China

| want to ask about workers’ states. Two questions about China. The first question: I read your material. I read that at your last world congress that the nature of the Chinese state is not so definite, the process is not finished, and your Swedish section, or a majority of your Swedish section, supports the idea that China is a capitalist state. But this document came out …

About five years ago.

in the last years, in the period since your last congress, have you changed your position about China, or are you staying with the position of some years ago?

Well, we are in the process of discussing this now. So, the whole question will be under review. Our position in general is that since 1978 and Deng’s reforms China has been on a slow inexorable return to capitalism. There are purely capitalist sectors in China in the coastal provinces, Shanghai, in Beijing, etc. That is indisputable. If anything, that process was speeded up somewhat in the 1990s. The main reason why the Chinese Stalinists, ex-Stalinists, are hesitant in going the whole way is the fear of provoking a social explosion. It is also the reason why the rate of growth of the Chinese economy is exponential in comparison to the situation in Eastern Europe, the former Soviet Union and so on, as well as world capitalism as a whole. It is, together with the US, the economic engine of world capitalism, averaging 8-10% growth, maybe even more than that this year.

So the process is clear. But this is not a normal state. We are talking about one quarter of humankind. There are huge diversities between different parts of China, some of which are already capitalist. On the other hand, there are big sections of China in which the state sector is maintained for social reasons.

The state-organised enterprises (SOEs) still account for the majority of employment in China. On the other hand, the latest figures seem to show that the majority of wealth produced – the value, output – now comes from the private sector. But the big problem that we have is that in one month of this year we had three different reports. One said that 80% of the economy is in the private sector, another report carried in the Financial Times said that 25% is in the private sector, while another gave another figure. Because of the very nature of the regime, and because it is a closed society, it is very difficult to find out what is happening internally, Our position is that the China train is on the tracks and is going towards capitalism When and at what stage it will arrive at the station is open to discussion and debate.

There is a huge state sector. There is resistance to the process of returning to capitalism, as is shown by the numbers of disputes that have broken out. The process of privatisation in agriculture has not been carried through as it has, to the same extent, in the industrial sector. All of these factors make us a bit cautious about a premature characterisation: this is now Chinese capitalism and that is the end of the matter. Elements of the Stalinist state machine still exist. There are still elements in the consciousness of the masses of support for the idea of the planned economy, There is resistance to the selling off of land. There is resistance to the closure of the SOEs, which is different and on a higher level than in Russia and Eastern Europe, where there was hardly any resistance. The Chinese bureaucracy/capitalist class is very hesitant about going too far for fear of provoking huge upheavals. We will discuss what is taking place in China between now and our congress.

However, we have general agreement about the conclusions that we should reach about the process. A revolution is being prepared in China. Trotsky always made the point that we do not think in fixed categories. Revolution and counter-revolution are both a process. He was very cautious about putting the nameplate of ‘workers’ state’, ‘non-workers’ state’, ‘capitalist state’ on a process, on unfinished processes, as he put it. We show the same caution. There are analogies, for instance, in the neo-colonial world in the 1950s, 1960s and 1970s, in particular, where large sections of industry were taken over and, to all intents and purposes, according to certain criteria, they qualified as workers’ states. There was such maybe a bit prematurely.

Were Iran in 1979 and Syria workers’ states?

Not Iran. But this is something that we have to look at, we have to re-examine the present situation on the basis of events. There can be periods of history when there is a deadlock, a class-economic deadlock in which the features, if you like, if both societies can exist alongside of one another, What was Gaddafi’s regime, where the majority of industry was in the hands of the state? Or for that matter Egypt? We did not call them deformed workers’ states. So we have to be a bit cautious from the reverse point of view in relation to China.

The question is whether it has gone from quantity to quality. Trotsky always made the point: well, you have to give a characterisation at a certain stage of a state, because from that flows the character of the revolution. Will it be a social revolution or will it be a political revolution? Will the state superstructures need to be altered? In a way, we have both tasks in China. We have in the considerable state sector demands that properly pertain to the political revolution: defence of the nationalised property relations, for workers’ control and management, election of all officials and the right of recall, and so on. In the purely capitalist sector, we demand the nationalisation or renationalisation of these sectors and their integration into a national plan, as well as workers’ control and management.

An additional factor is that China itself could break up. The bureaucracy tries to give the impression that China is a homogenous whole and that one language is spoken. There might be one official language but the spoken language can be as different as Japanese and Korean. There are also regional factors: the Muslims in the North-West, Tibet, regional factors now emphasised by the economic disparity that has increased. It is as it was in Yugoslavia, where the difference between Serbia, Slovenia and Croatia on the one side, and Kosova on the other was on a level of six to one. In effect, an almost developed country and a neo-colonial one co-existed in the same state.

The same disparities exist, only more so, in China. Astonishingly, China has more poor people than the whole of Africa. On the basis of the merry-go-round of the world economy, the Chinese elite is managing to hold the situation in check. But once there is a world crisis, which could be precipitated by China, the perspectives will alter decisively.

The last point is on the consciousness of the Chinese masses, It has been thrown back so far that most groups which come into opposition to the regime seem to gravitate towards a Maoist position to begin with. Mao is associated with leading the Chinese Revolution and the advantages of the planned economy. In Eastern Europe and Russia, most of the groups of young people, in particular, did not hark back to Stalin. Pro-Stalin attitudes were to be found in the old supporters of the Communist Party but not amongst the majority of the youth. Where movements have erupted in China so far they have not been in the major industrial areas. There have been protests over village land to be handed over to speculators, and on the sell off of factories, but mostly in a scattered way. But they have not occurred in Beijing, in Shanghai or, in the main, even in Guangdong. The consciousness of the masses, it seems, is for trade union rights. ‘The next movement may not even be like 1896 in Russia, with the big strikes in Petrograd and so on, which paved the way for 1905. It may even be a pre-1896 movement, in the sense of the masses testing their strength and gathering themselves together in the struggle for basic democratic rights, particularly on the question of independent trade unions.

Revolution in China

In our discussions, some comrades have studied and begun to look very seriously at China, which people all over the world are doing. On one side, we see the very quick development of the economy in many areas. That the development is big no one can deny. We also look at the US policy for the next century and its main rival will be China. When we began to study this question, we said we would not see the period of struggle between China and the US to become the most important capitalist power in the world. Before then, we would see a revolution in China. We are sure that before China arrives at the level of the US or near it, there will be some big conflict worldwide, not only inside China, and that clashes and problems should resolve that question before that position is reached. The second point is the level of the class struggle in China today. We have little information about the different kind of class struggles in any way: traditional class struggle in the factories, or in ‘unclassical’ struggles similar to those in the period of primitive accumulation, as Marx explained, but more radical and open. We have had reports of big rebellions in the rural areas against municipalities. The factor of the working class and the migrant people today and the next years will become the most important factor for the Chinese revolution and the world revolution. We have many hopes about this. Our discussion started in the last year. I would like to know what your ideas are about this and do you have a ‘Third World’ position? We think seriously that China will be the centre of the world. What is your opinion?

China is a major issue for world politics, for the bourgeoisie but also for the workers’ movement and for Marxism. That is why the CWI has set up the Chinaworker website precisely to open up a dialogue im general with the young people and workers in China who are looking for genuine Marxist ideas.

We have to be conditional about the future. At the moment, the main axis in world politics, potentially at least, is developing between the US and China. The US, as mentioned before, has a sort of ‘schizophrenic’ attitude towards China. China is vital for it economically but at the same time the US fears its independent development. The US is in favour of foreign direct investment going into Guangdong, the coastal provinces and elsewhere, into the purely capitalist sectors, because it is still under the control of foreign capital.

But it also fears technology transfer to China. The US still has the edge technologically in research and development, in the application of technology. Its huge arms expenditure gives it an edge because most of the technological spin-offs come from this. It is one of the reasons why the US wants to maintain its lead, not only in arms potential but also in arms production. It is also the reason why, when Europe attempted to supply missile technology to China, the US objected. This was also partly because of the implications for Taiwan. There is an additional factor as well: the fear that a rising power ‘borrows’ ideas and technology from the more advanced. The issue of ‘intellectual property rights’ is important in the negotiations between China, Western Europe and the US. Even Merkel, the German Chancellor, when she visited China recently, gave a warning to the Chinese regime: it should not use ‘pirate’ technology from the US and Western Europe.

What they are afraid of is that while, at the moment, China is dependent on foreign direct investment, and that will continue for a time, it will nevertheless develop indigenous industry. The scale of this borrowing will dwarf what Japan was able to do in electronics in the 1970s and 1980s. Already, there is quite a high level of technology in China in some sectors. There is also a huge development in student numbers but at this stage there is not the same quality of education which exists in the US. Technology, at the moment, is more extensive than intensive in the development of new products, etc. But just as, in the 1980s, Hollywood made movies about the Japanese ‘threat’ so, in the modern era, in this century, China is the new threat.

The difference between Japan and China is that Japan was disarmed at the end of the second World War, It is now a junior policeman, or potential policeman, for US imperialism in the Asian theatre in particular. But China has huge armed forces. There is the Peoples’ Liberation Army but also the development of China’s navy. The building of a navy flows from trade. There is a new scramble for Africa taking place in which China has made huge gains, in Angola, Mozambique and Nigeria, for example. There are the relations with Pakistan where they have facilities in Baluchistan. There are trade relations with Venezuela, Cuba, Brazil and Latin America.

The geopolitical impact of China is colossal and, at the moment, the American ruling class is in a halfway house. Do they see China as a ‘strategic partner’ or a ‘strategic rival’? There are elements of both in their current position. Will the USA, with only 5% of the world’s population and a big part of the resources of the planet and the dominant power, give up without a fight against a population of 1.2 billion? It is highly unlikely. There are now Voices within the American establishment, particularly in the universities and amongst Sinologists, who are saying that China is already a threat to the US and it has to block the transfer of technology to China. That could happen, especially if there is a world economic recession. If China is hemmed in by this situation there could be the scenario you mentioned for a revolution. It could happen anyway, whether there is an increase in the economy or not. Revolution flows not just from a collapse or from an increase in the economy. If the economy continues to go ahead but the change from one era to another is unable to absorb the unemployed and the 200 million migrant workers, there could be explosions in Shanghai, Beijing and in some of the colossal urban areas. What the outcome of that will be is not possible to say at this stage.

So perspectives on China are conditional on a whole number of factors, not least of which is the movement that will take place of the working class in the US, the movements in Latin America and the rest of Asia, and not least in Europe. I do not think that this is a ‘third worldist’ position. The USFI once had the theory that the ‘epicentres’ of the world revolution were no longer in Europe but in the ‘Third World’, Cuba became the epicentre, then Vietnam, of the world revolution. We always disputed that. We saw the working class in the metropolitan countries, the ‘heavy battalions’ of the working class, as decisive. But potentially, the most powerful industrial proletariat in the world is developing now in China. China has the elements of the Third World and the First World. Because of that, China and its working class are destined to play in this new era, potentially, a most important role in the development of the revolution worldwide.

One things absolutely certain. If there is a break in the situation of capitalism in one important country or a continent where the working class plays the main role, and that must be emphasised, that could trigger a world upheaval. There could also be a break with capitalism in an underdeveloped country in which the country is largely peasant and not proletarian. It will have an effect like Cuba but it would not have the effect of the Russian Revolution, the ‘ten days that shook the world’. The reason for that is not just the size of Russia but the pronounced role of the proletariat, with soviets, internationalism and the key role of the working class. If in Europe now one or two countries break with capitalism and it encompasses the whole of Europe, which it will once it starts, that would have world repercussions. It would have an immediate effect on China, because the European working class would appeal to the Chinese working class to demand trade union rights, democratic rights and so on. On the other hand, the Chinese masses could rise and could develop powerful independent workers’ organisations without overthrowing the regime.

That is why I mentioned Russia in 1896 and 1905, which were anticipations of the Russian Revolution. 1896 was the first blooding and fusing of the working class as a class. In 1905 the working class reached out for power but the peasants were not ready. 1917 was a combination of the proletarian revolution and the second edition of the Peasant War, as Marx put it.