal consequences on the environment, both for China and the world. The ‘Communist’ leaders of India have themselves embarked on the same path, offering transnational corporations special conditions in West Bengal where they are in government. They have never understood the Marxist opposition to the mixed economy championed by social democracy. Perhaps they tell their members that this is a kind of holding operation. In the future, in a more favourable situation, this will be redressed and the economy will move in a more socialist or communist direction. On the contrary, the arrow for the future of China points in an opposite direction, towards the remorseless growth of capitalism and the systematic dismantling of the state sector.

This does not rule out that the Chinese regime, under mass pressure or faced with a serious economic crisis, may be forced to temporarily halt the privatisation process and even renationalise some industries. However, as the examples of Russia, Japan or elsewhere in the 1990s have shown, such measures are ‘state capitalist’ in character. Capitalist governments can take over ailing industries, renovate them and hand them back to the private sector. Only a revolution – socialist and democratic in character – by the Chinese working class and poor could decisively halt China’s march towards capitalism and set it on the road towards socialism. This would involve the halting of the catastrophic dismantling of state industries, the renationalisation of the privatised sectors, the dismantling of the one-party regime and, through workers and peasants’ democracy, the establishment of a real socialist planned economy.

It is true that the European Union (EU) has preferred not to designate China as a "full market economy". This is partly because the Chinese have not as yet, internally at least, applied completely the ‘neo-liberal’ model of capitalism – it still has a significant state sector. Also, it is not sufficiently ‘open’ and ‘transparent’; it is not prepared to give foreign capital a completely unrestrained free hand within its borders. Nevertheless, the direction in which China is travelling, to a full capitalist economy and state, is well advanced. There are still significant obstacles to the completion of the process, in the form of the resistance of the working class. Another is the intrinsic nature of capitalism itself, of booms followed by recessions or slumps, sometimes of a most catastrophic kind. With its increasingly capitalist character, China is now subject to some of the contradictions and maladies of capitalism elsewhere – of booms followed by recessions or slumps.

China could be on the verge of such a collapse, as it displays some of the same features which afflicted the countries of South-East Asia before the 1997 crash. It has an ‘overheated’ economy with huge ‘excess’ capacity, visible in the empty or half empty buildings and factories in Shanghai and other urban centres. It has a shaky banking sector and faces growing hostility from its capitalist rivals, with demands for ‘protection’ against Chinese goods from countries who are suffering or claim to be suffering from the effects of China’s seemingly unstoppable economic juggernaut. Not least of the problems facing the Chinese ruling class is the fact that the working class and poor will not tolerate for ever the slave wages and conditions which exist at present. Even some foreign capitalist investors, fearing a massive social upheaval and its effects on their profits, as well as facing pressure from the workers’ movement in the West, have urged a rise in rock-bottom Chinese wages. They have even gone so far as to advocate the formation of ‘trade unions’, of the tamest kind of course. China’s future development is therefore likely to be anything other than smooth and harmonious.